OKC manufacturing plant closing after receiving $899,845 for job creation

[Plutonic Panda]

I think a change in this law is needed. Doesn't sound right that they can receive this money for creating jobs and then close it.

OKLAHOMA CITY - Southfield, Mich.-based auto parts manufacturer Federal-Mogul Corp. will close its plant in southeast Oklahoma City in early 2015 and eliminate 165 jobs there.

The plant, at 5500 S Hattie Ave., was owned by Ann Arbor, Mich.-based Affina Group Inc. until May, when the company sold its chassis component business to Federal-Mogul. The Oklahoma City plant includes a 122,712-square-foot heavy manufacturing plant and an 86,400-square-foot warehouse off of Interstate 35 in southeast Oklahoma City.

Affina has accepted tax money to create new jobs at the Oklahoma manufacturing plant through the state’s Quality Jobs Program, which gives companies quarterly cash payments to locate and expand in the state. The job creation payments are based on payroll numbers and companies can receive payments for up to 10 years.

Affina has received $899,845 in incentive payments from the state since 2007 through the Quality Jobs Program, including $31,090 in 2014, according to the Oklahoma Tax Commission.

- Oklahoma City manufacturing plant to close - Tulsa World: Manufacturing

[Chadanth]

I think a change in this law is needed. Doesn't sound right that they can receive this money for creating jobs and then close it.

Why should any company receive taxpayer money?

[kelroy55]

Thanks Obama

[Plutonic Panda]

Why should any company receive taxpayer money?

I'm not going to say I disagree with that. But this is Oklahoma and for some reason we love to give huge breaks to these companies, but we should at least be smart about it. I can't believe you can create some jobs, receive nearly a million dollars from the state, and then get rid of those jobs 6 years later.

[Plutonic Panda]

Thanks Obama

Read a comment this morning where a guy in Guthrie blamed Obama for a Guthrie school not having a heater because he loves illegal aliens. He was serious to. Thought that was pretty funny.

[jerrywall]

I'm not going to say I disagree with that. But this is Oklahoma and for some reason we love to give huge breaks to these companies, but we should at least be smart about it. I can't believe you can create some jobs, receive nearly a million dollars from the state, and then get rid of those jobs 6 years later.

To be accurate, as far as I know, the only payments they receive is 5% credit on the payroll taxes for new jobs created. So they're not getting "free" money handed to them. Or getting more money than they paid to the state. (I'm sure someone will correct me if I misunderstand the jobs program). Basically, the argument that someone would make is that it's better to get 95% of the payroll taxes for a new job created than 0% if the job doesn't get created here. Now, it might be questionable if the 5% rebate is enough incentive to cause a job to be created here... but at the end of the day, if the plant received $900k in rebates, it means they paid in $18,000,000 in new payroll tax revenues that wouldn't have existed if they weren't here.

[adaniel]

As much as I detest corporate welfare, Oklahoma's Quality Jobs program is one of the more sensible ones out there. A company can only qualify if the median wage they plan to create is over the county median wage, so no handouts for low paying stuff. Also, these payments are stretched out over several years; if you don't meet the job creation numbers you don't get the money.

Contrast that to Texas Enterprise Fund (which the new governor has already stated is out of control and will be reigned in) or Kansas PEAK Funds (which are being used to lure companies in KCMO 4 or 5 miles across the state border resulting in no job gain). Both of these are blank check slush funds and very ripe for abuse.

Given the fact that OK's incentive program is "pay as you perform," it doesn't look like this company will be receiving their full amount. So the whole premise of this thread is a bit misleading.

[Rover]

Thanks Obama

Seriously? I hope you are trying to be funny, because if this is serious it just shows how uninformed people can be. Or else the blind hate for Obama knows no rational thought.

I heard someone say that if Obama walked on water, the tea partiers would make a big fuss on Fox news that he couldn't swim and was trying to drown us all. LOL. This is the depths of how irrational we have become.

[jerrywall]

Seriously? I hope you are trying to be funny, because if this is serious it just shows how uninformed people can be. Or else the blind hate for Obama knows no rational thought.

I heard someone say that if Obama walked on water, the tea partiers would make a big fuss on Fox news that he couldn't swim and was trying to drown us all. LOL. This is the depths of how irrational we have become.

One, you really don't know Kelroy if you thought he was serious. Two, it is an old LBJ quote you're referencing. "If one morning I walked on top of the water across the Potomac River, the headline that afternoon would read: 'President Can't Swim.'" Which should tell you, politics has ALWAYS been irrational.

[onthestrip]

As much as I detest corporate welfare, Oklahoma's Quality Jobs program is one of the more sensible ones out there. A company can only qualify if the median wage they plan to create is over the county median wage, so no handouts for low paying stuff. Also, these payments are stretched out over several years; if you don't meet the job creation numbers you don't get the money.

Contrast that to Texas Enterprise Fund (which the new governor has already stated is out of control and will be reigned in) or Kansas PEAK Funds (which are being used to lure companies in KCMO 4 or 5 miles across the state border resulting in no job gain). Both of these are blank check slush funds and very ripe for abuse.

Given the fact that OK's incentive program is "pay as you perform," it doesn't look like this company will be receiving their full amount. So the whole premise of this thread is a bit misleading.

It may have started sensible but I dont like the fact that it was changed from going to companies that are moving jobs here to now also going to existing Okla companies that can pretend they are going to move jobs out of state. So now taxpayer money is given to an existing Oklahoma company to add jobs that they probably would have done anyways. Was Chesapeake or Sandridge really going to move their headquarters?
Nearly a billion dollars have been given out in the QJA 20 year or so history. I just wonder if its worth it.

[jerrywall]

It may have started sensible but I dont like the fact that it was changed from going to companies that are moving jobs here to now also going to existing Okla companies that can pretend they are going to move jobs out of state. So now taxpayer money is given to an existing Oklahoma company to add jobs that they probably would have done anyways. Was Chesapeake or Sandridge really going to move their headquarters?
Nearly a billion dollars have been given out in the QJA 20 year or so history. I just wonder if its worth it.

I agree that it should not be offered to existing Oklahoma companies... makes it seem like it would be too tempting for a company to hold the state "hostage".

[onthestrip]

Here is who received the most of it in 2013. Even the Thunder got in on the action, when they clearly were already going to come here. BTW, I think I saw recently that the Thunder profited $24 million last year, not to mention the increased value of the team from year to year.

Ten Largest Quality Jobs Payment Recipients, FY 2013
Chesapeake Energy $8,268,951 ConocoPhillips $3,250,975
Sandridge Energy $6,147,396 Dell Computers $3,238,774
Spirit Aerosystems $4,871,726 Holly Refining & Marketing $3,173,779
Boeing $3,589,428 Phillips 66 $3,055,624
Professional Basketball Club* $3,575,201 Devon Energy $3,021,064

[Rover]

One, you really don't know Kelroy if you thought he was serious. Two, it is an old LBJ quote you're referencing. "If one morning I walked on top of the water across the Potomac River, the headline that afternoon would read: 'President Can't Swim.'" Which should tell you, politics has ALWAYS been irrational.

You are right, I don't know him. The mistake many make on posting is that most people don't know the person posting and have to take things at face value.

Yes, politics has always been irrational...just at new heights now due to 24-7 information and disinformation media, social media, and other communications.