Fort Worth trying to lure DynCorp International headquarters to Alliance

Posted Wednesday, Jul. 24, 2013  comments  Print Reprints

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DynCorp International, the multinational contractor with 1,000 employees and most of its operations already in Fort Worth, is considering expanding here and moving its headquarters from Virginia under a tax abatement the City Council is studying.

DynCorp would expand the footprint of its Fort Worth offices in the Alliance Corridor, maintain its current 1,000 full-time-equivalent employees and move at least 100 here from the Washington, D.C., suburb of Falls Church, Va.

The council will vote on the agreement in August.

The company, which provides aviation, logistics, training and intelligence-related support services, is also considering Alabama and North Carolina, said Robert Sturns, Fort Worth’s assistant director of housing and economic development.

If Fort Worth loses the headquarters to one of those two states, it also risks losing the company’s local operation, he said.

“That’s really the risk factor,” Mayor Betsy Price said Tuesday.

The city and Dallas/Fort Worth Airport would benefit significantly, she said.

“A lot of people fly in and out of their headquarters at DynCorp, and they’re excellent jobs. The pay on these jobs is excellent,” Price said, praising the city staff and the Fort Worth Chamber of Commerce for a “long, hard-fought battle” in shepherding the DynCorp negotiations.

Fort Worth will also present the DynCorp development to the state for consideration as a state enterprise project designation, which would give the company a refund on its state sales tax.

DynCorp spokeswoman Ashley Burke declined to say whether the abatement and the sales tax designation would be enough.

“We are always looking for ways to operate more efficiently and effectively while reducing our costs across the organization,” Burke said in an emailed response to questions.

“Part of that process includes an examination of our facilities and our location-sensitive operating costs,” Burke said. “We love Fort Worth — DI has had operations there for decades — and, if it makes sense financially, we would be open to expanding that presence.”

DynCorp’s aviation business is based in Alabama, and the company has a “significant presence” there, Burke said, declining to answer other questions about the company’s motivation for relocating and whether it’s in negotiations with Alabama and North Carolina.

Both states are pursuing the company, and Fort Worth has been talking to DynCorp for three or four months, Sturns said. The average annual salary of headquarters employees is $125,000 to $130,000, he said.

DynCorp, a Fortune 1000 company with 30,000 employees worldwide, has operated in leased quarters at 13500 Heritage Parkway since 2006. Ninety-six percent of the company’s income comes from contracts managed by the Fort Worth facility, Sturns said.

DynCorp would receive a 10-year city property tax abatement of up to 80 percent of the new real and business property value that it adds to the tax rolls.

The abatement would be a maximum of $970,600 over 10 years. The company would pay an estimated $1.7 million in city taxes over that time.

To get the maximum abatement, DynCorp would have to invest at least $14 million in expanding the building and adding equipment in four annual increments starting next year and ending in 2017. The expansion and relocated employees would be be in place by December 2014, Sturns said.

The increments would be $2 million in improvements and $4 million in business property in 2014; $2 million in business property in both 2015 and 2016; and $2 million in improvements and $2 million in business property in 2017.

Either 30 percent or $600,000 of its construction spending on the improvements — whichever is greater — would have to be done with Fort Worth contractors. And the greater of 25 percent or $500,000 would have to be done with Fort Worth minority- and women-owned contractors.

The greater of 25 percent or $1.25 million of the company’s estimated $5 million in annual service and supply spending would have to be done with Fort Worth companies. The greater of 25 percent or $1.25 million would have to be done with Fort Worth women- and minority-owned companies.

The abatement contract also contains benchmarks for employment of Fort Worth and central-city residents.

Failure to meet any of the measures would result in a reduction of the abatement, with the overall employment target comprising 15 points of the maximum 80 percent abatement.

Water restrictions

Fort Worth residents seem to be complying with the new watering restrictions. About 30 percent fewer “advisory” letters are going out to violators than when restrictions were in place in 2011, said Frank Crumb, director of Fort Worth’s water department. Officials are debating whether to leave restrictions in place year-round.

Scott Nishimura, 817-390-7808 Twitter: @JScottNishimura

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