Big day for Conway. 1,200 $20/hour jobs.

What kind of jobs? Nobody said and who cares for the moment.

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But I think it’s worth compiling a handy quick checklist of what it took to land this company, in addition to Conway’s agreeable demographic factors.

$10 million from the state

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$5 million from the city of Conway

A property tax cut worth, I estimate, about $200,000 per year in tax bill reductions on the new building.

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A free land lease on 12 acres. Essentially a gift of $1.2 million worth of land.

All this is a lot, but probably, as the business shill up at Walton University suggests, it’s a necessity. It’s become a given that companies must be rewarded with corporate welfare wherever they locate, without any return promises on staying long enough to repay the gifts, without any showing that new jobs one place haven’t devastated some other city, without any report on potential environmental impact, etc. This shakedown is just a fact of life.

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But …. that ain’t all. Consider these other state promises, as detailed in the Democrat-Gazette:

* An unspecified state income tax credit. “Terms of the agreement are private.”

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* Sales tax and use tax refunds on equipment.

* A rebate equal to 5 percent of the payroll for 10 years ($2.4 million a year, or at least $24 million total, based on estimates of payroll yesterday) “if the company meets terms of a private agreement.”

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In all, I don’t think a $50 to $60 million total benefit is an overly generous estimate. If you’re counting, that’s more than $40,000 per job. Is it for a truly transformative job center or for a glorified call center? That question will be answered in the months ahead.

Good deal? Maybe. But these private agreements are outrageous. Not the givebacks, necessarily, but the privacy.

If the public doesn’t know the terms for the giveaway of ITS money and if the public isn’t given ANY future accountability on the lavishing of that money, we’ll never have a way to know if this was a wise investment for the state and whether it was made with sufficient protection should the inkjet printer market — or whatever product this call center will provide assistance on — turn south.

We must simply trust Gov. Mike Beebe. Do you think he’s likely to tell us if his giveaway turns out to be a bad deal? Deal ’em, Mike, but first cut the cards.

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I am not convinced of the theory that every aspect of these giveaway deals can be cloaked in secrecy. Perhaps there’s an FOI lawsuit in the making here.

On the jump, a story from New Mexico with a key point on nearly a mirror image announcement there yesterday:

If Hewlett-Packard ultimately pulls out of New Mexico, it will be required to repay a certain portion of the incentives.

Question for Gov. Beebe’s office: Does our agreement contain similar language?

UPDATE: No, the governor’s office won’t release the details of the secret agreements. But spokesman Matt DeCample emphasized that the state’s $10 million doesn’t go directly to H-P, but to the Conway Development Corp. to build the building that H-P will occupy rent-free lease. So, should H-P bail out, the building would remain as valuable infrastructure. But, though the specifics were not provided, DeCample also said there is a provision for the company to pay a portion of the $10 million should the company not meet performance targets.

The tax incentives, he said, are peformance-based. If specific criteria aren’t met, they won’t get the incentives, he said. The specific criteria? The amount of the incentives? The length of the terms? Only a few insiders are allowed to know, not the public who’s making this beneficence possible. Don’t worry your little head about it. If you can’t trust Gov. Beebe, who can you trust?

 

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