Cities gave financial incentives to IBM

COLUMBIA — Both Columbia and Dubuque, Iowa, dangled carrots to lure IBM to open customer service centers that are expected to create hundreds of jobs for their communities.

The incentive packages offered were mainly in the form of tax credits, tax exemptions and promises to assist Big Blue in the initial setup processes, such as recruitment and training of new employees.

Both the state and local governments chipped in to ensure success of what were termed as highly competitive bids among dozens of cities.

Critics of the deals cite the secretive manner in which they were handled and the generous packages that Big Blue — a corporate giant that already makes billions of dollars in annual profits — stands to enjoy, but those involved in both transactions say IBM has given contractual commitments that guarantee positive returns on investment.

Below is a breakdown of the incentives that were offered in the respective deals:

THE DUBUQUE, IOWA, IBM SERVICE CENTER INCENTIVE PACKAGE:

• Dubuque Initiatives       $24,427,986

• City of Dubuque              $5,549,447

• State of Iowa                    $13,988,600

• NICC Com. College          $8,500,000

• Misc. Incentives               $52,500

TOTAL                                        $52,518,533

THE COLUMBIA IBM SERVICE CENTER INCENTIVE PACKAGE:

• Missouri BUILD Program             $8,600,000
• Missouri Quality Jobs                    $14,700,000
• New Jobs Training                          $4,200,000
• Customized Training Grant          $300,000
• Recruitment Assistance                 $400,000
• Sales Tax Exemption on personal property to be determined under chapter 100 bonds
• Purchase of building                      $3,000,000
•  Work force training and office space donation

TOTAL                                              $31,200,000