Tag: PILOTs

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Politics Politics Feature

Touching the Hot Buttons: County Commission Takes on Trump, PILOTs

The public musings of the Shelby County Commission add up at times to as accurate a bellwether on issues at large as can be found in these parts, and that applies to state and national subjects as well as purely local ones. By definition, the commission represents a larger and more representative hunk of the population than does, say, the Memphis City Council, and, though the body is by no means exclusively partisan in its outlook, the fact that its membership is elected by political party gives it natural polarities on a number of matters.

Four matters taken up by the commission at Monday’s public meeting illustrate the range. The first, sponsored by Commissioner Tami Sawyer, well known as a Democrat from her party’s progressive wing, was a resolution “to prohibit the naming of any Shelby County property after U.S. President Donald John Trump, the 45th President of the United States.”

Tami Sawyer

Clearly occasioned by public outrage and confusion stemming from the catastrophic endgame of Trump’s presidency, the resolution garnered the seven votes necessary for passage, all from Democratic members: Sawyer, Van Turner, Mickell Lowery, Willie Brooks, Edmund Ford, Michael Whaley, and chairman Eddie Jones. Three Republicans — Mick Wright, David Bradford, and Brandon Morrison — and Democrat Reginald Milton abstained. Two Republicans, Amber Mills and Mark Billingsley, cast outright “no” votes.

A companion measure of sorts, coming late in the day, was a resolution “in support of preserving our Republic and condemning the insurrection that took place at the United States Capitol on January 6, 2021.” That one, sponsored by Wright and Milton, garnered 12 “aye” votes across the board but got a single abstention from Morrison.

In between those two resolutions was a pair of hot-button votes. One was a substitute resolution for one introduced back in the summer by Sawyer designed to curtail the potential acquisition of military-grade materials from federal sources by the Sheriff’s Department. Co-sponsored by Turner and Milton, the revised version acknowledged the fact that current Sheriff Lloyd Bonner desired no such weaponry but gives the Sheriff’s Department and the Office of Emergency Management and Homeland Security the option, via commission approval, to acquire protective equipment such as bulletproof vests, as well as rescue vehicles in case of emergencies.

The original resolution had drawn fire from several members as being what they saw as an unwarranted attack on the character of the sheriff. On Monday, Sawyer addressed those reservations: “You know, why do we need police reform? Sheriff Bonner’s a great guy. … But in 2020, across the country, and right here in Shelby County, we recognize a pandemic of racial injustice that was almost as deadly as COVID-19 that impacts the lives of Black and brown people every day.”

The ultimate vote on that one was 10-3, with Commissioners Billingsley, Mills, and Morrison remaining unmollified.

The other resolution incurring extended debate was also sponsored by Sawyer. It proposed a 180-day moratorium on the issuance of any new PILOT (payment-in-lieu-of-taxes) grants by any of the eight authorities in the county able to issue PILOTs.

These tax-abatement grants, which by definition limit property-tax revenues in the interests of industrial recruitment, have long been controversial, as Sawyer noted, denouncing “the organizations that come and promise 1,000 jobs and never offer more than 300, organizations that pay no taxes, recipients whose workforces are 75 percent temporary workers with no healthcare, and no childcare. And then they close when they’re pushed to do anything else. Why don’t these corporations have to invest in the community?”

Ultimately, the PILOT resolution was recast as a proposal to join with the city of Memphis in a task force to study the implications of PILOTs and to consider possible changes in policy. County Mayor Lee Harris supported that proposition, saying, “I am all for trying to figure out how we might reform the system. … It’s probably a good idea to not try to tee up too many questions. But instead, we try as best we can to narrow our scope to what we might be able to handle. So I would try to narrow the scope to bite-sized amounts.” With that understanding, the proposal was referred back to committee for further shaping.

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News News Blog

Tax Breaks Could Bring Apartments, Offices to Cooper-Young

CREDIT: Center City Finance Revenue Corp.

Center City Finance Revenue Corp.

The 25-unit apartment building proposed to be built close to the corner of Cooper and Walker.

Two projects before Downtown officials next week could bring more people to live and work in Cooper-Young.

Apartment building

A developer wants an 11-year tax break worth $542,352 to build a $3.2 million, 25-unit apartment building on a vacant lot in Cooper-Young.

Focal Point Investments has asked the Center City Finance Development Corp. (a board of the Downtown Memphis Commission) to grant the payment-in-lieu-of-taxes (PILOT) deal during its next meeting on Tuesday, Oct. 10.

The building would stand on the lot between the former Galloway United Methodist Church and the parking lot behind the Young Avenue Deli.

Here’s how the applicant describes the project:

“The building will feature 25 studio apartments, each with 550 square feet of space.

The portion of the building facing Cooper will feature nine apartments on three floors, while the remaining 16 apartments will occupy four floors behind the Cooper-facing portion.

The three ground-floor apartments facing Cooper will be configured as flexible spaces that can be used for retail, office, or live-work space.

Each unit will feature modern open floor plans and most of the units will have 10-foot loft ceilings. The site plan includes 19 parking spaces on the south and west sides of the property, as well as four exterior bike racks.”

The CCRFC staff likes the project. For one thing, the site is now generating annual city and county property taxes of $2,345. With the PILOT in place, the site’s owners would make annual payments (instead of regular taxes) of $18,780, a “701 percent increase.”

The staff report says the project would advance the DMC’s strategic goals in fighting blight, accelerating real estate development, and spurring economic development. The CCRFC, once only concerned with Downtown projects, recently adjusted its PILOT program to include Midtown projects with residential components.

New offices for archimania
Google Maps

The proposed site of new offices for archimania.

A local real estate company wants an 11-year payment-in-lieu-of-taxes deal worth $307,745 to renovate two buildings on Cooper in a $2.8 million project.

Filament LLC, a real estate company owned by two members of archimania, have asked the Center City Revenue Finance Corp. (CCRFC) for the tax break, noting the project would not be “economically viable” and could not attract financing without it.

The CCRFC is slated to vote on the tax break deal during its next meeting on Tuesday, Oct. 10.

The archimania architectural firm is now based in South Main but Filament partners Barry Yoakum and Todd Walker said the company would move to the updated space on Cooper once it was completed.

The other building on the site would be opened up to a “creditworthy office tenant.” The partners also want to build six rental apartments behind that building at 673 Cooper. They would range in size from 425 square feet to 590 square feet.
Center City Finance Corp.

Drawings show what the outside of proposed project on Cooper.

Construction on the project would start in late December, the applicant said, if the PILOT is approved. Construction would be completed by spring or summer of next year.

CCRFC staff said annual PILOT payments on the project ($31,486) would be 42 percent higher than the taxes the site is generating currently ($22,160).

Approving the project would strengthen the city’s urban core, the applicant said, and that “the time has come to develop an Innovation District.”

“Attracting the type and scale of mixed-use developments long absent from Midtown, this Innovation District strategy, generally, and our proposed development, specifically, will support the CCRFC’s goals by increasing the number of people living, working, and playing in the urban core, especially by increasing commercial property values throughout the urban core, further accelerating commercial and residential development,” reads the project’s application.

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News News Feature

Silver Rights Movement

Dr. Martin Luther King Jr., who would have turned 86 last Thursday, once said: “Equality means dignity. And dignity demands a job and a paycheck that lasts through the week.”

Keep this in mind whenever you see nearly giddy news coverage about new jobs coming to the Memphis area — whether it’s 900 new Williams-Sonoma warehouse jobs just across the state line in Mississippi, 400 jobs added with Target’s new fulfillment center, or the 282 jobs expected after Graceland gets a new hotel.

“But dignity is also corroded by poverty, no matter how poetically we invest the humble with simple graces and charm. No worker can maintain his morale or sustain his spirit if in the market place his capacities are declared to be worthless to society,” King also said.

A living wage in Memphis is around $13 an hour. Average wages at Conduit Global, a call center that opened last year a mile from the nearest bus stop, are around $12. The base wage for Electrolux line workers is less than that.

Today’s hourly wages have the same purchasing power they did when Jimmy Carter was president. (That’s 1979, for those too young to remember.)

Thousands, if not millions of black people, “are poverty stricken — not because they are not working, but because they receive wages so low that they cannot begin to function in the main stream of the economic life of our nation,” King said.

In December, the unemployment rate fell to 5.6 percent, the lowest in six years. That sounds like good news, until you view it through the lens of history and race.

“According to the official statistics,” King wrote in February 1968, “Negro unemployment is twice that of whites.” Fifty years later, the gap remains. According to the Bureau of Labor Statistics, black unemployment in December was 10.4 percent.

To lure companies to town, city and county government regularly give out multimillion-dollar incentive packages. In the case of Graceland, the tax breaks amount to a staggering $141 million, or more than $440,000 in incentives per job created.

The message from big business and elected officials to the thousands of Memphians mired in low-wage jobs is clear: Be grateful for whatever you get.

Meanwhile, workers struggling to make ends meet have questions that the dealmakers and elected officials don’t answer. Will they offer a steady schedule so that a single mother (there are an estimated 43,000 single moms in Memphis) can be at home most weeknights to check her children’s homework and tuck them in?

Will these jobs come with health insurance (which is critical since Governor Haslam refuses to accept federal Medicaid expansion funds and instead is trying to create his own version of Obamacare)?

Will workers be able to earn sick days, so that catching a stubborn cold doesn’t mean forfeiting several days of pay or coming to work and spreading the germs to coworkers?

Are the job sites accessible by public transportation?

Do these jobs pay enough for a family to save for a rainy day, their children’s education, and their own retirement?

“What does it profit a man to be able to eat at an integrated lunch counter if he doesn’t have enough money to buy a hamburger?” King asked. The business community’s argument has been that the wealth created for businesses eventually trickles down to the workers, although it’s workers’ labor that creates the wealth.

The Pew Research Center recently released a report showing that a rising tide doesn’t lift all boats, especially when the sailors are black and brown. “[E]ven as the economic recovery has begun to mend asset prices, not all households have benefited alike, and wealth inequality has widened along racial and ethnic lines,” wrote Pew researchers.

“The wealth of white households was 13 times the median wealth of black households in 2013, compared with eight times the wealth in 2010,” the report continues. “Likewise, the wealth of white households is now more than 10 times the wealth of Hispanic households, compared with nine times the wealth in 2010.”

To borrow from Operation Hope founder John Hope Bryant, the civil rights movement must give way to a “silver rights” movement.

Remember that King’s final and fatal mission to help striking sanitation workers was part of his quest for economic justice.

“Never forget that freedom is not something that must be demanded by the oppressor. It is something that must be demanded by the oppressed. If we are going to get equality, if we are going to get adequate wages, we are going to have to struggle for it.”

Are you ready to struggle?

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Editorial Opinion

A Mixed Bag in 2014

If you’re standing up, sit down; if you’re sitting down, stand up — whatever you need to do to take stock of the year that just passed or get ready for the new one. Frankly, we don’t know whether to be shocked, bemused, or encouraged.

There was a rush of things at year’s end regarding which we’re just going to have to wait and see.

To start with, it was one of the most satisfying: Yes, considering how often we’ve been on the short end of the stick in matters having to do with our relations with our sister city of Nashville, it does feel good to have something to gloat about. Folks up that way may not have noticed how well our NBA Grizzlies did in 2014 compared to their NFL Titans, but they dang sure noticed when the Swedish furniture giant IKEA chose to locate its newest mega-store not in the Middle Tennessee environs of the state’s capital city but on a generous stretch of land along Highway 64 in our own Shelby County bailiwick — within the city limits of Memphis, in fact. We know from things we read or saw on TV or picked up online that Nashville had been competing pretty hard for that honor. 

The folks there had let it be known that they were tired of having to truck the 250 miles or so to Atlanta to shop for the nifty, lightweight, modernist stuff that IKEA makes. Well, the good news for Nashvillians is, they won’t have to drive quite so far to get to the IKEA store in Memphis. And, in season, they’ll be able to take in a Grizzlies game while they’re here, and, you know, get that sense of what it’s like to be a winner.

Along with the news that Target intends to locate a fulfillment center here, the news about IKEA would seem to provide some justification for the high hopes that had been invested in the joint city/county EDGE (Economic Development Growth Engine) board, as well as to allay some of the doubts about that board’s incentives policy.

We still think, though, that the policy of attracting new business and industry through the liberal use of PILOTS (payments-in-lieu-of-taxes) needs careful oversight, lest it be abused. We don’t have much of a tax base for public purposes to start with, and to squeeze it much further could be counter-productive — and regressive. Surely nobody needs to be reminded that the city’s first responders are aggrieved by changes wreaked in their health-care and pension options as a result of austerity measures in local government. Nor has memory faded about the recent outbursts in public violence that caused such concern about our ability to counter or contain them. 

We are ending the 2014 year with a nice seasonal glow, thanks to some successes like those mentioned above, and we’re grateful. But we’re well aware from the all too obvious disturbances and discontent that have also manifested themselves that we have continuing and grave problems that have not gone away. It’s a mixed bag, but Happy Holidays is still the right thing to say. So we do.

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Opinion

Wharton Proposes Tax Increase but Council has other Ideas

whartonpix.jpg

Every year is next year for the mayor and Memphis City Council when it comes to the budget.

Calling it a “gap” budget, Mayor A C Wharton proposed a $628.3 million 2013 budget with a one-time 47-cent property tax increase to fund Memphis City Schools for the last year of the city’s obligation before unification with the county school system. The current rate of $3.19 would rise to $3.66. After this fiscal year, Wharton said the city would transition into a five-year strategic planning process that would supposedly avoid annual budget battles.

That increase would translate to about $120 per $100,000 of property appraisal. But it might not be the last word on city school taxes because a 2009 payment to MCS is still at issue in the courts.

Wharton said city property tax revenue has decreased by $17 million annually since 2009 because of declining appraisals. His proposed budget cuts $24 million from day-to-day operating expenses. But none of the cuts are in the police or fire departments which account for 4,519 of the 5,834 general fund employees. There are no layoffs of police officers or fire fighters in the proposed budget.

Council members had other ideas.

Janis Fullilove suggested getting more money out of nonprofits such as hospitals and universities and from businesses that make payments in lieu of taxes (PILOTs). As she noted, this idea has gotten mainstream support in other cities including Boston, with this nod from the Boston Globe.

Jim Strickland said Memphis is losing population, a statement supported by the last Census. Councilman Joe Brown said property taxes are lower in neighboring counties because there are fewer services and amenities, and disputed Strickland’s claim.

“Nobody’s leaving Memphis, that’s just a myth,” Brown said.

Shea Flinn said property taxes are probably going to go up by some amount and that members must compromise. Kemp Conrad said the council should avoid a repeat of last year’s budget sessions when “at the last meeting in June we cobble something together.” Ed Ford Jr. suggested taxing the (his estimate) 90,000 people who work in Memphis but don’t live here.

After listening to the suggestions, Wharton said Memphis is not alone in struggling to balance its budget, which he called a nationwide problem. He noted the city has added 10,000 jobs and $1 billion in investment and was favorably mentioned in a recent Gallup Poll of cities and hiring.