TAMPA — Hillsborough County routinely pitches tax subsidies to companies pledging to create lots of good-paying jobs within its boundaries.
But on Tuesday, county commissioners unanimously agreed to what economic development officials say may be a first-of-its-kind offer: Cash in exchange for keeping jobs here.
The board voted 5-0 on an emergency motion to dangle up to $1.2 million in local tax dollars to an unnamed international financial services firm already located in Hillsborough County. Much of the money is aimed at getting the company and its 1,633 jobs to stay, though the firm has said it will add another 200 employees by 2014.
The state is expected to pledge an additional $800,000 to the company through Florida's Quick Action Closing Fund, bringing the value of the combined subsidies to $2 million.
County officials note that the deal is contingent on the company building a $78 million, 250,000-square-foot office building and retaining the jobs for at least 10 years. Much of the money won't be paid out until the latter years of the deal.
"This would be an initiation of an approach that I'm not aware of being used in Hillsborough County heretofore," said Bruce Register, corporate business development manager for the county. "It's an approach that rewards long-term retention and long-term duration of those jobs."
Under Florida law, local and state government officials negotiate business subsidies in secret, allowing them to withhold details, including the names of the companies in question, until a deal is reached. County officials declined to disclose the company, though an application lists the "project location" as the West Shore business district.
Financial and professional service companies in Hillsborough County with 1,500 or more employees include J.P. Morgan Chase, Citi Group, PricewaterhouseCoopers, Progressive Insurance, USAA and MetLife, according to the state's Enterprise Florida website.
PricewaterhouseCoopers has a large presence in the West Shore district now, though county records don't make clear whether the company seeking incentives is located there now. Meanwhile, USAA has faced a space crunch at its office complex in North Tampa due to hiring in recent months, forcing it to lease space elsewhere.
Background material from the county indicates the company is considering relocation options in South Carolina, India, Singapore and Argentina, which also come with subsidy offers and/or opportunities to reduce costs.
Commissioners approved the incentive offer with little discussion. Board members Les Miller, who is recovering from medical treatment, and Mark Sharpe, who is out of town, were not present.
Democrat Kevin Beckner, who made the motion to support the subsidy, said he initially was concerned about setting a precedent that other companies would seek to exploit. But he said he doubts many would be able to match the $78 million investment this company — the name of which average citizens would recognize, he said — is promising to make in a new building.
"It's a pretty high bar," Beckner said. "It's a wise investment in a good community partner."
Register told commissioners Tuesday that the county will have its investment paid back within 21/2 years based on increases in property and other taxes from the company.
Commissioners had previously approved the first $120,000 of the subsidy in May, basically a reimbursement of taxes for creation of the new jobs. But Register said the county and state realized from talks with the company since then that it would have to sweeten the offer.
So they decided to offer an additional $1.1 million to the company for keeping existing jobs in place, with the money paid in installments in years five through 10 of the deal. The money would come from the county's Premier Business Bonus Incentive Program, if the company accepts it.
As part of their vote, commissioners agreed to waive a requirement of the program that wages of jobs created need to average 150 percent of the regional average wage. The company would have to pay an average of at least 115 percent of the average wage instead, or $46,833 a year.
An application from the company indicates that pay for existing jobs averages about $60,000, but that new positions to be created in accounting, back office work and processing would be closer to the median.
The county may not bear all of the local subsidy burden. Under the action taken Tuesday, half of it would come from one of Hillsborough's three cities if the new office is built within their municipal boundaries.
Bill Varian can be reached at (813) 226-3387 or email@example.com.