WASHINGTON -- Swedish aerospace and defense firm Saab says its plan to move its North American headquarters to East Syracuse, creating 260 high-tech jobs, could suffer a setback if Congress passes a Republican bill to overhaul the U.S. tax code.

Saab Defense and Security USA warned in a letter last week to members of New York's congressional delegation that the GOP plan may hurt its ability to attract and retain top talent as it moves its headquarters from the Washington, D.C. suburbs to East Syracuse.

Saab Defense President and CEO Erik Smith said the recruiting problem would be caused by the plan to scrap deductions for state and local taxes (SALT) on income, and cap deductions on property taxes at $10,000 per year.

"Losing the SALT deduction is bad news for employers of residents who will have no problem either leaving the state, or never coming to the state, for better personal economics," Smith wrote in the letter.

The letter was also signed by Mike Gerry, president and CEO of Saab Sensis, a sister company in East Syracuse that has become a leader in the commercial air traffic management business.

The two companies employ about 500 people locally. Saab Defense and Security, a global defense and security company, signed a deal with New York state in January to expand by moving its North American headquarters from Ashburn, Va. The company has added 100 employees this year.

Saab promised to invest $55 million in its East Syracuse headquarters as part of the move, which would include the launch of a technology transfer program at the facility to develop new products optimized for U.S. customers.

In return, New York agreed to provide $20 million in Excelsior Jobs Program tax credits, and a $10 million grant from the Upstate Revitalization Initiative launched by Gov. Andrew Cuomo.

Now Saab officials are worried that the most sweeping changes in the U.S. tax code in 30 years will hurt its ability to compete for top talent to fill technology jobs in engineering, research, development, testing and production.

"Central to our growth plan is the ability to attract and retain well-educated and highly mobile technology workers to Saab in Central New York," the company said in the letter dated Dec. 5.

"In doing so, we are competing with employers in other states and historically, high (New York) state and local taxes have been an impediment to employee relocation to the region," the letter said. "The fact that our housing market is very competitive and the SALT deduction offsets high state taxes, often is enough to get a recruit to relocate."

John Belanger, a spokesman for Saab Defense and Security USA, said Monday the company has every intention of keeping its commitment to expand in New York, but wanted to make sure members of Congress heard the company's concerns.

"We're not the only ones in this boat," Belanger said. "It's every employer looking to grow in Central New York or the state."

Belanger said the letter was sent to U.S. Reps. John Katko, R-Camillus, and Claudia Tenney, R-New Hartford, and U.S. Sens. Charles Schumer and Kirsten Gillibrand, both New York Democrats.

"They understand our concerns, and we know they will act accordingly," Belanger said.

Katko and Tenney were among four New York House Republicans to vote for the tax bill that passed last month in the House. Five other Republicans from New York and four from New Jersey split with the GOP over concerns about the tax deductions.

Schumer and Gillibrand, both Democrats, voted against the Senate's version of the bill.

The differences in the two bills are being ironed out in a conference committee, and will require both the House and Senate to vote again for final passage that would send the legislation to President Donald Trump to be signed into law.

The two Saab companies are the first employers in Central New York to publicly raise concerns about the GOP tax plan making its way through Congress this month.

Schumer, Cuomo and other opponents of the legislation say it will disproportionately harm high-tax states like New York, where about 3.4 million taxpayers claim the state and local tax deduction.

New York taxpayers are second only to California in the total amount claimed as IRS deductions for state and local taxes - about $72 billion a year.

Until now, local companies who have taken a position on the tax plan have praised the changes that will help businesses, led by a plan to slash the corporate tax rate from 35 percent to 20 percent. Saab Defense officials said they recognize the lower tax rate would be a significant benefit.

The Manufacturers Association of Central New York has endorsed the tax plan, and representatives of 17 local businesses - both large and small - praised the legislation in a meeting with Katko.

Among the local companies supporting the changes are Hueber-Breuer Construction Co., United Radio Co., Morse Manufacturing, Nucor Steel and the engineering firm C&S Companies.

None of the companies have announced plans to expand their workforce and create hundreds of new jobs like Saab Defense, but executives with the firms say the tax plan will help produce the kind of business climate that could lead to expansion.

In a statement Monday, Katko spokeswoman Erin O'Connor said the congressman has "played a large and tangible role in restoring a deduction for local property taxes" as the bill has moved through the House and into the conference committee.

Katko told syracuse.com last week that he is leaning toward a "yes" vote on the tax legislation when a final bill makes its way to the House. Republican leaders have set a goal of voting on the plan before Christmas.

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