The Metro Council Tuesday advanced an incentives package for Nashville-based HCA that is among the largest the city has ever offered.
Mayor Karl Dean’s proposal, aimed at incentivizing the health care giant’s plan to relocate two of its division headquarters to the long-vacant West End Summit property, will be up for a final vote at the council’s next meeting Dec. 4.
The incentives package is projected to total nearly $66 million. It includes a 100 percent property tax abatement of up to $3 million per year for 15 years — with a five-year extension available if the company continues to occupy the space — a $1 million one-time payment to cover HCA’s relocation costs, and an annual payment of $500 per employee. The state is also providing a $2.1 million incentive grant as part of the deal.
The proposal was moved along Tuesday without discussion, but council members said it had generated plenty at a recent meeting of the Budget and Finance Committee.
Councilman At-large Charlie Tygard, one of the council’s conservative voices, told The City Paper that he supports it.
“When I sat down and did the math — the hole in the ground right now is producing $128,000 of property tax per year,” he said. “If the building is appraised for $225 million, which is the building and parking garage, that would produce $4.1 million under current tax rates, of which we would rebate $3 million back. So the net effect, if you take all the jobs credits and everything else, the net effect to Davidson County is still positive. The benefit will be hopefully spurring development in that whole midtown area and for that reason it’s probably a good idea.”
Tygard said the council also needs to explore setting up criteria for smaller businesses, who want to expand and create more jobs, to have access to similar incentives.
But Tygard’s support for the HCA incentives puts him at odds with another conservative, Councilman Josh Stites, who argued that cost of the incentive is more than most citizens are willing to give away just to fill a hole on West End with two HCA towers.
“If you look at it from the pocket-price for the average taxpayer,” Stites told reporters after the meeting. “There’s 646,000 people here, in the most recent census. It’s a $60 million, probably a $66 million deal. It ends up being $95.74 per citizen in Davidson County. So you go to the average person and say, ‘Hey, you want to pay $100 for HCA to build a new building?’ That’s a hard sell.”
Citing numbers from the secretary of state, Stites said only 12 out of 9,000 for-profit corporations registered in Davidson County have access to similar Metro offers. He granted that incentives have indeed been given to some of the city’s largest employers, but also argued that the amount of jobs created by such deals represent an exceedingly small portion of the county’s overall workforce.
“It’s not sustainable,” he said. “You can’t continue to do that.”
As for greater access to tax incentives for smaller businesses, Stites said he’s planning on filing legislation in January aimed at the type of even playing field Tygard alluded to.
“So all those people that say small companies should have access to it, they’ll have the chance to put their vote where their mouth is,” he said.
In other council news:
The council gave initial approval to the mayor’s proposed buyout program for Metro workers, advancing it a second reading at the Dec. 4 meeting.