by Karen Pierog and Lisa Lambert
WASHINGTON, June 4 (Reuters) - The federal government may soon award stimulus money to a project that will move hundreds of jobs out of an area crippled by the recession, conflicting the goal of keeping Americans employed, Ohio officials say.
The officials are concerned that a grant authorized by the American Recovery and Reinvestment Act will be part of an incentive package to have automated teller machine company, NCR Corp, consolidate its operations in Georgia.
NCR said on Tuesday it will move its headquarters to Duluth, Georgia, from Dayton, Ohio, and locate a manufacturing facility in Columbus, Georgia, that the city would buy with stimulus money and then lease to NRC.
'The use of stimulus funds means that Ohio taxpayers were forced to pay for NCR's move to Georgia,' said Ohio State Senator Jon Husted, a Kettering Republican, in a statement. 'I hope our federal officials will act swiftly to stop this expenditure of tax dollars that would allow one state to lure away jobs from another state.'
Bert Brantley, spokesman for Georgia Governor Sonny Perdue, said it was the state's understanding that the grant application had nothing to do with moving NCR's headquarters.
A representative from the Columbus Development Authority said the city it wasn't aware of the headquarters move during the negotiations for the plant.
'We didn't even know about the headquarters piece until like two weeks before it was announced,' said Becca Hardin, adding there may have been coordination at the state level.
'These are brand new jobs to the United States,' she added.
Richard Maton, an NCR spokesman, also said the decisions on where to locate its headquarters and new plant were taken separately.
But Matt Joseph, a Dayton city commissioner, said the company was lured to Georgia by the total package.
'I'm going to protest as loudly and strongly as I can,' Joseph said, adding the deal was not in the spirit of the stimulus act's goal to create or save jobs.
RECESSION WOES
The stimulus plan allots $150 million for the Economic Development Administration to give to distressed areas for job creation and business development. The agency will soon announce grant recipients, said spokesman Bryan Borlik.
In weighing the Columbus application for a $5.5 million grant that arrived this week, the EDA will factor in the city's economic woes but not Dayton's, because it does not want to 'get into the back and forth between the two regions,' he said.
Ohio Governor Ted Strickland expressed concern that the deal goes against the recovery act's intent.
'The governor believes federal recovery act resources were provided to states to create and retain jobs in their communities, not to be used as a tool to raid jobs in other states,' said Amanda Wurst, his spokeswoman.
NCR's decision will cost Dayton about 1,200 jobs and approximately $2.5 million in annual income tax revenue for its $158 million general fund budget at a time when income tax collections were already down, according to Joseph.
The 17-month recession has hammered the state. In April, Ohio's unemployment rate stood at 10.2 percent and Georgia's at 9.3 percent, both above the national rate.
Dayton, with a jobless rate of 11.3 percent, has been especially hard hit.
On Tuesday, NCR said it may transfer some of its 1,200 Dayton jobs to Duluth and the Columbus plant will employ about 870 workers. It also said it will create 'a single innovation hub for its worldwide headquarters in Georgia.'
(additional reporting by Anupreeta Das in New York) Keywords: USA ECONOMY/STIMULUS OHIO (lisa.lambert@thomsonreuters.com; +1-202-898-8328; Reuters Messaging: lisa.lambert.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
WASHINGTON, June 4 (Reuters) - The federal government may soon award stimulus money to a project that will move hundreds of jobs out of an area crippled by the recession, conflicting the goal of keeping Americans employed, Ohio officials say.
The officials are concerned that a grant authorized by the American Recovery and Reinvestment Act will be part of an incentive package to have automated teller machine company, NCR Corp, consolidate its operations in Georgia.
NCR said on Tuesday it will move its headquarters to Duluth, Georgia, from Dayton, Ohio, and locate a manufacturing facility in Columbus, Georgia, that the city would buy with stimulus money and then lease to NRC.
'The use of stimulus funds means that Ohio taxpayers were forced to pay for NCR's move to Georgia,' said Ohio State Senator Jon Husted, a Kettering Republican, in a statement. 'I hope our federal officials will act swiftly to stop this expenditure of tax dollars that would allow one state to lure away jobs from another state.'
Bert Brantley, spokesman for Georgia Governor Sonny Perdue, said it was the state's understanding that the grant application had nothing to do with moving NCR's headquarters.
A representative from the Columbus Development Authority said the city it wasn't aware of the headquarters move during the negotiations for the plant.
'We didn't even know about the headquarters piece until like two weeks before it was announced,' said Becca Hardin, adding there may have been coordination at the state level.
'These are brand new jobs to the United States,' she added.
Richard Maton, an NCR spokesman, also said the decisions on where to locate its headquarters and new plant were taken separately.
But Matt Joseph, a Dayton city commissioner, said the company was lured to Georgia by the total package.
'I'm going to protest as loudly and strongly as I can,' Joseph said, adding the deal was not in the spirit of the stimulus act's goal to create or save jobs.
RECESSION WOES
The stimulus plan allots $150 million for the Economic Development Administration to give to distressed areas for job creation and business development. The agency will soon announce grant recipients, said spokesman Bryan Borlik.
In weighing the Columbus application for a $5.5 million grant that arrived this week, the EDA will factor in the city's economic woes but not Dayton's, because it does not want to 'get into the back and forth between the two regions,' he said.
Ohio Governor Ted Strickland expressed concern that the deal goes against the recovery act's intent.
'The governor believes federal recovery act resources were provided to states to create and retain jobs in their communities, not to be used as a tool to raid jobs in other states,' said Amanda Wurst, his spokeswoman.
NCR's decision will cost Dayton about 1,200 jobs and approximately $2.5 million in annual income tax revenue for its $158 million general fund budget at a time when income tax collections were already down, according to Joseph.
The 17-month recession has hammered the state. In April, Ohio's unemployment rate stood at 10.2 percent and Georgia's at 9.3 percent, both above the national rate.
Dayton, with a jobless rate of 11.3 percent, has been especially hard hit.
On Tuesday, NCR said it may transfer some of its 1,200 Dayton jobs to Duluth and the Columbus plant will employ about 870 workers. It also said it will create 'a single innovation hub for its worldwide headquarters in Georgia.'
(additional reporting by Anupreeta Das in New York) Keywords: USA ECONOMY/STIMULUS OHIO (lisa.lambert@thomsonreuters.com; +1-202-898-8328; Reuters Messaging: lisa.lambert.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.