Tag Archives: investment

Comish: Cutting Jobless Services Will Help the Jobless (thanks to fed funding)

Tennessee’s new commissioner of Labor and Workforce Development says cutting jobless services at 34 sites next month shouldn’t hurt out-of-work Tennesseans seeking employment, reports the Chattanooga TFP.
In fact, Commissioner Burns Phillips told members of the Legislature’s Fiscal Review Committee last week, things actually should improve.
The ability to offer services over the Internet will help, he said. And nonprofit Local Workforce Investment Act partners in communities across the state are stepping up to offer services, with the state pitching in computers and other equipment, Phillips said.
“After the career centers were reorganized, there was a lot of angst over that [cuts],” the commissioner said. “But in the final analysis what turned out was we wound up with a broader footprint in the state and not a more narrow footprint.”
He said the state now has 23 state comprehensive centers run by Labor and Workforce Development and 52 affiliates run by LWIAs.
… The 13 Local Workforce Investment Act districts are nonprofit entities funded with pass-through federal dollars. Many have multiple offices aimed at helping the jobless and employers connect.
House Minority Leader Craig Fitzhugh, D-Ripley, said Friday he remains skeptical that the LWIAs will close the gap created by shutting down state-run services in 34 centers and firing 125 state employees.
“It’s very disappointing,” Fitzhugh said, adding that his district in rural West Tennessee is taking a major hit.
“Here we are just coming out of this recession” and the administration chose to “decimate” career centers, he said.
Jobless residents will have to drive farther and some can’t afford an Internet connection to access the department’s website from home, he said.

Haslam Invested in Company Winning $330M State Contract

At least at one point, Gov. Bill Haslam was an investor in a company that has landed a $330 million contract to manage state buildings under a new outsourcing plan put into place under the Haslam administration’s leadership, reports WTVF-TV.
The Haslam administration insisted that the contract is about saving taxpayer money, not about making the governor richer.
But our investigation discovered the governor’s office was directly involved in the decision to give hundreds of millions of dollars of your money to a corporation he knew well.
Recently, the state signed a $330 million, five-year contract with a multinational corporation, Jones Lang Lasalle, to manage all of the state’s buildings. It’s a company that, our investigation discovered, candidate Bill Haslam listed among his major investments.
“The fact that he was invested in this company that got this contract is disturbing if he’s still invested in it,” said House Democratic Caucus Chair Mike Turner of Nashville.
…The governor’s office said that they don’t know if JLL is still among the investments that Haslam put into a blind trust.
“Even the fact that he was invested at one time, there was a relationship there,” Turner added.
The Haslam administration insisted the contract was awarded through an above-board, competitive process with no political influence.
Still, our investigation discovered that the selection committee was composed of procurement officer Mike Perry and two members of Haslam’s own team: chief of staff and former campaign manager Mark Cate and special assistant to the governor Larry Martin.
…A photo taken during that process — at an intimate dinner on April 24, 2012, at the Governor’s Residence — shows Haslam with JLL executives, including former quarterback Roger Staubach. Also present were Commissioner Cates and Mark Cate, who would eventually serve on the selection committee for the big facilities management contract.
…Just three weeks after that dinner at the Governor’s Residence, the Haslam administration began lobbying the State Building Commission for an amendment that expanded JLL’s consulting contract from $1 million to $4.5 million.
The administration wanted JLL to supervise efforts to modernize state offices — a program known as Transforming Tennessee for Tomorrow (T3) — as well as analyze requests for future building projects.
Emails show the lobbying of the commission was done by the governor’s legal counsel and Mark Cate.
…But, six months later, the commission approved increasing that $4.5 million to $6.5 million. Four months after that, the Commission approved increasing that contract to almost $11 million — again, without any bidding.
“It’s a good deal if you get it, I think,” (House Democratic Caucus Chairman Mike) Turner said. “If it’s not a sweetheart deal, it’s the closest thing to it. They’ve pretty much wrote their own check.”
And, in the middle of all that, our investigation discovered, the Haslam administration decided to take all lease negotiations out of the hands of career state employees.
So they amended JLL’s ┬ácontract again, this time giving the company the right to demand a 4 percent commission from anyone who wanted to lease the state a building.
Now, as a result of JLL’s recommendation that certain state buildings – like the Cordell Hull – be demolished, the company stands to make commissions on new leases it is negotiating.

Senator’s Concerns Helped Sink UT’s Plan for $98M Investment

The University of Tennessee may have abandoned tens of millions of dollars over the next decade from a proposed partnership that it is no longer pursuing with a proton therapy center in West Knoxville because of legislative and financial challenges associated with it, reports the News Sentinel.
The proposal, which was strongly backed by key university officials, called for using the additional revenues generated to fund new academic and research programs and facilities that were considered a step toward becoming a top 25 public research institution, according to documents obtained by the News Sentinel through a public records request.
The university dropped its legislative efforts in March, a month after a bill was filed by Sens. Randy McNally and Doug Overbey, ending a two-year effort to affiliate itself with Provision Center for Proton Therapy, much like how the University of Florida has partnered with a proton therapy center in Jacksonville, Fla. (Note: The legislature’s website shows Overbey as prime sponsor of the bill, SB1194, with Rep. Ryan Haynes, R-Knoxville, as House sponsor. It has not been withdrawn, the website shows, but was never moved in the Senate and taken off notice in the House.)
… While the university was projected to receive a minimum total financial benefit of $80 million in 2023 that could reach more than $180 million, questions were raised about the financial risk to the university, and ultimately to the state of Tennessee, as well as uncertainty about lower reimbursement rates and effectiveness of the treatment.
Among those with concerns were McNally — chairman of the Senate Finance, Ways and Means Committee — and local health care officials.
“Even if it benefited the university, there were philosophical differences,” UT President Joe DiPietro said in an interview, noting that various people were sympathetic to McNally’s concern about using taxpayer dollars to benefit a private enterprise.
McNally worried the public-private partnership would put the university and state at too great of a risk and potentially compete with local health care providers. It also would set a precedent for other schools, while allowing the center to cherry pick the best patients with private insurance.
“I might be pessimistic when it comes to those projects, but the state would have taken a lot of risk through the university. We found that out with Hemlock. It has not performed like it had promised,” McNally said in an interview, referring to Hemlock Semiconductor in Clarksville that received some $130 million in state and local incentives and announced last month plans to lay off 300 of its 400 workers and shut down its facility.
“I can’t say that I’m right on this, but I felt it was a risk to the state that it didn’t need to be taking,” he added. “I couldn’t tell you with everything the return would justify the risk. It was something new the state hadn’t gotten into and would open itself up for others.”
Proton therapy is a type of cancer treatment that uses a beam of protons to more precisely irradiate tumors without harming surrounding tissue and reducing treatment-related side effects. Local businessman Terry Douglass has spearheaded the development of the proton therapy center currently under construction in Dowell Springs as part of a comprehensive clinical outpatient health care center.
… DiPietro said in the interview that McNally wasn’t the only person to express concern over the proposal, though he declined to say who the others were.
Douglass conveyed his frustration over the lack of progress to university officials in December, questioning why McNally’s “nonissues” took precedence over the benefits of the legislation.
“Why is it that one or two individuals can defeat something that is potentially so good for UT, our community and our state?” Douglass wrote in an email to DiPietro, Executive Vice President David Millhorn, lobbyist Anthony Haynes and Chancellor Jimmy Cheek. “I have been around long enough to know that when one door closes a better one opens. I just hate to see this door close for UT.”
… McNally brushed off any notion that he was the reason behind the university’s decision.
“It did concern me, but I’m one of 33 senators. I wouldn’t think that it was anything that I had to do with. I think it was a decision made by the university,” said McNally, who last year sponsored the original bill, which didn’t move forward.
McNally said he didn’t discuss the latest bill with its sponsors or any of his legislative peers, though he did talk with local health care officials, who questioned the university’s role in a business that also provided traditional radiation therapy services.
Covenant Health has been in a dispute with Provision over its radiation therapy center, which received a Certificate of Need in December 2011. Covenant declined to comment for this story, citing its ongoing appeal.
McNally works for Cardinal Health, which runs the pharmacy program at Methodist Medical Center, a Covenant Health hospital. McNally’s wife, Jan, retired as a Covenant executive in December.

Talk of Repealing TN Solar Tax Break Scaring Away New Companies?

Lifted from a Tennessean story on solar energy tax credits and their impact in Tennessee, which has been rated as having “the third-fastest-growing clean energy economy” in the nation:
Tennessee now gives a massive property-tax break to solar-power facilities by allowing them to be assessed at their salvage value — defined as no more than one-half of 1 percent of their initial investment costs. But companion bills filed by several Republican legislators in the General Assembly earlier this year would eliminate that break so that solar installations would be assessed and taxed based on their real value, just like other business and residential property.
“That has already pretty much shut down any new solar companies coming to Tennessee,” said Ben Macias, vice president of Shoals Technologies Group in Portland, a manufacturer of components for solar systems that has about 500 workers.
“A lot of solar-power manufacturers are coming to the Southeast, but they are on hold as far as relocating in Tennessee is concerned because of the tax question in the legislature,” he said.
For a 50-kilowatt solar system installed at a business, for instance, the change could raise the property tax $1,500 a year, said Billy Gibson, vice president for engineering and development at Integrated Solar, another Nashville company that installs home and business systems.

Rally Seeks for More incentives to Movie Makers

The Association for the Future of Film & Television, a Nashville-based lobbying arm for the state film industry, has planned a rally at the state capitol to support pending legislation that would give bigger tax breaks to those who film in Tennessee, reports the Commercial Appeal.
The AFFT organized today’s Nashville rally to generate publicity and support for the state Entertainment Industry Investment Act, an incentives bill that would strengthen the state’s ability to compete for film projects.
Sponsored by a pair of Shelby County legislators, Sen. Mark Norris, R-Collierville, and Rep. Steve McManus, R-Cordova, the bill would bolster Tennessee’s lights-camera-action allure by offering studios tax credits rather than rebates for production expenses in Tennessee.
“This is about creating jobs in Tennessee, not just for actors and films crews but carpenters, drivers, the hotel industry, the stores,” said Falk, who will tote made-in-Memphis signs to the rally with such slogans as “HUSTLE! Stop the FLOW of Films to Georgia!!” and “We’re Walking the Line for Tennessee Movies.”
The slogans allude to “Hustle & Flow” and “Walk the Line,” two films shot in Memphis before the exodus represented by “The Blind Side,” the cable TV series “Memphis Beat” and Craig Brewer’s “Footloose” remake, all initially set in the Volunteer State but shot in Georgia and Louisiana.


Note: The bill is HB555/SB354, introduced more than a year ago and not yet scheduled for a vote in a committee of either chamber. The Senate version was put in ‘general sub’ last year. The fiscal note estimates that passage would mean a loss of $35 million in state revenue next fiscal year and $25 million a year thereafter.

Beavers Was Investing, Not Loaning $50,000? (Lou Ann Zelnick, too?)

Senate Judiciary Chairman Mae Beavers was investing $50,000 in a Macon County newspaper, not making a loan of that amount to the publisher, according to a response filed in a lawsuit Beavers has brought for collection of the money.
From Andy Sher’s report:
“Co-plaintiff Mae Beavers delivered said cashier’s check to Defendant (Kathryn) Belle for the specific purpose of investing in the venture and to make payment of the May 21, 2010 installment [payment] due to Main Street Media for purchase of the Macon County Chronicle,” the filing says.
It also alleges that Lou Ann Zelnick, a Republican who made a failed 2010 GOP 5th Congressional District primary bid, “invested” $36,000 in the newspaper venture as well.
…. (Beavers, in an interview) called the lawsuit a “personal matter.”
Asked about suggestions the money was not a loan but an investment, Beavers said, “I don’t believe that’s what the lawsuit said.”
Beavers said “yes” when asked if the $50,000 was intended as a loan.
Meanwhile, Beavers on Monday filed an amended Statement of Interests form with the Tennessee Bureau of Ethics and Campaign Finance. Her original State of Interests form, filed Jan. 30, did not mention the loan or the 6 percent her lawsuit cites as interest under the category “sources of income.”
Her new filing lists “Kathryne Bell — pass through interest on personal loan — no actual income.”
It also lists Bell’s nephew, John Cook, with the explanation “pass through interest on personal loan — no actual income.”

(Previous post HERE)

Former State Board Member Facing Felony Charges

A former Gov. Phil Bredesen-appointed member of the state Department of Commerce and Insurance’s Collection Service Board now faces federal charges, including 16 felony counts, related to three different investment schemes.
More from The City Paper:
In March 2011, the Tennessee Bureau of Investigation arrested Edward Shannon Polen, on three felony charges of theft, but the full scale of his alleged crimes came into focus on Monday when prosecutors from the U.S. Attorney’s Office in Nashville charged Polen with scamming 74 individual investors and banks out of $8,796,000.
Bredesen appointed Polen to the Collection Service Board, which oversees debt collection agencies in the state, in July 2008. He served a full term, before resigning on April 5, 2011, according to board minutes.
Polen, also a former Robertson County commissioner, is charged with five counts of bank fraud, three counts of mail fraud, three counts of wire fraud and two counts of money laundering for operating three investment schemes.
“Despite his assurances to investor-victims of significant returns on their investment … Edward Shannon Polen never intended to invest their funds as promised,” the charges state.

Mexican Investment Provides 1,000 TN Jobs, Study Says

News release from Vanderbilt University:
NASHVILLE, Tenn. – Mexican-operated manufacturing facilities and other businesses employed more than 1,000 workers in Tennessee in 2010, according to a recent study by Vanderbilt’s Center for Latin American Studies.
The largest concentration of employees was in the automotive sector in rural Middle Tennessee and the Cumberland Plateau, with other clusters in the service sector around Knoxville and Memphis.
“Many Americans think of Mexico in relationship to immigration controversies and as a source of cheap and illegal labor,” said Jane Landers, the Gertrude Conaway Vanderbilt Professor of History and the center’s interim director. “This study shows the significant and growing capital investment by Mexican multinationals in Tennessee alongside that of companies from Japan, Germany and Canada.”
The report, “Mexican Investment in Tennessee: A Preliminary Study,” is co-authored by Edward Fischer, professor of anthropology at Vanderbilt; Mateo A. Perez-Rodriguez, an economist and alumnus of Vanderbilt’s Graduate Program In Economic Development; and Lawrence Harrington, an attorney who is affiliated with the Center for Latin American Studies.
Their study suggests that a key to bringing more jobs to Tennessee might lie in recruiting investment from emerging markets such Mexico, rather than traditional sources such as Japan, Canada and Europe. They noted that Mexican businesses in Tennessee employ several times as many workers as companies from the People’s Republic of China.
While the presence of Mexican investment in Tennessee may come as a surprise to some observers, the study found that investment from Mexico in the United States has increased dramatically since the start of the North American Free Trade Agreement (NAFTA) in 1994 and doubled between 2005 and 2009. Tennessee exports to Mexico have increased more than 400 percent since 1995.
The researchers stress that their figures are very conservative and that actual Mexican investment and the number of Tennessee workers employed is likely much greater than they were able to document. The report’s data was taken from business websites and the Tennessee Department of Economic and Community Development. Additional research is required to document the full impact of Mexican foreign direct investment.
The report did not include such recent developments as Grupo Bimbo’s acquisition of Sara Lee bakeries in the United States, including a Knoxville facility, which significantly increased the number of U.S. workers employed by Mexican multinationals. Nor did the report attempt to measure investment in small business by Mexicans in Tennessee.
Vanderbilt’s Center for Latin American Studies Occasional Paper No. 11, is available at http://www.vanderbilt.edu/clas/cms/wp-content/uploads/Mexican_Foreign_Direct_Investment_in_TennesseeFINAL.pdf
The Center for Latin American Studies is a federally designated National Resource Center for Latin America. The center’s outreach program extends to public schools, local businesses and government agencies. For more information, visit www.vanderbilt.edu/clas