Thursday, February 15, 2007

Welfare Queens In Their Fletcher Machines

I thought we were Republicans. Why support Fletcher’s Ford welfare program? Stop taxing Ford when they are not profitable.

From the Louisville Courier-Journal:

A bill to allow the state to offer additional incentives to keep the two Ford Motor Co. plants operating in Jefferson County is expected to be filed in the General Assembly today. Most incentives that the state offers to businesses are restricted to companies that create or add jobs. But this bill would allow the state to offer incentives to companies that agree to keep existing jobs in Kentucky.

"It's just a tool we want to put in place that would help us, we think, keep Ford vibrant in Kentucky down the road," Gene Fuqua, interim state Economic Development secretary, said yesterday. "In general, it attempts to allow Ford to recover enough tax credits and enough wage assessments to maintain their operations in Kentucky if they choose to do certain things."

Fuqua and Gov. Ernie Fletcher were asked about efforts to retain the approximately 8,000 Ford jobs in Jefferson County during a meeting of the House budget committee. Later in the day, Fuqua and Ford officials spoke of the need for the bill at a meeting of Jefferson County's legislators.

Ford, one of the county's largest employers, recently announced that it lost $12.7 billion in 2006, in part because of lagging sales of sport utility vehicles and pickup trucks. The two Ford plants in Jefferson County make such vehicles, and concerns have been voiced about the factories' futures. Last week, Fletcher proposed that $10 million of an anticipated $401 million state surplus be spent on training for Ford workers.

Gabby Bruno, Ford's governmental affairs manager, told the Jefferson County delegation that other states are offering Ford incentives, which Kentucky is unable to match. "All of our government partners are stepping up," she said. "Your programs are more focused on job creation or about profit."

Such programs are not applicable to Ford's circumstances because it is not making a profit and wants to retain jobs, not add them, she said. Until incentives for job retention are added by Kentucky, she said, "I'd have to say you're not in the game."

Bruno said she does not know what decisions Ford will make as it works to become profitable. "I'm not in a position to answer that other than to say that time is of the essence, and we are making critical decisions right now, so the sooner they can get this tool on the books the better off we'll be," she said.

Earlier in the day, at the budget committee meeting, committee Chairman Rep. Harry Moberly, D-Richmond, asked how important it is that lawmakers approve the $10 million in training money for Ford. "We feel this is critical now because of what Ford is doing to reduce their work force through … early retirements and bringing new people in to keep their plant running smoothly and keep their people trained," Fuqua told the committee.

But he said that the $10 million is just a short-term solution, and that the tax-incentive bill would allow the state and Ford to negotiate a long-term agreement to keep the jobs in Jefferson County.

Ford and state officials have previously discussed the possibilities of tax incentives for the company. Fuqua and Fletcher said during the meeting and in later interviews that the bill was not final and that they could not divulge its details. The governor said the proposal would "allow us to pick up more flexibility in offering them an economic-incentive package that I think will be more appealing."

Asked to elaborate, Fletcher said, "It would be tax incentives. We need some flexibility on how we can get that to address the plants. … There's some flexibility that we need in looking at the two plants as one."

The governor, accompanied by more than 20 top administration officials, appeared for nearly an hour before the committee to explain his plan for the projected surplus, which he outlined last week in his State of the Commonwealth address.

While many lawmakers oppose reopening the budget this year, key members of the committee endorsed efforts to retain the Ford jobs. "It would be devastating to Jefferson County and all of Kentucky if they happen to close one of those Ford plants down there," Moberly said.

House Speaker Pro Tem Larry Clark, D-Okolona, said: "It's a full-court press to try to keep that plant here. I think we're at the point where we can't afford not to do something."

Rep. Jim Wayne, D-Louisville, said the Ford jobs are so important that the legislature must consider the unusual step of offering incentives to companies to stay in the state. "All indications right now say that they need this, and we need to act on it," Wayne said.

Last year, Ford offered all 75,000 of its U.S. hourly workers buyouts and early retirement packages, and more than 30,000 will leave the company this year. As the automaker closes plants, it will move workers from those facilities to others that have gaps created by the buyouts. Fuqua said the influx of new workers from other Ford plants makes the training money desirable. "They have new people coming in who are going to need to be trained on new equipment and systems."

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