Enquirer News Update   -   Updated 6:40 p.m.

Convergys vote cancelled


Council majority wants to renegotiate

By Gregory Korte
The Cincinnati Enquirer

The deal is off.

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At a news conference at City Hall, Mayor Charlie Luken and council members discuss the the Convergys deal. At rear are Chris Monzel, David Crawley and David Pepper.
(Gary Landers photo)
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Cincinnati Mayor Charlie Luken cancelled today's vote on a $63.4 million tax break for the Convergys Corp., saying he no longer had the five votes needed for passage.

Councilman Chris Monzel's change of heart this morning triggered a last-minute renegotiation of the tax incentive deal, which would keep the billing and customer relations giant from moving its headquarters to Northern Kentucky.

Mayor Luken and Convergys CEO James Orr were in talks this afternoon to renegotiate the deal. Luken said he remains optimistic in the face of growing opposition from City Council.

Specifically, council members want to know whether the city could reach the $63.4 million mark without offering job retention tax credits - a direct subsidy to the company which some think would create a dangerous precedent.

"Looking at the whole deal, there was always something nagging me about this," Monzel said today. "It was the job retention tax credits that didn't sit right. It's bad public policy."

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Convergys CEO James Orr leaves City Hall after meeting with Mayor Charlie Luken.
(Gary Landers photo)
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The retention credits make up about $33 million of the city's portion of the deal. The state of Ohio also has tax credits as part of its $144.2 million package of incentives to keep Convergys from moving to Northern Kentucky.

Monzel said City Council would have to be creative in restructuring the deal - perhaps using the city's authority to issue bonds to finance Convergys' purchase of the Atrium One building at 401 E. Fourth St., downtown.

Luken said it would be difficult to make the math work without the job retention credits.

"They're trying to change the deal, without changing the amount," Luken said. "I don't know where it all leads."

Convergys executives could not immediately be reached for comment.

E-mail gkorte@enquirer.com

imgVideo from WCPO

From Tuesday's Enquirer:
Close call on Convergys
Taxpayers want a bit of help, too
Editorial: Secure the jobs