ExxonMobil relocating from Fairfax to Houston? (school, closing, taxes)

[tysonsengineer]

Originally Posted by Jayess1

And neither are firms w/HQ here but incorporated in Delaware. FWIW, most of the F500 use Del. or Nevada to avoid taxes. Renders that line rather moot.

Why would an Energy company be so out of place? We're on the East Coast, closer to Atlantic sources & markets, making it an excellent site for energy trading and speculation (which is becoming a greater % of XOM's business) and generates a great deal of IT ifrastructure work - something we need more of, not less.

It was one thing when they actually had their operations occurring here, but this was just a shell of their former presence. I agree when mobile was merged with exxon, now THAT was a loss for this area because I believe we lost around 15000 positions that shifted to Houston, and all that was left was top level corporate. They were well paid, and likely had a bigger impact than any other group of 2600 in this region, but I doubt that all were Mobile employee hold overs, some were positions direct from houston from Exxon when they cleaned house and therefore some of them might not have even lived in this area, let alone purchased a home.

I actually didn't know that SAIC was a Delaware incorporated company, I find it odd that they can say their headquarters are in Tysons, but that they are also headquartered in DE?

[Jayess1]

It's not odd - over 400 of the F500 are incorporated in Delaware or Nevada (think West Coast tech firms) as a method of avoiding tax collections.
Last data I saw (2010) almost 2/3 of all Fairfax XOM employees were heritage Mobil. Most of the Sr. Exec & higher are from TX.

[tysonsengineer]

Ok, well then I stand corrected since you have the data on it. That is a shame that 2000 locals will lose their position, and if they do have to move in order not to lose it, it could cause a minor ripple in the area. But note that the typical months real estate transactions in Fairfax are measured in thousands, so I still think it won't be a noticeable event, especially since those employees are being told 12-24 months in advance of it occurring. Hopefully they find alternative employment and stick around.

[texas7]

Originally Posted by tysonsengineer

Dude, that building hasn't been filled since it was Mobile, we are talking about a couple thousand employees, its not like Exxon Mobile itself is leaving, just a tiny portion of what Exxon Mobile does. And because they only used it as a corporate branch, and the corporate taxes were actually going to Texas, its not a huge loss as far as losing their corporate presence either.

I said it will hurt, but with 2 years we should be able to make up for the 2600 employees that are leaving. Its not the end of the world like its being portrayed as. Yes they are paid well, so what, alot of people around here are, its not like we are a factory town.

Am I biased against an oil company? Sure. Do I want a bunch of Texas transplants who would rather live in Houston than the nations capital complaining all the time around here? No Get the hell out, and dont look back you filthy cowboy wanna bes.

1000 homes on the market? Many of those people complained about the cost of living around here(why they chose to leave evidently), I bet a lot of them were renters anyways.

From what I hear, most of those people truly enjoyed living in Virginia -- they were initially disappointed at how much less home their $$ bought them in Virginia but acclimated to their new home state very quickly as it is a nice place to live. I would guess the majority will be sad to leave Virginia.

[saganista]

Incorporation in Delaware offers a variety of advantages. Exemption from the income tax laws of other states isn't one of them. According to Exxon Mobil, the number of jobs involved will be around 2100 with some 600-750 actual people expected to move to Houston in stages over 2014-15 as the new facilities there come on line.

[Jayess1]

Originally Posted by saganista

Incorporation in Delaware offers a variety of advantages. Exemption from the income tax laws of other states isn't one of them. According to Exxon Mobil, the number of jobs involved will be around 2100 with some 600-750 actual people expected to move to Houston in stages over 2014-15 as the new facilities there come on line.

Not a complete exemption, but there are definite tax benefits. From Wiki:

However, in general, the state is viewed as a positive location for corporate tax purposes because favorable laws of incorporation allow companies to minimize the corporate expenditures (achieved through legal standardization of corporate legal processes), creating a nucleus in Delaware with operating companies often in other states

XOM is certainly looking to close Fairfax operations at the lowest possible cost - no buyouts (unless one agrees to a significant period of time in TX), no lost value on real estate, and roughly one thousand employees to be "separated".
Note too the numbers & descriptions - the 2100 figure does NOT include all support staff @ Fairfax (contract admin, food, building services, etc.). It's a shame, really.

[saganista]

Originally Posted by Jayess1

Not a complete exemption, but there are definite tax benefits. From Wiki: However, in general, the state is viewed as a positive location for corporate tax purposes because favorable laws of incorporation allow companies to minimize the corporate expenditures (achieved through legal standardization of corporate legal processes), creating a nucleus in Delaware with operating companies often in other states

That's all wonderful, except that every one of those operating companies in other states is fully subject to the corporate income tax laws of that state. Being registered in Delaware is not some Magic Wand that you can wave at the boards and legislatures in other jurisdictions.

Originally Posted by Jayess1

XOM is certainly looking to close Fairfax operations at the lowest possible cost - no buyouts (unless one agrees to a significant period of time in TX), no lost value on real estate, and roughly one thousand employees to be "separated".

The so-called separation numbers include people who are eligible to retire and will. Just the 600-750 people are actually expected to make the move. And keep in mind that working at Exxon Mobil has always been like being in the military in that you can expect to be moved around a lot. Even so, a lot are not happy about this move at all. I'm sure I'm paraphrasing here some, but as one of the no-go's put it yesterday... If I go to Houston, I can buy more house. And then I will have no culture, awful weather, horrible schools, no scenery, and probably worst of all -- all my neighbors will be Texans!

Originally Posted by Jayess1

Note too the numbers & descriptions - the 2100 figure does NOT include all support staff @ Fairfax (contract admin, food, building services, etc.).

You mean the illegal aliens? The numbers being thrown around are all loose approximations and current estimations. The numbers don't include the number of busboys who will be fired at Grevey's or Sweetwater either, but it wouldn't matter if they did. The move is spread out over 2014-15 and will ultimately have a footnote's worth of impact on the region's economy.

Originally Posted by Jayess1

It's a shame, really.

It's being blown out of proportion by people like you, really.

[tysonsengineer]

I think the bigger hit happened many moons ago at the time of the actual merger, this was always an inevitability. 2000+ jobs lost is 2000+ jobs lost, during any economic period that would suck (more so in recession), but seeing as a lot of the people will simply be moving their jobs to houston (no impact for those people on the job market), and that those who arent have 2 years to find other gameful employment (plenty of time for the economy stop being crappy I hope) then I really think that Saganista is right

I know... those last few words felt weird coming out of my mouth to me too :P

[LogSS]

Sounds like Jayess1 is not from this area. He likes making assumption about Northern VA economy.

[Jayess1]

That's all wonderful, except that every one of those operating companies in other states is fully subject to the corporate income tax laws of that state. Being registered in Delaware is not some Magic Wand that you can wave at the boards and legislatures in other jurisdictions

Do you always argue to the extreme & then claim otherwise? Not claiming there's any "magic wand", but indeed there are real, tangible cash benefits to incorporating in Delaware & Nevada. I note that you still can't answer my Q as to why so many incorporate in those two states...

Actually, most of the heritage Mobil folks haven't been moved much. FWIW, one of the key reasons Exxon bought them was for their expertise in petro logistics (a major business in the 90s - remember Enron?) and have stuck w/that here since then, expanding their trading & scheduling operations. In fact, FFAX is "ground zero" for the development of GOM, a new trading/scheduling/product flow system. Once that rolls out @ the world look for the move to accelerate.

Glad to see you admit that the closing will have an impact on many areas of Fairfax life. OTOH, you seem not to understand that footnotes are quite important...

Originally Posted by LogSS

Sounds like Jayess1 is not from this area. He likes making assumption about Northern VA economy.

Lived here longer than you.