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Raytheon confirms plans to add 2,000 Tucson jobs

Expansion plans at Raytheon will mean 2,000 additional jobs over five years and a doubling of the property tax base at the Southern Arizona missile factory. Pima County will lower taxes on the plant for a decade and restrict development next to the expanded facility.

The county and Pima Association of Governments have already invested $33 million in attracting new Raytheon jobs here, purchasing land for a buffer zone and constructing a new roadway near the factory, south of Tucson International Airport.

"Pima County is thrilled to support the addition of 2,000 Raytheon jobs here," said Sharon Bronson, chair of the Board of Supervisors.

"These rewarding, high technology jobs will support Raytheon's growth and bring even more top talent to this region," said Taylor Lawrence, Raytheon Missile Systems president.

As an incentive, the county will support a Foreign Trade Zone application by Raytheon to the Department of Commerce, which would include lowering the 18 percent property tax rate to 5 percent of assessed value for a decade. Pima County Administrator Chuck Huckelberry told the Board of Supervisors that Raytheon's local tax base would double as the company expanded here.

The company "will build and equip significant new capital facilities ... The expansion construction and employment growth ensure that Raytheon, as the single largest employer in Pima County, will continue to be a major economic driver of our local economy," Huckelberry said.

"For a variety of reasons, detailed information regarding their expansion plans are not being released, but they are real and verifiable," the administrator wrote in a memo asking the supervisors to approve the deal at a meeting next week.

Raytheon will continue to pay the full property tax rate to the local educational districts: Sunnyside School District, Pima Community College and the Joint Technology Education District, Huckelberry said. The tax abatement will cost the county about $16 million over 10 years.

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The Tucson City Council gave preliminary approval Friday for a portion of the deal, which would see Raytheon construct about $400 million in new facilities.

Among the new projects, the company plans to build a new secure entrance to the plant on a neighboring 48-acre parcel that would be sold by the county to the U.S. Air Force, with the sale funded by taxes paid by Raytheon to the city of Tucson.

The overall economic impact of the expansion could run into billions of dollars over the next decade, officials said.

TucsonSentinel.com reported last month about Raytheon's local expansion plans, although county officials would only comment anonymously at that point, and did not provide details about the incentives that would be offered.

The much-hyped expansion by the missile manufacturer could bump the company's local workforce nearly back to employment levels seen in 2009. The region's largest private employer would add nearly 2,000 jobs, bringing it to about 11,500 workers. In 2009, Raytheon reported more than 12,000 Tucson employees.

The company is ramping up production of the Standard Missile-3 and SM-6 interceptors, and has inked a deal with Norway's Kongsberg, with plans to assemble and test that company's Naval Strike Missile in Tucson.

Noting the company's "network of 500 suppliers in Arizona," Gov. Doug Ducey said Friday that "increasing Raytheon's infrastructure and job growth in Arizona is a major win for all of us, and the result of strong partnerships statewide."

County and Raytheon representatives have credited the county's purchase of land to create a buffer zone around the missile plant near TIA as an important factor in the expansion.

"In recent years, the county has made several key transportation/infrastructure investments near Raytheon to support potential expansions such as this one today, including the Raytheon buffer zone; creation of the Aerospace, Defense & Technology Research and Business Park; and rerouting Hughes Access Road to create the new Aerospace Parkway," Bronson said.

Also in the Aerospace, Defense and Technology Business & Research Park, the county is building a headquarters for high-altitude balloon firm World View, and facilitating a plant for new small-rocket company Vector Space Systems.

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The impact of Raytheon's planned expansion "cannot be overstated," said Joe Snell, head of economic development agency Sun Corridor.

"Raytheon's decision comes on the heels of other relocations and expansions in the last few years by Caterpillar, HomeGoods and Comcast among others. Southern Arizona is now at the top of national job growth rankings, making us a region on the move," Snell said.

Raytheon reported that it has about 9,600 workers now. In 2009, about 12,140 were employed by the company in Tucson. In early 2013, Raytheon reported 10,300 local workers.

The new hires will have an average salary of $110,000, the company told county officials.

In 2010, the company chose Huntsville, Ala., as the location for final assembly of the SM-3, with about 300 jobs created in a new plant on the U.S. Army's Redstone Arsenal. The company chose the location because of the large buffer zone and significant tax incentives unavailable in Arizona.

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A launch of an SM-3 missile manufactured by Raytheon.