Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: FRIDAY, March 5, 1993 TAG: 9303050047
SECTION: VIRGINIA PAGE: A-1 EDITION: METRO
SOURCE: DANIEL HOWES STAFF WRITER
DATELINE: LENGTH: Medium
ROANOKE OUTBID COUNTY FOR FIRST UNION'S JOBS
NEW JOBS are good news in a tough economy. But the Roanoke Valley is learning they don't come cheap - even when they come from the new owners of the region's flagship bank.Roanoke officials have discovered a new way to get jobs downtown: buy them.
The city's $2,000-per-employee incentive program - unveiled Wednesday as part of First Union Corp.'s plans to bring 400 jobs to the Roanoke Valley - was devised to offset Roanoke County's advantage in the job hunt, officials conceded U.S. job scene at impasse. B8. Thursday.
The county, where Dominion Bankshares Corp. has its Plantation Road Operations Center and bank-card center, seemed a natural location for the customer-service jobs First Union planned to bring here - and the city knew it.
Worse, the county was willing to offer its own incentive package to ensure it would be a contender with other Southeastern localities for the First Union jobs. In the end, the city agreed to pay three times the county's offer to get half the 400 jobs.
"Once you get in the Roanoke Valley," said a city official who worked on the package, "it's [a question of] where. All the reasons why people across the country choose the suburbs instead of downtown . . . had to be overcome."
Efforts failed to get state training money - Virginia's prime incentive for luring new industry. State officials, including Secretary of Economic Development Cathleen Magennis, told local and First Union officials that none was available.
Pressure increased on the city and the county, fueling discussion of local incentives.
"When I first heard about it, I was a little reluctant," said Ed Kohinke, one of five Roanoke County supervisors. "Here was this big bank that had come in here and cut all these jobs that then wanted us to help."
The alternative erased his puzzlement.
Roanoke and Roanoke County were not competing for the new jobs, Warner Dalhouse reminded skeptical local officials. Dalhouse formerly was chairman of Dominion and now is chairman of First Union's Virginia bank. The Roanoke Valley was competing with First Union operations in Charlotte and Raleigh, N.C.; Atlanta and Augusta, Ga.; Miami and Jacksonville, Fla.
Roanoke County agreed to make a $150,000 lump-sum investment in training. And Roanoke, painfully aware that First Union had space in the county to accommodate all 400 jobs, unveiled its training package - which could end up costing taxpayers as much as $500,000.
Early on, city officials searched for ways to secure federal job training money for would-be First Union workers, said one city source who asked not to be identified. Instead, they decided to establish an incentive program with money set aside for such economic development efforts.
"It comes in spurts, and we save it until something like this comes along," said Brian Wishneff, head of Roanoke's economic development office.
The program is confined to the city's 1,600-acre "enterprise zone" downtown. It would allow no more than $500,000 to be spent in any 18-month period - so long as the money is replenished in future budgets.
Roanoke's enterprise zone - one of 22 in Virginia - was established in 1984 by then-Gov. Charles Robb. Under state law, new businesses locating within an enterprise zones may qualify for corporate income tax credits and sales tax refunds.
Enterprise zones generally are in core-city areas or other economically depressed sections where new business might not locate without taxpayer-supported incentives.
First Union does not qualify for either tax credits or refunds, city officials said. But the Dominion Tower and Dominion Bank Building - future home to Roanoke's share of the 400 new jobs - are located in Roanoke's enterprise zone, partially explaining why officials tied location of the jobs to the training funds.
First Union, headquartered in Charlotte, N.C., completed its takeover of Dominion on Monday. The acquisition was initially expected to leave 1,300 Dominion workers - 850 in the Roanoke Valley - jobless. The assumption by local officials is that the new jobs will offset some of those losses.
To be sure, city officials and business leaders welcomed news of First Union jobs coming to Roanoke. Jobs pay money; wage-earners spend money and pay taxes. For some, though, the news rang hollow.
"The general consensus is, `Gee, that's nice for people in bank card who are going to lose their jobs,' " said a Dominion computer analyst who asked not to be identified because he is hoping to get a job with First Union.
Nearly 170 Dominion credit-card workers are scheduled to lose their jobs in November. First Union's plans to hire 150 credit-card workers here may well rescue some from unemployment.
"For us, what I'd term `white-collar professional,' it's, `What's all the excitement about? It's not going to help me feed my family,' " the analyst said. "Right now, we're in a `what's-in-it-for-me mode.' "