June 20, 2008

HP Plans Center In Rio Rancho

By DAN BOYD Journal Capitol Bureau

Computer giant Hewlett-Packard plans to open a technical support center in Rio Rancho that eventually could employ 1,300 people.

Several hundred employees would be hired when the center opens, and the work force would be rounded out by 2012.

The center could be open by next summer and is expected to have a payroll between $50 million and $60 million.

To draw Hewlett-Packard to New Mexico, the state offered incentives that could range from $28 million to $40 million.

Gov. Bill Richardson made the announcement Thursday and trumpeted Hewlett-Packard's decision as evidence of New Mexico's economy faring better than others despite national economic downturns.

"This is one of the most significant economic development agreements we've ever made," said Richardson, who returned Wednesday from a 10-day trip to Europe and the Middle East.

An exact location for the center hasn't been decided, but Rio Rancho officials said they expect it to be within a 160-acre central business district along King Boulevard and Paseo del Volcan.

The Santa Ana Star Center is also in the business district, and the University of New Mexico plans to build a campus on 200 adjacent acres.

Jobs at Hewlett-Packard mostly would be in customer support and sales. They could help offset layoffs at Intel, which remains the state's largest private-sector employer despite cutting about 1,000 jobs during the last year.

New Mexico's unemployment rate is 3.5 percent. The national rate is 5.5 percent.

Hewlett-Packard executives declined to specify starting salaries at the Rio Rancho center, but they indicated they will rely heavily on the local work force to fill jobs.

"We believe overwhelmingly that most of the employees hired will be from the local area," said Jon Flaxman, the firm's executive vice president. He joined Richardson and other state officials at the Capitol for the announcement.

The largest portion of New Mexico's incentives -- an estimated $20 million to $30 million -- will come from the state's high-wage jobs tax credit program, which is available to employers for a four- year period.

An additional $8 million to $10 million will come from job training initiatives, said Fred Mondragon, secretary of the state Economic Development Department.

Richardson said he also will ask the Legislature to approve $12 million in capital outlay funding to help offset infrastructure costs.

If Hewlett-Packard ultimately pulls out of New Mexico, it will be required to repay a certain portion of the incentives, Mondragon said.

Hewlett-Packard, based in Palo Alto, Calif., has 172,000 employees worldlwide and was listed 14th in the 2008 Fortune 500.

It plans to open a similar technical support center in Conway, Ark.

(c) 2008 Albuquerque Journal. Provided by ProQuest Information and Learning. All rights Reserved.