Nearshore Americas

Oracle Denied Incentives from San Antonio City Council

Software and hardware services giant Oracle is struggling to pick up $1 million in incentives promised by San Antonio City Council in return for creating 200 jobs in the city.
The dispute stems from an agreement Oracle signed with the city in 2014 when it set up a regional technology service center. The agreement required the technology firm to hire 200 local residents at a minimum annual salary of $70,000. The council offered to pay Oracle $1 million in return for these new jobs.
When Oracle came to collect the money in December last year, city officials refused. “Instead of 200 people, they had 187 and only about 20 of those people were making the promised $70,000 a year,” reported Texas Public Radio, citing city officials.
After months of negotiation, the city council made peace with the technology firm, which offered to generate an additional 150 jobs. The software maker, according to the radio, has now leased another building in the city as part of the expansion.
According to the San Antonio Business Journal, Oracle wants to pay each employee with $50,000 in annual salary rather than $70,000 it promised two years ago.
“I think the company misunderstood [the wage threshold for the previous agreement], but they are still creating high-wage jobs,” the journal reported, quoting Rene Dominguez, Director of Economic Development at the city of San Antonio.
Now, it seems, the council is not focusing on minimum salary but it wants Oracle to employ at least 350 people and retain them for ten years. If Oracle employed more than 350 people, it might even be eligible for bonuses.
“The question it raises, however, is: does a company not tied to San Antonio stay in the city once the ten-year contract runs out,” asks Texas Radio.

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Narayan Ammachchi

News Editor for Nearshore Americas, Narayan Ammachchi is a career journalist with a decade of experience in politics and international business. He works out of his base in the Indian Silicon City of Bangalore.

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