Thursday, July 17, 2003

Finishing Convergys deal could take weeks

By Gregory Korte
The Cincinnati Enquirer

It could be three weeks before city officials can finish the details of a new tax incentive agreement with Convergys Corp. - and before Mayor Charlie Luken can get enough members of City Council in town to vote on it.

Luken reported little progress Wednesday in the city's attempts to "repackage" a $63.4 million deal to keep Convergys downtown for at least 15 years.

The deal would have been the biggest tax incentive package in the city's history.

With City Council on a summer recess, "it's going to be very difficult to get five votes before the next regularly scheduled meeting" on Aug,. 6, Luken said.

"Council members keep sending me e-mails telling me they're going to be on vacation. And at some point, I'm going to be out of town, too," he said.

The deal collapsed Tuesday just hours before a council vote, when key votes on City Council started tilting the other way.

Most council members said they objected to the use of a specific kind of tax credit that gives Convergys a subsidy from earnings taxes paid by its current workers.

The city administration is negotiating a package that would be similar in value, but would eliminate the $33 million in so-called job retention tax credits.

Luken said he would let that process work itself out before speculating on what any new package would look like.

Convergys, the world's largest billing and customer service provider for other companies, has said it will move its headquarters to Northern Kentucky if it can't reach an agreement with Cincinnati.

The state of Ohio has already approved $144.2 million in tax credits.

Another $12.7 million in grants and loans is still subject to approval by the State Controlling Board.


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