AUSTIN (KXAN) – Dropbox, a popular cloud storage company, is growing in Austin despite doing so without incentives from the City of Austin.
The Austin City Council and chamber of commerce voted on an incentive package to the tune of $244,500. It stipulated Dropbox must pay its prospective 170 new employees at least $59,000 a year and invest $5.5 million in the city.
Dropbox is continuing with its plans to expand in Austin but will do so without incentives from the city.
“We’re excited to grow our office in Austin and plan to keep hiring,” a spokesman for the company said in a statement. “Austin is an exciting business hub, and we look forward to continuing to expand our presence in the area.”
Austin Mayor Lee Leffingwell released a statement on Tuesday on the loss of agreements with Dropbox, National Instruments and US Farathane:
The Dropbox, National Instruments and US Farathane agreements represented close to 1,400 quality jobs, potentially for Austin residents… some of which would have paid an average annual wage of up to $72,000 a year, just about what I make as Mayor.
In recent months, Austin City Council action instituted stringent requirements in regard to economic incentives. It concerns me that we have greatly diminished the effectiveness of our incentive program by placing burdensome conditions into the agreements. These obligations range from exceedingly difficult reporting requirements, to new provisions regarding prevailing wage and minimum living wage, and other requirements.
I maintain that these incentives have played an important part in Austin setting the pace in regard to our unemployment rate, and well respected national economic standing. We must remember that past and present success is no guarantee of future success.