Shelbyville City Council is being asked to consider approval of Tax Increment Financing (TIF) districts as an added recruiting tool to attract industries and businesses.
Shane Hooper, president/CEO of Shelbyville-Bedford Partnership, made a presentation to the council at a study session especially called for that purpose Thursday.
Hooper said the discussion was about “creating jobs…and creating revenue back to the city.”
TIFs create additional revenue sources for cities to provide services for constituents in additional to property taxes on individuals or industries and sales taxes, according to Hooper.
“It gives us a way to bring revenue back to the city without having to raise taxes,” Hooper said.
Hooper gave an example of a firm constructing a new $3.5 million building on a $1.2 million site with a total investment of $4.75 million. With a TIF plan in place, the base tax of $6,500 on that property would not change, but the new development would owe $74,400 in new city and county taxes – a $67,900 increase.
TIF districts will have to go though the full Council approval process before going into effect, Hooper said.
“A lot of people look at new business as just that, I look at it as revenue, but a lot of young people look it as quality of life issues,” Hooper said, adding they ask why Shelbyville doesn’t have those businesses.
“That’s the perspective I want to talk from today,” Hooper said.
One prospect seriously looking at Shelbyville is considering a $2 million capital investment potentially brining up to 300 jobs, Hooper said.
Hooper did not specifically name the prospect.
The Partnership has been contacted by eight retail prospects, said Hooper, whose primary job as Partnership CEO is recruiting industry and retail firms. Representatives of all asked about TIF package availability, Hooper said. All involve hotels, grocery stores, or restaurants.
“A lot of people leave Shelbyville and Bedford County for those services,” Hooper said.
TIFs can be structured as debt financing reimbursement or direct increment reimbursement, Hooper explained. They have no effect on individual tazxpayers.
“This gives developers money to put into a project that that they wouldn’t otherwise have,” Hooper said. “All the developers (considering Shelbyville) have directly asked for TIF finance or some other incentives. It’s the most direct, simple way we can put money in our developers’ pockets.”
Council member Henry Feldhaus, who has been working closely with the Partnership, made several remarks following Hooper’s presentation.
“We’ve been needing a TIF here,” Feldhaus said, adding the Council could approve the TIF or continue seeing Tullahoma and Murfreesboro gain businesses instead.
Tullahoma used a TIF to renovate Northgate Mall, which has been converted to a large strip shopping center, and attract the Marshall’s and Old Navy stores and Publix supermarkets within that complex.
Feldhaus said a previous Shelbyville council refused the old Castner Knott department store chain’s 1972 request to construct a store that would have resulted in the Tullahoma mall locating instead on the property at Madison Street and Davis Lane. That property later became a strip shopping center anchored by Kmart and Kroger stores and is now a storage unit complex.
“Shelbyville has the growth right now,” Feldhaus said, cautioning against turning down current large retail proposals.
TIF’s would only be located in specifically designated areas. The public square, riverfront area just west of the square, and areas out Highway 231 North would be suited for TIFs, Feldhaus said.
Also mentioned for a potential TIF area was a proposed new residential development off North Main Street containing 250-300 homes.
As the session ended, Mayor Wallace Cartwright asked if anyone had remarks.
Council member Gary Haile spoke up about an apparent racial slur he had heard. Haile did not specify when or where.
“Marilyn Ewing’s mother named her Marilyn – and it starts with an ‘M’. My mother named me Gary – and it starts with a ‘G’. Neither one of us sitting here’s name starts with an ‘N.’ And you take it for what it’s worth. I’m done with it. And I mean it from the bottom of my heart. I’m not going to listen to that any more. And I’m serious. And I’m out of here,” Haile said, rising from his seat and leaving the building before the meeting was adjourned.
No one commented as Cartwright ended the meeting and the crowd left the suddenly-quiet room.
Haile did not respond to a request for further comment Monday.