New York Power Authority Board of Trustees has agreed to assist the state in giving a $73.6 million bailout to Alcoa in exchange for retaining 600 jobs at the Massena west plant. That’s about $5 …
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New York Power Authority Board of Trustees has agreed to assist the state in giving a $73.6 million bailout to Alcoa in exchange for retaining 600 jobs at the Massena west plant.
That’s about $5 million more than had previously been discussed when the deal was first announced in November.
Under the deal NYPA agreed to provide $30 million in low-cost electricity. That will be paired with $43.6 million in subsidies for operational and capital expenses from Empire State Development. That's on top of NYPA power discounts the company is already receiving.
The subsidies and savings equal about $122,667 per job retained.
The deal is the latest in a long series of incentives offered to the company in exchange for maintaining jobs at the facility.
On multiple occasions Alcoa has failed to live up to promises made in previous agreements.
According to a March 2014 news release from the governor's office, the company promised to maintain 750 jobs at the west plant and provide training for the east plant's future workforce, once a promised $600 million modernization of the Alcoa East plant was underway. That plan was dropped.
In summer 2013, Gov. Andrew Cuomo was quoted as saying 1,000 jobs would be guaranteed under a deal that had been struck with Alcoa.
In the past Alcoa has not been held accountable for failing to meet the terms of its agreements with the state and NYPA.
However, this deal includes up to $40 million in financial penalties should the company breach its commitment to maintain at least 600 jobs, or close the plant before the contract expires March 31, 2019.
Last month the governor announced a $68.8 million deal in exchange for a pledge to keep 600 jobs in Massena through March 20, 2019. That deal had promised $38.8 million, but that number has apparently since risen to $43.6 million.
The government bailout was announced after Alcoa made public plans to layoff 487 employees.