Good while it lasted - Washington Missouri Looks to the Future after Harman Becker Automotive Systems Announces it is Leaving Town

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http://hermannmonews.blogspot.com/2010/12/harman-becker-automotive-to-shut-down.html
Until last week, when Harman-Becker Automotive Systems unexpectedly announced it was leaving town after just five years and taking 300 jobs with it, the company's plant had stood as a model of small-town economic development.

Now that it's all falling apart, you might expect bitterness, or at least doubt about the wisdom of doling out taxpayer money to court businesses, like a spouse in a divorce wondering if the marriage had ever been a good idea. But no.


To lure the company, reportedly in competition with 35 other cities, the city and state gave Harman a package worth nearly $3 million during its abbreviated stint here. But now - even as officials comb the deal's documents to determine whether Harman should return any of that largesse - there seems to be few hard feelings over the company's early exit.

Economic development has always been a delicate dance. And that tension has only increased as job creation becomes even more urgent as the nation's sour economy staggers on. At the same time, politicians grappling with ever-tighter budgets have focused new attention on the incentives thrown at businesses to capture their affections. A commission appointed by Missouri Gov. Jay Nixon just completed a skeptical review of all state tax incentives, recommending killing nearly half of the state's tax credits and slashing many others, a move projected to save $220 million annually.


‘Long-term relationship'

No one doubts the Harman jobs are good ones, worth saving. These are manufacturing jobs, fairly high-tech ones - exactly the kind of jobs economists and politicians say the country needs. Most workers earn $40,000 to $60,000 a year. They assemble auto accessories such as factory car radios and in-dash navigation systems. They work in a sleek brick building that resembles the manicured outpost of a community college campus, with a basketball hoop outdoors and a well-stocked employee workout room.

Harman is not a local company, but it wormed its way into the heart of this rural town of 14,000 in Franklin County. It gave $25,000 toward a new downtown farmers market. It donated a new sound system for the high school theater. It chipped in for a scoreboard at an area ball field.

Landing an employer such as Harman was widely seen as Washington's good fortune. Harman grew to become the city's eighth-largest private employer. And local officials had worked hard to lure the company, a subsidiary of Stamford, Conn.-based Harman International Industries.
To accomplish that, Harman received a package of state and local financial incentives, including the city's first-ever offer of a property tax abatement. In exchange, Washington got a $26 million investment, the largest industrial development project in its history at the time.
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