An unnamed Fortune 500 company might relocate its corporate headquarters to Lee County, and some hope taxpayer-funded grant money will help close the deal.
The Lee Board of County Commissioners will decide Tuesday whether to award a $4 million conditional incentive grant to the company — listed in government documents as “Project A” — to try to win it over.
The company would commit to employ 700 people in full-time positions at an average wage of $102,000 and would construct and equip a 300,000-square-foot headquarters office building at a total cost of about $68.7 million, according to documents from the upcoming commission meeting.
There is a small group of people who know the company’s actual name, and Jim Moore is one of them. Moore, the executive director of the Lee County Economic Development Office, said the confidentiality, allowed under Florida law, is a must.
“If we didn’t operate that way, we wouldn’t have a chance in doing anything like this,” Moore said.
And because the company has narrowed its choice between Lee and a location in another state, the incentive grant is also a must, according to Moore.
“That’s what the competition calls for,” he said.
The incentive money offered to Project A would come from the Financial Incentives for Recruiting Strategic Targets fund, known as FIRST grants.
The grant is “performance-based” and aims to “attract and grow high-value business projects,” its program guidelines explain. Applicant businesses have to hit eligibility requirements to be considered, including the creation of “at least 75 new full-time equivalent jobs within a three-year period, paying an average wage of at least 125 percent of the Lee County private-sector annual average wage,” program guidelines say.
Lee County’s average annual wage is $35,859, according to the Fort Myers Regional Partnership, the part of the county’s Economic Development Office focused on attracting high-wage businesses to the area. Financial Incentives for Recruiting Strategic Targets grants are one of the incentives Fort Myers Regional Partnership can offer.
Lee commissioners ultimately approve or deny each application.
Six companies have entered into FIRST grant agreements with Lee since the program was created in 2008. The fund has $7.45 million left of its original $25 million.
Of the FIRST grant recipients, two have exceeded the number of jobs that they committed to create, two are still in the process of creating the jobs required for them to meet their commitments, and two are in a state of performance limbo.
The companies whose job creation efforts have stalled: Source Interlink Cos. and VR Laboratories LLC.
Source Interlink — a media, publishing, merchandising and logistics company based in Bonita Springs — promised 50 jobs by April 9, 2015, through an expansion. It has reported none to date.
The contract for Source Interlink is in the process of being revised based on its updated two-year projections, according to Jennifer Berg, marketing and communications director for the Fort Myers Regional Partnership.
Because the company hasn’t yet met its requirements, the agency has yet to give the full amount of funding, she said.
VR Laboratories, a natural products company also based in Bonita Springs, promised 208 jobs by Dec. 31, 2017 and has created less than 10 so far.
That startup company was conditionally awarded $5 million in FIRST grant funds in 2011, the second highest amount agreed to in the history of the program. VR Laboratories has spent about $4.7 million of that money though its bottling plant in South Lee County remains fruitless.
The fallout from the VR Laboratories situation partly contributed to the resignation last year of former Lee County Manager Karen Hawes. The company is currently engaged in legal disputes with its contractors.
Former state Lt. Gov. Jeff Kottkamp left his position as CEO of VR Laboratories earlier this year.
Berg said Lee has since made adjustments to the FIRST grant program.
Comparing “Project A” to VR Laboratories is “not apples to apples” because the former has been around for about 90 years, Berg said.
The agreement between “Project A” and Lee County would protect the taxpayers’ $4 million investment because of built-in benchmarks, Berg said.
“Project A” would have to create 350 jobs and make a more than $46 million investment by Sept. 30, 2015. before it can receive the first $2 million grant payment from Lee.
To receive the second $2 million payment, “Project A” would have to create the remaining 350 jobs by the end of 2016 and have a total investment of $60 million.
“There is no risk to the county. They will not receive any funds until they have met considerable capital investment,” Berg said.
Though “Project A” would commit to creating 700 full-time jobs by 2015, about 1,704 new jobs could be created by 2017 in Lee County as a result of this project, according to an analysis by Gary Jackson, director of the Regional Economic Research Institute at Florida Gulf Coast University.
“The study was designed to help the office and the general public and the county commission to understand what the potential ramifications are for the county,” he said.
Jackson said he does not know the name of the company, but the Lee County Economic Development Office provided him with the data he needed to complete his analysis.
The total economic impact to the area after “Project A” has completed its relocation could be around $300 million, according to Jackson.
“Project A” could bring in around $900,000 in property taxes annually and stimulate other industries, such as construction, Jackson projects.
“It creates jobs and incomes for others,” he said.
And Jackson said the company’s high average salary of $102,000 could be huge for Southwest Florida.
Local educational institutions such as FGCU, Edison State College and Hodges University could work with “Project A” to continue to develop the kind of workforce it would need to fill those high-wage jobs, Jackson said.
“One of the pillars of a vibrant community is having a good workforce,” he said. “We’re always looking for a way of building a better business environment.”
Moore said he knows “Project A” feels this region can meet its workforce needs or else it would not have kept Lee County in the running.
And he said “Project A” would be right at home in Southwest Florida.
“It never crossed my mind that they wouldn’t fit in,” Moore said.