A $1 billion grant to a Chicago-based company to provide a free Gst training was withdrawn from the payroll tax roll Tuesday, after the company’s board and chief executive decided to abandon the plan, according to documents released by Gst.
The company’s stock closed at $1,200.03 Tuesday.
Gst, a global information services company with offices in Chicago and Mexico City, applied for the $1-billion grant from the Illinois Department of Revenue in February to pay for a pilot program that would give employees free training to teach basic computer skills to employees.
It was meant to help the company ramp up its digital-first hiring, hiring, and retention efforts.
But Gst said in April it decided to stop providing training, and that its board had decided that it would no longer fund the program.
In May, Gst’s board told board members that the company would no long be offering training to employees, according the documents.
But the company said in the documents that Gst had decided to discontinue the training program and would instead pay for the training itself through the Illinois payroll tax exemption.
The documents released Tuesday showed that Gis decision to abandon training was prompted by the board’s finding that Gs “current operational plan and guidance to employees is not sufficient and would be ineffective in providing the employee training.”
Gst is also asking for an additional $500 million in state funding for its workforce training program, which the company also hopes to build into a full-time job training program.
The $1B grant was intended to supplement the state’s payroll tax break of $2,000 per employee.
The money was supposed to go to the training and job-training programs in the state, Gs board said in a letter to Gst employees.
The board also noted that GSt had not provided the training or training materials needed to run the training programs.
In its letter to employees Tuesday, Gis said it was “extremely disappointed” that Gstal was no longer able to deliver on its goal of training and retraining workers, saying the company had decided it would instead use the tax-exempt exemption money to pay the salaries of employees.
Gstal said it has been working on a free training program since April.
The company is not providing any additional information on how many people have received training, the letter said.
The decision to stop training and the cancellation of the grant came as Gst grappled with a widening audit by the state auditing arm, which is examining the companys finances and how it manages its money.
In a letter sent Tuesday, the Illinois Board of Trade, which oversees Gstal, asked the state to investigate the company for possible violations of the state constitution.
The audit is the latest in a series of financial troubles for the company.
In October, Gstal said that it had lost $100 million in 2016, with an additional loss of $70 million due in March of this year.
The financial problems have caused the company to cut nearly 1,000 jobs, most of them in Chicago, as well as to shut down some of its offices in Mexico City and Chicago.
The board of Gstal did not immediately respond to requests for comment Tuesday.
In an interview with The Associated Press last week, Gsted’s chief executive, John R. McPhee, said the company was “absolutely” focused on meeting the audit’s deadline, and was in the process of making changes.
The audit is set to begin in late May, he said.