After months of plans, designs and research, a Peyton company achieved flight with a prototype airplane designed to attract a new class of aviators.
Nexaer hopes to begin producing the planes, which will range in price from $90,000 to $125,000, within the next 18 months, creating new jobs and a new manufacturing plant.
But those jobs and that plant won’t be in El Paso County.
The company is moving to Laramie, Wyo., after receiving an incentive package that includes a state grant for a 50,000 square foot manufacturing facility at Laramie’s airport.
Nexaer president Paul Klahn said it was an offer he couldn’t refuse.
“We started talking to them through the friend of a friend,” he said. “It gave us the start that we’re going to need to get the business off the ground. We met several times with the local EDC but when it came down to it, we had to sign with Laramie. They had a stronger incentive package and it was hard to turn away from that.”
Tim Stamp, president of Laramie’s Economic Development Corp., says it isn’t just about the incentives — it’s about the importance of a new company to the small Wyoming city.
“To be truthful, I think it was more than our incentive package,” he said. “I think they found Laramie an attractive place for them to make a difference for their company. We wanted them in Laramie — they’ll be a big fish in a little pond here, and that’s not necessarily the case in Southern Colorado.”
Stamp said Laramie didn’t focus only on incentives, but made the company feel welcome in the city.
“I’ve always said incentives are only as good as the next incentives that another state will offer,” he said. “I think this company understands that the community, the University of Wyoming, the Laramie EDC and the airport are all seeing it as a very positive thing. We wanted them here, and we let them know it. I don’t think they got that where they’re at. They were told ‘you’re a start-up, we have nothing to help you.’”
It’s an assessment that Mike Kazmierski, executive director of the Colorado Springs Economic Development Corp. disagrees with. He said he had several long talks with Klahn, but could not offer him the type of incentives other communities have because the EDC is a nonprofit organization that receives no state or local tax dollars.
“It boils down to the community’s desire to invest public money in job creation,” Kazmierski said. “Some communities understand the value that new companies bring — jobs, income and capital investment that returns the initial investment many times over. We just haven’t embraced it here; we haven’t felt the need for it at this point.
“On occasion, this attitude has hurt Colorado Springs, but we still have some things going for us,” he said. “As long as we’re able to bring in quality jobs, the community doesn’t see a need — and it’s hard to make a case for — an economic incentive tax.”
Kazmierski points out that although Pueblo has a tax that brings in $7 million annually for economic development; Colorado Springs’ reluctance to use public money to attract business is reflected in the state’s position as well.
“Our state has $1 million this year for economic development,” he said. “New Mexico has $1 billion at the state level. That gives you some sense of how far behind we are.”
Klahn’s isn’t the first aircraft company to depart from the Springs. Kazmierski said another aircraft company moved to Oklahoma City last year. But he doesn’t think it’s time to ask voters to approve an economic development levy.
“I wouldn’t at this time,” he said. “But we need to start talking about it. We need to think about being more aggressive. We’re the 49th largest city in the country, and other communities our size have economic development that is generously supported by the public sector – not a small nonprofit.”
Kazmierski said it might take a crisis to get voters’ attention.
“We’ll have to feel some pain first,” he said. “But right now, we’re not feeling that. It’s time to talk about it, though, and get out in front before it is a problem. We need to be ready for it, if problems come.”
Nexaer has been in Peyton since it incorporated in 2001, Klahn said. The company’s employees spent two years performing studies, developing a business plan, and doing market and material research.
“The plane is built out of a carbon fiber,” he said. “It’s a cost-effective way to build. In January 2004, we were ready to start designing a plane. We now have a prototype.”
The prototype is designed to be a light support aircraft, a new category of plane that will be marketed to people who can’t afford larger private planes.
“It has some limitations, it’s only a two-seater, it has fixed landing gear,” Klahn said. “It is a single engine plane with a propeller. Its maximum speed is 120 knots and it can only be flown during the day in good weather.”
Those are restrictions were mandated by the Federal Aviation Administration. One plus for the new the plane is that it can be piloted after half the usual instruction hours, cutting down the expense of obtaining a license.
“The average cost of getting a private license is between $5,000 and $6,000,” Klahn said. “But we expect the cost for a sport license to be about $1,500 to $2,000. It eases the cost of entry into flying, making it more accessible to more people.”