| Company |
Dillon,
Read & Co
DEAL TERMINATED in 1998, RECAPTURE PAYMENT MADE in 1999 |
| Date Announced | 10/7/1996 (deal closed 1/3/97) |
| Project Site | 535 Madison Avenue, Manhattan |
| Competing Sites | Stamford, Conn. |
| Type of transaction/ Company type | Commercial Retention / Financial |
| Maximum City Subsidy | $5.845 million plus savings from lower interest rates on borrowing through tax exempt bonds |
|
? |
|
$2.15 million |
| Type(s) of City benefits |
Tax Exempt Bond
Financing - Up to $58,500,000 Sales Tax Abatement - $97,503 used Energy Savings (Con Ed's BIR program) - $111,360 used Real Estate Tax Credit for Growth - $10,500 used Total: $219,363 used according to project documents |
| Benefits from New York State | ? |
| Total Benefits Allowed | ? |
| Benefits Distributed to Date (according to Local Law 69 Report FY ) | $108,000 |
| Promised Job Retention | 620 |
| Promised Job Creation | 664 |
| Total Promised Jobs | 1284 |
| Jobs Reported in LL69 Report FY 2002 | 620 |
| Layoffs | Unspecified number of layoffs resulted from 1997 merger with Swiss Bank Corporation. Although new entity claimed job numbers were not possible to track, they admitted to being below the required threshold. |
| Length of Contract | 20 years |
| Project Purpose | Dillon Read & Co. accepted nearly $6 million in tax incentives and other benefits for staying in the city and renewing its lease for 195,000 square feet at 535 Madison Ave., its namesake building. The investment bank, which had threatened to move to Stamford, would get the full amount only if it added another 644 workers over two decades. |
| Clawbacks | The city and Dillon Read are in dispute over whether the job reductions were due to people being fired or being transferred out of the city. Separate penalties result from each kind of job reduction. The city argues that people were transferred out and that therefore it is entitled to collect 200% of the benefits distributed, or $438,727.92. The company maintains that jobs were reduced due to layoffs and that therefore it owes only 100% of benefits received, or $219,363.96, an amount which it paid to the city in March of 1999. |
| Background/Since then . . . | As a result of the merger, Dillon Read's headquarters left the city. The company became a wholly owned subsidiary of Swiss Bank Corporation (SBC). |
| Corporate Notes | Investment bank Dillon Read & Co. is now Warburg Dillon Read, part of UBS Warburg, the investment banking arm of UBS, Switzerland's leading bank. |
| A note on sources -- Information in this deal comes from GJNY's examination of project agreements obtained through Freedom of Information Law requests, as well as news reports, minutes and notes taken at board meetings, and communication with our allies. The entries are a work in progress. For more information about the documentation behind GJNY's database, or to let us know about any developments that are not yet reflected here, please contact us at gjny@ctj.org or (212) 414-9394. | |
| Date last updated: 07/03/03 | |