Subject: (LONG) Apple pulls plug on relocation project

From: [email-masked] (T. David)
Date: Wed, 1 Dec 93 5:58:26 PST

>From the Dec 1, 1993 Austin American Statesman:

Apple pulls plug on relocation project

Denied tax break by Williamson County, computer giant says it may
leave state

By R. Michelle Breyer
American-Statesman Staff

GEORGETOWN- Apple Computer Inc. tabled its proposed project in
Williamson County on Tuesday and suggested it may move all operations
out of Texas afer county commissioners defeated a tax incentives
package for the computer giant because of the company's domestic
partners policy.

"It is unlikely we will locate in Williamson County because of the tax
abatement issue," said Lisa Byrne, spokeswoman for Apple in Cupertino,
Calif.  "We were very disappointed with the vote."

The measure, which would have given Apple property tax breaks of up to
$750,000 over seven years, was defeated by a 3-2 vote shortly after
the commissioners unanimously approved an abatement for Dell Computer
Corp. [which has no DP benefits or EEO protection].

The commissioners' vote shocked many in the Willaimson County business
community who believed the $80 million Apple project was all but a
done deal.

Meanwhile, officials in Austin, stung by Dell's decision to move its
sales, service and support activities to a 350-acre site in Round Rock
that would employ 1,500 tried to capitalize on the commissioners'
decision and recruit Apple to Travis County.

Earlier this year, the Cupertino, Calif., company announced plans to
build its U.S. Customer Support Center on a 129-acre site south of
RM-620 on Parmer Lane.  The center's operation, which is in leased
space in Northeast Austin, employees 700 people.  The support center
at the proposed site, which is in the extra-territorial jurisdiction
of Austin, could have employed an estimated 1,400 people over the next
few years, said Bill Keegan, spokesman for Apple.

Apple officials also have said that in time the Williamson County site
could expand beyond customer service to include research and
development and marketing.  The site could accomodate up to 750,000
square feet of space and could employ several thousand people over the
next few years, Apple officials said Tuesday.  Comstruction on the
first phase of the facility was expected to begin in the spring.

By the year 2000, a total of 4,500 jobs and millions of dollars in
payroll would have been created as a result of Apple's move to
Williamson County, according to an economic impact study by Texas
economist Ray Perryman.  During that period, the facility would
generate $52.4 million in wages and salaries and would pump over $300
million into the local economy, the study said.  Aplle has donated
$70,000 in cash and computer equipment to 30 Austin-area non-profit
organizations since it moved to Austin in July 1992.

"Suffice to say, the impact is significant," Commissioner Mike
Heiligenstein, a supporter of the abatement, said during the meeting.

In an employee memo Tuesday, Jim O'Neil, site director of Apple's
Austin facility, said the company has asked commissioners to
reconsider.

"Should they not do so, it is clear that we would not locate our
facility in Williamson County," O'Neil said.  "We would then review
alternative site options.  Regrettably, this means leaving Texas."

In October, Commissioners Jerry Mehevec and Greg Boatright pledged to
oppose the tax break because Apple provides benefits such as health
insurance to domestic partners of gay and lesbian employees.

Apple's proposal is the first tax abatement Williamson County
commissioners ever have voted down, said Commissioner David Hays, who
surprised many people by voting against the abatement.

"If I had voted 'yes,' I would have had to walk into my church with
people saying, 'There is the man who brought homosexuality to this
county,'" Hays said.

Going into Tuesday's meeting. business leaders believed Commissioners
Hays and Heiligenstein would vote in favor of the abatement, Mehevec
and Boatright would vote against it, and Williamson County Judge John
Doerfler would be the swing vote.

In the final vote, Mehevec, Boatright and Hays voted against the
abatement, while Heiligenstein and Doerfler supported it.

Business leaders were caught off guard by Hays' votes.  A letter to
the editor written by Hays was published in Monday's Round Rock Leader
rallying support for Apple's tax abatement.

"I do not condone domestic fringe benefits as supported by the City of
Austin and Apple Computer," he wrote, "However, I do support a policy
of limited government and free enterprise.  Government should not be a
social engineer; it should not tell private industry how to run its
businesses!"

Hays, a new commissioner, said he slept little Monday night as he
grappled with one of the toughest decisions he has ever had to make.
His final decision, he said, was made Tuesday morning.

"For me it boiled down to values," Hays said.  "The people felt we
were compromising our values.  That hurt me.  The only thing you have
are your values, integrity and character.  When people you care about
question that, you have to wonder if bringing in this industry is
worth it."

Hays said he received more than 100 calls from "Christians from all
over the county" and people who had worked on his campaign.  When the
county raised taxes 8 percent, he said he received only five calls.

Randy Smith, a Leander City Council member who spoke out against the
abatement, said Apple's policy could lead to broken homes, a higher
tax rate and the spread of disease throughout the county.

"It could undermine the foundations of our community," he Staudt, who
spoke to commissioners twice during the meeting. "If Apple goes
elsewhere, this community will prosper because we've taken a stand for
strong families."

Others in the area viewed it as a blatant attempt to interfere with a
company's policies - a move they believe will strike a damaging blow
to the area's economic development efforts.

"Apple would have been a beautiful company to have in the community,"
said Joe Beneat, owner of Manhattan's a popular Round Rock watering
hole.

Beneat is a member of Round Rock's Century Club, a group of business
people who work to recruit companies to the city.  He said he believes
Tuesday's vote has hurt their efforts.

"This sends a clear message that Williamson County doesn't want to
work with businesses," Beneat said.

Phil Brewer, president of the Round Rock Chamber of Commerce, sadi he
had been cautiously optimistic the abatement would pass.

"Everyone was," said Brewer.  "I'm hearing concern and disappointment.
It's negative, it really is."

Brewer, who has spearheaded the city's economic development efforts,
said he will be going to California at the begining of the year to
mend fences.  The Round Rock Chamber of Commerce has focused much of
its recruitment effort on Northern California's Silicon Valley, where
Apple is based.

Several Austin City Council members drafted a letter Tuesday to
Apple's O'Neil underscoring the city's support for the company and its
personnel policies.  The council voted 5-2 in September to give
benefits to domestic partners of city employees.  The City Council
members reiterated the city's previous offers of assistance, which
include an expedited planned development agreement ans assistance in
evaluating alternative sites in Travis County.

"We value your presence in our community and we appreciate the lengths
Apple has gone to in responding to the needs of its employees." said
the letter signed by Council Members Max Nofziger, Gus Garcia and
Brigid Shea.

In a statement, Gov. Ann Richards said she had talked with Apple
officials Tuesday and said she will continue to promote other sites in
Texas, although she respects Williamson County's right to make its own
decision.

"Apple is a great company.  They produce a great product, and they
have been a good corporate citizen here in Austin," Richards said.

-- 
T. David