RSSMalloy’s “First Five” is Complete – Now on to Second Five
Jun 29
Corporate Viewpoint, Economic Development, Economy, Malloy, Taxes Malloy. Economic Development 11 Comments
Tell the state you are thinking of moving to Florida or Kansas or any place but Connecticut. Promise to create 200 jobs, engage the right contacts and millions in taxpayer funds could be yours.
It’s called the First Five program and it’s the cornerstone of Governor Malloy’s economic development program.
While the first five have been picked, the legislature has given the Malloy Administration the authority to grant “first five” packages to up to 15 companies.
The “First” First Five Cigna, Bloomfield: $71 million ESPN, Bristol: $25 million NBC Sports, Stamford: $20 million Alexion, New Haven: $51 million CareCentrix, Hartford: $24 million*There was also TicketNetwork, the online ticket broker, who was supposed to get $7 million, but “gave up their” grant after their President and CEO was arrested at a major political event in Hartford.
Governor Malloy made CareCentrix, with “only” $850 million in annual revenues, the fifth “First Five” company yesterday. They will be getting $24 in taxpayer funds for agreeing not to move to Florida or Kansas, but instead will be moving from East Hartford to Hartford and creating 200 jobs in Connecticut.
According to a report in the CT Mirror, “while based in Connecticut, CareCentrix already has more employees in Florida and as many employees in Kansas, two states that were potential locations of a new headquarters. Apparently a third state was wooing them as well.
To critics, the Malloy Administration claims that the $200 million dollar “First Five” program has retained 8,449, produced 2,640 new jobs and attracted $561 million in private investments.
Meanwhile, Governor Malloy continues to use smaller grant programs to attract or retain smaller companies. For example, a few weeks ago, Malloy announced that a $3 million “loan” would be used to get Tronox Inc., a chemical company, to move its headquarters from Oklahoma City to Stamford Connecticut.
According to the agreement, “the first $2 million would be forgiven if 60 full-time jobs were established in the first year, and the entire loan would be forgiven if the company sustained 100 jobs for three years.”
As and aside, for those interested in the environment or trivia, or both, Tronox, Inc. is a spinoff of a company called Kerr McGee. In addition to the revenue making side of the chemical business, Tronox took all Kerr McGee’s major liabilities. Liabilities such as a “situation” in Nevada where “’stuff’ has been leaking into the Colorado River and Lake Mead for many years.”
And, in the small world department, Kerr McGee was the firm involved in the death of Karen Silkwood. Its fun to know that our tax dollars is going to help the spin-off of the company that killed Karen Silkwood.
Meanwhile, back to Connecticut’s economic development policies, all this “good economic news” comes on top of the “bad news” that ESL Investments, a $9 billion hedge fund owned by Edward Lambert, relocated from Greenwich to Miami, Florida on June 1, 2012. This despite the fact that Governor Malloy exempted Connecticut residents making more than $2 million a year from having to pay higher income taxes, when the legislature adopted this $1.5 billion tax increase last year.
Republican State Senator L. Scott Frantz, who is also a venture capitalist, told the Greenwich Times that the firm’s departure as “a terrible loss to the state of Connecticut and, in particular, to the town of Greenwich…We as a state have to do everything we can to remain competitive and attractive to businesses of all sorts. ESL’s departure not only represents the loss of wonderful people and philanthropy, but also a large amount of state tax revenue.”
Remaining competitive is a much nicer term than corporate welfare.
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