Canadian Corporate Welfare to Watch

In late 2009, Windsor Machine Group from Ontario, Canada, committed to bringing $4 million of its own money and 130 jobs to the Gibson County area (Evansville).  The Indiana Economic Development Corporation gave them $275,000 in performance based tax credits and they also received $39,000 to train the new hires.  They were also promised additional property tax abatement (the exact amount is unknown at the time of this post).

Just last month, the Economic Development Coalition of Southwest Indiana requested and was awarded a grant from the Indiana Office of Community & Rural Affairs (that they get from US Housing and Urban Development) on Windsor's behalf for an expansion.  A grant of $500,000 was awarded to assist Windsor in purchasing equipment to produce head rests for the Toyota Plant and potentially a Ford project, too.  This grant promised 50 new jobs, of which 42 are reserved for low-to-moderate income families in the Gibson County area.  They will pay $10.00 per hour, with an added $5 per hour in benefits (health insurance and holiday pay). 

This essentially means that we've given Windsor Machine, a Canadian company, $875,000 in tax payer money over the last few months in exchange for more than 150 low wage jobs (some of the 180 new jobs are supervisory at $15+ per hour).  Plus, they will have additional money given to them in the form of tax abatement - which hurts the local economy by giving away money that would have been spent on schools, public services and public safety.

There is an added twist:  The recent grant that they received requires them to hire workers from low to moderate income families for at least 51% of the jobs.  They have to pay back some of the money if they do not meet this performance indicator.  That seems like an easy incentive for the company- why pay the workers higher wages which could pull them out of poverty and make them ineligible for the grant? 

This is something the tax payers in Gibson County should watch - and all across Indiana for that matter, because your tax payer dollars from the state went into this project, too.  Everyday we give away millions of dollars to companies in exchange for jobs - and we should care about the types of jobs our tax dollars are creating; especially if the families then have to apply for public assistance to make ends meet.

Do you have more questions about this?  Contact Debbie Bennett Stearsman, Grant Administrator at (812) 423-2020 or dbennett@southwestindiana.org