Other communities hope to land 'Tango' jobs

Rutherford among several vying for warehouse, distribution center

Daily News Journal A Gannett Company

MURFREESBORO Neighboring Lebanon and Loudon County in East Tennessee are among those offering economic packages in competition with Rutherford County for Project Tango, a secret proposal that could bring hundreds of jobs with it.

The Lebanon City Council and Wilson County officials recently approved tax incentive deals designed to lure the American warehouse and distribution company to town with a promise of up 1,200 full-time jobs. Two of three possible sites are located in Lebanon city limits and could bring hundreds more seasonal jobs, according to a memo from Mayor Philip Craighead.

Wilson County is offering a $3.8 million tax break, while Lebanon offered to waive between $439,000 and $550,000 in personal and real property taxes over seven years. The company in turn would agree to make an annual payment of $28,900 if it locates one of two proposed facilities there, according to a Gannett Tennessee report.

Lebanon City Council member Kathy Warmath said city officials learned more about economic recruiting and how to handle tax incentives after their encounter with Dell Computer, which opened a facility there more than 10 years ago but has since left town. Proposals are vetted by two government entities before the council considers them.

"I don't mind giving incentives when I know there are triggers and threshholds they have to meet," Warmath said.

Meanwhile, Loudon County offered Project Tango a 100-acre site at a $10,000 discount per acre, a 10-year 50 percent property tax break and $1 million in infrastructure improvements, according to reports. The company reportedly sought an annual payment in lieu of taxes from city and county taxes in Loudon.

The company is considering two sites in Loudon County, Centre 75 or a privately-owned site in Highlands Business Park in the county, which is located southeast of Knoxville off I-75.

Montgomery County/Clarksville is also in the running for the company as are counties in other states, Rutherford County Chamber of Commerce President Paul Latture said Wednesday.

 
 
James Chavez, president of the Montgomery County Economic Development Council, declined comment on the matter Wednesday and said he was not aware of any decisions by local government there.

Latture would not say Wednesday whether he feels Rutherford County's offer is better than those proposed in Loudon and Wilson counties.

"We put together what we thought was the best package we could offer," Latture said.

The Rutherford County Industrial Development Board approved two incentive packages for the company, one a 20-year abatement of all personal and real property taxes totaling $15.8 million for a proposed sort facility that would create 1,150 jobs in either La Vergne or Murfreesboro.

The other agreement for a non-sort facility creating 325 jobs stretches over 15 years and cuts a total of $4.9 million in personal and real property taxes. The company would start paying $635,035 annually in property taxes after the seventh year.

The average pay is estimated at $16.25 an hour, about $33,800 a year, which is lower than the county average of $42,642.

Both packages meet the County Commission's requirement of 3-to-1 benefits/cost ratio, according to an analysis conducted by Younger & Associates of Jackson.

The sort facility's capital investment is projected at $87.5 million, and during the 20-year tax abatement period, it is expected to create $47.6 million in tax revenue from construction and operation, giving it a better than 3-to-1 return on the tax break of $15.8 million.

A much smaller building, the non-sort facility's capital investment is projected at $51.5 million. Total tax revenues during that abatement period are estimated at $15.5 million, which divided by a tax break of $4.9 million.

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9/9/11