Former top mortgage lender Countrywide, now owned by Bank of America, failed to bring an additional 7,500 jobs to the state of Texas as promised back in 2004.
Six years ago, the Calabasas, CA-based home loan lender received a $20 million grant after pledging to create 7,500 new jobs in the Lone Star State by 2010.
Bank of America reportedly notified Texas Governor Rick Perry’s office on December 31, 2009 that it was terminating the $20 million deal, as it was unable to meet the goal, falling more than 1,600 jobs short of target.
As a result, the company will repay $8.45 million to the state.
Countrywide said it had created 4,530 net new jobs in Texas in 2005 and 2006, exceeding its target for those two years, as well as its third year target of 4,000 jobs by January 2008, including layoffs and attrition.
But the company was expected to create 5,500 new jobs by the end of 2008, and could only squeeze out 3,876.
A year later, BofA spokesman Rick Simon concluded that it was best interest of all parties involved to bring the contract to an end.
Back in 2007, a fifth of Countrywide’s staff was based in Texas, and the company still has 23,000 employees based there.
Countrywide wasn’t the only company unable to fulfill its promise; 20 other companies receiving grants from the fund failed or struggled to meet job creation targets in 2008 as well.