PILOT Agreements May Get More Scrutiny From Council and Commission

CHATTANOOGA, TN (WDEF-TV) — Almost everyone agrees that the tax-abatement deal for Volkswagen in 2010 was a good idea..
After all the company spent a billion dollars on a plant and is credited with creating 10-thousand new jobs in the area.
But the "Payment in Lieu of Taxes" agreements may not be so readily available in the future.

Volkswagen got a property assessment of 214-million dollars, and will pay 8-million a year under the pilot program over the next 29 years. But the company is paying every cent of the school taxes as it creates jobs.

GREG BECK, COUNTY COMMISSIONER "All of the augmentation that’s going on out there in the Bonnie Oaks area…and all of the suppliers that are coming in…they’re providing all kinds of jobs and those who are critical don’t have an alternative for that."

But there are 37 PILOT programs still on the books, providing tax relief for such companies as U.S.xpress and Coca Cola.

LARRY GROHN, CITY COUNCIL MEMBER, PACHYDERM CLUB "Every PILOT has to be examined on its on strengths and weaknesses. We have another PILOT coming up that I can’t vote for."

Tea Party leader Mark West thinks many of the PILOTS create an unfair advantage for some businesses..and that the agreements are not tough enough.

MARK WEST, PRESIDENT, CHATTANOOGA TEA PARTY "Really the key right now is to force our city and county representatives to get tough with more ..Better rules and regulations on how these pilots should be managed."

LARRY GROHN "We did not have enough accountability built into the framework of these pilots."

West says the Alstom company is an example of a PILOT not upheld. The company has created only 140 jobs..instead of 300 in its 2010 agreement.
Both city council and the commission agree with the PILOT approved last week for a developer to turn the old McClennan building into apartments.

GREG BECK "To see that building sit there for all those years..10 years without without anything going on in it…I’m surprised it lasted that long."

PILOT agreements are focused on two economic benefits–creating housing like the McClellan building deal, and creating jobs and economic development, like Volkswagen.

Categories: Consumer News, Hamilton County, Jobs & Economy, Local News

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