TWIN FALLS — Lamb Weston has been granted a property tax exemption on a $41.6 million capital expenditure for upgrades to its local plant.
The Twin Falls County Commission approved the exemption at its April 8 meeting. Lamb Weston’s exemption on its investment begins in the 2020 tax year with a 100% exemption for the first two years. Commissioners also awarded a 90% exemption in the third year, 80% in the fourth year and 70% in the fifth year.
According to the company’s application, Lamb Weston’s investment includes infrastructure updates and new sorting, processing, packing and palletizing equipment.
“This project will modernize a part of our facility, making it safer, more efficient, and improving competitiveness, thus, helping to protect local jobs for years to come,” the company said in its application.
Lamb Weston makes frozen potato products in Twin Falls that are sold to restaurants and retailers throughout the United States.
Twin Falls County has the right to grant property tax exemptions for certain types of manufacturing projects, generally up to a five-year time frame. The Lamb Weston decision matches the exemption percentages the county gave last year to a $21 million Jayco investment and a $20 million investment at KapStone Container Corp.
Commissioner Jack Johnson said Lamb Weston basically maxed out on the county’s score sheet for tax exemptions, receiving a score of 81.18 out of 100. Factors considered include job quality, job benefits, job training, job quantity, capital investment, property value and location.
Lamb Weston says the project will save 57 jobs. The company currently employs 650 people. The average salary for its 589 hourly positions is $47,630. The average annual salary for its 61 salaried positions is $79,300.
“Work outlined in the application is scheduled to begin in April by expanding a deck to support new equipment, however, the bulk of the project work will begin this fall and is scheduled for completion in early 2020,” Lamb Weston spokeswoman Tammy Barry said in an emailed statement.
According to draft minutes from the April 8 meeting, Plant Manager Curt Snyder said the plant would shut down in December 2019 and the work would take approximately six weeks.
The company’s initial application in December 2018 was for a $6 million investment, but that did not include the entirety of the projects, Barry said. The projects were consolidated to coincide with the company’s normally scheduled downtime.
“Each year we shut down plant production at specific times for maintenance and capital project work,” she said. “Lamb Weston invests in our facilities on an on-going basis by using cutting edge equipment in order to meet our customer needs. The Twin Falls facility has been a significant part of the Magic Valley economy for more than 50 years.”
Twin Falls County Assessor Brad Wills said the valuation for Lamb Weston’s plant in 2018 was $84.8 million. Wills said that because Lamb Weston is replacing older equipment, the actual increase in value may be lower, about $35 million.
“This isn’t a shifting of the tax burden because this only affects the new value created by Lamb Weston’s investment in the local plant,” he wrote in an email to the Times-News.
Taxing districts affected by the exemption include Twin Falls Highway District, the city of Twin Falls, the Twin Falls Urban Renewal Agency, Twin Falls County, the College of Southern Idaho, the ambulance district and Twin Falls County Pest Abatement District.