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Utah's Business and Economic Development Board has agreed to give Parker Hannifin Corp., an aerospace company, a $500,000 grant and loan package to help it expand in Weber County.

Parker Hannifin is to add 140 high-paying jobs, and if it doesn't, the company will have to pay back the money at 10 percent interest.The loan is forgiven if the jobs come through. The agreement calls for the company to meet other economic targets, like buying from Utah suppliers.

The financing is the latest in a series of grant and loan packages from the Industrial Assistance Fund, established in 1991 to encourage companies to bring high-paying jobs to Utah. The fund often has been controversial because companies don't have to repay the money if they help Utah's economy.

The state has committed $4.4 million to McDonnell Douglas; $1.1 million for Morton International Inc. in Ogden; $350,000 to Unisys in Salt Lake City; and $900,000 to DOD Electronics in Murray.

Parker Hannifin, which earned $63.5 million in 1992, will use the $500,000 to help build a 100,000-square-foot plant in the Weber Industrial Park, nearly doubling its size by 1994. Ground is to be broken within a month on the $5 million plant. The company intends to spend $2 million to $3 million for equipment and relocating key people.

Richard Nelson, administrator of the Industrial Assistance Fund, said Parker Hannifin's expansion eventually will mean $8 million in income taxes to state and local governments. However, the company intends to ask for property tax relief soon, said Robert Barker, vice president and general manager.

The 140 engineering, fabrication and other technical jobs will pay an average wage of $38,341, far above the state's average salary of $20,520.

When the Ogden expansion was announced in October, Parker Hannifin hoped to add some 250 jobs, bringing Ogden employment to about 500. But slowdowns in orders from a major customer, Boeing, prompted the company to scale back plans. The 140 jobs are to be filled by transfers and local hiring, said Barker said.

Nelson said that while Parker Hannifin is large enough to finance its own expansion, Utah's incentive helped.

"In this case the $500,000 was an important factor because they had other states vying for this business," Nelson said.

Barker said the company also looked at locating in Arizona or staying in Irvine, Calif. "We chose Utah because of the incentives Utah provides and because of our experience in Utah. We've been very successful in Utah. It seems to have a good work ethic."

Parker Hannifin is moving much of its commercial business to Utah from Irvine. The company plans to combine its Aerospace Hydraulic and Control Systems division as part of a program to separate military and commercial business.

The Ogden plant now produces flight controls, actuators, reservoirs and accumulators.