By Sarah Meyer: PNT Staff Writer
Tina Hughes was considering relocating the family business to Clovis but decided to stay in Portales thanks to an economic development grant.
Hughes and her husband Craig owned Craig Hughes Trailers and Craig Hughes Welding at the intersection of N.M. 467 and U.S. 70. After Craig Hughes died two years ago, his wife considered selling the trailer business and relocating the welding business.
“Most of our jobs are in Curry County and West Texas,” said Tina Hughes.
She has since sold the building to New Mexico Machinery and is operating the welding business in part of the building. She has purchased land nearby and will build a new, smaller building for the welding business.
“We’ve always had our business in Portales. It’s home to us,” Hughes said. “Portales has always been good to us. The incentive of the grant helped me make up my mind to stay here.”
She said Curry County didn’t offer any such incentive.
Hughes purchased eight acres on Spruce Street just west of U.S. 70, where the new facilities will be located. The land has since been annexed into city limits — a requirement to receive the grants, also known as Local Economic Development Assistance or LEDA.
Hughes will receive $60,000, reimbursable for construction of a new building, grading and drainage improvements and new signs, according to documents provided to the Portales City Council. Estimated cost of establishing the new location is $337,000.
The grant money can only be used for projects that help create jobs, but several limitations are imposed by law, explained Greg Fisher, director of economic development for the Roosevelt County Community Development Corp.
The funds cannot be used for retail establishments, but can be used to help restaurants and hotels, as well as agribusiness operations, Fisher said. The grants are provided to businesses that are expanding or relocating, and to help retain businesses, such as Craig Hughes Welding.
A finance review committee analyzes all applications, Fisher said. Their recommendation then goes to the city council.
Funds come from a one-eighth of 1 percent gross receipts tax, said City Manager Debi Lee.
Grant recipients must report annually to the city and must document expenses and improvements to receive reimbursement. The grant agreement also includes a promissory note, which requires the business to pay back any money received if the business fails.
Officials estimate that Craig Hughes Welding will repay its grant, in the form of gross receipts tax generated for the city, in five years.
During the last fiscal year, which ended July 1, Fisher said, the economic development grants have helped generate 85 full-time jobs.
The economic development fund is an incentive for businesses to stay in or move to Portales — “a carrot that a lot of communities don’t have,” Lee said.
Economic Development Grants
State law authorizes communities to levy a tax to be used for economic development incentives. Portales residents approved a one-eighth of 1 percent gross receipts tax in 2002.
The tax has generated more than $1 million through June 2008. Expenditures for the past six years total $431,000.
The following are actual expenditures from the economic development fund:
Holiday Inn Express — $60,366
Portales Inn — $163,002
MainStreet Program — $100,000
RCCDC — $15,000
Sievers Sports Medicine — $49,500
Enchanted Capital Partners — $43,148
The city also recently authorized a grant of $83,800 to New Mexico Machinery for new signs, landscaping, entrance paving and access, and training.
Source: City of Portales