VOL. 133 | NO. 99 | Thursday, May 17, 2018
Three Projects Get Green Light from EDGE Board
By Patrick Lantrip
The Economic Development Growth Engine for Memphis and Shelby County approved a trio of projects that could create as many as 255 new jobs and retain nearly 300 more during a busy Wednesday, May 16, agenda.
“Year to date, you have now approved nine (payment-in-lieu-of-taxes) projects, which puts us on a similar pace as last year,” EDGE president and CEO Reid Dulberger told the EDGE board, referring to the tax incentives commonly known as PILOTs. “Last year’s tally of 18 was the highest number of PILOTs approved since 2002.”
The largest of the three, New York-based Mimeo.com, sought a 15-year Expansion PILOT for a $13.4 million project that could see its corporate headquarters consolidated and relocated to its Memphis facility at 3350 Miac Cove.
Currently, Memphis is in the running with several other cities for the relocation, including Nashville; Louisville, Kentucky; Austin, Texas; and Denver, Colorado.
If chosen, the relocation would bring in 85 jobs to Memphis, including the company’s senior leadership, and create space for 77 new salespeople.
“Oliver (Doughtie, Mimeo chief financial officer) is a longtime Memphian and I grew up in North Mississippi and moved here after I graduated college from Ole Miss,” Mimeo senior vice president and general counsel Adam Ferguson told the board when asked about Memphis’ chances of landing the headquarters. “I live in New York City now, and have been there for the past six years, but we both consider ourselves Memphians.”
After the meeting, Ferguson said he expects a decision to be made sometime in the next quarter.
To date, Mimeo employs 288 workers in the Memphis area and would maintain a total of 455 employees with an average salary of $54,930, excluding benefits.
EDGE staff estimates $28.4 million in local total taxes will be generated during the life of the PILOT, while saving Mimeo $2.5 million.
Secondly, a group of entrepreneurs headed by Andrew Kim was awarded a 15-year Community Builder PILOT to redevelop a vacant supermarket in Whitehaven into a community-oriented shopping center anchored by a trampoline park.
Located on the northwest corner of Faronia Road and East Shelby Drive, Whitehaven Landing will be anchored by Altitude Trampoline Park, which will occupy 37,000 square feet.
Kim said they have waited to market the remaining 12,016 square feet of retail and 17,432 square feet of office/retail flex space left until after the EDGE board’s decision.
EDGE staff projects the $4.4 million project will create an equivalent of 89 full-time positions averaging $22,804 in annual pay.
William R. Moore College of Technology and the Greater Memphis Automobile Dealers Association were also awarded a 15-year Community Builder PILOT to open an auto mechanic training school in a blighted, 24,500-square-foot building at 2785 S. Mendenhall Road near Fox Plaza Drive.
While the $2.3 million project would only create four jobs with an average annual wage of $56,750, the school can hold 90 students at full capacity and received the support of both mayors.
Also at Wednesday’s meeting, Technicolor Videocassette of Michigan Inc., a division of France-based Technicolor SA that was approved for four possible expansion scenarios in December, told the EDGE board it would be selecting the most lucrative of the four packages.
Technicolor’s new 15-year Expansion PILOT will retain 916 new jobs averaging $46,085 in salary a year and result in $14 million of capital investment spread across four properties – 5215 S. Lamar Ave., 4155 E. Holmes Road, 4010 Holmes Road, and 4926 Southridge Blvd.
And in other action, the EDGE board tabled the vote on a new PILOT program known as the Sewer Capacity Management Incentive for a month to give the City Council more time review the proposal.
The new incentive was proposed by the city administration to help developers offset the cost of having to build an offline sewage storage system while the city undergoes the process to upgrade its capacity in certain areas.
“There are certain geographic sections of the city where we have sewer capacity restrictions due to a number of factors,” Public Works director Robert Knecht said. “The goal is to resolve the capacity issues long-term so that we don’t have to require offline storage, but that takes time. It could take three to five years depending on the scenarios we are looking to adopt.”
Like most PILOTs, the SCMI would provide a 75 percent abatement of city taxes for up to 15 years. However, unlike most PILOTs, this one does not abate any county taxes.
Since the incentive is designed to only offset the cost of the sewage storage system, EDGE staff estimates the term length of the incentives would not be as long as their more traditional counterparts.
Some board members, like City Councilman Martavius Jones, questioned whether or not coming to EDGE before the council was putting the “cart before the horse,” which was the ultimately impetus for the hold.
The EDGE board will continue this discussion during its June 20 meeting.