The state and Baltimore County have loaned Stanley Black & Decker $1.1 million to secure the company’s presence in Towson for at least the next five years and ensure the company’s 1,300 local workers have a job.
The company — formed after a 2010 merger between Stanley Works and Black & Decker — is planning a $12 million, five-year project to modernize its 94-year-old campus in Towson. The 33-acre facility will become the Construction and Do-It-Yourself world headquarters for the company.
The state is providing a $1 million conditional loan combined with $100,000 from Baltimore County to help pay for the project. The company might also be eligible for a property tax credit since the property lies in the Towson Commercial Revitalization District. That would mean the company would not pay extra property tax for improvements that increased the assessed value of the property.
Baltimore County Executive Kevin Kamenetz said Stanley’s decision to stay in Towson allayed fears the company would be wooed by other states and leave.
“We were apprehensive when the merger happened and the corporate headquarters was moved to Connecticut,” Kamenetz said. “The company has a long history in Baltimore County, and we have had a long-standing love affair with Black & Decker, so this project is great news.
“The fact they’re investing $12 million in the campus is a strong indicator they want to stay here and likely grow,” he added.
Stanley acquired Black & Decker in March 2010 in a $4.65 billion all-stock deal. The corporate headquarters is in New Britain, Conn. Stanley Black & Decker employs 36,700 worldwide, with 14,400 employees in the U.S.
The merger led to job losses initially. According to a filing with the Securities and Exchange Commission in January, the merged company listed $224 million in restructuring charges, including $194.4 million for severance related to the cutting of 3,000 jobs.
The company did not break out where the job cuts occurred, but an estimated 250 jobs were cut from the Towson campus last year. The remaining workers at the Towson location are mainly engineering and research and development.
The money from the state came from the Maryland Economic Development Assistance Authority and Fund, which was created by the General Assembly in 1999 and has closed on 405 transactions worth $180.4 million since then. According to the Department of Business and Economic Development, the loans have created 15,966 new jobs, retained 17,872 jobs and spurred $2.6 billion in private spending.
Since its creation, the program has recorded $20.8 million in gross charge-offs. The program recorded charge-offs of $378,258 for fiscal 2010, according to a December report by DBED.
The Stanley Black & Decker loan is sub-categorized as a “Local Economic Development Opportunity” by the state, which are conditional loans capped at $2 million that require a 10 percent matching loan from the jurisdiction where the project is located.
For fiscal 2010, which ended June 30, the state made nine loans for $6.18 million under circumstances similar to the Stanley Black & Decker loan. The largest of the loans went to Gardner Denver Inc., a Quincy, Ill.-based manufacturer of pumps and compressors, which received $2 million in connection with a $26.8 million project.
The loans do not have to be paid back if the conditions are met. In Stanley Black & Decker’s case the conditions include keeping its Maryland workforce at no less than 1,300 workers — 1,100 at the Towson campus and 200 at other facilities in the state — for a five-year period. The company also must keep the divisional headquarters in Towson for five years and complete the $12 million renovation project.
Timothy Doyle, a project manager in the Office of Finance Programs, said the state captures its return on loans like this one through taxes paid by people whose jobs have been retained or are hired in the case of expansions. Ancillary benefits are received through property and indirect taxes, he said.
“It is a tremendous economic return,” Doyle said. “We consider this to be a very big win by retaining these jobs that could have gone elsewhere.”
Shares of Stanley Black & Decker lost 27 cents Tuesday to close at $75.38 in New York Stock Exchange trading.