TODAY'S PAPER
40° Good Morning
40° Good Morning
ClassifiedsJobs

Broadridge wants 'competitive' deal to stay

Broadridge Financial Solutions' printing and processing center in

Broadridge Financial Solutions' printing and processing center in Edgewood is seen on Wednesday, May 9, 2012. Credit: Newsday/Alejandra Villa

The governors of Virginia and Florida are wooing Broadridge Financial Solutions Inc., hoping it will move an Islip Town operation with 1,600 employees to their state.

Virginia's Bob McDonnell visited the $2.2-billion company in February. Florida's Rick Scott is due this week.

Officials at Broadridge, which provides shareholder communications, said they would prefer to stay in Suffolk County. However, they said the publicly traded company must reduce costs.

"We want to be here, but we have to have a competitive package that our independent board of directors and CEO can accept -- one that's in the best interests of the company and the shareholders," Robert Kalenka, chief operating officer of Broadridge's investor communication solutions business, said in an interview.

The "package" he referred to includes tax breaks, lower electric rates and other incentives being negotiated with New York State, the Long Island Power Authority, Islip and Suffolk. Ohio, Texas and others with Broadridge plants also have made entreaties.

"We have a good knowledge base in New York," Kalenka said, referring to Broadridge's factories and warehouses in Edgewood and Brentwood. (The company has no plans to move its Lake Success headquarters, where about 200 people work.) "We want to keep it here, but if the economics are compelling, we would have to leave."

Broadridge, begun in an East Northport bedroom in 1987, is the latest Long Island company to be courted by other states' governors. Arrow Electronics Inc., once the Island's largest public company, transferred its headquarters in November, from Melville to a Denver suburb, after lobbying by Colorado Gov. John Hickenlooper. The Hain Celestial Group Inc., a maker of health foods, recently decided to stay, moving its headquarters to Nassau County from Suffolk despite appeals from New Jersey Gov. Chris Christie.

Competition among the states for plum employers intensified in the 2007-09 recession and hasn't eased since, economic developers said.

Broadridge's Islip operation is attractive because of its large workforce, earning an average of $75,000 a year, and ties to the vigorous financial services industry. The company said it distributes investor documents for almost all U.S. public companies.

Broadridge has demonstrated a willingness to move facilities to cut costs. This summer, it will close one in Brooklyn and move the work to New Jersey, laying off 135. Kalenka said rent was less and utility costs were half in the Garden State.

About a year ago, company executives began exploring options for Islip, where annual reports, proxy statements, ballots and other documents are assembled for mailing. Leases on two plants, totaling 730,000 square feet of space, are set to expire in 2013-14.

The executives asked New York State and local officials for help, particularly to reduce an electric bill of $5 million a year.

This month, the state Power Authority offered to lower Broadridge's utility bill for seven years. This week, Suffolk's industrial development agency is expected to take up a sales tax exemption on $75 million in equipment purchases and a 15-year property tax break.

Islip's development agency has offered a 15-year property tax break on one Broadridge building. "They can locate anywhere," said William Mannix, chief executive of the Islip IDA. "Can Long Island suffer the loss of 1,600 jobs without pain?"

Islip, Suffolk and Empire State Development Corp. backed Broadridge's earlier expansions, as has landlord Gerald Wolkoff. ESDC spokesman Austin Shafran said, "We are working hard to . . . keep these jobs in New York."

Broadridge expressed hope a deal could be reached. "Other states have been aggressive," Kalenka said, "but I'm optimistic they [state and local officials] will come up with a good plan."

Still, he conceded other states' governors have gotten his attention. Virginia's governor gave an hourlong pitch -- minus the usual entourage -- before touring the factory. A Virginia spokeswoman declined to discuss the meeting last week.

Speaking of Gov. McDonnell, Kalenka said, "He had a compelling proposal."

AT A GLANCE

 

WHAT IT DOES: Provides shareholder communications on behalf of public companies and financial services firms such as banks, mutual funds and stock brokerages

HEADQUARTERS: Lake Success

OTHER LOCAL OFFICES: Four in Islip Town (910,000 square feet)

OBJECTIVE: Upgrade office and factory space; purchase new equipment; reduce costs

STATES WOOING COMPANY: Florida, New Jersey, Ohio, Texas and Virginia

EMPLOYEES: 5,900; about 1,600 in Suffolk

AVERAGE ANNUAL WAGE IN SUFFOLK: $75,000

2011 SALES: $2.2 billion

2011 PROFIT: $170 million

TICKER SYMBOL: BR

HISTORY: Started in 1987 in a bedroom in East Northport by two Long Islanders

Latest Long Island News