VOL. 127 | NO. 204 | Thursday, October 18, 2012
Nike Gets 15 Year $57.8 Million PILOT For Tentative Frayser Expansion
By Bill Dries
The board of the Memphis and Shelby County Economic Development Growth Engine approved Wednesday, Oct. 17, a 15-year payment in lieu of taxes agreement with Nike Tn. Inc. for a $301 million expansion of its Northridge plant in Frayser.
After the approval of the incentives for an expansion that would retain 1,600 jobs and add 250 more once the expanded facility opens, Willie Gregory, Nike director of Community and Business Relations, emphasized that the company is still weighing other possible incentives from other parts of the country competing for the economic development plum.
“We still need to go through some other incentives before we make our final decision,” Gregory said. “Nothing is final. It is our intent to be here in Memphis. The support and incentives that we have received will help in that decision.”
The PILOT amounts to a $57.8 million tax break with a local tax benefit of $105.3 million in return. The benefit-cost ratio is $1.82 in revenue for every tax dollar abated.
The addition to Northridge would be a supply chain logistics distribution center. With such an addition in Frayser, Nike would move out of space it has been leasing at 8400 Winchester Road. Employees from Winchester would move to the Frayser addition of 1.8 million square feet.
Nike’s 1,700 employees across Memphis are the second largest workforce in the U.S. for the worldwide company headquartered in Beaverton, Oregon.
Documentation the EDGE board got for the PILOT application included a reference to the code name local leaders have been using for the effort which was called Project Victory before the NIKE plans went public earlier this month.
The EDGE board also approved a $100,000 FastTrack grant from the state to Praxair Inc. for infrastructure improvements near its Paul R. Lowry Road facility. Praxair is undertaking a $46.7 million expansion of the plant in southwest Memphis.