Copyright AL.com
A Birmingham health care company that’s shutting down its headquarters this year once promised at least 200 new jobs. But Pack Health never asked for any cash from the state or county, and it appears many of those new jobs never materialized, according to project agreement records obtained by AL.com. State officials once boasted that Pack Health was “one of Birmingham’s most successful startups.” The company’s plans for a $5.7 million expansion and 200 new full-time jobs came with promises of cash incentives and tax cuts from the state and Jefferson County. But while Pack Health said it did receive tax cuts from the state, the company never asked for any incentives in exchange for new jobs. Now, it’s shutting down, and taking nearly 100 jobs with it, a spokeswoman for Pack Health confirmed. “We expect to follow up with the state regarding the tax credits received,” Jennifer Petrella said in an email. Petrella blamed the company’s closure on the loss of a major customer as well as “slower market adoption” than anticipated. “We did not make this decision lightly and are committed to supporting our affected employees through this difficult transition,” she said. Pack Health is a digital health coaching service that works with patients to address chronic conditions. Its clients are employers, life science and biopharmaceutical companies, health plans and other organizations that work with health management. Read more: Alabama pledged nearly $500M in incentives for 40 companies since 2023 Five years after the Birmingham startup was founded in 2013, the company set up its headquarters downtown. That’s when Alabama first entered into a project agreement with Pack Health – then called Project Cheddar – in February 2018, per documents obtained by AL.com. At the time, Pack Health employed 27 full-time workers, and planned to increase its staff by 175 employees and invest $50,000 into its new facility, according to its original project agreement. Under that agreement, Pack Health could receive cash from the state for a percentage of wages paid to its workers, with a preference for veterans and Alabama residents. Then, in 2022, Quest Diagnostics acquired the company, and a year later Pack Health announced renovations and even more hiring at its headquarters at 110 12th Street North. Under that plan, Pack Health would hire additional health advisors, coaching staff, member services representatives and software engineers to add onto its team of programmers, health advisors and developers, the company said at the time. The state revised its agreement with Pack Health in Oct. 2022, and the company pledged to hire another 200 new workers with average hourly wages of at least $25 for a total of 402 workers. Alabama pledged tax credits for the company, tied to its headquarters renovations, as well as free job training and $108,000 in cash from the AIDT, per the agreement. Pack Health was scheduled to start construction in 2023 and hire 200 new employees by the end of 2027. The company ended up asking the state for more time for hiring after its merger with Quest Diagnostics. Alabama agreed to extend its deadline for Pack Health to employ at least 175 workers who met the wages requirements by the end of 2023, per records obtained by AL.com. But then, on March 5 of this year, the company asked the state to change the agreement again, without proof that it had made progress on its hiring goals, per the documents. That same day, Pack Health and the state ended their agreement after the company had never asked for any of the incentives tied to new hiring. “The Company has not requested and has not received any Jobs Act Incentives pursuant to the Project Agreement,” the termination agreement reads. “The Parties have determined that it is in their best interest to terminate their respective obligations under this Project Agreement and mutually terminate this Project Agreement.” The Jefferson County Commission also made an agreement with Pack Health in 2022 pledging up to $67,100 for new jobs. In return, the company would create 120 jobs by 2025 and reach 200 jobs by 2027. But the county never paid Pack Health any incentives because they never asked for the money. Now, because the company is shutting down, the agreement is void, the county confirmed. “Pack Health never submitted a report or payment request,” said Jefferson Traywick, the county’s economic development advisor. “The jobs grant is paid out to companies after they create the jobs and hold onto them for a year. The company then needs to provide documentation of this and request payment.” The city of Birmingham never had an incentive agreement with Pack Health, said city spokesman Rick Journey.
