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VOL. 127 | NO. 205 | Friday, October 19, 2012

Nike Wins $57.8 Million Tax Break

By Bill Dries

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Project Victory isn’t in the bag just yet. There is competition. Project Victory is what local economic development officials were calling the proposed $301 million expansion of the Nike Inc. plant in Frayser.

An addition to the Frayser Nike plant would be a supply chain logistics distribution center. 

(Daily News File Photo)

Nike’s application to the Memphis and Shelby County Economic Development Growth Engine board for a 15-year payment-in-lieu-of-taxes agreement, made public earlier this week, revealed the specifics of the plan.

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 the “Northridge” plant 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.

The EDGE board approved Wednesday, Oct. 17, the PILOT that would add 250 more jobs to a Nike workforce in Memphis already at 1,700.

The workforce is the second largest in the U.S. for the worldwide brand based in Beaverton, Ore.

After the approval of the incentives, 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.”

Documentation the EDGE board got for the PILOT application included a reference to the code name local leaders have been using for the effort.

Gregory indicated other cities or areas are likely to offer incentives or already have to lure the project away from Memphis.

The competition has surfaced in the past. Gregory downplayed his role in those discussions. But Memphis Mayor A C Wharton Jr., Shelby County Mayor Mark Luttrell and economic development leaders have said several times that Gregory was instrumental in past efforts when it looked as if others within Nike wanted to relocate elsewhere.

The EDGE board also approved Wednesday 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.

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RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 56 137 4,903
MORTGAGES 88 226 6,452
FORECLOSURE NOTICES 6 25 1,504
BUILDING PERMITS 170 318 11,577
BANKRUPTCIES 65 119 5,078
BUSINESS LICENSES 27 46 1,982
UTILITY CONNECTIONS 84 227 6,693
MARRIAGE LICENSES 15 44 1,385

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