Boston Herald: Fidelity bolts

By Greg Turner
Wednesday, March 16, 2011

Fidelity Investments’ bombshell decision to ship 1,100 staffers out of state caught Deval Patrick off guard and overseas — raising fresh concerns that the absentee governor should be tending to business at home instead of trolling for new jobs abroad.

“For the governor to be out of state when one of the state’s largest employers decides to shutter what amounts to an entire campus tells me there needs to be a more concerted effort to focus on the businesses that are already here,” said Jim Lowell, who tracks the Hub mutual-fund giant as the longtime editor of the independent Fidelity Investor newsletter.

Most of the affected workers will relocate from Fidelity’s Marlboro campus to the firm’s offices in Merrimack, N.H., and Smithfield, R.I., beginning this summer and extending through the end of 2012.

“The vast majority of these employees will go with their jobs,” said Fidelity spokeswoman Anne Crowley. “There are a small number of jobs that might be eliminated.”

A source close to Patrick said the governor was given less than 24 hours notice about Fidelity’s decision, adding that he was stunned and upset by the announcement. According to the source, who requested anonymity, Patrick had conversations with Fidelity honchos shortly before his 10-day trade mission began, but they gave no indication of the pending move.

House Minority Leader Bradley Jones (R-North Reading) blasted the globe-trotting governor, saying, “You question whether his time would have been better spent trying to keep these 1,100 jobs here rather than doing the traveling troubadour routine.”

Even more outrageous, said Jones, is that Patrick has announced no major job-creating deals in either Israel or Britain. “It’s almost as if it turned out to be a vacation rather than anything else,” he added.

Lt. Gov. Tim Murray, who is in charge with Patrick away, issued a statement, saying, “We are committed, now more than ever, to compete for every job both at home and on the international market.”

Marlboro Mayor Nancy Stevens said she was shocked by the news, getting neither a heads-up from the Corner Office nor notice from Fidelity, which has been in the city for 16 years. “I am disappointed there was no effort to reach out to the city,” Stevens said. “I would have loved the opportunity to work with them.”

The Bay State’s mutual-fund industry won a controversial tax break in 1996 that reduced Fidelity’s corporate burden by nearly 57 percent in exchange for its vow to boost jobs by 5 percent annually for five years.

Fidelity met that goal, but recent job cuts at other companies with tax deals have prompted state Sen. James Eldridge (D-Acton) to seek a so-called “clawback” tool to allow the state to recoup taxpayer dough.

“Companies should honor their promises to create jobs, and if they don’t, let’s make sure the state has the power to take back lost tax revenue,” he said. “We should stop giving money to companies that are shedding jobs instead of creating them.”

Just last week, Fidelity, which employs 8,400 in Massachusetts, reported a whopping 17 percent rise in operating profit, to $2.9 billion, thanks to the bull market.

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