Tag Archives: incentives

What did the governor say today on guns, race, vouchers, etc? Well, not much, but….

Gov. Bill Haslam had a media availability Tuesday wherein he fielded questions on multiple topics, though saying nothing really novel about anything. Richard Locker sorta rounded up the gubernatorial commentary HERE in notable fashion and the following includes excerpts from his story and a a sample of other media reporting on what the governor said today.

Not sure yet about gun bills, via Andrea Zelinski:
Gov. Bill Haslam says he hasn’t decided what position he will take on bills rehashing unresolved terms of the past gun legislation.

Lawmakers have filed bills that would resurrect from recent years both the so-called “guns in parks” and “guns in trunks” debates that have pinned legislators between gun rights advocates and either businesses or municipalities.

“We’re having some discussions now. We have not come down with a final decision on what we’re going to do,” Haslam told reporters after a speaking engagement at Lipscomb University Tuesday, adding he’ll have a position on at least some of the legislation this week.

The governor said he met Monday with mayors from the state’s four largest cities about some of the legislation and said the focus is on “who owns the property and who gets to make that” decision about whether guns are allowed in parks or parking lots.

On Rep. Sheila Butt and race, ‘We need a conversation,’ via The Tennessean:

Although Gov. Bill Haslam didn’t condemn recent controversial comments from Rep. Sheila Butt regarding the need for an
“NAAWP,” the governor did say Tennesseans need to speak openly about issues of race.

“My point in this whole thing has been: I honestly think we need to have more open conversations about race in Tennessee and in the country, too, for that matter,” Haslam said Tuesday morning after an event at Lipscomb University in Nashville.

“My first point would be Facebook’s not the place to do that. But I think there are some forums where that needs to happen.”

Does he want to be president?
, via Locker (link above)

“I honestly don’t know and doubt it, just to be frank. I see all these guys running now and I see what they’re going through, and I know they’re going to go through it for two years. You better really want to do that and at this point in my life, I don’t have that kind of burning passion to do that. So who knows. Life changes but at this point in time it’s a little hard to see that happening.”

On the FCC broadband ruling, also lifted from Locker below, though also noted in separate AP story with more detail posted HERE.

“I just don’t know enough about it yet. … I think the question obviously is, is the local government subsidizing something that makes it harder for business to compete,” Haslam said.

On why preferring one school voucher bill over another (interrelated previous post HERE), via Locker:

The Dunn-Gardenhire bill “came to us in the form most like the bill we had proposed last year. (Lawmakers) interested in vouchers and the advocates who have been pushing for vouchers came to us and said, ‘If we get this passed, would you fund it in the budget?’ We said we would as long as it looked like this, and the Dunn-Gardenhire bill was the one that looked like it.”

On business incentive funding, like the $165M going to Volkswagen in this year’s budget (Locker again):

“The reality is, none of us like doing incentives when we encourage business to come here but it’s the price of playing in the game. When other states are out there doing very lucrative deals, we can’t just unilaterally disarm. …

“I think what we’ve tried to do is be a lot more precise about the benefit that would come from that business moving and to look at it like you do in your business as a return on the investment — what the state has to do and what would the return be.”

As legislators eye VW subsidies, Ramsey says Saturn subsidies may have been a mistake

By Erik Schelzig, Associated Press
NASHVILLE, Tenn. — State Senate Speaker Ron Ramsey said Thursday that it may have been “a mistake” for Tennessee to subsidize the development of the General Motors plant outside Nashville because it has a United Auto Workers union contract.

The Blountville Republican’s comments came as GOP lawmakers weighing a $166 million incentive package for Volkswagen expansion in Chattanooga seek assurances that the German automaker will remain neutral on labor issues among its workers.

Republican lawmakers have grumbled about the United Auto Workers union’s ongoing role at the plant, and Ramsey pointed to the thriving Nissan plant in Smyrna as an example of the benefits of nonunion auto production compared with the GM plant that begun its life making Saturns.

“Maybe we made a mistake years ago with the things we did for Saturn, because it’s been up and down, closed and open, and yet Nissan is booming right now,” Ramsey said.

The GM plant in Spring Hill produced more than 3.7 million vehicles between 1990 and 2007. At its peak, the facility employed nearly 8,000 workers. But that number had dwindled to about 630 by 2009, when auto assembly was idled during the Great Recession.

Production was restarted following a 2011 contract agreement with the UAW that included salary concessions for entry-level workers and an agreement to bring jobs to Spring Hill that would have otherwise gone to Mexico. The plant now employs about 1,700 hourly workers. GM announced earlier this month that under the 2011 contract, each worker will receive $9,000 in profit sharing.

The Nissan plant in Smyrna has added about 4,500 jobs since 2011, bringing its total to 8,400 employees. The plant made 648,000 vehicles last year.
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McCormick says legislators will OK $300M in VW incentives

NASHVILLE, Tenn. (AP) — A top Republican in the Tennessee General Assembly says he expects his colleagues to approve the state share of a $300 million incentive package for Volkswagen despite misgivings about the role of the United Auto Workers union at the German automaker’s plant in Chattanooga.

House Republican leader Gerald McCormick says he agrees with some colleagues that the UAW should not, in his words, “slip in the back door because of a secret deal with Volkswagen.”

But McCormick nevertheless expects his colleagues to approve the deal struck to ensure the production of a new SUV at the plant and the creation of 2,000 jobs. In McCormick’s words: “Tennessee will keep its promises.”

The UAW has qualified under a new labor policy at the VW plant that stops short of collective bargaining.

Legislators eye blocking VW incentives because of union activity

The General Assembly could oppose providing incentives for Volkswagen’s Chattanooga plant expansion in the wake of United Auto Workers gains at the factory, reports the Chattanooga TFP.

“I start with a jaundiced view,” said state Rep. Mike Carter about the incentives estimated at nearly $300 million, a large chunk of which is to come from the state.

Action on the VW incentives, negotiated last year by Gov. Bill Haslam and state economic development officials, is expected to come during the upcoming legislative session and with a backdrop of UAW activity at the plant.

“There will be discussions about additional incentives to Volkswagen,” said state Senate Speaker Pro Tempore Bo Watson, R-Hixson, in a meeting with Times Free Press reporters and editors. “Whatever is playing out locally will be part of that discussion.”

When pressed on an outcome, Watson said, “I didn’t say they should pass the incentives. I didn’t say they were going to pass. At the end of the day, we’ll settle on what is in the best interests of the citizens. Each individual legislator will take a position that best represents his district.”

Last year, Watson was among state legislative leaders who sharply criticized VW for supporting the UAW ahead of a February union vote by VW employees. He said then that VW conducted a labor campaign that’s “unfair, unbalanced and, quite frankly, un-American.”

The UAW lost, 712 to 626.

But the UAW alleged interference by Republican state politicians and formed a nondues-paying local. Since then, VW created a new policy to interact with labor groups based on membership and granted the UAW access to the plant and regular meetings with management.

A rival labor group, the American Council of Employees, has alleged that VW favors the UAW and is not offering “a level playing field.”

VW denies preference for one group over another and says its policy is “fair and equal treatment of all groups.

…Sen. Todd Gardenhire said VW officials are “in your face. It’s their way or no way. They’ve decided by-golly they want the UAW here. They’re not listening to the community.”

But state Rep. JoAnne Favors, D-Chattanooga, believes VW supports the UAW because in Germany, working with unions has helped stabilize the economy and labor pool.

Still, Favors said, with other budgetary needs in the state, such as education, VW may not need the full incentive package.”

UPDATE: Haslam weighs in.

NASHVILLE, Tenn. (AP) — Gov. Bill Haslam says he understands the “real concerns” raised by some fellow Republican lawmakers about the ongoing role of the United Auto Workers union’s role at the Volkswagen plant in Chattanooga, but stressed that they shouldn’t sink a $300 million incentive deal to get the German automaker to expand production there.

Haslam, who last summer struck the incentives deal with Volkswagen to add the production of a new SUV at the Chattanooga plant and add about 2,000 jobs, told reporters Wednesday that his administration will work to persuade reluctant lawmakers to agree to the arrangement.

“You have some real concerns expressed by legislators that we understand — we expressed those same concerns up front as well,” Haslam said. “We’ll have those discussions about where we think Volkswagen is and why we think this is the right proposal for the state.”

Furniture retailer seeks $9.5M in tax breaks to locate in Memphis

Swedish furniture retailer Ikea would save about $9.5 million over 11 years with a tax incentive the company is requesting as it plans to invest more than $64 million for a new store in Memphis, reports the Commercial Appeal.

Ikea would be the first retailer to receive a payment-in-lieu-of taxes incentive from the Economic Development Growth Engine for Memphis and Shelby County, created in 2011 to streamline city and county governments’ business incentives.

In an announcement on Dec. 16 at Memphis City Hall, Ikea unveiled a plan to build a store — its first in Tennessee, Mississippi or Arkansas — on 35 acres behind a Costco near Germantown Parkway, Interstate 40 and the Wolfchase Galleria.

In the final version of its PILOT application filed this week with EDGE, the high-profile furniture retailer indicates that receiving a tax incentive is part of its plan to come to Memphis, the smallest market in the country that the firm has considered.

…EDGE officials say that it is only by board policy that no local tax incentives for retail companies have been given and that the board can change that policy, either for a specific case like Ikea or drawing up guidelines.

The next regularly scheduled EDGE board meeting, held on the third Wednesday of each month, is Jan. 21.

State incentives in Tennessee don’t allow retail-only incentives, officials said.

Haslam complains report on West TN ECD grants “way off base”

Gov. Bill Haslam says the state is spending more money per capita on economic development in the Southwest Tennessee Development District than in any other part of the state, contrary to a report in the Jackson Sun.

From the newspaper’s story today:

Haslam’s comments were in response to a story published by the Sun on Dec. 7 that said the district, which includes Madison and seven other counties, was last among nine development districts in the state in investment through the FastTrack program, one of the state’s largest economic development programs.

The Sun’s examination looked at FastTrack projects that had gone to contract in 2013 and the first three quarters of 2014. The Southwest Tennessee Development District was last in the number of jobs created through FastTrack investment, last in the investment per job created, last in investment per capita and last in percentage and amount of total FastTrack funds invested.

…”I think if you look at the places where we actively market, we actively market here as hard, if not harder, than anywhere else,” Haslam said.

“If you look at where the state has actually invested money on a per-capita basis, we’ve invested more in this economic district than any other economic district,” he continued. “Period.”

Haslam said the district leads in per-capita spending because of money spent or appropriated for the Memphis Regional Megasite in Haywood County.

Clint Brewer, assistant commissioner for communications and marketing at the state Department of Economic and Community Development, has said the Haslam administration has spent more than $66 million on the megasite.

Haywood County Mayor Franklin Smith has disputed that figure, saying that large portions of that money have not actually been spent, including $19 million for re-routing State Highway 222 and $22.2 million for a waste water force main.

Regardless, Haslam said the megasite is in a position that it could be made ready for a company to move in before any company would be prepared to do so.

Haslam said he didn’t think The Jackson Sun’s focus on FastTrack was fair.

“To be honest, I thought your story was way off base,” he said. “I don’t get upset about a lot of things, but that one I did because it’s like saying the U.S. Olympic Committee is awarding more Olympic gold medals to this country than they are to that country.
“But the gold medals are a result of a process that happened, and somebody won that race,” he continued. “In economic development, you win a race for a lot of different reasons.”

He said people in every part of the state, except Nashville, feel like they get the short end of the state’s economic development stick.

Hemlock Semiconducter closes Clarksville plant that got a $95M state grant in 2008

CLARKSVILLE, Tenn. (AP) — Hemlock Semiconductor Group is permanently closing its idled polysilicon plant in Clarksville, citing global trade disputes that have led to an oversupply of the compound used in solar energy panels.

The company’s president, Denise Beachy, announced the decision to The Leaf-Chronicle (http://leafne.ws/1AI0vz5 ) on Wednesday.

“We have been looking at the Clarksville site constantly, and we’ve reached the conclusion now, with the market looking very long and adverse … that we are going to close this Clarksville facility permanently,” she said.

Hemlock’s decision to build the plant was made to great fanfare, with then-Gov. Phil Bredesen predicting the investment would be “game-changing here in Tennessee.” Construction began in 2009, and the facility was nearly complete when Hemlock announced in 2013 it would not begin manufacturing there because of the supply glut and disputes with China over tariffs.

Republican Gov. Bill Haslam said his administration had recently been in talks with Hemlock about plans to jumpstart the factory.

“So we were most surprised and disappointed to get the announcement from them,” Haslam told reporters at the state Capitol.

Hemlock received a $95 million capital grant from the state in 2008 to help land the project in Clarksville, according to the state Department of Economic and Community Development. Those economic incentives for Hemlock were issued before the state enacted a “clawback” provision to recoup grant money if companies don’t deliver on their job-creation promises.

Haslam noted that the Hemlock deal was struck by his predecessor but added that the arrangement “made a lot of sense at the time.”

“In the end, obviously the fact that they’re not going to be growing and adding those jobs in Clarksville is a disappointment for all of us,” he said.

The Clarksville plant was designed to initially make about 10,000 metric tons of polysilicon, with an eye toward expanding to more than double that capacity.

Beachy said the 50 remaining Hemlock employees at the plant were informed of the decision earlier Wednesday, and that some will be offered to relocate and others will be given a severance package.

Hemlock will work with economic development officials to dismantle the facility and to consider options for selling the site.

“We will accept the obligation to disassemble the manufacturing plant and equipment that cannot be repurposed,” she said, adding that the process will take an estimated 12 to 18 months.

Hemlock Semiconductor Group is a joint venture between Dow Corning Corp. and Shin-Etsu Handotai Co. of Japan.

___

Duncan knocks TVA secrecy on incentives; Alexander and Corker do not

U.S. Reps. John J. Duncan Jr. and Chuck Fleischman are questioning TVA’s refusal to disclose its incentive payments to expanding business, but U.S. Sens. Lamar Alexander and Bob Corker back the agency’s decision, reports Michael Collins.

“TVA is not a private company — it is a public monopoly, most places, with advantages that are not given to most other businesses,” said Duncan, a Knoxville Republican. “I believe all of their activities should be transparent and open to the public.”

TVA has refused to say what incentives it provided to SL Tennessee, claiming that releasing the information would cause “competitive harm” to the utility and its strategies for attracting businesses to the Tennessee Valley.

…Duncan not only questioned TVA’s decision to keep secret the incentives it has given to SL Tennessee, he also questioned the wisdom of granting incentives.

“I have long believed it is unfair to give so much to businesses that move from other states or even other countries, while not giving much of anything to businesses that have been contributing locally and across the state for many years,” Duncan said.

U.S. Rep. Chuck Fleischmann, an Ooltewah Republican, also suggested TVA should be transparent about the incentives.

“There’s no question that the No. 1 issue in East Tennessee is jobs, and SL Tennessee’s expansion will bring 1,000 new jobs to Anderson County,” Fleischmann said.

But, “it is important that our government and all related agencies function with proper transparency and oversight,” Fleischmann said. “I believe TVA can do that while remaining competitive and aiding economic development throughout the Tennessee Valley.”

Tennessee’s two U.S. senators — Republicans Bob Corker of Chattanooga and Lamar Alexander of Maryville — deferred to TVA’s judgment on refusing to make the incentives public.

“I have talked with TVA, and as I understand it, their well-known economic development programs were used when recruiting SL, but they do not publicize the specifics of how the programs are applied to each prospective company,” Corker said.

Alexander’s spokesman, Brian Reisinger, noted TVA has a nine-member board “whose job it is to make decisions such as this.”

Note: Previous post HERE.

Bridgestone would leave Nashville without $56M in incentives?

A top official in Nashville Mayor Karl Dean’s office says Bridgestone Americas would relocate its headquarters out of Nashville if not for a package of tax incentives offered to the company, reports The Tennessean.

Matt Wiltshire, the mayor’s director of economic and community development, said he agreed with that scenario when asked Monday about the significance of incentives that could total $56.3 million to lure Bridgestone to a new downtown office tower. He was appearing at a special Metro Council hearing on the Bridgestone proposal.

Bridgestone Americas CEO and President Gary Garfield, following the same hearing, seemed to agree, saying that he didn’t think the company would stay if incentives weren’t in play.

“It was a critical part of the package,” Garfield said. “I don’t know how we would have been able to justify to our shareholders that we were staying here when the other cities and states made very significant offers to us.”

Garfield added that it would be “extremely problematic for us” if the council were to vote against the incentives, but declined to predict what action Bridgestone would take as a result.

The state has agreed to a similar sum of financial incentives.

…Dean has proposed freeing Bridgestone Americas from paying any of its real property taxes for the next 20 years on a new 30-story building it would occupy at Fourth Avenue and Demonbreun Street. There, the company plans to move its 1,100 employees who currently work in Donelson, as well as two out-of-state devisions that would bring 600 new jobs to the state.

The incentive plan also calls for a $500 grant over seven years for all new employees added to the city’s workforce.

TVA keeping secret its incentive payments to expanding business

While state and local governments have revealed what they’re paying in incentives for a South Korean auto parts firm to expand at a Clinton industrial park, TVA is keeping secret what incentives the agency awarded in the deal, reports the News Sentinel.

The News Sentinel had requested the information after SL Tennessee, Gov. Bill Haslam and other officials announced this summer the company’s nearly $81 million addition.

“We just never have disclosed specific incentives to a specific company,” said Denise Smith, TVA’s Freedom of Information Act officer.

TVA can offer power cost discounts and other, unspecified agreements as incentives, she said in a letter Wednesday, denying the newspaper’s Freedom of Information Act request.

TVA at first based its refusal on SL Tennessee’s initial objection to the release of that information. But the firm then declined TVA’s request for “a more detailed statement of the competitive harm that would result if the information was made public,” Smith’s letter states.

Now, TVA is withholding the information based on a Freedom of Information Act exemption “that would place the government at a competitive disadvantage,” Smith wrote.

“TVA considers the specific economic development incentives offered to companies locating or expanding in the TVA region confidential and competitively sensitive,” the letter continues. “Release of these details would cause TVA competitive harm by allowing other utilities, who are competing for the same customers, insight into TVA’s programs and strategies for attracting businesses to the Tennessee Valley.
…Advocates for open government called the denial outrageous.

“Citizens want to know how these deals work,” said Deborah Fisher, executive director of Tennessee Coalition for Open Government, an alliance of journalists and civic groups that seeks to preserve access to public information and open government.

“Citizens want to know how much governmental entities are giving away in economic incentives because they want to know if those programs are effective.
…(T)he company received a $5 million state grant and the gift from Clinton of 53 acres — the last large tract of land in the industrial park. The land is valued at $637,300 on the tax rolls.

In addition, Anderson County agreed to contribute up to $300,000 from a special fund set aside from industrial development to repave Frank Diggs Drive — the main roadway into the industrial park from Highway 61.

In exchange for Clinton’s donation of land, SL Tennessee is giving enough property to the city for a new fire station. The company will also provide the city either $200,000 and site preparation work toward firehall construction, or $250,000 without site work.