Cottage Grove has given the green light to a $54 million factory that will turn air into money.
That’s the business model of Airgas USA, a Philadelphia-based company that sells liquid oxygen, nitrogen and argon for use in manufacturing, medicine and other industries. After getting City Council approvals last week, the company is building a new plant near the northeast corner of Jamaica Avenue and 100th Street South, with huge compressors to liquefy and separate air into its component gases.
According to city documents, the plant will consist of two buildings of 17,000 square feet, an outdoor tank farm and a trucking terminal on 8.5 acres. The facility won’t be hard to spot, with two “cold box” towers, 130 and 160 feet tall, rising above the rest of the compressor machinery. The project will create 35 full-time jobs, of which 25 will be truck drivers who will transport the compressed gases directly to customers.
For Cottage Grove, the project is a win-win, Economic Development Specialist Matt Wolf said at a March 20 council meeting. Not only does the project bring new jobs and tax revenue to the city, but it will raise the profile of the city’s available industrial land for other manufacturers.
“A lot of their products are used in that industry, so we really view this as a valuable tool, potentially, for marketing to other business to come to our business park,” Wolf said.
Airgas, which bills itself as “the leading U.S. supplier of industrial, medical and specialty gases,” has six plant and store locations across the Twin Cities with almost 100 workers, Media and PR Manager Kim Menard said in an email. The new plant will allow for more reliable local service for large customers in Minnesota and surrounding states.
“Given our local presence and our growth in the area, we decided to add local bulk capabilities to have a full, reliable supply chain with more locally produced supply,” Menard said.
Cottage Grove isn’t the company’s only expansion in the works. Airgas announced the project in December alongside a second new air separation plant in Fairless Hills, Pennsylvania. The company has additional plants already under construction in North Carolina and Southern California.
According to city documents, the project includes $30 million in land, site work and construction costs and $24 million in machinery and equipment. Airgas initially looked for sites in Minnesota, Wisconsin and Iowa, and identified the Cottage Grove site through Xcel Energy’s Shovel Ready Certification Program.
To land the deal, the state has estimated Airgas is eligible to receive up to $175,000 from the Minnesota Job Creation Fund and $250,000 in forgivable loans through the Minnesota Investment Fund. Cottage Grove has approved its own subsidies, totaling $437,000, and the city Economic Development Authority is buying the land, currently used for farming, to convey it to Airgas for the development.
The plant won’t be up and running until late 2020, but city officials are already rolling out the red carpet. Before the council voted to approve the project, Mayor Myron Bailey said the city is eager to welcome Airgas to town.
“Obviously the city of Cottage Grove supports you and your business,” he said. “We love the fact you’re bringing high-quality, good-paying jobs, and another opportunity in our business park.”
published in Finance and Commerce