VOL. 132 | NO. 100 | Friday, May 19, 2017
EDGE Approves Trio of Tax Incentives
By Patrick Lantrip
The Economic Development Growth Engine board has granted tax incentives for a pair of Presidents Island manufacturing operations and a South Memphis health care company that together will result in the creation of 126 jobs and capital investments topping $140 million.
The payment-in-lieu-of-taxes agreements for NouriTech’s new gas fermentation facility, Cargill’s corn mill and an expansion of Neighborhood Docs’ Good Health Institute all received approval at the EDGE board’s Wednesday, May 17, meeting.
NouriTech was awarded a 12-year Jobs PILOT that will allow the company to invest $120 million into a new facility at 2330 Buoy St., which will produce a sustainable source of protein primarily used for fish feed.
As a result of the project, NouriTech will create 66 new jobs with an average salary of $62,955.
Of the total investment, $85 million will go toward the construction of a new facility on a 37-acre site that currently houses a 45,000-square-foot manufacturing facility. An additional $35 million will be spent on manufacturing machinery equipment.
“This facility will be the largest gas fermentation facility in the world,” said Trey McKnight, an economic development specialist for EDGE. “The facility will initially produce up to 20,000 metric tons of FeedKind annually and expand up to 200,000 metric tons per year when operating at full capacity.”
NouriTech is required to spend $25 million of the investment costs with minority and women business enterprises and Shelby County certified locally owned small businesses.
NouriTech is a joint partnership between California-based Calysta, which developed and commercialized the FeedKind protein, and Cargill, which will use its existing manufacturing footprint to ramp up production on a global scale.
In 2015, Calysta and Cargill entered into an agreement to locate their new corporate entity at one of Cargill’s existing facilities. After an extensive search, Memphis was eventually chosen over several other sites, including Houston, Texas; Mobile, Alabama; and Alberta, Canada.
Additionally, Cargill separately sought and was approved for a six-year Jobs PILOT for its existing adjacent facility.
Per the terms of the PILOT, Cargill will invest $20 million into its 412,337-square-foot facility and add 24 net new jobs with an average base salary of $60,417.
The $20 million investment will allow Cargill, the largest privately owned company in the U.S., to optimize its corn germ network extraction plants to supply crude corn oil to its on-site oil refinery.
Cargill was originally awarded an eight-year Retention PILOT in 2010 to retain 370 jobs, create 27 net new jobs and invest $72 million at its facility.
However, Cargill surrendered the tax incentives when it closed most of its Memphis corn milling facility in January 2015 due to transportation costs and its distance away from Corn Belt suppliers. Since then, the corn-processing facility has been operated with a nominal staff of 41 employees.
“I think this is a great news for Memphis. We’re seeing reinvestments in manufacturing,” a Cargill representative told the board about both his company’s and NouriTech’s PILOT. “This is the start of new energy, new jobs and new investments in that area.”
Meanwhile, Neighborhood Docs, which offers a limited range of services in lower-income areas of South Memphis, was granted a 15-year PILOT to provide more expansive service.
Neighborhood Docs plans to expand and rebrand the efforts of its existing Good Health Institute, which has worked in the Cherokee, Bethel Grove and Orange Mound neighborhoods for more than 15 years.
The PILOT will enable Neighborhood Docs to add much more comprehensive health care prevention services in addition to the dental clinic, nutrition center and endocrinology services it now provides. The ultimate goal is to impact emergency room misuse by promoting proactive health care through access to primary care doctors for both medical and dental treatment.
“We hope to anchor our expansion with OB/GYN, primary care, and radiology physicians,” said Neighborhood Docs representative Joseph C. Greer, DDS. “Our primary purpose is to bring good, quality health care to the inner city and serve as the spark for future redevelopment for the neighborhood.”
Neighborhood Docs was established by Greer, Dr. William Terrell Jr. and Rodney S. Meyers. It will maintain six existing Good Health Institute jobs, create 36 net new jobs with an average base salary of $52,119 and make a capital investment of $3.7 million. The total project investment includes $1.5 million for the purchase of property, $1.4 million for new construction and site improvements, $528,919 to renovate existing space, $75,000 in existing personal property and $250,000 for new personal property.