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THURSDAY, MAY 3, 2007
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Senate ends stalling on steel mill package
Plea from governor brings
incentive standoff to a close

By Phillip Rawls
Associated Press Writer

MONTGOMERY — After a personal plea from the governor, the Alabama Senate ended a standoff Wednesday that had threatened to take the state out of the competition for a $2.9 billion steel mill that would be the largest industrial project in Alabama history.

The Senate, after two days of stalling, finally took the procedural step necessary for it to vote on a package of tax breaks for ThyssenKrupp AG on Thursday.

The end to the stalling came after Riley lectured senators on what was at stake.

"This is a debate about the impression we are going to send across the Atlantic to Germany that we can't get along and pass this," Riley said.

Alabama is competing with Louisiana for a 2,700-employee steel mill planned by the German company. It has narrowed the search to a site 25 miles north of Mobile and another between New Orleans and Baton Rouge, La.

Riley said he expects a decision by the company on May 11 and needs the tax breaks signed into law a few days before then.

Riley's tax legislation would give the German company a 10-year tax break on paying utility taxes, an enhanced 20-year break on property taxes that don't go to education, and an income tax credit for 30 years. The tax breaks would be added to a $400 million package of economic incentives that the Legislature approved in February.

In Louisiana, the Legislature approved $300 million in infrastructure investments in December. On Monday, Gov. Kathleen Blanco asked lawmakers to add another $100 million "to match Alabama's commitment."

In Alabama, the House approved the governor's tax break package without any trouble, but it had not been addressed by the Senate because of a feud between the Democratic majority and Republican minority.

The GOP bloc has been stalling action for weeks to protest the Senate's new operating rules that it says disenfranchise the minority.

Republicans had offered to set aside their stalling tactics so the Senate could receive the tax break legislation after it was approved by a Senate committee, but the Democratic majority insisted the minority couldn't pick what the Senate addressed or didn't address.

When Riley made a surprise visit to the Senate on Wednesday, he stressed that the project would be not only the largest in state history, but one of the largest in U.S. history.

"We are sitting here being petty — both sides," the Republican governor said. He urged both sides to reflect on how the project "will determine to a large extent what this state looks like for a generation."

After his speech, Senate President Pro Tem Hinton Mitchem, D-Union Grove, worked out a deal where the Senate took the procedural steps necessary to put the tax break legislation in line for a final vote on Thursday. It also passed some routine bills — previously blocked by Republicans — that will extend the life of six state regulatory boards.

Lt. Gov. Jim Folsom Jr., the Senate's presiding officer, said he is confident the Senate will pass the tax break legislation Thursday and send it to the governor for signing into law well before ThyssenKrupp picks a site. He said the resolution reached Wednesday shouldn't hamper Alabama's chances for the plant.

"I think they'll look at the final result," he said.

Riley concurred in Folsom's optimism.

"I'm not worried, but it's time to get this done," he said.

Copyright 2005 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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