Monday, December 15, 2014

Navistar to Close Foundry; Breaks Commitment to Indianapolis Taxpayers...Again

The Indianapolis Business Journal reports:
Navistar International Corp. plans to close its foundry in Indianapolis, eliminating 180 workers, the Lisle, Illinois-based manufacturer announced Monday morning.

The foundry, located on the city’s east side at 5565 Brookville Road, produces engine blocks and heads. Navistar said the closure process will take place during the first half of 2015 and be completed in the summer.
People forget that just a few years ago, the City decided to grant Navistar a subsidy after it had failed to live up to a previous commitment.  This is what I wrote in October of 2011:
Listening to WIBC on the way home tonight, I heard Indianapolis Mayor Greg Ballard respond to the Litebox fiasco with assurances he would hold the company accountable for the jobs that were promised.  Ballard cited the example of his making a company pay back $5 million when it failed to live up to its job promises.

Mayor Greg Ballard
Ballard is talking about Navistar.  A decade or so ago, Navistar had received an $18 million abatement.  In 2009, the company laid off 1,000 employees. At that point Navistar clearly owed the City of Indianapolis $23 million under the contract.  In a bizarre move by City Legal, the case was settled for a mere $5 million.  City Legal Attorney Jonathan Mayes trotted out the bogus explanation that it was being settled for such a low amount to avoid legal costs.  Of course, City Legal's attorneys have fixed salaries and it was merely a contract interpretation matter, not one likely to result in years of litigation.   There simply was no reason for the City to give away $18 million of the $23 million it was owed.

But the story didn't end there.  In July 2011, Navistar offered to hire 250 more people and again asked for a tax abatement.  The City eagerly handed one over, even though the company had stiffed the City on $18 million in a previous deal.

If that is what Mayor Ballard thinks is holding a company accountable for not living up to job commitments, Lord help us.

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