Austin City Council approves Merck IT Innovation Hub proposal

Posted on 04/13/2017 by Austin Chamber of Commerce

In a bold move, Austin City Council late this afternoon approved an economic development proposal to bring Merck to Austin. In a 7-3-1 vote, council members paved the way for the global healthcare leader to create its fourth global IT innovation hub in our own backyard.

Voting for the agreement were Mayor Steve Adler, Council Member Ora Houston of District 1, Pio Renteria of District 3, Ann Kitchen of District 5, Jimmy Flannigan of District 6, Mayor Pro Tem Kathie Tovo of District 9, and Alison Alter of District 10. Opposing the agreement were Council Member Delia Garza of District 2, Greg Casar of District 4, and Ellen Troxclair of District 8. Council Member Leslie Pool was absent from the dais today.

The Merck IT Hub is a project worked through Opportunity Austin 3.0, the Chamber’s economic development initiative designed to foster job creating investment in Central Texas.

The Austin Chamber applauds the Mayor and Austin City Council for taking a bold step to help bring a Merck IT Innovation hub to Austin, a game changer for our community. It validates the numerous potential benefits for Austinites, including collaboration opportunities with the Dell Medical School, education providers and development of the innovation district around health care.

The city approved agreement with Merck is a 10-year performance-based contract which will result in 600 new jobs (approximately 350 in the first four years) with an average annual wage of $84,586 and an average median annual wage of $79,548 by 2026. The city would provide about $85,000 a year in incentives based on annual employment and investment benchmarks. According to city economic development officials, the project is expected to contribute a net benefit of $1.9 million to the City of Austin.

In a previous work session, Council Member Ora Houston expressed her view of the potential deal:

“This is the first 380 agreement that has been available to District 1 and I am excited about that,” said Councilmember Ora Houston of District 1. “They don’t want to just do community benefits. They are about corporate neighbors and how to be good neighbors. Cancer is the number one issue in our Hispanic population and number two in the Black population. To me, this is an excellent opportunity to get Dell, UT, and Merck to look broader than just the Innovation District. I am confident that they are willing to do that.”

Representatives from the Dell Medical School have also publicly expressed their support. They highlighted that Dell Med’s primary focus is on health and the community. A potential collaboration with Merck could offer tangible opportunities to help communities and populations across Austin get and stay healthy in ways that would be difficult to achieve without a relationship with this specific sort of company.

“Dell Med is focused on our mission of transforming the ways this community gets healthy and stays healthy," Dell Med Dean Clay Johnston said in a recent statement. "While a number of details need to be worked out, a collaborative relationship with this company could create unique opportunities to fulfill our mission in different and far-reaching ways."

Merck, headquartered in Kenilworth, New Jersey, currently has global IT hubs in New Jersey, the Czech Republic and Singapore.

Related Categories: Economic Development