Barden/FAG and its Winsted Precision Ball division (USA; a division of Schaeffler Group, Germany) will be receiving a total of $3.3 million in state aid from Connecticut, to assist in building the business, and protecting and expanding employment.

The Connecticut Development Authority (CDA, website) a quasi-public agency, has awarded a $3 million loan to the company. Barden/FAG will also receive $300,000 in sales and use tax exemptions.

In all, the awards are to enable the company to retain 462 jobs and add as many as 19 new positions following an expected expansion at Barden/FAG in Danbury, Connecticut.

Barden/FAG manufactures deep groove and angular contact super precision ball bearings. Applications include machine tools, spindles, instrumentation, aircraft/aerospace, and medical devices.

State development authorities reportedly became concerned when Barden hinted it would consider moving some or all of its operations out of Connecticut. Connecticut is by its own admission a "high-cost place to do business," with expensive business mandates, and the minimum wage set at $8 per hour.

CDA President Marie O'Brien said, "The corporation was certainly reviewing its facility and locations," as a justification for its funding award.

The CDA release [here] said: "With this financial assistance, the company will retain 462 jobs and expects to hire 19 more people."

Such funding is, "an important consideration for Barden as it reviews its commitment to Connecticut as a place it wants to do business," commented Ms. O'Brien.

Announcing the awards, Connecticut Governor Mary Rell said, "Every job we can save and create in Connecticut is another step toward economic recovery."

Barden receives the lion's share of a total $5.25 million package the CDA is dividing among Barden, ThermoSpas ($2 million) and Imperial Graphics ($250,000).

In an odd twist of logic, the CDA, based on this $3 million loan, is now taking credit for helping to retain Barden's entire 462-person workforce. So far in 2009, the CDA has released $15 million in loans, laying claim to have "retained and created" more than 4,000 jobs in the state.

News of Barden/FAG's $3.3 million brought a wave of negative comments, undoubtedly exacerbated by economic situation now faced by all bearing manufacturers.

An individual affiliated with the matter told eBearing the CDA's employment claim is, "insulting," noting business employment is by determined skill, market knowledge and supply and demand, not CDA involvement.

A number of Barden competitors have also called into question the premise that Barden was seriously considering a move from Connecticut, and the "fuzzy logic" lay behind what "save and create" jobs really means.

One competitor threatens to lodge a formal trade complaint, arguing the Barden/FAG awards are thinly disguised and anticompetitive government subsidies, paying out U.S. taxpayer dollars to a division of a multi-billion-dollar German manufacturing conglomerate.

Barden was acquired by FAG in 1991 and is now at the core of Schaeffler Group's high-precision bearing manufacturing operations in the UK, Canada and the United States.