Allstate Insurance Co. says it will close its call center in Cross Plains by Dec. 31, ending the jobs of 214 employees.
Cross Plains Village President Kurt Schlicht received a letter from Allstate on Wednesday, saying the closing is "the direct result of improvements in technology, declining insurance claim counts and efficiency gains."
"It's very troubling, very sad," Schlicht said. "It's another sock in the stomach for the economy."
Matt Schuenke, Cross Plains village administrator and clerk-treasurer, said Allstate's announcement came as a complete surprise. "There was no warning," he said.
It is the second big loss of call center jobs in the Madison area — within 35 miles of each other — in three weeks. Lands' End, of Dodgeville, said in late September it will end 149 positions at its Dodgeville call center by the end of January. Another 50 job cuts at the company's headquarters already have taken effect.
Allstate's "express claims" call center at 1850 Ludden Drive in Cross Plains opened in 2007, two years after Lands' End closed a call center at the same location.
At the time, the state Department of Commerce offered Allstate up to $750,000 in Enterprise Development Zone tax credits, to be applied to the Northbrook, Ill., company's Wisconsin income taxes over three years. The offer came with the understanding that the jobs would stay at the site for the development zone's seven-year duration.
Now, Allstate is pulling up stakes only five years later. But the insurance company is not reneging on a deal with the state because it never received the tax credits, said Tom Thieding, spokesman for the Wisconsin Economic Development Corp., successor agency to the Department of Commerce.
"The company never submitted annual reports requesting the tax credits so none were released," Thieding said.
Allstate spokesman Justin Herndon said the Wisconsin claims center is the only one to be closed. Eight others, nationwide, will remain open and will add 110 jobs. He said the Cross Plains employees can apply for those jobs and may be eligible for relocation assistance.
Asked why the Cross Plains site could not stay open but with fewer employees, Herndon said the decision was made based on such factors as "effectiveness, efficiency and technology ... I don't think you can pin it on any one particular thing."
"They were great business partners and great neighbors. I'm sorry to see them go," Schlicht said.
The 34,950-square-foot Cross Plains building and the land it sits on are owned by a limited liability company and valued at $4.1 million, according to the Access Dane website.
"We'd certainly want to work with the property owner to try to assist them in refilling the space, as best we can," Schuenke said. He said there are no interested parties at this time.