You’re going to have to bear with me folks. News is coming in from all sectors right now, and it appears I missed a very important milestone:Â Goodyear is going to get around $14 million from the state of Kansas.
They were approved through the State’s IMPACT program, which evidently subsidizes worker training through the issuing of bonds. In the interest of full disclosure, I should note that Goodyear can receive up to $14.2 million dollars. I am sure that someone in the accounting/legal department will make sure that they get no less than that sum.
On the other side of things, Goodyear reportedly signed a contract with the local union that lets them cut 225 union jobs. By my reckoning, this allows Goodyear to get nearly all the money they originally asked for.
Let’s do the math:
- 225 jobs @ 50K a year = $1,125,000
- 8.5% * $1,125,000 for SS and Medicare withholding = $95,625
- Health Insurance @ ~$2400 year, per worker retained(I am aware that I am lowballing the actual cost here.) = $540,000
- Total cost per year(excluding unemployment insurance and other costs of doing business) = ~ $1,760, 625 per year
- Total savings over the course of 10 years: ~$17,606,250
- Add in the contributions from the state of Kansas: ~$14.2 Million
- Total savings to Goodyear: ~$32 Million( like I said, this doesn’t include training costs and pensions)
Goodyear found a way to get their $38 Million, it just didn’t come directly from the Kansas legislature. I give them half-hearted applause on this one. The state of Kansas has put stipulations on the money as well: If Goodyear does not retain at least 1,400 jobs, then it must repay the $14.2 Million. Notice I said repay, because as I originally claimed, this is only a grant in loan’s clothing.
So there you go…Tire Review did an excellent job covering this situation when it occured on March 23rd. My apologies for missing it. Back to work everyone. I’ll attempt to keep an eye on all the happenings taking place in the tire and mining industries. When I find something of import, I’ll report.
Until then, I’ll be…
Signing off…
Related posts:
