IRS Submission Processing Facility Update Closing in Late 2019 Affected Employees Disposition of Real Estate
IRS Submission Processing Facility 23 Acres (combined)
• IRS notified it’s affected employees via email on September 14. • Also Closing Submission Facilities in Fresno, CA in late 2021, affecting 3,000 employees and; Austin, TX in 2024 • “Flat Top” Facility on West 4 th Street Only, Not Gateway IRS on Scott Street. • GSA (General Services Administration) is property landlord, not IRS • A statement from the IRS said: “As part of the continuing efforts to use resources efficiently, the IRS is taking steps to further consolidate submission processing operations across the country as electronic filing continues to grow and fewer taxpayers file paper tax returns. These consolidation efforts began in 2003, leading to the consolidation of 10 sites into five locations that process paper tax returns.”
Criteria Used to Determine Consolidation Sites and Order Highest Consideration: Employee Impact and Real Estate Savings Labor Savings Condition of Facility Labor Savings Condition of Facility Lease Conditions Workload Impact
Timeline • The Submission Processing work in Covington will cease after the end of the 2019 filing season, but sometime before the end of the fiscal year (9/30). • The IRS has consolidated other Submission Processing sites, closing five between 2003 and 2011. • As in prior consolidations, the IRS will provide assistance to employees to help as many as possible transition to other jobs in the IRS or find employment outside of IRS. • It is too early to know how many employees will be able to transition to other opportunities or voluntarily depart between now and 2019. • The IRS will make use of local resources, Gateway Community and Technical College, and the Kentucky Career Center, in assisting its affected employees.
Affected Employees Cincinnati SP--Affected Employee Count Street City St Employee Building Name Count 200 West Fourth St. Covington KY 1571 CSC Service Center CSC Gateway Center 333 Scott St. Covington KY 64 CSC Gateway West 300 Madison Ave. Covington KY 2 7125 Industrial Rd. Florence KY 176 CSC Files (IRRC) Totals 1,813 Cincinnati--Non-Affected, other than SP Building Name Street City St Employee count 200 West Fourth St. Covington KY 60 CSC Service Center CSC Gateway Center 333 Scott St. Covington KY 1238 CSC Gateway West 300 Madison Ave. Covington KY 559 CSC Files (IRRC) 7125 Industrial Rd. Florence KY 193 CSC Annex 7940 Kentucky Dr. Florence KY 207 7300 Turfway Rd. Florence KY 29 Turfway Totals 2,286
• Net Loss of 1,637 IRS Jobs in Covington • Net Loss of 176 IRS Jobs in NKY outside Covington • 1,857 IRS Jobs Remain in Covington • 429 IRS Jobs Remain in NKY outside Covington • According to the IRS, the Average Annual Wages at Submission Processing Facility in Covington is $34,196. • Estimated Annual Payroll Tax Decrease to City is $1.37 Million
Where do the Affected IRS Employees Reside? Kentucky: 944 Ohio: 833 Indiana: 34 Other 6 Total: 1,867
Other History • President Kennedy Called Covington Mayor to Notify that the Covington Location was selected over Ohio Location • Properties Transferred to Federal Government by City May 6, 1965 for $1.00 October 5, 1971 for $214,630.37 IRS Urban Renewal Project (expired January 1, 2000) December 12, 1974 for $168,900
Next Steps • City to Coordinate Local Resources, Gateway and Kentucky Career Center, to assist affected IRS employees, with goal of maintaining jobs in Covington. • IRS to assess its future business needs in light of the consolidation of these SP’s. • IRS to assess its future space needs after future business needs established. • GSA assists IRS in identifying and satisfying its space needs and facilitating the disposition process if applicable. • City Seeks Commitment from IRS on remaining IRS jobs in Covington. • City Seeks Commitment from GSA to participate fully with City and other partners in determining best future use of “Flat Top” facility and maintaining open lines of communication throughout the disposition process.
Next Steps (cont’d) • City Commission Requests of IRS and GSA: Encourage IRS to Offer Retraining Opportunities to Affected IRS Employees Consider Growing Other IRS and Federal Government Jobs in Covington to Replace Lost Jobs Full City Participation in the SP Property Disposition Process Recognize City as Lead Entity in a Unified Approach to the Disposition of the SP Property in Coordination with other Public Partners (NKY Convention Center, NKY Convention and Visitors Bureau, Kenton County) Since City has Jurisdiction over Future Land Use
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