As lawmakers prepare to debate the merits of a $291 million loan to help Jackson Laboratories expand at the UConn Health Center, the Department of Economic and Community announced Tuesday that it’s loaning $3 million to Blue Sky Studios in Greenwich to help that company expand and create 70 new jobs.
The digital animation studio responsible for the blockbuster hits like “Ice Age” and “Rio” will received a $3 million loan from the state to help it expand its space and upgrade its equipment. It will also receive a tax credit of 20 percent on infrastructure costs up to $3 million.
“In 2009 Blue Sky Studios opened its digital animation production facility in Connecticut, and in just two years, the company is ready to expand its operations and add jobs. This proves that film studios like what Connecticut has to offer and are willing to invest here,” Gov. Dannel P. Malloy said in a press release. “State support for Blue Sky will ensure the industry will grow and other film production companies see Connecticut as a great location and an important partner in their plans.”
The additional 43,000 square feet that the company plans on adding will allow the company to better utilize its facility, decrease production cycles — which means more movies in less time — and to do more work in house rather than outsourcing certain aspects of production, the press release says. The expanded facility, which will total 150,000 square feet, will include seating for up to 140 artists, conference rooms, a screening area, editorial space, and a data center.
In 2009 the company received an $8 million loan from the state to relocate from White Plains, N.Y., and $3.5 million in film tax credits. Since that time it has grown from 300 employees to 400 employees.
“One of the reasons we are so proud to partner with the state on this project is the governor’s commitment to our industry’s growth,“ Brian Keane, Blue Sky Studios chief operating officer, said. “Blue Sky, which was one of the first stops on Governor Malloy’s Jobs Tour, is as committed to job creation as the governor.”
While the price tag isn’t as hefty as the one for Jackson Laboratory, lawmakers are beginning to question the wisdom of offering these types of incentives to companies.
On Thursday the Finance Committee will hold an informational hearing on the proposal for Jackson Laboratory. Public comment will be taken after the hearing.
Last week, Malloy’s administration spent two hours explaining the deal to Republican lawmakers from both caucuses.
After the meeting, some Republican lawmakers said there were still more questions than answers. But with Democrats controlling both chambers of the General Assembly the proposal could pass during the Oct. 26 special session without any support from Republicans.
House Minority Leader Lawrence Cafero said his caucus still has concerns about the deal, which would rely mostly on about $25 million of bonding over the next decade.
Not only are there questions about how the deal is structured and how it will be amortized, but there’s questions about how many jobs it will create. Cafero said he rather the state focus on helping small business, so if there’s no help for small business in the greater jobs bill then he won’t be voting in favor of helping Jackson Laboratory.
According to the DECD the deal with Jackson Laboratory will create 841 construction jobs and about 330 jobs over the next 10 years. It also estimated there will be about 4,000 “spin off” jobs created and 2,000 indirect service type jobs created as a result of the investment.
Sen. John Kissel, R-Enfield, pointed out last week that 330 jobs over 10 years will be a tough sell to his constituents.
But Roy Occhiogrosso, Malloy’s senior communications adviser said, he thinks the Republicans are simply making a political calculation and have decided there’s nothing in it for them if they support it. He said the rationale they’re using to oppose it is based on isolated information.
“Republicans are free to oppose this but they will have a hard time explaining to their constituents in five to 10 years why they did when Connecticut emerges as a leader in bioscience,” Occhiogrosso said.
As far as offering incentives to companies to stay or expand in the state, Occhiogrosso said it’s “naïve” of people to suggest Connecticut doesn’t have to offer these types of incentives if it wants to compete against 49 other states and several countries for these jobs.
“That’s not the way economic development works,” he said. “You have to make smart bets.”