ROCHELLE – Rochelle is in the running for a $1.6 billion manufacturing plant Toyota and Mazda want to build, and the proposed site lies largely in Lee County.
The Japanese automakers are working on a joint venture that would create up to 4,000 jobs at the plant the companies want to build in the U.S.
DeKalb and Rockford also are among several cities in 11 states said to be on the automakers’ final site list. The plant would make Toyota Corollas and Mazda crossover vehicles.
Plans are for the plant, which could produce up to 300,000 vehicles a year, to open by 2021.
Although Rochelle Economic Development Director Jason Anderson said he has been working on three large projects, he doesn’t know what any of them are. He now assumes that Toyota-Mazda is one of them, but there has been no confirmation from the companies or state economic development officials.
“I’ve filled out three profiles for mega projects in the last few months, but they come with code names and we usually don’t know who it is until there is an official company announcement,” Anderson said.
Japanese rail car manufacturer Nippon Sharyo, which opened a plant in Rochelle in 2012, used the code name ERAIL when it was looking for a site.
Anderson said he first heard that Rochelle was being considered for the automotive plant from a reporter.
“The Chicago Tribune called Monday and told me that we were in the running,” Anderson said. “I said we have three projects that fit the profile, and we have a site that is suitable for that big of a project, but I haven’t heard anything about those companies.”
The site is 1,000 acres of farmland near the intersection of Interstates 39 and 88. In December, the Greater Rochelle Economic Development Corp. took out an option to buy the land, which had been put in trusts after the deaths of farmers who had worked it for the two large farm management groups that owned it.
“It’s south of the county line, and about 75 percent of it is in Lee County,” Anderson said. “With mega projects needing 500 to 2,000 acres, we decided we were willing to put money into the site.”
Incentives often determine where projects go, and Illinois is frequently at a disadvantage when competing for business with other states. The state’s most important jobs incentives program, Economic Development for a Growing Economy (EDGE), was allowed to expire and the General Assembly still is working on a new version.
State Rep. Tom Demmer, R-Dixon, who sits on the House Economic Development Committee, said the EDGE tax credit program, administered by the Department of Commerce and Economic Development, soon could be available.
“The new program passed the House with bipartisan support, and it’s now in the Senate,” Demmer said. “I think they could act on it very soon.”
The EDGE program would be the most likely enticement for a project of this magnitude, Demmer said. Even with that incentive back in its arsenal, Illinois is unlikely to come up with anything close to the $3 billion Wisconsin is offering Taiwanese company Foxconn Technology Group.
Site selection for projects of this scale, however, are based on much more than incentive packages, Demmer said.
“Another state might throw more money at them, but no amount of money can change geographic location,” he said.
Anderson said Rochelle is ideally positioned for this particular project after spending hundreds of million of dollars on infrastructure over the past 20 years.
“We promote what we have, and that’s a great location, with infrastructure that is already in place.”
Interstate exchange access in four places, that could cost upward of $40 million, already been built, he said. A $5 million water tower is at the site, sewer and water lines are in place, and fiber-optic cable is laid.
Rail access could be Rochelle’s biggest selling point.
“Rail, intermodal and cargo access are key for automotive manufacturers,” Anderson said. “We have three railroads – the city’s, Union Pacific and BNSF, and an international intermodal port right down the street from the site.”
Air cargo access is available at the Chicago Rockford International Airport.
Demmer said landing this type of business could have a ripple effect across the region, impacting middle-class workers and bringing in related businesses.
“A lot of attention has been given to growing middle-class wages, and more competition for good workers creates more of a workers’ market that brings higher wages,” Demmer said.
The area already has many automotive-related manufacturers, such as Dixon’s BorgWarner, which is a supplier for Toyota. Putting a new plant in Rochelle could help solidify the industry’s footprint in the area.
“This definitely could have a huge ripple effect – the potential would be there for other suppliers in the industry to see the region as a good place to locate,” Demmer said.
In his experience, Anderson said, a plant of this size would take about 2 or 3 years to become operational. Based on the 2021 target date, he estimates that a decision on the site should come within the next 6 months.