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Investigation: How many jobs at IBM in Columbia and where are they going?

“These credits, when used properly, will mean jobs for decades,” said Missouri Governor Jay Nixon on May 17, 2010 at a press conference in Columbia.

Those jobs Governor Nixon was referring to five years ago are the 800 jobs promised to the state by International Business Machines, or IBM, when the company opened a facility in Columbia in 2010.

In return, the company would get $28 million in tax breaks.

But IBM has not fulfilled that promise, according to the state, and some of those state incentives were suspended just weeks ago.

And that’s not the only thing ABC 17 News has learned. Some jobs are being created, but may not be going to the people you think they are.

ABC 17’s Jillian Fertig first reported on mass layoffs at the Columbia facility back in January and has been following the story since then.

When Fertig filed her report in January, IBM would not release job numbers.

Now, she not only got those numbers, which fall way short of 800, but both current and former employees say they want the taxpayers to know the truth about what’s really going on behind closed doors at IBM.

“The payback is striking,” said Columbia Mayor Bob McDavid on May 17, 2010 at that same press conference. “I mean, the amount of tax revenue we’ll get by this economic activity will make this a very shrewd investment on our part.”

Bought for $3 million by the city of Columbia and leased to IBM for $1 a year, the facility on Lemone Industrial Boulevard was expected to boost the local economy by providing jobs.

But after three rounds of rumored layoffs, Fertig started digging around.

In January, a spokesman for IBM said the company layoffs were part of a “$600 million restructuring.”

But he would not provide job numbers.

Fertig then filed an open records request with the Missouri Department of Economic Development.

After several calls and emails went unanswered, the department finally provided her with documents that showed the current number of employees at the Columbia facility is just 453. That’s down from 610 in January of 2014.

In a letter from the DED dated April 22, 2015, the department informed IBM that “reducing the number of jobs at the Columbia facility below 500 constitutes a suspension event,” meaning the state will no longer be giving tax credits under the Missouri BUILD program.

Fertig went back to Columbia Mayor Bob McDavid, who was a big supporter of IBM coming to Columbia in 2010 to ask him whether he thought IBM kept its promises.

“I think a lot of it depends on perspective, you know?” McDavid said. “Is the glass half full? Or half empty? Because I would submit that if you go back to the year 2010, and say we’re going to bring in an international, a global company, with 450 employees, I think that the city would have been delighted about that.”

“They [IBM] are not required to be transparent with the city,” McDavid went on. “You know, for example, I have no business knowing what your salary is. You’re a private employee.”

“But do you feel like maybe that’s a little misleading to the taxpayers?” asked Fertig. “I mean, this was a big deal for Columbia.”

“Well now let me just say this,” McDavid said. “They do have an obligation to the state of Missouri, whereas our obligation simply was that they had to pay for fixing up the building.”

Fertig also got in touch with IBM spokesman Clint Roswell, who initially insisted the company met all state requirements.

“We don’t publicly discuss staffing numbers, but we’ve met all state and local requirements and that’s really as much as we’ll be saying,” Roswell said.

“But according to the letter, it says you’re not so they’ve suspended them for the time being, for the state credits, for the Missouri BUILD program,” Fertig said.

“The incentives which IBM qualified, we’ve lived up to those obligations,” Roswell responded.

“Just not the BUILD incentives,” Fertig replied.

“Correct,” Roswell said.

Fertig asked more questions to try to find out more about the future of IBM in Columbia, but the phone call stopped there.

“I’ll come back to you when we have something to tell you,” Roswell said.

But IBM employees in Columbia, both current and former, said they have something to tell.

One employee, whose voice has been concealed to protect their identity, said the 453 number of employees at the facility is far from accurate.

“It’s hard to count 300 in the building at any one day,” the employee told Fertig. “There are people that work from home and some of those homes are not even in Columbia. They’re in different states. It looks as if they’re here in Columbia, but in reality, they’re not.”

Two other employees and a union leader for IBM said similar things about the numbers.

To get an idea of just how many people work out of the building, Fertig went on a Monday afternoon and counted the cars in the parking lot.

She counted 164 cars in the lot at 2:45 p.m. That means nearly three people would have to carpool together in each car to equal the 453 people that IBM says it has working in the building.

The company said not everyone reports to the building on Mondays.

That employee also talked to Fertig about the most recent round of layoffs back in January.

“Everyone in the building knew something was up,” the employee said. “Everyone. And then when all the strangers showed up with packets, others walking around, looking out over employees that were there, keeping track, everybody knew that was the day.”

But this employee said while the layoffs are concerning, they said it’s what the company is doing to replace those workers who are laid off that’s more disturbing.

“IBM will bring Indian people over here to work,” the employee said.

“So you’re saying they’re replacing American workers with foreign workers?” Fertig asked.

“Yes,” the employee said. “In the case of training the folks from India, to do whatever the person is doing here, that would be an accurate statement because that’s exactly what’s happening.”

Another employee who did not want their voice recorded told Fertig the same thing.

They said some people in the building are currently training the foreign worker who will take over for them when they finish their last day.

The Union also said the company has been doing this and even has a page on its website where an employee can confidentially submit information if they are training their off-shore replacement.

The same allegations have been made at the IBM facility just 300 miles away in Dubuque, Iowa.

In fact, U.S. Senator Chuck Grassley even sent a letter to IBM questioning why the company was petitioning for H1-B visas when it just laid off hundreds of American workers.

IBM told an Iowa newspaper last month “In order to serve the evolving technology needs of clients in high-growth area such as cloud computing, data analytics, social and security, IBM and the tech industry must utilize a global talent pool. Today, there are simply not enough American workers with expertise in these areas to fill the thousands of U.S. job openings IBM currently has available.”

Fertig has been in regular contact with Senator Grassley’s office. She was told Grassley’s office has gotten a response to the letter, but the contents of that response letter are not being made available to the media yet.

Fertig asked Mayor McDavid about this same issue.

“Are those concerning allegations?” she asked.

“I don’t know anything about them, and again, it’s just, I don’t have any control over who your media company hires,” McDavid said. “I would love it if they hired Mixxou graduates or Hickman or Rock Bridge graduates, but they’re free to hire people from Arizona right? So, that’s just the way the world works and you have to be able to compete on that basis.”

Fertig reached out to several lawmakers, including Missouri Congresswoman Vicky Hartzler, whose district includes the IBM plant.

Her office said it’s aware of the concern that American workers are possibly being replaced at IBM with foreign workers.

Fertig was told her office has been in communication with Senator Grassley’s office about his proposed legislation regarding stricter H1-B visa laws.

While government leaders at the state and local level may or may not know about what could be going on behind closed doors, IBM employees said the reason they’re coming forward is because the taxpayers have a right to know.

“Unless the state of Missouri, you know, grabs themselves by the boot straps and says, ‘This is taxpayer money, this is not some sort of fluff money from Washington,’ nothing is going to happen,” the employee said.

While the state of Missouri has suspended some of the tax credits for IBM, here’s a look at how much money the company has received in tax incentives so far:

Missouri Quality Jobs Program: $3.9 million

Missouri BUILD incentives: $4.1 million

Training dollars: $1.71 million

Sources an the Columbia IBM facility said more layoffs are expected to be announced later this month.

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