The Utah Governor’s Office of Economic Development awarded Lunar Resources, Inc. a post-performance tax reduction on June 11 to support the construction of its HELIX-1 Factory in Salt Lake County. The agreement, part of the state's Economic Development Tax Increment Financing program, is expected to create more than 400 high-paying jobs and involve an $85 million investment in Utah over a decade.
Details of the factory expansion
The new facility is projected to be the largest pulsed power manufacturing facility in the United States. Lunar Resources specializes in pulsed power technologies and systems, which utilize extremely high power pulses of energy in short bursts for use in defense, energy, power transmission, and industrial power systems.
Economic impact and technology uses
According to the Governor's Office of Economic Development, the company applies these technologies to various applications on Earth, in space, and on the Moon. The projected economic impact over the next 10 years includes $188,247,625 in wages and $47,335,857 in new state tax revenue.
Utah as a manufacturing leader
Jefferson Moss, commissioner of the Governor's Office of Economic Development, said the expansion will help establish Utah as a leader in cutting-edge manufacturing and technologies. He noted that the company's technology aligns with the state's future-focused mindset and will serve as an economic catalyst.
Reasons for choosing Utah location
Lunar Resources CEO Elliot Carol stated that finding a location to scale manufacturing for their Helix Driver technology was paramount. Carol cited Utah's exceptional talent pool and supportive business environment as key reasons for the expansion, adding that the company intends to build deep roots in the state.
Understanding the EDTIF program details
The tax reduction provided to Lunar Resources is part of the Economic Development Tax Increment Financing (EDTIF) program, which was created by the Utah Legislature in 2005. Under this program, the state offers tax credits or grants to companies that meet specific contractual performance benchmarks, such as job creation and capital expenditure.
Targeted industries in urban counties
For projects located in urban counties—including Salt Lake, Davis, and Weber—the EDTIF program is restricted to five strategic targeted industries: Advanced Manufacturing, Aerospace and Defense, Financial Services, Life Sciences and Healthcare, and Software and Information Technology. The Lunar Resources project falls within these parameters.
The state also utilizes the Rural Economic Development Tax Increment Financing (REDTIF) program for projects in other areas. In rural counties such as Box Elder, Cache, Iron, Summit, Tooele, and Washington, the state may authorize additional non-retail projects outside of the five primary targeted industries.
In these rural areas, the state can provide up to 50% of new state tax revenue for very large projects. For the Lunar Resources agreement in Salt Lake County, the EDTIF post-performance tax credit is set at 30% of the new state tax revenue.
The Economic Development Tax Increment Financing program requires that new jobs in urban counties pay at least 110% of the average county wage. The Governor's Office of Economic Development evaluates all project applications based on criteria including average planned wages, capital investment, and the type and number of new jobs created.
