On Monday the Bechtel Corporation announced it was pulling up stakes from Frederick, Md., and moving a "substantial" portion of its Maryland-based jobs across the Potomac to Reston, Virginia.
In doing so, the company is withdrawing from a multi-year grant that the Maryland state government paid to Bechtel to keep jobs in the state, reported Ed Waters Jr. of the Frederick News-Post:
In 2011, Maryland officials negotiated with Bechtel to keep 1,250 jobs in Frederick through December 2018. Bechtel received a $9.5 million state grant in the deal. According to the deal, Bechtel must report the number of Frederick jobs at the end of each year to the Maryland Department of Business and Economic Development and pay money back if the employee level falls below the agreed-upon number.
At the end of 2012, the company had agreed to pay $1,600 for each position fewer than 1,250. In each year after that, the repayment falls to $857 per employee.
Karen Glenn Hood, spokeswoman for the Maryland Department of Business and Economic Development, said Bechtel didn’t get the full amount of the state grant all at once.
“It was in increments, $1.5 million to $2 million. The state has received the full amount back, so we didn’t lose anything. We got the money back, plus interest,” Hood said in a telephone interview.
“We were able to keep those employees in Frederick for three years, that helped with income and sales taxes,” Hood said.
“I know several people who work at Bechtel,” Frederick County Commissioners President Blaine Young said. “It is unfortunate due to their change, consolidating divisions.”
“We fought to get Bechtel to Frederick County,” Young said.
But he disagrees with the state’s payment to keep the company in Maryland. Young said. The state had asked the county for money during the state’s negotiations, up to $2 million from the county to keep Bechtel in Frederick.
“Frederick County is pro-business, but we weren’t going to give Bechtel $2 million to stay,” Young said.
The move reflects the difficulty of doing business in Maryland, Young said, with higher taxes and regulations than Virginia. In 2011, Virginia provided Bechtel with $6.5 million in state grants to move some operations to Reston.
In fairness, Bechtel already has a strong presence in Reston, Va., and there are probably numerous factors for the relocation beyond the tax and regulatory environment in Maryland. That said, losing nearly 1,000 jobs to a neighboring state which has a lower tax and regulatory burden does underscore the complaint of conservatives and Republicans who oppose Lt. Gov. Anthony Brown and back the GOP candidate, Larry Hogan.
Perhaps that's why the Washington Post, which has subscribers and sells newsstand copies in Frederick County, Md., refused to carry even an Associated Press account of the story in the print edition. WashingtonPost.com readers can, however, read this brief AP account online, which apparently was condensed from earlier reporting by the Frederick News-Post:
FREDERICK, Md. — Bechtel (BEK’-tel) Corp. says it’s moving a substantial number of jobs from Frederick, Maryland to Reston, Virginia.
Spokeswoman Michelle Michael told The Frederick News-Post (http://bit.ly/1scjKy0 ) Monday she doesn’t yet know how many of the 1,100 Frederick-based jobs will be moved.
She says the shift reflects a reorganization of the San Francisco-based contracting giant, starting Jan. 1. She says the jobs will be moved in phases.
Bechtel opened its Frederick operations in 1999. Those jobs are in the company’s power unit, which includes power plants and renewable energy. Bechtel announced last week that most of the power unit will be combined with the civil engineering division.
The reorganization also will create a global unit for nuclear power, environmental cleanups and facility security for defense departments in the United State and abroad.
Of course, even there, you may notice that the political complaints leveled in the News-Post story by the Republican county commissioner Mr. Young were omitted.