Tennessee Lures Amazon to Nashville With $102 Million In Taxpayer-Funded Incentives

Nashville won’t be getting Amazon’s new HQ2, but in a surprise announcement Tuesday the city will get Amazon’s new Operations Center of Excellence in exchange for $102 million in taxpayer-funded performance-based incentives.

A press conference held at the State Capital with outgoing Governor Bill Haslam, Economic Community Development (ECD) Commissioner Bob Rolfe, and Nashville Mayor David Briley appeared with Amazon’s Holly Sullivan to make the announcement.

While Nashville was considered to be in the hunt as one of the top 20 for Amazon’s HQ2, that distinction was awarded to New York and Virginia. Being a finalist “opened the opportunity for Nashville to be chosen for this significant operation,” according to Ralph Schulz, President and CEO of the Nashville Area Chamber of Commerce.

The new operation promises 5,000 new jobs with average salaries of $150,000 per year, Haslam said during the press conference.

While Amazon’s investment to establish the operation is sited as $230 million, the announcement didn’t address the $102 million in incentives as the trade-off. Incentives from the State include a $65 million grant for capital expenses and allows Amazon seven years to create the 5,000 jobs.

A tax credit from the State of Tennessee worth $21.7 million is intended to offset franchise and excise taxes, reported Yahoo Finance. This is a particularly interesting incentive, in that Governor Haslam’s IMPROVE (Improving Manufacturing Public Roads and Opportunities for a Vibrant Economy) Act passed in 2017 lowered the franchise and excise tax for certain businesses.

Additionally, the “broke” city of Nashville will provide a cash grant up to $15 million. Meanwhile, Metro hasn’t been able to fully fund schools or provide promised pay raises to employees, as previously reported.

According to the State’s Open ECD webpage, Amazon has received about $15 million in FastTrack grants alone. There may have been other tax incentives provided Amazon, but not available on the Open ECD website due to statutory taxpayer confidentiality provisions.

Amazon’s Eastern Hub will be located in Nashville Yards, an under-development mixed-use site that boasts over 1.5 million square feet of office space, a thousand residential units, 600,000 square feet of retail and entertainment space and 1,100 hotel rooms. It was not revealed how the Amazon operation will fit into the plan.

Also not clear is how Nashville intends to deal with the traffic woes that will most assuredly come along with an additional 5,000 commuters in an already congested area.

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Laura Baigert is a senior reporter at The Tennessee Star.
Photo “Nashville at Dusk” by Jorge Gómez.










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6 Thoughts to “Tennessee Lures Amazon to Nashville With $102 Million In Taxpayer-Funded Incentives”

  1. Tricia Stickel

    Try to dispel the thought Amazon will be bringing 5000 jobs (paying $150,000) to Tn. Amazon will be bringing 500 people… , from Seattle, 5000 progressive Democrats to TN. What happened to last months exclamation of the lowest unemployment blah, blah, blah. And what about that workforce we are trying to develop? We need more people like a fish needs a bicycle! But big Corp/Gov could not care less about Dem/Rep, Red/Blue, Cons/Lib. The concern is “fill the coffers”. While the PEOPLE scream for better traffic, infrastructure, education, healthcare etc… we spend millions on libraries and corporate welfare. This is how to turn a red state blue.

    1. John Bumpus

      Keep in mind, Ms. Stickel, that Davidson County voted blue in the gubernatorial and senatorial elections earlier this month (as did Shelby and Haywood Counties–the only other counties in the State to do so). Also, Davidson County voted blue in the U. S. House, 5th District, election. Obviously, Davidson County is overwhelmingly at odds with most of the rest of the State politically. Sad but true.

  2. Rick

    We the people are told everyday that Bezo’s , the owner of Amazon, is one of the richest people in the world yet we have to give all of this tax break money to bring Amazon here. The people will have to endure the traffic problems, property value increases and I am pretty sure this will give Mayor Briley the push needed to raise property taxes which they want to
    Improve infrastructure for we the people.

  3. Wolf Woman

    Amazon needs corporate welfare to survive. Why didn’t we give them more? Poor ole Jeff Bezos, out there just scraping by, not knowing where his next billion is going to come from . . .

    1. tballard

      I suppose you can say we came out better than New York that actually gave them $48,000 per job. Nashville only had to ante up $20,000 per job. So Nashville taxpayers get screwed, just not as bad as New York taxpayers get screwed. Somehow we need to stop the whole corporate welfare mentality of state and local governments in this country – it is out of control.