The state is clawing back some of the tax breaks it offered to a once fast-growing Sacramento software company.
The California Competes program is poised to recapture the majority of the $3 million in tax breaks it once awarded to SkySlope Inc., according to the program committee’s upcoming agenda.
The state awarded SkySlope the tax credits in 2018, as an incentive to keep the company expanding in Sacramento, as opposed to out of state.
At the time, the company anticipated growing from 90 full-time employees in 2017 to 320 last year, and investing a total of $4.78 million in the region, according to its CalCompetes agreement.
It appears SkySlope fell short of those milestones. According to the agreement, 2022 was the last year for SkySlope to claim that award. Now, the state plans to recapture $2.4 million in tax credits — those are all the credits the company should have earned since 2020.
SkySlope did not respond to requests for comment.
The company develops transaction management software for real estate brokers. Founder Tyler Smith, who was a real estate agent at the time, launched the company out of his bedroom in 2010. Five years later, it had 60 employees. In 2017, Fortune 500 title insurance company Fidelity National Financial Inc. (NYSE: FNF) purchased a majority share of SkySlope. At the beginning of 2020, it had 200 employees, after outgrowing a series of office spaces, and was poised to keep growing.
But the pandemic brought in a sudden decline in real estate sales, and the company had laid off 25% of its staff by April 2020.
The CalCompetes program is administered by the Governor’s Office of Business and Economic Development. The CalCompetes committee will make its final decision regarding the award at its Nov. 16 meeting.
