Tuesday, February 21, 2006
SWOP homepageTaxpayers SOL Says BernCo
From the Journal [paid site]
Still no guarantee against future delay. Still no jobs. Still no transparency.
Still no community benefit from the deal.
corporate welfare
taxes
Economy
Business
labor
Hiring Delay Won't Cost Tempur-Pedic Tax Breaks[Update] karlos says: Basically, Liz Hamm, a spokesperson for Bernalillo County, is saying that as long as the company doesn't start its production process, it could conceivably continue receive tax breaks on the equipment it purchases in the state indefinitely. (The Philips deal from a few years back should raise some flags - readers may remember that they were moving their tax-abated equipment to other sites.) That's a pretty big loophole considering the company bases its production decisions on business models, not taxpayer gifts from elected officials.
Journal Staff Writer
A hiring delay at Tempur-Pedic won't cost the company any of its tax breaks, Bernalillo County officials say.
The company is installing equipment at its mattress factory near Paseo del Volcan and Interstate 40. The plant won't open until the end of the year about six months later than expected.
A slowdown in company earnings late last year triggered the hiring delay.
The company gets a break on some of its property taxes as part of a $100 million industrial-revenue-bond package approved by the county last year. It's the largest IRB deal ever adopted by Bernalillo County.
The value of tax breaks, which are in effect now, start at roughly $600,000 a year, with the value declining as assets depreciate. An agreement approved in August calls for the company to pay back abated taxes if it halts operations or moves the plant out of town within 10 years.
"By virtue of the fact that they have not even begun their production process, the claw-back provisions do not apply," spokeswoman Liz Hamm said.
Tempur-Pedic has made its first payment to cover the cost of taxes for the local school district and county hospital, which weren't abated.
About 300 people will work at the plant when it's in full production. Salaries are in the $25,000 to $50,000 range.
Karlos Schmieder communications organizer for the SouthWest Organizing Project, a watchdog group suggested the company should face some kind of penalty.
"Is there any way to delay some of these tax breaks?" he asked in an interview.
Still no guarantee against future delay. Still no jobs. Still no transparency.
Still no community benefit from the deal.
corporate welfare
taxes
Economy
Business
labor
