Adecco Group North America will be offered almost $2 million in state and city incentives, or $10,800 a job, to move its corporate headquarters and 185 jobs to Jacksonville, if City Council approves the deal submitted Monday afternoon by Mayor Alvin Brown.
The city would be responsible for $407,000 of the incentives and the state would pick up the remaining $1.59 million.
In return, Adecco Group would pay a salary and benefits package averaging $85,969 per job and make a capital investment of $3.4 million in renovating space for the headquarters.
The legislation will be introduced on the addendum to the council agenda Tuesday night and receive a first read. It will then be referred to the council Finance Committee next Tuesday for a presentation by the Office of Economic Development and a committee recommendation, then return to council for final approval on second reading April 8.
The compensation package includes an average wage of $63,669 for the 185 jobs. That amount is 150 percent of the state’s average wage. The average benefits would be $22,300.
A schedule shows that 150 jobs must be created by Dec. 31, 2015, and the remaining 35 a year later.
The incentives would be paid out over a five-year period beginning in 2016 after the jobs are created and the average is verified by the Florida Department of Economic Opportunity. The incentives would be paid through 2020.
Adecco Group also would retain 354 existing Adecco jobs in Jacksonville. Those jobs average $45,600 plus benefits.
The annual payroll of the new jobs totals $11.8 million a year. Plus benefits, that is estimated annually at $15.9 million.
The annual payroll of the existing jobs is $16 million. With benefits, that rises to $21.6 million a year.
The city says the payroll generated over the life of the agreement is $200 million.
Adecco North America proposes to move its headquarters from Melville, N.Y. Adecco would move the headquarters to space it already leases for its Jacksonville operations at 10151 Deerwood Park Blvd., No. 200, in the Deerwood South office park and expand there.
It would renovate 50,000 square feet of space, spending $2.47 million in tenant improvements and $935,000 on buying machinery, equipment, furniture and fixtures.
Adecco, based in Switzerland, is considered the world’s leading provider of human resources and staffing solutions. Its services include temporary staffing, permanent placement, outsourcing, consulting and outplacement.
It bought Jacksonville-based MPS Group in January 2010 and operates businesses in Jacksonville and the state that include Accounting Principals, Ajilon Professional, Beeline, Pontoon, Entegee, Lee Hecht Harrison, Modis, Parker and Lynch, Soliant Health and Special Counsel.
When Adecco bought MPS, it moved the business from Downtown to Deerwood South in Southside. It also used the Qualified Target Industry Tax Refund program to expand the business from 236 to 354 employees.
QTI, which is a repayment of taxes, is a large component of the incentives package for the headquarters move.
The incentives comprise:
• City: $407,000, consisting of $222,000, or 20 percent, of the QTI refund, and a $185,000 Countywide Economic Development Fund Grant.
• State: $1,591,000, consisting of $888,000, or 80 percent, of the QTI refund; a $370,000 Governor’s Quick Action Closing Fund based on the jobs; $333,000 from the Quick Response Training Program, also based on the jobs.
The city’s funds are equal to $2,200 per job, while the state’s funding works out to $8,600 per job.
The QTI award for the Adecco jobs equals $6,000 per job because they are eligible for the base $3,000 refund and also are within a state high-impact targeted industry (corporate headquarters) for $2,000; and the wage is equal to 150 percent of the 2014 state average of $42,446, for another $1,000 a job.
The mayor’s office seeks a waiver of the city’s Public Investment Policy, which does not provide for a County Economic Development Fund grant to support job creation.
There also are clawbacks in the event Adecco does not create the jobs. The QTI program has a built-in clawback in that it does not pay the refund if the jobs aren’t created and the wages not paid. Because the closing fund and countywide grant also are tied to the jobs, the QTI method will be used to monitor jobs for those incentives.
State law allows the annual payments to be reduced if the company does not create the jobs, but does not allow incentives if the jobs fall below 80 percent of the goal.
The $3.4 million private capital investment is expected to generate $384,000 in new taxes over six years.
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