Curt Ritter (212) 788-2971
Bernadette O'Leary (212) 312-3523 (EDC)
MAYOR GIULIANI ANNOUNCES AGREEMENT FOR BOOK SELLING GIANT BARNES & NOBLE TO REMAIN IN CITY; BENEFITS TIED EXCLUSIVELY TO JOB GROWTH
-- 577 Jobs Retained, 287 New Jobs Projected --
The agreement will keep 577 jobs here and also create a projected 287 new jobs during the 15-year period and provides sales tax benefits to Barnes & Noble that are entirely dependent on the company's growth. This is the fourth exclusively "growth-linked" agreement implemented under Mayor Giuliani, which means that sales tax benefits will not be provided unless the company achieves specific employment targets.
"New York City is the publishing capital of the world so it makes perfect sense that a top-notch bookseller like Barnes & Noble should remain here," said Mayor Giuliani. "This agreement reinforces a precedent we set with our first all-growth agreement -- we will encourage Barnes & Noble to expand in the City through sales tax benefits only if the company adds jobs. In addition, we are securing the presence of these important jobs in the City, as well as the company's new Internet business."
Barnes & Noble had considered relocating 150 of its technical and support staff to a Barnes & Noble facility in Cranbury, New Jersey. Instead, the company has committed to locating these employees as well as its headquarters and Internet business in the City.
Barnes & Noble, the world's largest bookseller, is headquartered at 122 Fifth Avenue and has several other leases in the area. The company's leases began to expire in 1997. As part of the agreement, Barnes & Noble plans to consolidate its New York City corporate operations by adding 108,000 square feet to its headquarters for a total of 144,000 square feet. Barnes & Noble also recently launched an Internet business as the exclusive bookseller for America On Line, BarnesandNoble.com.
Over the term of the agreement, negotiated through the New York City Economic Development Corporation (EDC) and approved by the City's Industrial Development Agency (IDA), Barnes & Noble will receive a maximum of approximately $900,000 in sales tax exemptions and $1.2 million in energy benefits. The City's portion of these benefits is $511,000, 100 percent of which is contingent upon growth by the company.
"Barnes & Noble has a long history in New York City, and we are pleased that the company has decided to continue making history here for the next 15 years," said Randy Levine, Deputy Mayor for Economic Development, Planning and Administration. "This agreement not only keeps almost 600 jobs here but will help the company potentially increase its staff by almost 50 percent in the City."
"For more than twenty years, New York City has served as the home office for Barnes & Noble, Inc., and we're delighted that we will continue to play an important role in the economic and cultural life of this dynamic city," said Mary Ellen Keating, spokesperson for Barnes & Noble, Inc. "Barnes & Noble would like to thank the City and the Mayor for their support."
"Barnes & Noble's commitment to remain in New York City is a win-win situation," said EDC President and IDA Chairman Charles Millard. "Not only do we keep a world-class organization such as Barnes & Noble here, we also ensure that the company's future growth will be in New York City.
Including this agreement, the Giuliani Administration has now retained 38 major companies, representing 82,501 jobs retained and a projected 44,961 new jobs over the next 20 to 25 years through its business retention program. The total tax revenue generated by these companies to the City is approximately $1.4 billion a year.
In the event the company does not maintain the specified job level, the agreement calls for the repayment or reduction of some or all of the benefits taken, as well as penalties, and an elimination of any unused benefits. Barnes & Noble generates $7.2 million annually in total City tax revenues. As a result, the payback period to the City is less than a month.
EDC is the City's primary vehicle for economic development services. Using its real estate and financial resources, EDC helps develop businesses and create jobs throughout the five boroughs. IDA is a public benefit corporation contractually administered by EDC and established to encourage business development and expansion.
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