Washington County, Tenn. Commission approves incentive agreement to attract unnamed company

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JONESBOROUGH, Tenn. (WJHL)- The Washington Co. Commission sweetened the deal Monday night to lure a global auto manufacturing company to the county to create 200 new jobs.

The commission approved a tax incentive agreement in hopes of convincing the still unnamed company to set up shop in the former Alo Manufacturing building in the Washington County Industrial Park in Telford.

“Incentives are part of the game. If a community is not offering incentives, then you’re out of the game,” said Alicia Summers, the Vice President for Business Development of the Northeast Regional Economic Partnership.

The two-phase payment in lieu of tax agreement could net the company more than $1.8 million in tax incentives. Most would come from 3-year abatements of tax on the $136 million of equipment the company plans to install. The proposed wage is also higher than the county’s average.

“They’re offering a competitive wage for their entry-level employees and we’re also working with the Tennessee Department of labor to help identify potential employees for them,” Summers said. “They’re needing production workers, assembly workers, welders, machine operators, those types of positions.”

Washington Co. Mayor Joe Grandy says the company plans to be in operation by the end of the year. He hopes the county’s incentive will beat out other offers from Ohio and Michigan.

“The initial tranche of jobs will be just over 100 and when you think about it- that’s about the number of jobs that were lost when Hexpol burned so the job market can definitely support this,” said Grandy.

Hexpol Compounding was a rubber facility in Jonesborough that burned to the ground in January of this year, putting about 100 people out of a job.

The deal creates a “win-win” situation for the company and the county.

“An increased tax base gives us increased financial stability,” Grandy said. “The tax abatement in the phase two when they do their big expansion and create a market for real property tax, the portion that’s attributable to education is excluded from the proposal so that they will be paying the portion of property tax attributable to education from day one.”

The lone commissioner who voted down the project said these types of incentives aren’t fair to businesses that aren’t getting a tax cut.

“We don’t have a guarantee that the company will come. we don’t have a guarantee that they’ll stay once they’re here. In this particular deal there was only a 50% clawback provision if they don’t meet their goals,” said Robert Tester, the district 12 commissioner who consistently votes against these types of proposals. “The risks are to be taken by entrepreneurs, companies who are willing to risk their money whereas we’re kind of… we’re not necessarily putting taxpayer money out there risking it- the decisions we make affect taxes and our budget and those kinds of things.”

The company is expected to make a decision on where its first US manufacturing site could come within the next thirty days

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