Otto Aviation remains on a flight path to relocate to Northeast Florida after the Jacksonville City Council approved a $20 million incentive package for the Texas-based aircraft company.
The 18-0 vote constituted final action on a 20-year, 75% Recapture Enhanced Value Grant for Otto, which announced in May that it had short-listed Jacksonville’s Cecil Airport as a site to build its Phantom 3500 corporate jet.
“In moments like this, my heart is always filled with gratitude,” Otto President and CEO Scott Drennan told Council members after the vote. “We’re about to create one of the greatest aerospace company that the history of aerospace has seen, right here in Jacksonville.”
The city grant is among three Otto sought in connection with its potential move to Cecil, where it plans to begin operations in a vacant hangar before building a new manufacturing and production facility on 80 to 90 acres on the grounds of the airfield. Boeing Co. previously used the hangar.
The deal
On May 19, the Jacksonville Aviation Authority board approved a $34.9 million package of investment and incentives for the company. According to the city Office of Economic Development, the state of Florida also is considering attracting the project with its Corporate Income Tax Credit and High Impact Performance Incentive Grant programs.
JAA’s package for Otto comprised:
• A $22.5 million investment by JAA for site preparation and design/construction to extend taxiway E-1 to the property where Otto plans to build its facility.
• Abatements on rent and common area maintenance fees on Hangar 825, worth $3.73 million.
• Abatements on rent and common area maintenance on the development site for the new plant, worth $7.18 million.
• Rent credits on Hangar 825, worth $1.5 million.
Nick Howland, the Council liaison with the Jacksonville Aviation Authority, said he supported the grant because of the JAA’s co-investment and because the city’s contribution is through a REV grant versus a cash incentive. A REV grant is a refund on ad valorem tax revenue generated by a new development.
Howland commended the parties involved in creating the incentive package, including JAX Chamber President and CEO Daniel Davis and Ed Randolph, the city’s chief economic development officer.
“Basically, we’re providing them a rebate on taxes that would only be collected if they move here,” Howland said.
In a release, JAA CEO Mark VanLoh said Council's approval of the incentive "demonstrates our community’s commitment to fostering innovative aviation businesses that create jobs and economic opportunities for our residents."
Aundra Wallace, president of JAXUSA Partnership, said Otto's "decision to establish their manufacturing and production facilities here in Jacksonville reinforces the region’s standing as a leader in the aerospace industry. We look forward to supporting their growth and long-term success in Northeast Florida.”
JAXUSA Partnership is the economic development arm of JAX Chamber.
Otto’s potential plans
If it selects Jacksonville for the plant, Otto says it plans to employ a workforce of 1,200 employees who will earn an average annual compensation of $90,000
The city Office of Economic Development staff says the Fort Worth-based company’s move to Jacksonville would generate a return on investment of $1.24 per $1 of the REV grant.
Officials say the facility could attract related development. Not all components of Otto’s jet will be manufactured in the city, creating a possibilities that the company’s suppliers would move to Cecil.
Otto says its two-engine Phantom aircraft, which is in development, is designed to minimize drag and maximize fuel efficiency. The jet will operate on 60% less fuel than competing aircraft while outperforming them in range, says Otto, which plans to bring it to market in 2030.
The Phantom is in the super-midsize category that typically carry eight to 10 passengers.
The aircraft evolved from a “proof of concept” plane, the propeller-driven Celera 500L. To reduce air drag, that experimental craft included a fuselage shaped more like a football than a standard tube design.
Otto said it would begin research and development in Cecil Airport’s Hangar 825 as part of plans to begin flight tests of the Phantom 3500 by early 2027.
The private company says it hopes to achieve certification from the Federal Aviation Administration and place the Phantom in service in 2030, meaning the aircraft would go on the market at that time.
Among other high-tech features, the aircraft forgoes traditional porthole-style windows for high-definition digital displays on the cabin walls and ceiling, which will show real-time views of the plane’s surroundings. The purpose, as with other design elements of the plane, is to reduce drag.
Otto is named after its founder, William “Bill” Otto, who established it in 2008. According to the company’s website, Otto was a frequent business traveler who became frustrated by the high costs and significant environmental impact of private air travel.