SWOPblogger

karlos says:
Temper-Pedic's (TP) announcement to postpone its hiring process for its West Side plant by six months came as a disappointment, to say the least.

When Bernalillo County approved Temper-Pedic's $100 million Industrial Revenue Bond, worth a minimum $10 million in tax breaks, SWOP was very critical of the ordinance and was able to pressure the county to include some provisions for clawbacks to recover lost taxes if the Swedish Mattress Manufacturer halts operations or moves the plant within ten years. (Other provisions, like reporting on job numbers and a preference for local south valley hires were also included.)

By the time the bond deal was made public, the manufacturing plant was already being constructed on Albuquerque's west mesa. Robby Rodriguez, SWOP director, was quoted in the 8/24/05 issue of the Journal saying, "It creates the perception there was a deal made sometime before."

At the time, TP insisted it needed the tax breaks to keep going and start hiring.

The company changed its tune recently. From Feb 6, 06 Journal...

"We have thoroughly analyzed our (business) models and made the decision to slow down the completion of the Albuquerque facility," chief financial officer Dale E. Williams said. "(We) will delay its opening by six months to the end of 2006."

CFO Williams' response was refreshingly honest and instructive for future County Commission debate. The risk to tax payers from these kinds of deals is dramatic, even more so on the West side where residents lack infrastructure. Ultimately, companies looking for entitlements are accountable solely to principal stock owners and business models; not tax payers or voters. Deals like TP received from the County are icing on the cake, and don't really impact siting, hiring or environmental practices.

The myth that the use of entitlements to lure companies as economic development is to bring jobs is slowly being debunked. Tax breaks and other incentives for large, often multi-national corporations is about a transfer of wealth away from tax payers and working families back to wealth.

Without transparency, measures for tax-payers to recoup losses if the company doesn't live up to its side of the deal and real community involvement and benefit, these deals undermine democracy, hurt taxpayers and are responsible for that giant sucking sound you hear.

Bernalillo County should inquire about some additional community benefits in light of TP's announcement to postpone hiring.

Along with community groups and service agencies, local governments can negotiate better deals for tax-payers and recieve real community benefits in the future.