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HP to repay $459K in state incentives

Posted: January 22, 2014 - 11:59am

Hewlett-Packard in Conway is to repay state incentive money received through the Governor's Quick Action Closing Fund for not employing at least 1,000 people by 2014, according to the Arkansas Economic Development Commission. 

The company owes $459,000 of the $10 million it received through negations in 2008 when the State and Conway Development Corporation were recruiting HP to the area. 

The governor's incentive fund helps seal the deal for new business infrastructure in the state and was offered along with other incentives if HP made a home in Conway. 

The payback amount was arrived at, according to Arkansas Economic Development Commission spokesman Scott Hardin, through a formula that weighed the total number employees with the total payroll. 

Hardin said he could not release details of the formula because it would divulge company information, but said the formula is a standard part of a "clawback agreement" should a company not meet the employment goal. 

Hardin said the agreement is set up "to encourage the company to continue hiring people," and that HP has been easy to work with and upfront in dealings. 

Hewlett-Packard didn't meet the 1,000 mark at the end of December after a round of layoffs announced mid-year in 2013, and in December announced the addition of 200 unrelated positions that would be added locally in 2014.

About 500 jobs were cut from the Conway call center, part of a company wide move to eliminate 9,000 positions overall. 

Talk of the 200 new jobs, which are said to be higher paying than the positions that were cut, centered around healthcare. 

Hewlett-Packard account executive John Herzog said previously the new positions are technical roles supporting software engineering, business analysis and management in HP's growing government and commercial healthcare business, an endeavor that differs from HP's typical offering of office-friendly hardware, PCs and and software. 

The company held a job fair at the Conway Area Chamber of Commerce Wednesday. 

Spokespeople from HP said representatives were ready at the career fair to make offers to people who fit the new roles. 

Hewlett-Packard's original job projections for Conway were for 1,200 positions with starting salaries of $40,000.

Jamie Gates, CDC executive vice president, said HP does not owe clawbacks to Conway or the CDC.

The Conway Area Chamber of Commerce delivered HP a $28 million, 150,000-square-foot building in the CDC-developed Meadows Office and Technology Park. 

The City of Conway dedicated about $5 million to prepare the site and build new roads in and around the technology park. 

 

 

 

 Staff writer Michelle Corbet contributed to this report. 

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