Tax back program for L&R Distributors on Quorum committee agenda

The company that has purchased the assets of SAJ Distributors from the Walgreen Co., is asking the Jefferson County Quorum Court to endorse their application for state tax-back credits.

L&R Distributors of Brooklyn, N.Y., acquired SAJ after the LaFrance family sold USA Drug to Walgreens last year. According to the Quorum Court resolution, L&R expects to create 232 jobs at the facility at 3017 N. Midland Drive after it’s upgraded and new equipment installed.

The project plan from L&R indicates that new construction to expand and modernize the building is projected to cost $2.2 million, plus an additional $1.8 million for new machinery and equipment. Another $11 million is projected for inventory and receivables, bringing the total cost to $15 million.

The company currently has distribution facilities on the east and west coasts, and the Pine Bluff facility would be their largest, according to Lou Ann Nisbett, president and chief executive officer of the Economic Development Alliance for Jefferson County.

Nisbett made the statement at a meting of the Economic Development Corp. of Jefferson County, which administers the three-eighths cent sales tax that was approved by county voters in 2011.

At that meeting, the corporation board agreed to offer up to $1.25 million in incentives to locate here and create an additional 81 jobs. In December, L&R projected that there would be 119 employees at SAJ when they took ownership.

Documents prepared for the state incentive program indicated that the average wage for employees at L&R would be $15.40 per hour, or a total payroll of $5.5 million per year.

With the state tax back program, sales tax money paid on purchases is returned to the company, rather than being allocated to the state and county as they would be without the tax back program.

In order to be considered for the state program, L&R needs a resolution from the county’s legislative body endorsing their participation in the program, and a minimum investment of $100,000 is required to qualify.