Occupy Bell Helicopter?
To get an idea of why people are so angry at corporate America and the political class, consider a local exchange last week. Bell Helicopter negotiated an 80 percent tax abatement for 20 years, and a Fort Worth councilman called it "a good example" of how the city can help its own.
It might as well have been high-fives all around the table and a big wink: That's just how the 1 percent roll.
It's a bit unfair to single out Bell here, because employers big and small are constantly putting the squeeze on their communities, as though dodging taxes is the new American pastime. Since spring, local tax-break babies have included prized companies such as General Motors, General Electric, Alcon and In-N-Out Burger.
By the usual standards used to measure these things (the size of the tax break versus private investment), Bell's package is solid. It's seeking $13.5 million in abatements from the city and $4 million more from Tarrant County, and it pledges to spend $235 million on new facilities at its longtime headquarters.
Compare that with the worst deal ever: Last year, RadioShack managed to get a $10.7 million tax break in exchange for a short-term, below-market sublet in a building it already rented.
But Bell's deal arrives at a time when the Occupy Wall Street movement is capturing the frustrations of many Americans. In dozens of cities including Fort Worth and Dallas, protesters have complained about a surge in inequality and about the way the rich and powerful play by their own rules. While the most elite citizens collect most of the benefits of the economy, protesters say everyone else has to deal with rising unemployment, declining income and a lower standard of living.
"We are the 99 percent that will no longer tolerate the greed and corruption of the 1 percent," the group declares on its website.
View the Bell proposal through that prism, and it's pretty clear which side of the divide the company falls on. Bell's argument is pretty simple: It's putting big money into east Fort Worth and agreeing to keep at least 4,500 workers here for the rest of the decade.
That's great for the local economy, even if it merely moves people from one part of the city to another, rather than create jobs. If consolidating around a new headquarters helps Bell be more competitive and win more contracts, it's even better. But I asked Bell's lead man on the deal, "What does that have to do with paying your fair share of taxes?"
He said that Bell generated $7.6 billion in economic impact in the state, including almost 40,000 direct and indirect jobs.
"That's the fair share that Bell brings to this community," said Robert Hastings, senior vice president of communications. "You've got to look at the whole picture."
This sounds a lot like the stalemate over tax policy in Washington. Should those who make more pay more -- or should they get a break because they're already paying far more than anyone else?
Warren Buffett and Mark Cuban have entered the national debate. They say it's a privilege to pay higher taxes, an obligation that comes with great success.
When Bob Simpson and XTO Energy renovated several important buildings in downtown Fort Worth, they never asked for a tax break.
They're the exception. Most see tax breaks as one more item on the financial checklist. City staffers and even elected officials don't have much leverage in these discussions. In theory, Bell could choose to improve facilities across the county line, the kind of threat that the chamber of commerce always cites, no matter how hollow it is.
But if companies play hardball -- RadioShack convened a meeting of competing cities to drive home its intentions -- who's going to blink?
The state limits tax abatements to 10 years, as if to protect communities from themselves. So Tarrant County proposes a 70 percent abatement for 10 years on Bell's improvements. But Fort Worth is using a loophole, a so-called 380 agreement, so it can offer an 80 percent abatement for two decades.
Officials spent six months negotiating the tax breaks down to that, so imagine where Bell's consultants started.
It's notable that Bell CEO John Garrison hasn't met with city officials about the incentives. Maybe he'll appear when the City Council votes on Bell's request this month. Hastings, who joined Bell in April 2010, less than a year after Garrison, led the initiative.
Have they been around here long enough to be embarrassed by putting the touch on the city? Heck, are any execs anywhere embarrassed by such things?
Hastings is proud to say that Bell isn't asking for an abatement on school taxes. They're usually much tougher to get, but Hastings said Bell passed because education faces so many fiscal problems.
True enough. But Fort Worth has also had a budget crunch in recent years. It laid off workers, closed swimming pools and took other measures. And there isn't a lot of money at stake here for Bell.
Over 20 years, all the incentives total $17.8 million. Calculate the net present value and Bell's tax rate (because municipal taxes are deductible), and the number is closer to $10 million.
How crucial is that to a company that generated $2.5 billion in sales and $354 million in operating profit through three quarters? Hastings said it's plenty important, noting that Bell recently lost a major contract because a rival's costs were $2 less per hour.
Every business is cutthroat these days. Despite those pressures, Bell's parent, Textron Corp., paid out $22 million in dividends last year, $21 million the year before, and $284 million in 2008.
Maybe Bell really can't afford to pay all its taxes to Fort Worth. But it's paying Wall Street.
© 2023 McClatchy
Occupy Bell Helicopter?
To get an idea of why people are so angry at corporate America and the political class, consider a local exchange last week. Bell Helicopter negotiated an 80 percent tax abatement for 20 years, and a Fort Worth councilman called it "a good example" of how the city can help its own.
It might as well have been high-fives all around the table and a big wink: That's just how the 1 percent roll.
It's a bit unfair to single out Bell here, because employers big and small are constantly putting the squeeze on their communities, as though dodging taxes is the new American pastime. Since spring, local tax-break babies have included prized companies such as General Motors, General Electric, Alcon and In-N-Out Burger.
By the usual standards used to measure these things (the size of the tax break versus private investment), Bell's package is solid. It's seeking $13.5 million in abatements from the city and $4 million more from Tarrant County, and it pledges to spend $235 million on new facilities at its longtime headquarters.
Compare that with the worst deal ever: Last year, RadioShack managed to get a $10.7 million tax break in exchange for a short-term, below-market sublet in a building it already rented.
But Bell's deal arrives at a time when the Occupy Wall Street movement is capturing the frustrations of many Americans. In dozens of cities including Fort Worth and Dallas, protesters have complained about a surge in inequality and about the way the rich and powerful play by their own rules. While the most elite citizens collect most of the benefits of the economy, protesters say everyone else has to deal with rising unemployment, declining income and a lower standard of living.
"We are the 99 percent that will no longer tolerate the greed and corruption of the 1 percent," the group declares on its website.
View the Bell proposal through that prism, and it's pretty clear which side of the divide the company falls on. Bell's argument is pretty simple: It's putting big money into east Fort Worth and agreeing to keep at least 4,500 workers here for the rest of the decade.
That's great for the local economy, even if it merely moves people from one part of the city to another, rather than create jobs. If consolidating around a new headquarters helps Bell be more competitive and win more contracts, it's even better. But I asked Bell's lead man on the deal, "What does that have to do with paying your fair share of taxes?"
He said that Bell generated $7.6 billion in economic impact in the state, including almost 40,000 direct and indirect jobs.
"That's the fair share that Bell brings to this community," said Robert Hastings, senior vice president of communications. "You've got to look at the whole picture."
This sounds a lot like the stalemate over tax policy in Washington. Should those who make more pay more -- or should they get a break because they're already paying far more than anyone else?
Warren Buffett and Mark Cuban have entered the national debate. They say it's a privilege to pay higher taxes, an obligation that comes with great success.
When Bob Simpson and XTO Energy renovated several important buildings in downtown Fort Worth, they never asked for a tax break.
They're the exception. Most see tax breaks as one more item on the financial checklist. City staffers and even elected officials don't have much leverage in these discussions. In theory, Bell could choose to improve facilities across the county line, the kind of threat that the chamber of commerce always cites, no matter how hollow it is.
But if companies play hardball -- RadioShack convened a meeting of competing cities to drive home its intentions -- who's going to blink?
The state limits tax abatements to 10 years, as if to protect communities from themselves. So Tarrant County proposes a 70 percent abatement for 10 years on Bell's improvements. But Fort Worth is using a loophole, a so-called 380 agreement, so it can offer an 80 percent abatement for two decades.
Officials spent six months negotiating the tax breaks down to that, so imagine where Bell's consultants started.
It's notable that Bell CEO John Garrison hasn't met with city officials about the incentives. Maybe he'll appear when the City Council votes on Bell's request this month. Hastings, who joined Bell in April 2010, less than a year after Garrison, led the initiative.
Have they been around here long enough to be embarrassed by putting the touch on the city? Heck, are any execs anywhere embarrassed by such things?
Hastings is proud to say that Bell isn't asking for an abatement on school taxes. They're usually much tougher to get, but Hastings said Bell passed because education faces so many fiscal problems.
True enough. But Fort Worth has also had a budget crunch in recent years. It laid off workers, closed swimming pools and took other measures. And there isn't a lot of money at stake here for Bell.
Over 20 years, all the incentives total $17.8 million. Calculate the net present value and Bell's tax rate (because municipal taxes are deductible), and the number is closer to $10 million.
How crucial is that to a company that generated $2.5 billion in sales and $354 million in operating profit through three quarters? Hastings said it's plenty important, noting that Bell recently lost a major contract because a rival's costs were $2 less per hour.
Every business is cutthroat these days. Despite those pressures, Bell's parent, Textron Corp., paid out $22 million in dividends last year, $21 million the year before, and $284 million in 2008.
Maybe Bell really can't afford to pay all its taxes to Fort Worth. But it's paying Wall Street.
Occupy Bell Helicopter?
To get an idea of why people are so angry at corporate America and the political class, consider a local exchange last week. Bell Helicopter negotiated an 80 percent tax abatement for 20 years, and a Fort Worth councilman called it "a good example" of how the city can help its own.
It might as well have been high-fives all around the table and a big wink: That's just how the 1 percent roll.
It's a bit unfair to single out Bell here, because employers big and small are constantly putting the squeeze on their communities, as though dodging taxes is the new American pastime. Since spring, local tax-break babies have included prized companies such as General Motors, General Electric, Alcon and In-N-Out Burger.
By the usual standards used to measure these things (the size of the tax break versus private investment), Bell's package is solid. It's seeking $13.5 million in abatements from the city and $4 million more from Tarrant County, and it pledges to spend $235 million on new facilities at its longtime headquarters.
Compare that with the worst deal ever: Last year, RadioShack managed to get a $10.7 million tax break in exchange for a short-term, below-market sublet in a building it already rented.
But Bell's deal arrives at a time when the Occupy Wall Street movement is capturing the frustrations of many Americans. In dozens of cities including Fort Worth and Dallas, protesters have complained about a surge in inequality and about the way the rich and powerful play by their own rules. While the most elite citizens collect most of the benefits of the economy, protesters say everyone else has to deal with rising unemployment, declining income and a lower standard of living.
"We are the 99 percent that will no longer tolerate the greed and corruption of the 1 percent," the group declares on its website.
View the Bell proposal through that prism, and it's pretty clear which side of the divide the company falls on. Bell's argument is pretty simple: It's putting big money into east Fort Worth and agreeing to keep at least 4,500 workers here for the rest of the decade.
That's great for the local economy, even if it merely moves people from one part of the city to another, rather than create jobs. If consolidating around a new headquarters helps Bell be more competitive and win more contracts, it's even better. But I asked Bell's lead man on the deal, "What does that have to do with paying your fair share of taxes?"
He said that Bell generated $7.6 billion in economic impact in the state, including almost 40,000 direct and indirect jobs.
"That's the fair share that Bell brings to this community," said Robert Hastings, senior vice president of communications. "You've got to look at the whole picture."
This sounds a lot like the stalemate over tax policy in Washington. Should those who make more pay more -- or should they get a break because they're already paying far more than anyone else?
Warren Buffett and Mark Cuban have entered the national debate. They say it's a privilege to pay higher taxes, an obligation that comes with great success.
When Bob Simpson and XTO Energy renovated several important buildings in downtown Fort Worth, they never asked for a tax break.
They're the exception. Most see tax breaks as one more item on the financial checklist. City staffers and even elected officials don't have much leverage in these discussions. In theory, Bell could choose to improve facilities across the county line, the kind of threat that the chamber of commerce always cites, no matter how hollow it is.
But if companies play hardball -- RadioShack convened a meeting of competing cities to drive home its intentions -- who's going to blink?
The state limits tax abatements to 10 years, as if to protect communities from themselves. So Tarrant County proposes a 70 percent abatement for 10 years on Bell's improvements. But Fort Worth is using a loophole, a so-called 380 agreement, so it can offer an 80 percent abatement for two decades.
Officials spent six months negotiating the tax breaks down to that, so imagine where Bell's consultants started.
It's notable that Bell CEO John Garrison hasn't met with city officials about the incentives. Maybe he'll appear when the City Council votes on Bell's request this month. Hastings, who joined Bell in April 2010, less than a year after Garrison, led the initiative.
Have they been around here long enough to be embarrassed by putting the touch on the city? Heck, are any execs anywhere embarrassed by such things?
Hastings is proud to say that Bell isn't asking for an abatement on school taxes. They're usually much tougher to get, but Hastings said Bell passed because education faces so many fiscal problems.
True enough. But Fort Worth has also had a budget crunch in recent years. It laid off workers, closed swimming pools and took other measures. And there isn't a lot of money at stake here for Bell.
Over 20 years, all the incentives total $17.8 million. Calculate the net present value and Bell's tax rate (because municipal taxes are deductible), and the number is closer to $10 million.
How crucial is that to a company that generated $2.5 billion in sales and $354 million in operating profit through three quarters? Hastings said it's plenty important, noting that Bell recently lost a major contract because a rival's costs were $2 less per hour.
Every business is cutthroat these days. Despite those pressures, Bell's parent, Textron Corp., paid out $22 million in dividends last year, $21 million the year before, and $284 million in 2008.
Maybe Bell really can't afford to pay all its taxes to Fort Worth. But it's paying Wall Street.