June 10, 2009 GlobalFoundries commits By DREW KERR
We're in.
That's the message GlobalFoundries officials sent state leaders on Tuesday when they delivered a commitment letter confirming their intent to build a $4.2 billion computer chip factory in Saratoga County.
The announcement comes almost exactly three years after officials with Advanced Micro Devices, which partnered with an Abu-Dhabi investment firm last year to form GlobalFoundries, first said they wanted to build at the Luther Forest Technology Campus in Malta and Stillwater.
A formal pledge to construct the plant was needed by next month for the company to cash in on a $1.2 billion incentive package New York leaders used to entice the company to the region. The package includes tax breaks and $650 million in cash.
Local officials who have worked to bring the computer chip maker to the area said the company's commitment should erase any lingering skepticism about the development.
"For those of us who have been working on the project day to day, we've had little doubt," said Michael Relyea, Luther Forest's executive director.
GlobalFoundries officials will be in Malta today to buy the 223 acres of land they need to become the tech park's anchor tenant. Site clearing is expected to begin at the site on Monday, and a groundbreaking ceremony is being planned for July.
Relyea said area residents should expect to see an increase in construction traffic over the coming days and weeks as equipment is moved in.
On Tuesday, road construction continued within the 1,400-acre park, located off Route 67, while crews also continued work on a new roundabout on Route 9 that is part of the Round Lake bypass, meant to funnel traffic from the Northway to the tech park.
All other infrastructure efforts -- including the new county waterline, electrical lines and sewer pipes -- are on schedule, Relyea said.
Construction of the chip factory is expected to last up to two years and use as many as 1,900 workers.
Last week, the company agreed on terms with local labor unions that will provide 100 percent prevailing wages on the project. The effort to reach a deal with the unions had, in part, led to delays in the land purchase and formal commitment.
The plant is expected to be operational in 2012 and to employ around 1,400 people, company officials have said.
The development is also expected to spur a series of spin-off businesses, indirectly creating as many as 5,000 support jobs in the process.
Dennis Brobston, executive director of the Saratoga Economic Development Corp., said several other companies that would support GlobalFoundries could also arrive soon, now that the company has pledged to build.
"We've probably got three or four companies that are really working hard to solve the issues that they have, which is, 'Where do we go from here?'" he said. "And those companies that have been hovering around waiting for GlobalFoundries to get in the ground will be a lot more serious now."
Brobston said he and other local officials will travel next month to Semicon West, a nanotechnology conference in San Francisco, to try to attract more companies to the area.
Local promoters hope the tech park will become home to at least two other large manufacturers.
Whether additional public money will be requested to lure other companies remains to be seen, but Brobston said such incentives are becoming increasingly common.
"We're in a competitive marketplace, and we have to understand that we have to give to get in this market," he said.
It would be "foolish" for the state to stop building on the momentum of the GlobalFoundries deal, he said.
GlobalFoundries also announced Tuesday it has reached a development agreement with the towns of Malta and Stillwater that will provide the communities with $5 million in "host benefits."
A 32-acre public recreation complex will be built with $1 million of the money, while the remaining funds will be put toward two foundations that will finance future community projects.
