Tag Archives: incentives

Hankook gets another $2.7M to move HQ to Nashville

Hankook Tire America Corp. is set to receive $2.72 million in incentives for moving its North American headquarters from New Jersey to Nashville, reports the Nashville Business Journal.

Hankook, whose parent company is based in South Korea, plans to employ about 200 people at the Nashville headquarters within two or three years.

…Details of the state grant became public in advance of Tuesday’s meeting of Metro’s Industrial Development Board, which also has to sign off on the grant. It’s little surprise the state is devoting taxpayer aid to help entice Hankook, given the state’s desire to continue to foster its reputation and profile within the automotive industry.

According to board documents, the grant is to reimburse Hankook for expenses tied to renovating and setting up its new headquarters. Hankook is leasing the entire fifth and sixth floors of the (Nashville’s AT&T Tower, also known as the) “Batman Building,” about 40,000 square feet. When Hankook announced its move in the spring, the company said it would invest $5 million in the move itself.

Hankook will be eligible to claim the grant money between now and April 2021. To receive the reimbursements, Hankook commits to hire and retain 150 full-time employees through the end of that grant period.

…By the end of this year, Hankook expects to start making tires at its $800 million factory in Clarksville, an hour northwest of downtown — a precursor economic development deal that gave state officials an opening to recruit Hankook’s North American headquarters as well. In that separate deal, Hankook received local and state incentives and benefits worth more than $120 million.

Nashville, Chattanooga companies lead in TN corporate welfare

Companies bases in Nashville and Chattanooga are leading beneficiaries of “taxpayer handouts to big businesses in Tennessee,” according to Beacon Center of Tennessee statewide listing of incentives and tax breaks.

The new Beacon website, Endcorporatehandouts.com, “is the start of a large public awareness effort on corporate favoritism the Beacon Center will run over the next couple of years,” says a news release.

Further: “The website features an interactive map that tracks which businesses received handouts from the state and local governments. Nashville, Chattanooga, Clarksville, Memphis, and Charleston round out the top five areas for private businesses receiving taxpayer money. The site also features a brand new video on corporate favoritism and a ticker with the Tennessee businesses that have received the most taxpayer money over the past decade.

“…”This is a really exciting start in our effort to educate the public on the unfair and unethical practice of giving the tax dollars of hard-working Tennesseans to multi-million dollar corporations. Ending corporate handouts is an issue that those on both sides of the aisle can come together to support. This isn’t an issue of right and left, it’s an issue of right and wrong.”

The site says $3 billion in “corporate welfare” has been provided to 470 companies since 2005, about 3 percent of the state’s 170,000 companies.

The Commercial Appeal has story on the report. An excerpt: Continue reading

State paying $5.5M to help Memphis company move

State taxpayers are anteing up $5.5 million toward the $27 million renovation of Memphis’s vacant Peabody Place mall into the new corporate headquarters for ServiceMaster, which is moving Downtown from its current East Memphis offices, reports the Commercial Appeal.

The State Funding Board on Thursday approved a $5.5 million grant for the project. The money is coming through the Tennessee Department of Economic and Community Development’s FastTrack economic development program that provides incentives for businesses to relocate to the state and, increasingly, to keep existing businesses here.

ECD spokesman Clint Brewer said the grant is the total state incentive for the project and will help pay for construction and renovation of the 15-year-old, 328,000-square-foot Peabody Place for use by ServiceMaster.

The state money was the first public incentive to be disclosed for the ServiceMaster relocation announced last Friday by the home and commercial services provider’s chief executive, Gov. Bill Haslam and Mayor Jim Strickland, who declared it “the most significant corporate headquarters announcement in Downtown Memphis in a generation.”

Downtown officials are proposing a $1 million grant to help ServiceMaster with an estimated $14,795,000 in tenant improvements.

…Landlord Belz Enterprises expects to spend about $12 million to retrofit the building.

On Tuesday, Belz is scheduled to ask another commission board, the Center City Revenue Finance Corp., to approve an amendment to Peabody Place’s existing tax abatement.

State subsidies not enough to save ‘Nashville’ from ABC ax

The ABC television drama “Nashville” will not be renewed for a fifth season despite allocation of another $8 million in incentive money including in the state budget for the coming year.

From The Tennessean:

The show’s production reshuffled its creative team and negotiated in principal a lucrative government incentive package in making its sales pitch for renewal to ABC. But inconsistent ratings plagued the program, a fictionalized drama on the local music industry and city politics.

Still, “Nashville” made its mark on the local economy.

Tourism leaders say “Nashville” lured visitors from around the globe. The Bluebird Café, which was a regular setting for the show, enjoyed sell-outs and long, winding lines of fans hoping to gain a seat.

“We are incredibly disappointed to hear the news that ABC has not renewed the show ‘Nashville’ for another season,” Nashville Mayor Megan Barry said in a written statement. “The show has been an enormously successful promotional tool for our city, which is why the state of Tennessee and Metro Nashville were prepared to support production for a fifth season to be filmed here.

“This is a loss for ABC and for the millions of fans across the world who have grown to love this show. We have enjoyed hosting the cast and crew of the show over the last four years and look forward to future opportunities for film and television production here in Nashville.”

…In four years of production, “Nashville” brought in $45.65 million in incentives, mostly from the state. The state and Metro justified the incentives because they viewed “Nashville” as an hour-long commercial for visiting the city.

In that way, the show influenced the incentive strategy for film work, with a new focus on productions that might help boost tourism.

“The state has supported the show, and we believe it was an excellent marketing vehicle for Tennessee,” said Bob Raines, executive director for the Tennessee Entertainment Commission. “The show had a great run, and it will live on through syndication and streaming services for people all over the world to enjoy. The show also leaves a terrific musical legacy that fans can continue to enjoy and associate with Tennessee and the city.”

Religious counseling bill could offset $8M subsidy of ‘Nashville’ TV show?

Gov. Bill Haslam included $8 million in the coming year’s state budget to subsidize the TV show “Nashville” (previous post HERE) and it was approved by the Legislature. Now, a Fox News entertainment writer is speculating that Haslam’s signature on a bill allowing therapists to refuse counseling to persons based on sexual orientation could lead to cancellation of the series.

ABC’s Nashville has received deserved praise for its handling of Will Lexington’s (Chris Carmack) struggles with his sexuality, and his whole coming out storyline. But now, some of the show’s stars find themselves in the middle of a real-life battle over a recently-passed Tennessee law that discriminates against LGBT people.

House Bill 1840, which Gov. Bill Haslam signed into law this week, gives therapists and other mental health professionals the right to refuse to treat patients whose lifestyles go against the professional’s “sincerely held principals.”

When the bill was still under review, Nashville star Connie Britton spoke out against it, telling The Hollywood Reporter: “I shoot a TV show in Tennessee, and honestly, if they proceed with this, I’m not necessarily going to feel comfortable working there. That is a tricky situation because of course we employ a lot of people in the state, and you certainly don’t want to have to interrupt that, but at the same time, this is the only way that we can have our voices be heard.”

Added Carmack — who, according to THR, is reconsidering buying property in Nashville because of the law: “We said, ‘Do we want to live in a place like this?’ … I guarantee you that there are many more individuals like myself and my fiance who are potential long-term transplants from all over, who are saying, ‘Is this a place I would want to call home, a place that would write this sort of thing into legislation?'”

A “tricky situation,” indeed. ABC has yet to renew Nashville for a fifth season, but if it does, Carmack and Britton’s comments beg the question: does the show’s cast and crew have a responsibility to put their money where their mouths are, so to speak, and refuse to shoot in the state? Certainly Britton’s comments, more so than Carmack’s, will be perceived as an empty threat if the show continues to film there. Perhaps rather than pulling production from the state, the cast and crew of Nashville can use their influence to raise awareness and money for LGBT rights issues, and fight the good fight from within.

On the other hand, if ABC isn’t planning to renew Nashville, this could be a nice opportunity for the network to put an activist label on its decision. Particularly because it would be difficult if not impossible for the show to relocate elsewhere, since so many scenes are tied to actual Nashville hotspots, including the Bluebird Caf and the Grand Ole Opry — not to mention the local musicians who provide much of the show’s music.

Note: Post on Haslam signing the bill is HERE.

Haslam’s $30M secret project draws criticism

By Erik Schelzig, Associated Press
NASHVILLE, Tenn. — A state senator on Tuesday questioned fellow Republican Gov. Bill Haslam’s proposal to earmark $30 million for an undisclosed economic development project in Tennessee.

Sen. Bill Ketron of Murfreesboro cited state money spent on problematic economic development deals, including a shuttered polysilicon plant in Clarksville, a West Tennessee solar farm that still isn’t operational, and a facility to study converting switchgrass to fuel that has been moved to Iowa.

“We continue year after year, and even going back to the prior administration, laying out large chunks of money for what we think might occur,” Ketron said. “And they don’t seem to materialize.”

State Finance Commissioner Larry Martin declined to elaborate on the development prospect other than to describe it as an “exciting project” during a Senate Finance Committee meeting.

Ketron said he was uncomfortable voting for the new project on the basis of state officials saying, “Trust me, it’s going to be good.”
Continue reading

Haslam earmarks $12.5M to subsidize TV shows

NASHVILLE, Tenn. (AP) — Gov. Bill Haslam is proposing to spend $8 million to keep the ABC television show “Nashville” in the Tennessee capital.

The Republican governor’s spending plan also includes $4.5 million to subsidize the CMT network’s “Million Dollar Quartet” miniseries in Memphis.

CMT is adapting the Tony Award-winning musical on the recording sessions featuring Elvis Presley, Johnny Cash, Carl Perkins and Jerry Lee Lewis into an eight-episode drama. The series will focus on the musicians’ rapid rise to fame during a time of political change and social unrest.

The music-oriented drama “Nashville” has been set in Music City since 2012, and officials credit the show for drawing tourists from around the country and world.

Eastman reducing workforce without losing $30M in job-creation incentives

Kingsport-based Eastman Chemical Co. may be trying to reduce its workforce, but that doesn’t jeopardize a $30 million incentives package provided to the company two years ago for building an new and almost complete “global corporate business center,” reports the Kingsport Times-News.

Eastman told the Times-News last Wednesday the company would offer voluntary separation to employees amid short-term challenges the company was facing due to slow global economic growth.

…As part of the project (announced two years ago), Eastman pledged to invest $1.6 billion in its Kingsport site and add 300 new jobs to its 6,000-plus workforce in Northeast Tennessee… In total, the state signed off on $30 million in economic incentives toward the project.

…“Eastman is fully in compliance with their grant (contract),” said Clint Brewer, spokesman for the Tennessee Department of Economic and Community Development. “They have a number of years to complete the job creation, and they are well within the grant period to make up the jobs.”

Eastman Chairman and CEO Mark Costa told employees during a global town hall-style meeting last Tuesday that the company expects to reduce non-operations labor by up to 5 percent worldwide — which is about 300-350 employees. The company’s worldwide workforce is about 15,000.

“We expect to manage this primarily with a targeted voluntary separation program, not filling some open positions, and by leveraging normal attrition and performance management,” Eastman spokeswoman Tracy Kilgore said in an email the following day.

Kilgore, in a follow-up email, said the near-term challenges faced by Eastman are not a reflection of the strength of its growth strategy.

“We will continue to invest in growth even as we navigate through these challenges,” she promised. “This means that we will continue hiring, driving innovation, investing in our sites and supporting our communities. We will continue to meet the multi-year commitments we made through Project Inspire, including new job creation. The actions that we are taking do not impact this.”

Munitions company gets $26M in incentives for move to Blount County

The incentives package negotiated to bring Advanced Munitions International to Blount County from Arizona totals about $26.6 million, reports the News Sentinel. That excludes local property tax abatements by the county and the city of Alcoa.

AMI and state and local officials announced Oct. 20 that the company, based in Payson, Ariz., will invest hundreds of millions in building a new “global headquarters” and munitions manufacturing facility in Partnership Park in Alcoa, ultimately creating hundreds of jobs. The company said it expects to start construction next spring and open in late 2018.

The incentives package includes:

— The $11,325,000 agreed-upon value of the 236 acres deeded over to the company Oct. 19 by the Industrial Development Board of Blount County, Maryville and Alcoa. The IDB acquired the bulk of the property, 222.5 acres, for $2,336,460 in 1998, county property records show.

— A TVA grant of $6,769,224, which the federally owned utility has refused to publicly disclose.

— A previously undisclosed state economic development grant of $6,050,000, in two phases, which the state Department of Economic and Community Development (ECD) confirmed Wednesday.

— A grant of $125,000 from Oak Ridge National Laboratory.

— Highway improvements totaling $2.3 million for access to the facility, mostly funded by the state.

— Property tax abatements on the facility and its equipment for the first six years the plant is in operation. The company would pay 40 percent of the property taxes it would otherwise owe in its first year of operation, 50 percent the second and so on until it pays 90 percent the sixth year and 100 percent in years seven and thereafter.

The agreement says that the industrial development board will convey the land to AMI for $1, then reacquire the property and lease it and the facility to the company “with a nominal $1 purchase option. It says the board will issue industrial development revenue notes for the cost of the improvements and buildings, and AMI will pay the board the amount necessary to pay debt service on the note.

On silence in TN incentive payments

Gov. Bill Haslam’s administration is reluctant to disclose the incentive payments to businesses for locating in Tennessee, observes Jack McElroy, but not reluctant as TVA, which flatly refuses to make its payments public.

Take the announcement that Advanced Munitions International will build an ammo factory and move its headquarters to Alcoa. Gov. Bill Haslam and Randy Boyd, commissioner of economic and community development, were on hand to tout the 605 jobs being created. But when asked what the citizenry of Tennessee was contributing to the deal, Boyd said the details were still being finalized, “so, there is not anything I can say.”

Actually, the deal is done. A deed already has transferred 269 acres from the Industrial Development Board of Blount County to AMI. Blount Countians paid $2.3 million for the land back in 1998.

Questioned further, Boyd clarified that it’s only the state’s share of the AMI incentives that still are being worked out.

“We’ve agreed in principle,” he said, “but they are dotting the ‘I’s and crossing the ‘T’s. Then we have to have the State Funding Board approve it. But until that happens, we don’t disclose it.”

So when will that be? John Dunn, spokesman for the state Comptroller, said the State Funding Board is scheduled to meet Nov. 13 and 19 but the AMI incentives aren’t on the agenda.

“Our staff is not aware of this project at this time,” he said.

…Haslam’s administration prefers to focus these announcements on the jobs being created and the adroitness of the government’s deal-making without mentioning what taxpayers have brought to the table. Other administrations, such as those of mayors Madeline Rogero and Tim Burchett, are more willing to share the details up front.

Eventually the cost to state coffers will become public, but only after the fanfare has faded and attention has turned elsewhere.

Still, that’s better than what the Tennessee Valley Authority does. The federal agency refuses to reveal the subsidies it bestows on private businesses even after deals are done. TVA insists its ability to compete would be compromised if that sensitive info leaked out.

But, oops. Loose-lipped Rogero spilled the beans on TVA’s contribution to the Regal deal, too, letting slip that it added $80,000 in “utility money” to the pool.

We’ll see if the $11-billion-a-year utility can survive the disclosure of that secret to the public.