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Flying high


OKC and state officials hammer out incentives packages for Boeing as it moves 800-plus jobs here.

Clifton Adcock January 18th, 2012

Oklahoma City officials are likely to consider by next fall an incentives package to Boeing for an anticipated 800 to 900 jobs being relocated from Wichita, Kan.

Earlier action is expected for an incentives package involving 550 Boeing jobs already coming to OKC from Long Beach, Calif. In March, the city’s Economic Development Trust will likely receive Boeing’s application for the second part of that incentives package.

Boeing announced Jan. 4 that it will close its Wichita facility, which employs about 2,160 workers, and shift many of those positions to Oklahoma City and San Antonio. In a media release, Boeing indicated its contracts in Wichita have matured, programs have come to a close and that site was not likely to maintain and win new business.

“The decision to close our Wichita facility was difficult, but ultimately based on a thorough study of the current and future market environment and our ability to remain competitive while meeting our customers’ needs with the best and most affordable solutions,” said Mark Bass, vice president and general manager for Boeing Defense, Space & Security’s Maintenance, Modifications and Upgrades division.

right, Cathy O'Connor, president of the Alliance for Economic Development of Oklahoma City

“We recognize how this will affect the lives of the highly skilled men and women who work here, so we will do everything possible to assist our employees, their families and our community through this difficult transition,” Bass said.

Most of the jobs are expected to arrive in Oklahoma City in 2013. Any incentives package application would not arrive before the city’s Economic Development Trust until later this year, said Robin Roberts Krieger, executive vice president of economic development with the Greater Oklahoma City Chamber.

“It’s really a wonderful addition to the community: highly skilled, highly paid positions,” she said. “It does a lot to increase our overall economic base. It creates opportunities for our citizens, as well as growth for the community.”

The city already has given the company $1.5 million through its strategic investment program when Boeing brought in 232 new jobs last year. Those positions came from Boeing’s C-130 avionics modernization program, which had been in Long Beach, Calif. With a payroll of around $20 million, the 232 jobs each have an average annual salary of $90,000. Around 318 more jobs from the company’s B-1 operations are expected to begin arriving soon.

Boeing almost has filled its current Oklahoma City facility, and is working on a 320,000-square-foot facility next door as part of its second phase, which is expected to open in April.

State funds also are involved in the Boeing jobs. The company is participating in the state’s 21st Century Quality Jobs program, which focuses on high-skilled, high-paying jobs. More than 250 new jobs created by Boeing have qualified it for as much as around $26 million over a 10-year period, according to the state Department of Commerce. The company also qualified for a maximum of approximately $6.5 million in rebates for 207 jobs created under a separate state initiative, the Quality Jobs program.

For the most recently announced jobs stemming from Wichita, there has not yet been a formal incentives offer from the city to Boeing.

“We just don’t know yet,” said Cathy O’Connor, president of the Alliance for Economic Development of Oklahoma City. “They’re saying around 800 jobs. Until we get the actual numbers and the amount of capital investment they plan to make and what those average wages are going to be, we really don’t know what their recommended amount for a local incentive will be."

Still, Oklahoma City has confirmed that the company qualifies for the city’s incentives program, said Oklahoma City Economic Development Program Manager Brent Bryant.

The numbers break down to around $6,450 of offered city incentives for each Boeing job that already has come here.

If the same rate is offered by the city for the jobs coming from Wichita, incentives would be somewhere around $5.16 million.

However, that number does not take into account capital investment by the company, which would likely push incentives higher, Bryant said.

Photos by Mark Hancock

 
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01.24.2012 at 07:26 Reply

So we're scrambling to hand over tax dollars to pay them to do what they've already decided to do?

 

 
 
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