by Max Marbut
Staff Writer
“Does this mean I’m excused?”
That question was asked by Systems Services Enterprises Chairman and CEO Susan Elliott after the Jacksonville Economic Development Commission deliberated for all of 10 seconds and then approved an incentives package to help the St. Louis-based IT firm open a satellite office in Jacksonville.
The incentives are based on the state’s Qualified Target Industries Program. JEDC business development chief Lindsey Ballas explained to the commissioners that the company is eligible for two reasons: SSE is an Information Technology provider and would bring to Jacksonville jobs that pay 150 percent of the statewide average salary.
According to documents presented to the commissioners, SSE’s local operation would comprise 60 jobs paying an average salary of $58,445 plus $7,500 in benefits by the end of 2012 for an annual payroll of approximately $3.5 million.
The company was founded in 1966 and develops custom software for training and programming purposes for defense contractors and other third parties. If an office is opened in Jacksonville it would be the company’s first expansion outside St. Louis.
Of the total $240,000 in possible tax credit incentives proposed, the state’s share would be 80 percent and the maximum obligation to the City would be $48,000.
Ballas pointed out the City and state are protected if the company fails to hold up its end of the bargain.
“SSE must meet the number of jobs and the wages,” she said. “It’s also a back-end incentive based on performance and paid out over a period of four years.”
Ballas also said that while a few managers would be transferred from the company’s headquarters, most of the jobs would be hired from the local market. The company also anticipates a capital expenditure of about $90,000 in office space improvement and infrastructure.
SSE Chairman and CEO Susan Elliott addressed the commissioners and explained the genesis of her company and its history.
“I went to work for IBM in 1958,” she said then explained that eight years later when she became pregnant with her first child, “IBM thought I was so fragile I had to quit work at six months.”
Elliott said she then tried to get a job with a bank but was met with the same attitude.
“My husband was in law school so I really had to work,” she continued. “So he incorporated me and I went to work for the bank. They hired me because they were protected by hiring a corporation.”
The big leap for her business came in 1992 when IBM introduced the first personal computer. Elliott said she and her husband bought one at a charity auction and after she worked with it for a while, she started developing software for the PC that could teach people how to use the new device. That eventually led to SSE developing much more high-tech offerings including military applications.
“One of our first products was a game-like interactive software package that trained Humvee drivers how to detect mines in the road. Now we provide training to people worldwide over the Internet,” said Elliott.
She also said her focus is on Jacksonville because SSE has a client who wants the company to have an office here and added, “We’ve pretty much decided we’ll be located Downtown. Landlords are vying for our business.”
The commissioners also approved a three-year extension on a loan made by the Jacksonville Economic Development Company, Inc. in 1989 to FAM-CO Enterprises, Inc. for the purchase of land and a building on Soutel Drive.
The original mortgage was for $75,000 with a 20-year term at an 8.5 percent interest rate. It is a first mortgage and secured by the property.
In 1997 JEDCO entered into a Forbearance and Mortgage Modification Agreement to address failures by FAM-CO to make payments due under the mortgage. The loan was restructured to lower the monthly payments increasing the principal that would be due when the loan ballooned on Dec. 1, 2009.
In 2002, JEDCO, which had been part of the City and the JEDC, was privatized and the mortgage was assigned to the City.
According to the staff report presented to the commissioners the company has attempted to seek financing through a private bank and other sources but has been unsuccessful due to current economic conditions and was therefore seeking a three-year extension to the agreement making the loan due Dec. 1, 2012.
FAM-CO was granted the extension and will continue to make monthly payments which are current and provide quarterly reports to JEDC concerning the progress of its refinancing effort.
Both proposals will be sent to the City Council for its approval.
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