INDIANAPOLIS (Feb. 21, 2016) – Millions of dollars were given to Carrier to keep their production plant in Indianapolis.
But the company just announced last week that they were moving the plant, along with its 1,400 jobs, to Mexico, in order to cut costs.
That announcement received a ton of national backlash and now, city and state governments may be demanding money back that Carrier was given to stay in Indiana.
Carrier cited high costs as the reason they decided to move the plant to Mexico. Carrier’s parent company, a Fortune 500 company, profited $56 billion in 2015.
The news came as a complete shock to the 1,400 employees at the Indianapolis plant last week, especially considering the company agreed to a multi-million dollar expansion in 2011. The city provided a six-year tax abatement, which got Carrier out of paying nearly $1 million in city property taxes.
Indianapolis Mayor Joe Hogsett promised to get that money back.
“If there have been incentives given to them that were based on commitments the company made, then we’re going to force them to honor their commitments,” he said last week.
“Especially given the fact they were given millions of dollars by the federal government, it concerns me,” said U.S. Rep. Andre Carson (D – Indianapolis).
The city isn’t the only group left hanging from a Carrier contract. In 2013, the feds offered Carrier $5.1 million in clean tax credits to ramp up production in Indy. Since 2013, the Indiana Economic Development Corporation gave Carrier almost $200,000 dollars in employee training grants.
Since Carrier is still under contract in Indianapolis, all that money will likely be taken back.
Carson blamed unfair trade agreements, like NAFTA, that make it easy for American companies to move American jobs overseas.
“We have tax loopholes that need to be closed and we have members of congress who are supporting these damaging trade deals that ship our jobs overseas, it must stop,” he said.
The move even made national headlines. In the latest republican presidential debate Saturday, Donald Trump weighed in.
“You’re going to go to Mexico across the border with no tax, I’m going to tell them I’m going to get consensus from Congress and we’re going to tax you when those air conditioners come so stay where you are or build in the United States,” he said.
Indiana Governor Mike Pence weighed in Monday as well and said he had directed the Indiana Department of Workforce Development to assist in finding the 1,400 soon to be unemployed Hoosiers, new jobs.
Carrier responded to a request for comment, saying they have not received and will not claim the $5 million federal tax credit:
“In 2013, Carrier was awarded a $5.1 million Advanced Energy Project Credit, which we would have been eligible to claim in 2016,” said a spokesperson for Carrier. “We have not received and will not claim this federal tax credit. We are evaluating other grants and credits that have been awarded and will not retain or claim any credits for obligations that have not been met.”
Still, a bi-partisan group of officials, including Hogsett and Pence, are hoping they can somehow convince Carrier to stick around. They co-authored a letter to Carrier executives with Senators Dan Coats and Joe Donnelly, and two Indiana congressman this past week.
In that letter, the elected officials wrote:
“While we struggle to understand the basis of your business decision, we continue to believe that when we work together we can solve most problems.“We understand that you are meeting with union officials to discuss the decision to move your operations to Mexico. We ask that Carrier, UTEC, and United Technologies also meet with our offices to discuss this issue, and hope that you come to the table in good faith and work to find a solution to continue this partnership that has brought success to your company and strengthened our communities.“On behalf of the workers at Carrier and UTEC and the Hoosier communities in which they live, we stand ready to support these discussions.”