Indiana Economic Development Corp. and City Government and Economic Development Agencies and Local Government and Economic Development Incentives and Job Creation and Government & Economic Development and Government and Economic Development

City votes to end tax break for tech staffing firm

September 19, 2013

The Metropolitan Development Commission voted Wednesday to cancel a tax abatement for the Market Street headquarters of the Indianapolis-based tech staffing firm BCForward, since it didn’t hit job-creation targets laid out in a 2009 economic development agreement.

BCForward executives had agreed with the Department of Metropolitan Development’s recommendation to terminate the remainder of the 10-year abatement. The MDC’s vote was unanimous.

“Overall, all segments of BCForward are growing, and the company is enthusiastic about continuing that growth in Indianapolis,” company finance and accounting director Christy Paddock said in a prepared statement. “The company is grateful for the city’s cooperation and for the dedication of its people.”

The city’s metropolitan development staff has been reviewing tax-abatement compliance for five firms, and BCForward was the first to come before the commission. Others may ultimately be found in compliance, or the city may renegotiate terms of the agreements.

BCForward, formerly known as Bucher & Christian Consulting Inc., expected to add 200 jobs by the end of 2012, but the number by August was 166, said Ryan Hunt, senior project manager at DMD. That included employees of a non-technology staffing subsidiary, StaffForward. The company also retained 276 jobs, as promised.

Hunt said BCForward's hiring has been significant. “We’re not trying to penalize them,” he said. “We just have to maintain the integrity of the program by holding people to their commitments.”

Many of BCForward's new hires have left the company's payroll for permanent positions with clients, an unexpected trend that would have made it difficult to hit job-creation targets in the future, Hunt said.

The city will not try to claw back real estate and personal-property taxes in this case, as BCForward saved only $4,100 under the first three years of the abatement, Hunt said. When officials announced the agreement in 2009, they estimated the company would save about $40,000 in taxes over the 10-year abatement.

Losing the abatement won’t drive BCForward out of the city – the firm recently signed a five-year lease extension on its headquarters at 10 W. Market St., Paddock said.

Justin Christian and Tony Bucher founded the company in 1998. It is one of the largest minority-owned businesses in the city.


 

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