Bad Math
The Finance, Revenue, and Bonding Committee voiced its approval Wednesday for a tax incentive package that gives up to $90 million to Starwood Hotels and Resorts up for relocating its headquarters from White Plains, New York to Stamford, Connecticut.
The deal which took more than three years to structure will bring 813 new jobs to the state and is expected to generate far more revenue than the tax credit the state is offering, state officials said. [...]
According to Starwood executives, the median compensation for its employees is $114,000.
813 employees x $114,000 salary x 5% income tax x 10 years = $46,341,000
That doesn’t mean that the project is a bad idea or shouldn’t be approved, but let’s be honest: it will be a long, long time before this deal is a positive on state tax rolls. And in year 11, what will we do if Starwood says “extend our credit, or we’re moving”?
February 26th, 2010 at 2:34 am
The Starwood deal doesn’t seem all that great a thing. I don’t understand how moving headquarters 15 miles results in job creation for Stamford. Won’t most of the Starwood employees simply commute? I’d imagine those making over $100k will be heading north on I-95, with those lower on the ladder hopping MetroNorth. Maybe they’ll be hiring 813 cleaning people.
Stamford has a long history of giving the bank to lure companies to the city, only to see those companies move on as soon as the welfare runs out. Why would Starwood be any different? On a positive note, maybe Stamford government will move into another municipal building in 11 years.
October 10th, 2010 at 1:21 am
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