America’s number one mutual fund company – lured to the Ocean State in part by a series of special tax incentives approved by the General Assembly two years ago – has delivered on the promises it made to Rhode Island’s business and political leaders – and taxpayers. Fidelity has delivered more than 1,100 jobs to a sprawling 350-acre campus in Smithfield and at least one more building and more people are on the way.
In April 1988 the company opened a 250,000 square-foot, four-story office building. On Wednesday, Sept. 8, Fidelity broke ground on a second building at the Smithfield complex. The new facility will be bigger than the first and will bring another 1,300 jobs.
Rhode Island's Market Has Changed. Developers, Builders, Investors and Sellers Must Change With It.
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The second office building is expected to be completed by the end of 2000 – bringing Fidelity’s total Rhode Island employment to 2,500.
James Griffin, a Fidelity spokesman, said that Fidelity Investments Institutional Services Company, Inc. in Smithfield (FIIS) – is among the mutual fund’s fastest growing divisions and the employees there need more room.
“The new building will help us answer our short and long-term needs,” Griffin said.
Evidence of Fidelity’s rapid growth can be found on any given Sunday – by scanning the want ads.
Last week, the company promoted a job fair in Smithfield, at which programmers, mainframe developers, software developers, customer service representatives, operations managers, client managers and contingency planners were being recruited. More job openings at the company have been advertised in recent days.
State feeling the impact
FIDELITY
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Sen. William V. Irons, a Democrat from East Providence is not surprised by the success of Fidelity’s operations in Smithfield – nor the economic impact the company is having on the state. And the true weight of that impact, said Irons, goes “way beyond the bean counting.”
“A bigger part of this equation that few people focus on, is the mere presence of Fidelity,” Irons said. “Now we have the number one mutual fund company in the country and the number one retailer, in Nordstrom.”
Irons said that when he talks with representatives from major companies throughout the country, they want to know how Rhode Island was able to land Fidelity Investments. The tax incentives the company received, Irons said, are being repaid with interest.
It’s not just about jobs, Irons said. For example, he said, Fidelity has spent about $250,000 in the Rhode Island arts community to enhance the Smithfield facility. And at last Wednesday’s groundbreaking, the company awarded scholarships to five incoming juniors at colleges in Rhode Island.
“These things go beyond the bean counting,” Irons said. “Fidelity is a world leader. For a world leader to come in to Rhode Island and expandthat gives the Economic Development Corporation such a tool. You can’t put a number on that. It’s not about bricks and mortar.”
Fidelity Investments currently has on the table, a 1.1 million-square-foot, five-office-building master plan that it may ultimately develop in Smithfield. The key to that development, however, may be found in the next session of the General Assembly.
The company – along with other major Rhode Islander employers such as Fleet and American Power Conversion – is watching closely to see what becomes of a “flat tax” proposal that would benefit executives earning at least $175,000 per year. The proposal – which had been tied to the creation of 7,500 new jobs – drew a decidedly cool response from several state representative and community leaders. While proponents believe the flat tax is a worthy investment if it results in the creation of thousands of new jobs, opponents see it as nothing more than an unnecessary tax break for the wealthy.
The issue is expected to be revisited on Smith Hill in 2000. There are also other pieces of “job growth legislation” that would benefit Fidelity, including the elimination of the tax on capital gains taxes for investment assets held five years or longer.
At an announcement in early June of this year that Fidelity was proceeding with plans to build the second office building, David C. Weinstein, the company’s chief of administration, said Fidelity’s decision to expand its Smithfield operation was in fact based on the strong relationship between the company and the leadership at the State House.
“For more than four years, Fidelity has worked with Rhode Island government leaders to create the climate to grow good jobs in the financial services industry,” said Weinstein. “Our company, with a base of 15 million customers, has chosen Rhode Island for its newest expansion because we believe in the strength of the partnership that we have forged with government leaders. The enactment of the job creation legislation will show employers throughout the country that Rhode Island is friendly to business.”
