Brown & Sharpe Inc., purchased by Sweden-based Hexagon AB in 2001, will be moving out of North Kingstown and into North Stonington, Conn., in the spring of next year, after more than a year of negotiating with Rhode Island officials for a new development deal, according to the company.
Bill Gruber, president & CEO of Hexagon Metrology North America and Brown & Sharpe Inc. said in a statement, “Connecticut presented to Hexagon a number of attractive incentives to assist us in the relocation process that made this clearly the best choice from among those we were considering, including our Rhode Island options.”
Beyond Cash Donations: How New Forms of Giving Are Transforming Not-for-Profit Accounting
Evolving Funding Landscape for Not-for-Profits Not-for-profit organizations are being asked to do more with less,…
Learn More
Hexagon Metrology, a subsidiary of Hexagon AB, made the announcement on Feb. 1.
Despite the announcement, EDC executive director Michael McMahon remained optimistic and said that he doesn’t think Rhode Island will lose many of the 270 jobs; workers will most likely just commute a longer distance over the border, he said.
“We are disappointed by any company leaving, and the decision of the company to move out of state,” McMahon said. “This is a classic example of what happens when one mixes politics and economic development. Fortunately, my understanding is that most of the Rhode Island employees likely stay with the company as they move just over our border.”
The state had been negotiating with Brown & Sharpe since 2003, and in September, nine months of talks failed to result in an agreement. Officials at the EDC at that time urged the state to make a last-ditch effort to keep the company and its jobs here, but in the end, North Stonington offered a few incentives that Rhode Island could not.
The move, according to the company, is pending approval of $6 million in loans and grants and a subdivision zoning change and tax abatements by officials in North Stonington, a meeting for which is scheduled for Friday, Feb. 4.
As to why the agreement failed, the EDC head said, “We couldn’t get everybody working together.”
The General Assembly’s refusal to approve a resolution – which called for the EDC to borrow $15 million to build a new facility in Quonset – played a major part. Hexagon soon after told the state it was actively looking elsewhere.
“The Legislature voted down the item that essentially funded our deal (in Rhode Island) …and that pretty much forced our hand to look elsewhere,” said Bill Fetter, director of marketing and communications for Hexagon Metrology North America. “We haven’t held anything back in terms of our disappointment” in the failed deal.
Hexagon plans to build a new, $13 million, 115,000-square-foot facility in North Stonington, and architects and builders are currently evaluating the site, Fetter said. The company also plans to expand its services at the new facility by adding contract inspection, contract programming and commercial gage calibrations, services Hexagon said could not be effectively supported in the Rhode Island location.
According to the EDC, the cost for the proposed new Quonset facility for Brown & Sharpe was estimated at $12 million. It was to be funded by bonds, with a final maturity of 20 years issued by the corporation. Hexagon would lease the building for a minimum of 15 years. The lease would be guaranteed by Hexagon’s parent, Hexagon AG.
“We came up with a proposal that was overall a better business deal,” McMahon said. “We were going to lend them development money to build new and they were going to guarantee the lease. This deal was overall, better for Rhode island taxpayers than the one that North Stonington offered.”
Laura Ricketson, PBN Staff Writer
