The Paducah Sun
The Paducah Sun
Paducah, Kentucky
Friday, April 12, 2002

State to offer USEC incentives: Paxton
Paducah's mayor is working with state legislators on an incentive package to sway USEC to build its next uranium enrichment plant here instead of Ohio.

By Bill Bartleman

USEC Inc. will be offered an aggressive incentive package later this year to help persuade the company to build its next-generation uranium enrichment plant in Paducah, according to Mayor Bill Paxton.

USEC will build the $1 billion gas centrifuge plant in either Paducah or Portsmouth, Ohio, according to USEC spokeswoman Elizabeth Stuckle. It will replace the antiquated gaseous diffusion process used at the Paducah Gaseous Diffusion Plant, the nation's only remaining enrichment plant.

At stake for both states are hundreds of jobs and economic development opportunities related to having the high-tech plant. Paxton said he's working to coordinate a package that will have the backing of local, state and federal officials.

"We need to get our act together," Paxton said. "At this point, we feel Ohio is a little ahead of the game in what they are doing. We know that Ohio is extremely hungry for this since it lost its enrichment plant."

The new plant, expected to be in operation in six or seven years, will replace the Paducah plant, which has about 1,400 employees.

Stuckle said USEC has two decisions to make where to build a demonstration plant to test and refine the new technology and where to install the commercial plant.

"As with any competitive economic development project, both states later this year will be offered the opportunity to vie for the centrifuge sitings," Stuckle said. "The siting of the demonstration plant does not mean the commercial plant will be there, as well."

Paxton met with state development officials Thursday in Frankfort, including Economic Development Secretary Gene Strong, to lay the groundwork for drafting an incentive package. He also met with officials of the University of Kentucky involved in developing a research park in the Paducah Information Age Park.

"We brought officials in Frankfort up to speed on environmental issues at the plant, the new technology and what we need to do to get it in Paducah," Paxton said after the meeting. "The meat of the meeting was trying to make the state aware of what's going on. We hope to have another meeting in a couple of weeks to follow up on some of the issues we discussed."

While declining to specify potential incentives, he said state officials were cooperative and helpful. He said one potential incentive "should be extremely attractive to USEC" and give Kentucky a competitive advantage.

Strong was not available for comment.

On Saturday, Paxton, McCracken County Judge-Executive Danny Orazine and others will meet with U.S. Rep. Ed Whitfield to discuss USEC. Whitfield said it is too early to speculate on whether the federal government will help pay for the plant or if it will have a say in its location.

Whitfield, R-Hopkinsville, said he's concerned about rumors that members of the Ohio congressional delegation are pressuring the U.S. Department of Energy to force USEC to build the gas centrifuge plants in Ohio.

USEC is involved in negotiations with DOE to remain the exclusive agent for processing nuclear weapons from Russia that will be recycled into nuclear fuel. He said some officials from Ohio want a guarantee from USEC that it will build the new plant in Ohio in exchange for remaining the exclusive agent for the Russian uranium.

"I think that would not be the proper thing to do, and it would shock me if they (DOE negotiators) did it," he said. "The decision on centrifuge should be based on the competition between the states."

Whitfield said he was trying to schedule a meeting with DOE's lead negotiator to discuss the situation.

Paxton said additional meetings will be held with U.S. Sen. Mitch McConnell, R-Louisville. "I want to make sure we all are working together to put together the best possible package we can make," Paxton said. "I am extremely optimistic that we can win this competition."