Company McGraw-Hill/Standard & Poor's Corporation
Date Authorized 4/24/1997 (deal closed 11/19/1998)
Project Site 55 Water Street; 2 Penn Plaza; 1221 Sixth Ave, Manhattan
Competing Sites Jersey City, N.J.
Type of transaction/ Company type Commercial retention/Publishing and financial information firm
Maximum  City Subsidy $52.5 million

City Amount Tied to Job Retention

  

$19.7 million

City Amount Tied to Job Growth

 $10.8 million ($1,500/employee)
Type(s) of City benefits Up to $30.5 million in sales tax breaks; up to  $4,000,000 in energy breaks (BIR); $18 million in PILOT savings
Benefits from New York  State ?
Total Benefits Allowed ?
Benefits Distributed to Date (according to LL69 Report FY 2002) $17,777,000
 
Promised Job Retention 4,010
Job recruitment  
Projected job growth 2,631
Total Jobs 6,641
Jobs Reported in LL69 Report FY 2002 4,089
Layoffs  
Length of Contract 22 years
 
Project Purpose Retention of company in NYC
Clawbacks Up to 10% of workers can be laid off with no penalty. After that, a proportional reduction of future benefits will be assessed and at over 30% layoffs the agreement may be terminated.

Penalties for moving workers out of NYC without laying them off include clawbacks with penalty fees and begin after only 2.25% of the workforce is transferred.  

Background/Since then . . . New Jersey reportedly offered $50 million to lure Standard & Poor's, a bond-rating and financial information unit of publishing giant McGraw-Hill. Charles Millard, then president of the city's Economic Development Corporation, accused New Jersey Gov. Christine Todd Whitman of violating a 1994 pledge not to poach New York companies. Under the agreement Standard & Poor's pledged to keep all its New York City employees in the city. S&P employees, spread among four buildings before the deal, were to be consolidated at 55 Water Street.

Speaking about the border war with New Jersey, H. Claude Shostal, president of the Regional Planning Association, says at the time of this deal, "It's a zero-sum game and you've got to believe the public sector could spend the money more wisely. You could put that money into schools and transportation programs that would benefit everybody, and the whole pie would grow. But it's difficult for elected officials not to play the game" (New York Times, 4/19/97).
Corporate Notes McGraw-Hill, owner of Business Week magazine and the nation's largest publisher of educational materials, also owns four television stations and the Standard & Poor's financial information service.

Of the many office deals in 1997, Standard & Poor's lease of 930,000 square feet (15 floors) at 55 Water Street was the largest. McGraw-Hill also made a deal for 447,000 square feet at 2 Penn Plaza in 1997, the sixth-largest deal of the year.
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: 05/31/05