Former Micron facility to buzz with production

LEHI — IM Flash Technologies LLC on Friday said it will hire 1,850 people in Utah over the next two years and put its corporate headquarters at the former Micron Technology Inc. facility here.

David Simmons, chairman of the Governor's Office of Economic Development Board, said the IM Flash investment in Lehi — $3 billion to $5 billion — represents the largest single business investment ever in the state.

IM Flash is a joint venture between Micron and Intel Corp. The Lehi facility will produce NAND flash memory chips used in a variety of consumer electronics, removable storage and handheld communications devices.

Micron and Intel announced the venture in November, but Micron representatives at the time said only that Lehi could see "hundreds of jobs" as the new company ramped up operations.

"Our plans here are to ramp up a brand new semiconductor factory," Dave Baglee, co-chief executive officer of IM Flash, said Friday. "We've got to go hire the people to put in that. We're looking to hire these 1,850 folks over the next 18 months to two years. With lead time on training and everything, we're moving forward."

The employment total was made public Friday morning when the GOED board approved a tax-rebate incentive to help the company.

Board documents indicate the capital investment for IM Flash will be $3 billion to $5 billion, which includes $1.2 billion to build out the facility — completing the fabrication portion and office space for the headquarters — and the rest for chip manufacturing equipment and other start-up costs.

The average base salary for employees will be about $50,000, which is more than twice the Utah County median of $22,300. Job information is available at www.imftech.com.

"We're going to be hiring across the board to start up the brand new semiconductor fab," Baglee said.

Operators typically must have a minimum of a high school education. Technicians usually have two-year associate degrees. Engineers will be hired with bachelor's, master's and doctoral degrees, he said.

"We're running the full gamut here of educational requirements, because we're running a full gamut of a semiconductor fab, which goes all the way from high-volume production to also having some R&D as well. . . . We're in the process of starting to ramp on our hiring here, so we're still at relatively low numbers."

After the chips are manufactured in Lehi, they will be assembled and tested in shared space in a Micron facility in Manassas, Va., and elsewhere.

The state tax incentive equates to up to 30 percent of new incremental state revenue over a five-year period after the plant is operating, likely about $15 million. The incentive deal also calls for the operations to remain in Utah for at least 10 years and for IM Flash to maintain the wage threshold of at least 200 percent of the Utah County median.

IM Flash is projecting new salaries of $1.1 billion over 10 years in Lehi, and the state is expecting to see overall new state revenue of $121.5 million during that time.

GOED board members were effusive with praise for IM Flash and its potential to benefit the Utah economy.

"I think this is an extraordinary opportunity for the state," board member Richard Nelson said.

"In all my years being on this board, this is the type of technology company which we've looked at in terms of trying to bring into the state — companies that are in the technology sector, that pay high wages, that other companies will be moving in as vendors and have the type of synergies that we want," board member Jerry Oldroyd said. "This represents a very, very significant opportunity for the state of Utah, and I look forward to having this in the state."

"It's a huge investment in the state," said board member Mark Howell. "It's clearly within our (economic) clusters we want to incent to bring in high-tech companies. We're excited because we think there will be some suppliers that will come with them . . . and set up so they can be close to supply them."

Micron received approval for a $3 million Industrial Assistance Fund loan from the state board in 1995 but, despite building the Lehi plant, never received the funding. Intel received $5 million from the IAF in 1998 but later returned a portion of that incentive when it scaled back plans in Utah.

"Both of these companies have proven themselves to be outstanding corporate citizens. . . . We're delighted with the partnership, and we hope that they will be with us for a long, long time," Simmons said.

IM Flash officials reciprocated.

"I think this is really great, the support that the state is showing us here," Baglee said.

"We really appreciate the support of the state and local governments," said Stan Lockhart, public affairs representative for IM Flash. "We know they're committed to building a competitive business environment in the state of Utah."

The state incentive requires IM Flash to have local incentives in place. There are two years left on an existing Micron RDA and property tax waiver in Lehi, although a new RDA is being negotiated. "We're working in cooperation with Utah County, Lehi city and the Alpine School District to make sure those (elements) are in place," Lockhart said.

He also noted that the state money will come to IM Flash on a post-performance basis. "Only as we perform do we get the incentive," Lockhart said.

Micron announced plans for the Lehi plant in March 1995, saying the $1.3 billion plant would employ about 3,500 people. But a downturn in the computer chip market followed. It had only 500 workers in mid-2000 involved in testing, not fabrication, and much of the 2.3 million square feet on 2,100 acres remained dormant.

Micron is in the process of moving the chip-testing operations from Lehi to Boise, which is home to Micron's headquarters.

Intel, with about 350 workers in Riverton, has said its Utah operations would remain unchanged. Its Utah workers are involved in payroll, the on-call assistance center and general employee services.

The two companies said in November that IM Flash would manufacture products exclusively for Micron and Intel. But both of those companies have entered into separate 10-year contracts to supply Apple Computer Inc. with "a significant portion" of their share of IM Flash's NAND flash memory output, with Apple to prepay $250 million to each company.

Most of the newer Apple iPod players, such as the Shuffle and Nano, use flash instead of a hard drive to hold memory.

Boise-based Micron owns 51 percent of IM Flash. Intel, based in Santa Clara, Calif., owns 49 percent.