SUPERIOR, WIS. – The cofounder of Cirrus Aircraft Corporation, Alan Klapmeier, is moving closer to home with his newest company, Kestrel Aircraft Corporation. It was announced January 16, 2012, that Kestrel will be locating its manufacturing facility to Superior, Wisconsin, rather than Brunswick, Maine. The Kestrel aircraft maintenance and modification center – Kestrel Aeroworks – will continue to be located in Brunswick, the composite shop will be located at a new Winter Street facility in Superior, and a final assembly plant will be located at Superior’s Richard I. Bong Municipal Airport.
Kestrel Aircraft Corporation was created in 2010 to certify the single-engine turboprop, the Kestrel K-350, which is expected to have lower operating costs than a light jet. Kestrel is expected to create up to 600 permanent, non-seasonal jobs by 2016. Kestrel’s staffing requirements will range from experienced senior executives to highly skilled engineers and designers to composite technicians and aircraft assembly personnel. Most of these positions will be recruited locally with many of the composite technicians and aircraft assembly personnel being trained locally in conjunction with community colleges and Wisconsin Indianhead Technical College.
The K-350 is an all-composite (carbon fiber) single-engine turboprop, designed to carry five passengers plus a pilot over a long range (approximately 1,500 miles) at high speed (approximately 375 mph), in a comfortable pressurized cabin, using short runways. Kestrel claims that along with comfort and performance, the K-350 will have the lowest “seat miles per gallon” cost of any aircraft in its class.
For most missions, the K-350 will have journey times that are comparable with light jets, while burning significantly less fuel, thus lowering direct operating costs and reducing emissions.
Kestrel had planned to locate its facility in Brunswick, Maine at the recently decommissioned Brunswick Naval Air Station. However, the company sought additional financing, which Wisconsin Gov. Scott Walker made possible, and Maine Gov. Paul LePage did not.
Kestrel had hoped to fund a portion of its $100 million project through Coastal Enterprises, a Wiscasset-based private, nonprofit community development institution, and the federal New Market Tax Credit program. The program helps to bring jobs and investments into low-income or distressed areas, as identified in the U.S. Census.
Kestrel hoped to receive $39 million in tax credits, but only received a fifth of that amount. In April, the company was allocated $7.8 million in tax credits, enough to get Kestrel Aeroworks, the maintenance and repair operation, off the ground, but not enough to start manufacturing airplanes.
Below is the list of incentives the City of Superior, Douglas County and the State of Wisconsin put together in order to make the Kestrel move to Superior a reality:
City of Superior
• Tax increment financing and land grants totaling $3.1 million.
• Low interest loan of $2.4 million.
• Transfer of County-owned property located adjacent to the Bong Airport (13.3 acres).
• $500,000 loan through the Douglas County Revolving Loan Fund.
State of Wisconsin – Wisconsin Housing and Economic Development Authority (WHEDA)
• $30 million in New Market Tax Credits (NMTC) in 2012.
• $60 million in future NMTC allocations.
• $2 million loan through the U.S. Treasury’s State Small Business Credit Initiative Program.
Wisconsin Economic Development Corporation (WEDC)
• $18 million in Enterprise Zone Tax Credits.
• $2 million economic development loan.
Kestrel will begin construction on its Winter Street composite plant this spring, and in 2013, will commence construction of its assembly plant at Richard I. Bong Airport.
Wisconsin Gov. Scott Walker and local Superior dignitaries were on hand for the announcement.
Meanwhile, next door in Duluth, Minnesota, is the China Aviation Industry General Aircraft Company (CAIGA), which now owns both Cirrus Aircraft Corporation and Epic AIR, LLC.
Kestrel’s Alan Klapmeier is the co-founder and former CEO of Cirrus Aircraft. Klapmeier’s brother, Dale, is the co-founder and current CEO of Cirrus Aircraft.
Cirrus Aircraft Corporation started at the Baraboo-Dells Airport in Baraboo, Wisconsin, in 1984, and opened its doors in Duluth, Minnesota on January 1, 1994.