Austin Approves $8.M Incentive for Apple Campus, Jobs

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Austin’s City Council unanimously approved a US$8.6 million incentive deal on Thursday for Apple to double its local workforce and build a new campus to house the extra employees. The city’s deal will be part of a $33.5 million incentive package Texas is offering Apple to get the new jobs and campus.

Apple’s growth plans include adding 3,600 more employees to its 3,100 already in the area, and expanding its office facilities in the city. The state so far is committing a $21 million investment to keep Apple from looking at other cities.

Austin Approves $8.6M tax deal for Apple ExpansionAustin Approves $8.6M tax deal for Apple Expansion

While the growth is good news for Austin and the Texas economy, not everyone was pleased with the city’s decision to spend millions on what they see as an unnecessary expense, according to The Statesman. Austin’s City Council decided the package was needed to lock Apple in after word surfaced that the Mac and iPad maker was also considering Phoenix for its expansion.

Apparently Arizona lawmakers said the city was never really a serious consideration for Apple, leaving Austin locals feeling like the new jobs would’ve come to their home town without any extra expense.

Without Austin’s incentive deal, however, the $21 million from the Texas Enterprise Fund program wouldn’t be available, and Apple had already said that it couldn’t move forward in the state without that package.

City officials see the deal as a small price to pay to bring new jobs to the area. Apple’s city incentive package will give the company the $8.6 million through a ten-year personal and real property tax waiver.

“There are 25,000 people in Austin, Texas, today looking for work who can’t find it,” commented Austin Council Member Bill Spelman. “We are only six months away from the worst unemployment figure since the city starting tracking it, and it would be premature for us to think we’re out of it.”

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Comments

geoduck

Without Austin?s incentive deal, however, the $21 million from the Texas Enterprise Fund program wouldn?t be available, and Apple had already said that it couldn?t move forward in the state without that package.

Riiiiiiiight.
They just couldn’t afford to expand without this grant from the state and city. It’s not like they have a secret $97bln in the bank or anything.

/sarcasm

zewazir

Corporate welfare for the wealthiest corporation in the world? I don’t think so. Laws which create a positive environment for business are one thing.  Paying companies to move in are an entirely different matter.  If the environment is wrong without the bribes, they’re probably wrong for the long term stability of the enterprise, anyway.

As for Apple: they’ve made a ton of money legitimately by offering products which have people camping out on sidewalks to get. WHY do they need taxpayer money on top of that? The welfare state is KILLING the world economy. It MUST end!!

geoduck

WHY do they need taxpayer money on top of that?

Dead right.
And don’t get me started on the corporate welfare for sports stadiums.

ibuck

These tax incentives (aka giveaways, corporate welfare) will only cease when citizens pass initiatives outlawing them…and make officeholders criminally and civilly liable for such acts. Can Americans do that when we actually cannot even restrict campaign financing?

Lee Dronick

And don?t get me started on the corporate welfare for sports stadiums.

I am already started on it. The Chargers want San Diego to build them a stadium.

Laws which create a positive environment for business are one thing.? Paying companies to move in are an entirely different matter.?

Spot on. Although I have no problem with Los Angles paying the Chargers to move up there.

zewazir

Well, not only shame on the politicians of Austin and Texas for approving this, but double shame on Apple for asking/accepting (even insisting) on it in the first place.

To Corporate America: if you want the PEOPLE to stand on their own two feet, thus reducing your tax burden, how about YOU do the same?

geoduck

Can Americans do that when we actually cannot even restrict campaign financing?

The problem is that every time someone stands up and says we shouldn’t do this, the politician will reply that it would just disadvantage us. Our City can’t outlaw this because then the jobs would go to the next town. Our State can’t outlaw this because then the jobs would go to the next state. Our Country can’t outlaw this because then the jobs would go to the next country.
But it’s OK as long as corporations don’t start contributing to political campaigns. :grin:

zewazir

The politician wants to increase dependency on government as much as possible.  The more businesses and/or people are dependent on government, the more power government has.

Now, if this kind of thing were outlawed on the national level, then they could not claim any kind of disadvantage. Why would a business go elsewhere if they won’t get any better deal?  From that point on, it would depend on the economic environment set up by the state/county/municipality. That would set up an environment where taxes are leveled at the necessary (instead of trying to fund things that government should not be doing in the first place) and regulations which are necessary and reasonable, instead of regulations which do more to increase the power of some government agency than actually protect the people.

Lee Dronick

It is one of those things, well everything, that is both good and bad. Paying a business to open up brings jobs. Not just the jobs at the business, but industries that support the business and workers; Housing, retail, medical, transportation and such. On the other hand it opens a possibility for graft and corruption in politics.

kevin

you guys are missing the point… the Jobs would have gone to Arizona if they would not have given the incentive package..

its just like you buying a house or a car for Apple you are going to go with the best loacation and deal… this small ammont of investment will pay of for Austin later plus intrench a BIG company that will make it harder to fold up there operations here.

zewazir

So Arizona loses out because Austin had more money to bribe Apple with?

Why would Apple have chosen Arizona instead of Texas, if it were not for the tax-payer supported bribes? Are there genuine reasons for choosing Arizona over Texas, or was Apple making empty threats to get more free money they do not need to expand operations?

Or, if there are factors which make Arizona a more desirable location (sans taxpayer supported bribes), are those factors going to cost Apple in the long run? If Arizona would have been the better place for Apple to expand, then, by gosh, just MAYBE that should be where they build instead of being influenced by taxpayer money to build at a less-optimal location.

Noone is missing any points here. We are full aware of the ins and outs of corporate welfare being used to entice companies to locate in one place rather than another. We are aware the benefits of a corporation adding a bunch of jobs to a local economy.  Unlike some, though, it seems we are also aware of the NEGATIVE impact that NOT having those jobs in another place entails - especially if the other place would have been better overall for both the corporation and the locality.

The bottom line is that it is WRONG. Bribing companies with our tax dollars to do something they would not otherwise do is NOT what government should be doing with our money. And corporations should determine the best place to expand operations by other factors than how much they can soak the taxpayer for.

thevupster777

Well, not only shame on the politicians of Austin and Texas for approving this, but double shame on Apple for asking/accepting (even insisting) on it in the first place.

To Corporate America: if you want the PEOPLE to stand on their own two feet, thus reducing your tax burden, how about YOU do the same?

So in your view, Apple should say, “You know, we’re not going to go for the best possible deal because we don’t need to save.”

It’s called business! As an Apple shareholder, if Apple hadn’t tried to get the best deal they could, I would be the first one to call for a class action lawsuit for failure to act in the best interests of shareholders.

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