FRANKFORT — Kentucky’s economic development chief assured lawmakers Wednesday the state will hold Ford Motor Co. to its job commitments or claw back $250 million in state incentives as the company retools the BlueOval SK battery plant in Hardin County.  Jeff Noel, secretary of the Kentucky Cab inet for Economic Development, told the Senate Appropriations and Revenue Committee that Ford will assume responsibility for the entire $250 million forgivable loan provided by the state to help build the sprawling complex. Jeff Noel,  secretary of the Cabinet for Economic Development, speaks to lawmakers Wednesday. (Kentucky Lantern photo by Liam Niemeyer) ]South Korean company SK On and Ford dissolved their joint partnership in December for BlueOval SK, which originally had promised 5,000 jobs across two plants producing electric vehicle batteries. The two companies had  split the loan — each receiving $125 million from the Kentucky Economic Development Finance Authority — to be forgiven if the venture met job, wage and investment commitments.  Only one of the two plant buildings is fully operational, and Ford is taking sole ownership and retooling the lone plant to make batteries for the energy storage industry. Ford has been laying off BlueOval SK workers and plans to spend $2 billion on retrofitting the plant for its new assignment. Demand for utility-scale batteries has risen in response to the needs of energy-intensive operations such as data centers that pair batteries with solar installations and other renewable energy sources. Noel told lawmakers there would be “no argument” that Ford must repay the $250 million in taxpayer funds if it doesn’t invest the promised $2 billion and jobs don’t result from the pivot.  “I try to count every penny seriously in my head so that I make sure I feel the obligation to you as an individual taxpayer in the state of Kentucky to do what’s right,” Noel said. “If they don’t create any more jobs, they owe us $250 million, and let’s hope they bring those 2,100 jobs and more to the state.”  Noel also said Ford and the state would seek to market the second plant at the BlueOval SK complex “to attract more jobs into the community.”  The GOP-controlled Kentucky legislature allocated $350 million in 2021 to provide $250 million in economic development incentives for the BlueOval SK project, along with incentive funding for the planned AESC electric vehicle battery plant in Bowling Green. The Wall Street Journal reported last summer that construction at the AESC had paused amid economic and policy headwinds in the electric vehicle market.  Noel said under the original agreement with the $250 million forgivable loan for BlueOval SK, Ford and SK On would have escalating investment, job and wage benchmarks the companies would have to meet starting at the end of 2026 through 2037. If those benchmarks were met each year then a portion of the loan — $10 million a year, escalating to $25 million a year — would be forgiven. If not, the companies would have to pay back a portion of the loan.  He said Ford’s commitments to bring on 2,100 workers for the energy storage business could change but declined to offer specifics. Mentioning Ford’s already large presence as an auto maker in the state, he said: “If they know they have that liability, both financially as well as reputationally, I think they can really do a lot of great things.”  Sen. Chris McDaniel, R-Ryland Heights, the committee chair, told reporters after the hearing he felt the Economic Development Cabinet’s response “is as realistic as it can be at this point,” mentioning it appeared the cabinet was working to restructure the forgivable loan payments.  “They’ve gotten more concessions out of Ford than they originally had obligations for,” McDaniel said. “In light of the situation, the cabinet is doing about as good of a job as they could be doing.”  McDaniel predicted that with the marketing of the second building, “the jobs will come to that site as the General Assembly intended” whether the building is being used by Ford or another company.  “You’re dealing with a well respected company across the United States who values their reputation, who values the longevity of what it is that they’re doing,” McDaniel said of Ford.  He said he has “a lot of concerns” about the AESC battery plant project in Bowling Green but believed Noel was doing a “good job” regarding the project. Noel, the economic development secretary, said AESC was still in full compliance with the terms of its incentive agreement which provided more than $100 million in state funding. That agreement has clawback provisions as well, he said..  Both McDaniel and Noel suggested that Ford and state economic development officials could be back before the legislature ends its regular session in April with additional requests as the BlueOval SK loan agreement is reconfigured.  “I would struggle to see a scenario where Ford and the Cabinet aren’t back by the end of this session needing some help, and I’m optimistic that they’ll get to a place where we have a willingness to do it,” McDaniel said.  The post KY will protect taxpayers as Ford retools battery plant, says economic development head appeared first on The Lexington Times. ...read more read less