GSE Dynamics Inc., a maker of components for submarines and military aircraft, will open a factory at 110 Oser Ave. in Hauppauge. It's buying the building for $3.4 million and plans $3.6 million in improvements, according to the Suffolk County Industrial Development Agency.
Founded in 1971 by then-Grumman Corp. employee Daniel Shybunko, GSE recently won federal contracts valued at about $50 million to supply parts for the Air Force's C5 transport airplanes over five years. The company's sales totaled $13 million last year.
To fulfill the orders from the Air Force and others, GSE expects to consolidate its composites business, now split between a rented factory on Old Willets Path, also in Hauppauge, and a company-owned plant in Comer, Ga.
GSE president Anne D. Shybunko-Moore said the Old Willets operation will move to Oser Avenue in September, to be followed eventually by all the work now done in Georgia. The five Georgia employees will be offered positions here, she added.
Shybunko-Moore had considered expanding the Georgia operation or locating a plant adjacent to Boeing Co. in South Carolina. She said, "The financials of the South are far more attractive" when compared with Long Island's high taxes and energy bills.
"But here, I think we are ahead of the nation in terms of workforce training," she said. "If people have the skills set I need, I can train them."
GSE has teamed with Suffolk County Community College's training programs in the past. The company expects to add seven people by 2014 to its local workforce of 48. Employees earn $66,667 per year, on average, records show.
The development agency's board of directors Thursday offered to cut GSE's property tax bill by $706,000 over 15 years and provide $38,000 off the mortgage recording tax and a $5,000 sales tax exemption.
The Suffolk IDA also agreed to boost its aid package for guitar-strings maker D'Addario & Co. The East Farmingdale business plans to enlarge its Marcus Drive facility and make improvements to two others so work done in New England can be done locally.
Last month, the IDA granted D'Addario a $648,000 reduction in property taxes over 15 years for 99 Marcus Dr. The company's other properties are covered by the Babylon Town IDA, which offered greater incentives.
So D'Addario requested $1.4 million from the Suffolk IDA over 20 years, an increase of $752,000 over the earlier offer.
The IDA board balked, saying it had been "very generous" to the company.
"Someone has to make up this revenue, and it's all of us and our neighbors," said vice chairman David Rosenberg, referring to lost revenue for local governments.
Board member Kevin Harvey agreed, saying, "I think our offer was more than generous."
After much debate, the board agreed to cut D'Addario's property taxes by $1.08 million over 15 years, including paying no taxes for one year. The vote was 4-1, with one abstention.
Both GSE and D'Addario are being helped by Empire State Development Corp.