Wichita Cessna Aircraft has announced plans to return $10 million to the city of Wichita and Sedgwick County after canceling a business jet program that had brought the company cash assistance and tax breaks.
“It’s the right thing to do given the circumstances,” Cessna spokesman Bob Stangarone said Friday of returning the incentive money.
The city and county had approved more than $70 million in cash assistance and tax breaks last year to entice Cessna to develop the new jet in Wichita. Projections called for the project to add 1,000 jobs.
But the economy led Wichita-based Cessna to slow, then suspend, development of the $27 million intercontinental jet earlier this year.
Cessna’s parent company, Providence, R.I.-based Textron Inc., said in a securities filing Thursday that it was formally canceling the program.
Cessna said it will return $5 million each to the city and county by month’s end. The $10 million had been used for site preparation work for a 60,000-square-foot plant in southwest Wichita, where ground was broken in October.
The county tapped its reserves for its share of the project, while the city issued bonds.
The state didn’t provide incentive money.
Allen Bell, the city’s director of urban development, said the city likely will use the money to pay off the bonds it issued.
“I’m surprised they’re setting all that good work aside, instead of waiting for the market to improve,” Bell said.
“We’re willing to be patient and hope that it comes back.”
Textron spokeswoman Karen Gordon Quintal said that if market conditions improve, Cessna will revisit the prospect of a large widebody jet.