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Rank-And-File Lawmakers Briefed On Lockheed Martin Incentive Package

by | Sep 26, 2016 4:35pm () Comments | Commenting has expired | Share
Posted to: Business, Election 2016, State Budget, Taxes, State Capitol

Christine Stuart photo Democratic and Republican lawmakers are poised to approve a $220 million package of economic incentives for Lockheed Martin that would guarantee the company continues to produce helicopters in the state through June 2032.

In anticipation of the vote, about 50 House Democratic lawmakers met behind closed-doors Monday to discuss what will happen Wednesday during the one-day special session to approve the deal. Over in the Legislative Office Building, the House Republican caucus was briefed on the package by Department of Economic and Community Development Commissioner Catherine Smith and Larry Duncan, vice president of government relations at Lockheed Martin.

The General Assembly and the Teamsters union will have to approve the deal before Oct. 7 in order for Lockheed Martin to meet U.S. Department of Defense production requirements.

A Republican staffer said it would cost $400 million more to build 200 CH-53K King Stallion Helicopters and expand operations in Stratford than it would be for Sikorsky, which sold its operations to Lockheed Martin in 2015, to do business in other states. That means, it’s likely the company is looking to make up that differential through its $220 million incentive package with the state and its negotiations with the union. It was unclear Monday if the company expected to make up the remaining $180 million in labor savings.

House Speaker Brendan Sharkey, D-Hamden, said the lack of information on the labor deal was a concern for some of his members. But Sharkey said details about those negotiations are still unknown. He said the Teamsters can work out their own agreement.

A representative of the union did not immediately respond to inquiries regarding the union vote.

Meanwhile, Republicans will likely vote for the deal, even though they don’t necessarily like it.

“If the state of Connecticut had good fiscal policy, had good business policy, and wasn’t trying to kick businesses out we wouldn’t have to turn around and try and keep them in here,” House Minority Leader Themis Klarides, R-Derby, said.

House Majority Leader Joe Aresimowicz, D-Berlin, said the there’s a reality that they will lose jobs if there’s no new contract because the contract for Blackhawk helicopter production has been fulfilled.

“You have to weigh what you’re getting to what you’re giving up,” Aresimowicz said.

What does this deal mean for Connecticut?

Aresimowicz said it means jobs in almost every community because part of the deal requires the company to increase its purchase of goods from local Connecticut suppliers.

“Our members are excited to come in and vote for this,” Aresimowicz said.

He said “shame on the other side” if they’re not excited because this doesn’t fit their narrative that Connecticut’s economy is not performing in a way “they hope will get them elected.”

Sharkey said Republicans just want to change the subject by expanding the call for the special session to include a whole host of unrelated issues “that have nothing to do with job creation.”

Sharkey said there was no desire on the part of his caucus to expand the call of the special session.

But is offering an economic incentive package the only thing Connecticut can be doing to remain economically competitive?

In January, Democratic Gov. Dannel P. Malloy was forced to defend his economic development strategy when General Electric announced it was moving its headquarters to Boston.

“I think we all realize that Connecticut needs to make itself as competitive as possible,” Sharkey said.

“But if you look at what Massachusetts paid GE to come to Massachusetts, it’s an exponentially more per job that Massachusetts paid than we’re paying for here,” Sharkey said.

Connecticut is admittedly not the cheapest place to do business, but it’s made the investments it needs to make in order to keep the jobs here with this incentive package, Sharkey added.

Klarides described the deal as a “hostage situation.”

“We have no choice but to do this deal because we have been put into a corner by the governor and the Democratic majority for all these years,” she added. “You cannot speak out of both sides of your mouth.”

She said she doesn’t blame the company for asking for incentives, but she said it’s ridiculous to suggest that Democratic lawmakers are “pro-business” after they approved the two highest tax increases in the state’s history in 2011 and 2015 and passed other anti-business legislation.

“They’re hypocrites and they’re speaking out of both sides of their mouth,” Klarides said.

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