Hauppauge manufacturer gets $652G in tax breaks
The offices of Spellman High Voltage Electronics in Hauppauge, seen on Thursday. Credit: Danielle Silverman
A manufacturer of power supplies plans to renovate its Hauppauge headquarters to add office space for 43 employees hired in the past year and 10 more in the near future, executives said Thursday.
Spellman High Voltage Electronics Corp. will add 5,000 square feet on the second floor of 475 Wireless Blvd. and remodel a section of the first floor and lobby. The $3.3 million project would affect about 25 percent of the 96,116-square-foot facility, which the company owns.
“We have to add additional floor space for the employees that we have already hired and plan to hire,” said Spellman chief financial officer Robert P. Kerley. “We have had to create small temporary cubes on the side of the manufacturing floor and push people into small spaces, versus what would be normally needed for them to adequately do their jobs.”
Spellman's products power luggage screening machines at security checkpoints in airports, CT scanners in medical offices, equipment used to make computer chips, and fiber-optic cable repeaters on ocean floors used for telecommunications, he told the Suffolk County Industrial Development Agency.
Thursday, the IDA granted Spellmam $652,000 in tax breaks to support the expansion project. The aid includes a property tax savings of $480,065, or a 14.8 percent reduction, over 10 years.
In return for the aid, the company promised to add 10 people to its local payroll of 320. The additional jobs are on top of more than 40 created in the past year. Records show the company's employees earn, on average, $95,000 per year.
Worldwide, Spellman has about 2,000 employees and operations in upstate Valhalla, and in China, England, Germany, Japan, Mexico and South Korea.
Kerley, in the company's application for tax breaks, said without them Spellman would expand at one of its other facilities. “As Suffolk County is an expensive place to do business, this helps us stay here,” he said.
Kerley also said the company had been wooed to move its headquarters to New Jersey, North Carolina or Virginia.
Spellman was founded in 1947 and is owned by the Skeist family. Its sales totaled $238 million last year, according to Kerley.
Spellman has received IDA help previously. In 1997 the company received tax-exempt bond financing and 10 years' worth of tax breaks to purchase the Wireless Boulevard building that it now proposes to renovate. In 2012-13, the company proposed to install $750,000 in equipment for which the IDA granted a sales-tax exemption of up to $32,345.
However, months later Spellman dropped the expansion project after laying off 47 people, moving production work to Mexico and closing a factory in Bohemia. The IDA withdrew the sales-tax exemption, which hadn't been used.
The hiring activity over the past year and that planned in the future will almost return the payroll to its 2012 level of 344 employees.
IDA executive director Anthony J. Catapano called the 2013 layoffs "a hiccup," saying "it's a complicated story,but it all checked out. ...This company has the types of jobs that we need more of in the county."
James T. Madore writes about Long Island business news including the economy, development, and the relationship between government and business. He previously served as Albany bureau chief.
