Mall retailer The Finish Line Inc. has agreed to forfeit a potentially lucrative tax-abatement deal because it won't be
able to meet a 2008 promise to create almost 200 jobs and invest $24 million at its Indianapolis headquarters.
The local company had agreed in August 2008 to create 183 jobs paying an average wage of $19.15 per hour, retain 671 employees averaging $20.27 per hour, and invest in upgrades to its headquarters at 3308 N. Mitthoeffer Road. In exchange, the Metropolitan Development Commission approved abatement deals for Finish Line that would have saved the company about $2.25 million on its taxes over a 10-year period.
But late last year, Finish Line officials informed the city that the company could not meet its capital-investment or job-creation commitments due to "unforeseen economic circumstances."
"What The Finish Line has done is exactly what we hope any company would do,” said Stephanie Quick, an assistant administrator in the Department of Metropolitan Development. “When a company requests a tax abatement, they’re committing to create and retain jobs. If they can’t live up to it, we would like them to come to us.”
The MDC is scheduled
to consider a formal cancelation of the Finish Line deal on Wednesday afternoon. The move will not change the amount of taxes
collected on the property since the abatement had not yet taken effect. The company's promised investments
would have added about $10 million to the city's tax base, with the abatement allowing Finish Line to
gradually take on a higher tax bill.
It wasn't clear whether Finish Line has added jobs or invested in some of the improvements it planned in 2008, including $10 million to build a warehouse and distribution building, $2 million to upgrade its existing headquarters, and another $12.4 million to upgrade its logistics, IT and telecommunications equipment.
A company spokeswoman said she was not familiar with the company's decision to forgo the incentives.
The deal was finalized about five months after Finish Line extracted itself from a disastrous effort to acquire Nashville, Tenn.-based Genesco Inc. for $1.5 billion. The company had to pay about $40 million to Genesco and hand over the equivalent of about 12 percent of the local company's shares.