Allstate Insurance Company told North Carolina officials the number of jobs it plans to create in Charlotte could go “well beyond” the 2,250 announced last month under an expansion project, documents obtained by the Observer show.
The disclosure is among findings from documents received in a public records request following the insurer’s Aug. 9 announcement to expand its Charlotte employment. The records provide a window into behind-the-scenes talks between North Carolina and Allstate officials, as the company sought millions of dollars in taxpayer-funded incentives.
Gov. Roy Cooper has called it one of the largest job announcements for the Charlotte-Mecklenburg area.
Records also show Illinois-based Allstate was awarded substantially more incentives in North Carolina than it estimated it would have received in some other states.
Here are some takeaways:
Documents show North Carolina economic development officials began discussing the deal, known internally as “Project Clipper,” as early as February. It’s typical for state economic developers to use such code names to keep projects secret while negotiations with companies are ongoing.
According to a proposed hiring schedule in documents, 735 hires would be made in 2018, 895 in 2019 and 620 in 2020.
In its requests for incentives, Allstate noted the expansion would build upon its decision four years ago to consolidate its Charlotte-area employees into new facilities in Innovation Park, the University City office complex.
Allstate told state officials it already employed 1,444 in Innovation Park, its largest employment hub in North Carolina. Elsewhere, the company said it had 96 employees in Wake County and 237 “remote” workers statewide.
Through the expansion, Allstate would be committing to a “significant” five-year growth plan resulting in the new hires, the company told state officials, adding: “Beyond this, we’re optimistic that we will continue to experience success which will lead to sustained long-term growth.”
“It is very possible that our final growth will extend well beyond the 2,250 new jobs described in this application.”
In considering Charlotte for the project, Allstate told state officials it was looking to identify a “strategic market” for growth, “so as not to be so reliant on the suburban Chicago market for talent.” Allstate also said it expected through diversifying talent recruitment it would not only improve those efforts but also lead to better retention.
The company told North Carolina officials the project would establish a strategic operations center to accommodate future growth for most of Allstate’s operational groups.
“One of our operational goals for this project is to establish a larger talent center with a focus on succession planning,” the company also said in incentives applications. Business activities in the operations center would involve claims, specialty operations, actuarial services, product underwriting, shared services and information technology functions.
At a press conference to announce the new jobs, Allstate said it was still looking at various sites in Charlotte to locate the hires.
The company did not immediately provide comment Wednesday. But in incentives applications, Allstate said options could involve expanding in Innovation Park, including adding new buildings there, or constructing or leasing space elsewhere.
What was the competition?
Charlotte wasn’t the only city Allstate was considering, records show. Other competitors included: Boise, Idaho; Denver, Colo.; Irving, Texas; Lincoln, Neb.; Philadelphia; and Phoenix.
Allstate said it believed those locations demonstrated the availability of a productive labor force, competitive labor costs and favorable business environments. In addition, the locations showed the availability of governmental incentives, the company said.
One document that listed estimates for state and local incentives showed Allstate could have received $23.6 million to locate in Lincoln, $8.3 million in Irving and $8 million in Boise.
In North Carolina, the company is expected to receive more than $22 million in incentives, including more than $3 million in community college training. Other sources include $701,986 from Mecklenburg County and $741,539 from the city of Charlotte.
State incentives include $17 million, to be awarded over 12 years, involving reimbursements of withholding taxes for the new jobs, provided the company meets job-creation and investment targets.
According to one analysis drawn up by the N.C. Department of Commerce and included in the records, the state will have a negative revenue return on that investment in years 2023 through 2029. But ultimately the state’s return will be $5.6 million, the analysis shows.