LITTLE ROCK, Ark. (KTHV) - The state of Arkansas is looking to regain money that was invested in companies to bring them and more job opportunities to Arkansas.
"One of the first words out of their mouths when they came to tell us what was happening was, 'We know we're going to owe you some money back,'" Grant Tennille explained. Tennille, director of the Arkansas Economic Development Commission, said when Nordex and Hewlett-Packard showed interest in coming to Arkansas, the state invested millions of dollars in incentives. "When we do these incentive deals, they are all based on performance."
When the company reaches a certain employment level by a certain date, the state monetarily rewards them, but when they don't meet those expectations, that is when they have to pay the state back.
"The state's made this investment, Hewlett-Packard acknowledges it, acknowledges that they owe some money back," added Tennille. "But, at the same time, we want to continue to support a very important employer."
At the end of June, Nordex halted production in their Jonesboro facility, cutting 40 of approximately 100 workers. Recently, the HP facility in Conway announced they would lay off 500 of their 1,400 employees.
"They'll return some of the money to the state," Tennille explained. "We will take that money and put it back to work in another deal."
With this happening twice in the span of two months, we wondered what it means for us as tax payers. Tennille said we should not worry; the incentive programs are working exactly as they were designed.
"We feel confident in the companies that we've made these deals with and feel like on the long term, they were good investments, and I believe they will continue to pay off for the state of Arkansa," he concluded.