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VOL. 126 | NO. 144 | Tuesday, July 26, 2011

EDGE Keeps Memphis ‘In the Ball Game’

By Andy Meek

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For the longest time, elected leaders and local economic development officials have lamented a missing ingredient surrounding what Memphis and Shelby County can do to prime the pump for business investment in the area.

Memphis Mayor A C Wharton Jr., left, and Shelby County Mayor Mark Luttrell confer at the last meeting of the IDB, which is being replaced by the EDGE board. 
(Photo: Lance Murphey)

Summed up in one word, that missing piece is an edge.

Those same officials have been racing for months to fashion something that affords the Memphis area a leg up on the mountain of tax breaks, help with infrastructure and other financial aid that neighboring states and cities are using to win a high-stakes economic development version of an arms race.

In public and behind the scenes, Memphis Mayor A C Wharton Jr., Shelby County Mayor Mark Luttrell and various civic officials including some affiliated with the Greater Memphis Chamber have worked to move the needle.

Late last year, Wharton made an impassioned plea to the Memphis City Council to allow the city-county Industrial Development Board to change up the way it grants tax breaks to keep businesses here in addition to bringing new ones to the area.

But even that wasn’t enough. Both mayors ultimately got behind an idea to re-jigger the whole system of economic development for the area and decided to build from scratch something they’re calling a new Economic Development Growth Engine.

In abbreviated form, it’s the elusive EDGE.

At the end of this month, several existing boards and agencies involved in the economic development game from a variety of angles – such as the IDB, which awards critical tax incentives to businesses – will disappear as they’re folded into the new EDGE entity.

Still to be chosen is an office for the group. Various procedural issues also are being finalized, such as choosing an attorney to work with the board and deciding meeting dates and times.

Even more important will be the choice of a president, who will immediately become an economic development power player as he or she is called on to juggle requests, concerns and questions among the mayors, the two local legislative bodies, business leaders and the new board.

The IDB’s swan song came last week, when that board approved six tax deals for companies planning to invest a little more than $200 million in the area and in the process create hundreds of jobs. It was the board’s final scheduled working session; it meets Tuesday, July 26, for a special meeting.

Before last week’s meeting got under way, both mayors had seated themselves at the head of the conference room table around which the board was assembled and made a few farewell remarks.

Wharton joked that the board members’ final checks were ready, a reference to the fact that the IDB is made up of all-volunteer members.

Turning serious, Wharton said, “Your check is our expression of gratitude. Your service has often been misunderstood, that you’re quote, ‘giving away tax dollars,’ close quote. But you’ve kept us in the ball game.”

Keeping Memphis and Shelby County “in the game” is a phrase the city mayor has often fallen back on.

Here’s Wharton speaking to City Council members last fall encouraging them to approve the creation of a pot of money that would be used to help keep companies here who otherwise had an incentive to leave for greener – and cheaper – pastures.

“I think most of you know I have probably been involved in most of the economic development projects or, let’s put it this way, efforts to retain some of our employers here over the last seven to eight years,” Wharton told council members. “The chamber does a great job. The IDB does a good job. But we are not equipped the way our neighbors are. We talk about PILOTs. But it’s hard to take a PILOT into a bank loan committee.

“We’ve got to send a signal that we’re serious. That we’re going to equip our agents, our recruiters. We’ve got to get in the game. The last Craig Brewer movie – we worked around the clock trying to keep that here. Everybody else has something to put on the table. What did this big city have? We lost that. Craig wanted to do that movie here so much, but we couldn’t play. We couldn’t get in the game.”

Only a week after Wharton’s comments, word emerged that Memphis-based Pinnacle Airlines Corp. was being courted heavily by the state of Mississippi, which essentially had a blank check to encourage the company to relocate its headquarters south of the Tennessee state line. Thanks to some intense scrambling and a major push involving almost every conceivable economic development group and official in the city, Pinnacle was convinced to stay.

It was a similar high-stakes scramble to convince elected leaders to approve incentives for later projects involving major corporations like Mitsubishi Electric Power Products Inc. and Electrolux. Such incentives are often the lynchpin of the deal yet dependent to a certain extent on politics.

Wharton told The Daily News the new EDGE board will improve that situation in a variety of ways. For example, international executives who need to fly in to Memphis will now have one stop to make as opposed to trying to find room in their schedule for multiple meetings.

“It’s just going to streamline those processes so that companies don’t have so many bases to touch,” said Kim Hackney, Luttrell’s senior policy adviser.

PROPERTY SALES 51 223 1,152
MORTGAGES 55 189 861
BUILDING PERMITS 149 541 2,593