With the aid of no public oversight, this blog on MWBE covers some of the entities that benefit from public programming designed to serve the overall public good in the Memphis Tomorrow public-private complex. The blog comes at a time of the Coronavirus when public programming is on the upswing. 

Based on our recent EDGE survey, fueled by excessive incentives, local MWBE programming benefits mostly highly reputable, established and some seemingly affluent companies while forwarding a culture of runaway elitism. This finding makes MWBE programming with regard to excessive PILOTs a scam. In fact, most of the companies that generated more than $1M in MWBE receipts gathered in the survey, appear too large to qualify as a locally owned small business (LOSB).  

These highly established, reputable and locally operated entities are companies that large corporations would look to locally trade with regardless of any local incentive programming. Some of the companies appear to be based outside of Shelby County while others carry no MWBE or LOSB designation that can be found. So why underwrite the purchase orders of global corporations through excessive incentives under the heading of MWBE and economic development?

In local legislative proceedings, oversight to determine whether the local economy is really benefitting from MWBE programming, just does not occur. There are never any deep dives into the data or legislative discussions of the companies generating significant MWBE receipts with most of the top receipt generators needing no special consideration at all. 

This occurs as legislators fail to ask investigative questions while diving into MWBE LOSB status or asking how startups are benefitting from MWBE. Memphis has long needed more small business establishments which startups would fuel. And to make matters worse, there is no public lobbying support, on this front, from the likes of the Epicenter. 

So who are some of the top companies that benefit from MWBE programming?

The Top MWBE Companies

The above table has been adjusted from the previous blog based on further research and reclassification. The below amounts, of the covered companies, only include companies that generated greater than $1M in EDGE MWBE recorded receipts included in the above $79M based on the last compliance report issued by PILOT companies.

Nike never has issued an MWBE EDGE compliance report as of the date of this survey. And finally, the below does not include all MWBE receipts the companies may be locally receiving as this just involves a sampling of EDGE. Here are the companies from the EDGE survey:

KBG Technologies (WBE) – $12,059,663

KBG Technologies is  the only woman-owned, full-service specialty chemistry provider for pulp and paper. Starting in 1993, Kathy Buckman Gibson worked her way up in the ranks of her father’s company to serve as Chairman of the Board of Bulab Holdings and Chief Operating Officer of Buckman International. In 2017, Gibson launched KGB Technologies and today benefits from significant MWBE transactions from International Paper

Fayette Janitorial (WBE) – $6,038,941

Fayette Janitorial, a 15 year old company, incorporated in Somerville, TN. with a corporate website and a Memphis website and a local address at 5100 Poplar. Fayette appears to have a national footprint with several notable, mostly food processing clients referenced on their corporate website while generating significant MWBE transactions with Smucker and Solae.

R&R Plumbing (WBE) – $5,601,599 

R&R Plumbing is a 30 year old WBE company based in Collierville while generating significant MWBE transactions from Amazon. A company website was not found. 

Image Environmental (WBE) – $5,338,431

Image Environmental is a 12 year old WBE company based in Memphis, TN. and has generated significant MWBE receipts from Valero.

American Electrical Contractors (WBE) – $5,218,306

American Electrical Contractors is a 44 year old WBE company that has generated significant MWBE receipts from TAG Trucking, Solae, JM Smucker and Ebfrost. 

GCM Inc. (WBE) – $4,567,88

GCM is a 17 year old WBE concrete construction company that has generated significant MWBE receipts from Amazon. 

ServiceMaster Facilities (MBE) – $4,433,276

Separate from ServiceMaster Holdings, ServiceMaster Facilities is a 15 year old janitorial MBE company servicing 10 states while generating significant MWBE receipts from International Paper and Technicolor. 

Signet (WBE)  – $3,429,492

Signet is a 44 year old promotional marketing WBE company that generates significant MWBE transactions from ServiceMaster and International Paper

Airfield Inc (WBE) – $2,630,231

Airfield is a 19 year old electrical contracting WBE company that has generated significant MWBE transactions with TAG Truck Enterprises.

W.A. Soefker (Vendor)  – $2,498,745

W.A. Soefker is a 77 year old mechanical contracting company that has generated significant MWBE transactions from TAG Truck Enterprises. 

C-1 Inc. (MBE) – $2,060,682 

C-1 Inc is a 21 year old MBE construction company that generated significant MWBE transactions from Amazon. 

Provide Staffing (WBE) – $2,056,978

Provide Staffing is a 40+ year old WBE warehouse staffing company that has generated significant MWBE transactions from Impact Innovations.

Prestigious Placement (MBE) – $1,919,347

Prestigious Placement is a 9 year old MBE staffing company that has generated significant MWBE transactions from Technicolor.

Southern Sales (MBE) – $1,562,379

Southern Sales is a 29 year old MBE electrical supply distributor that has generated significant MWBE transactions from Amazon. A website could not be found for Southern Sales. 

1Link Technology (WBE) – $1,480,309

1Link Technology is a 3 year old WBE technology staffing company that appears to be headquartered in Monroe, Louisiana. 1Link promotes itself as being one of the 500 fastest growing companies in America. 1Link has generated significant MWBE transactions from International Paper and Technicolor. 

Artizan Constructors (MBE) – $1,155,843

Artizan Constructors is a 20 year old MBE construction firm that has generated significant MWBE receipts from TAG Trucking Enterprises.

Bright Construction (Vendor) – $1,089,525

Bright Construction, unrelated to Al Bright, is a 57 year old local construction company that helped Kemmons Wilson build the first Holiday Inn. Bright Construction has generated significant MWBE receipts from JM Smucker.

APG Office (WBE) – $1,000,330

APG Office is a 51 year old WBE interior office design company based in Cincinnati, OH. With a local Memphis office, APG has generated significant MWBE receipts from ServiceMaster Holdings and Enoble. 

Conclusion

Who knows what’s next with the Coronavirus. But one thing is for sure, the local taxpayer, in a Memphis Community in need, will be carrying forward $120M in annually recurring tax incentives. If Memphis is to move forward from the Coronavirus, a new culture of govermental oversight is needed where none of the public-private complex has historically existed.

Its clear that the historic top beneficiaries of public MWBE programming are well established and long thriving companies. In the future, MWBE programming should demand LOSB and Startup status while reducing local incentives by 60% for the overall good and allowing companies to buy into reformed MWBE programming. 

But even with reforms, to be effective, public programming requires governmental oversight; something that seems foreign in a Memphis community in need….

Bustin’ out that MWBE programming is a scam. Such programming is a scam to carjack the taxpayers through excessive corporate/real estate incentives. From increased corporate receipts, MWBE programming is supposed to help build new and stabilize existing Minority Women Business Enterprises (MWBEs) and Locally Owned Small Businesses (LOSBs). But the MWBE program seems mostly to benefit well established, even affluent local business enterprises carrying forward the culture of elitism.

Based on a review of the last individual performance report issued by EDGE PILOT recipients, Kathy Buckman Gibson’s KBG Technologies led all vendors with $12M in MWBE recorded receipts from the EDGE MWBE PILOT program. For 2019, International Paper (IP) recorded $21M in MWBE receipts, with $12 of $21m expended to Gibson’s KBG Technologies. KBG receipts dwarfed the second contender in R&R Plumbing, a woman owned business enterprise (WBE) at $5.6M in receipts from Amazon. 

Why is this important now? Because crisis, like the Coronavirus, are ripe for public scams. And the Coronavirus comes amidst a culturally sustained Memphis crisis in lacking governmental oversight of the Memphis Tomorrow public-private complex. Rigorous oversight is needed more than ever. 

Given the former need, if one digs deeper into the local MWBE program, one will find City Councilman Frank Colvett’s Greenscape enterprise carrying designations at one time or another of LOSB, WBE and MBE. Or one may find Duncan “Donuts” Williams well established financial management firm with a WBE designation. Greenscape and Duncan Williams are just examples of well established and known second generation businesses participating in local MWBE programming. And there are several others, like Tri-State Plumbing, an established 45 year old Asian owned firm that carries an MBE designation. 

Then there are the corporate PILOT players themselves in International Paper (IP) and “social justice” icon Nike each with $57M PILOTs. Nike sends approximately $4M per year back from Memphis to one of the least impoverished areas of the country in Portland, OR. And while IP reports  MWBE, Nike arrogantly does not even bother to report EDGE MWBE compliance. And with regard to KBG Technologies found in IP’s report, KBG does not even carry an LOSB designation. So what’s really going on here?

What is Really Happening ?

MWBE social justice programming is a marketing scam for excessive corporate/real estate incentives. The marketing programming, along with bogus projection accounting, helps justify excessive incentives on the back of a Memphis community in need. Effectively, local taxpayers are underwriting purchase orders of global corporations for local MWBE vendors to serve global audiences under the heading of “economic development”.

Currently, with flat property tax revenues that potentially are about to get worse, there are approximately $120M in recurring annual tax incentives occurring across all of Shelby County that benefit corporate/real estate interests. This occurs in community, where the primary economic development challenges are workforce and a small business sector, with a relatively low number of business establishments. But sadly, the MWBE spend appears to be going to well established, long standing and affluent firms.

In a majority black community, MWBE is largely sold based on increasing the spend with minority owned businesses or MBEs. In reviewing the data for each of the EDGE PILOTs’ latest compliance report and/or diversity report, which does not include all EDGE MWBE spend, here are how the numbers break out for MWBE:

There were a number of firms that are local, but a classification for MBE, WBE or LOSB could not be found. Those firms are classified as “Vendor”. KBG Technologies is classified as WBE making up $12M of the $49.8 WBE total above. But while KBG is a WBE, KBG appears to exceed requirements for an LOSB.  

Solution and Conclusion

Instead of excessively serving global corporations and their audiences, taxpayers would be better off to reduce incentives and contract with MWBEs to build out a more attractive city to increase organic economic development demand. After all there is $500M in deferred maintenance of Shelby County Schools.

Better yet, savings from reduced incentives should be optimally expended for the public good in workforce, public safety, transportation and etc. But with the existing crisis in local government oversight, that has not been happening or may never happen. 

With MWBE as a scam, here is a pre-corona virus solution for economic development incentives: 

Baseline and reduce incentives when benchmarking against other cities which include no social justice requirements like affordable housing and MWBE requirements. In this way, tax dollars are saved from excessive incentives and used for the common good in a majority black and Memphis community in need. Residential PILOTS would go away, urban renewal incentive terms would come down and job incentive amounts would be reduced. This might involve the locally owned small business (LOSB) proposal in the tax incentive fiscal note impact (TIFNI) platform. This effort would likely reduce overall baseline incentive amounts by 60%.

Allow tax incentive recipients to optionally buy into social justice programming in exchange for additional years of tax incentives while being supported with targeted and aggressive MWBE requirements, oversight and program enforcement.

Allow residential development tax incentives for true affordable housing or for market rate residential developments when engaging 50% or more MWBEs and LOSBs

Purge MWBE list of affluent participants

This is a path forward for economic development incentives. But it will only work when engaged with rigorous local government oversight. 

Even with the Coronavirus, EDGE wealth transfer programming continues uninterrupted in Memphis. This blog will recap the EDGE meeting on 3/18/2020 that awarded a residential PILOT to the Link Apartment project, locally led by Bob Loeb while reviewing some other residential PILOT awards. 

Overall, the blog is mostly about overall programming and less the developer Bob Loeb. One has to give Loeb credit. He asks for PILOTs in person and does not have front men like some others apparently do in Memphis asking for obnoxious 30 year PILOTs.

The conspiratorial virus of no oversight of the public-private complex is alive and well in Memphis. Only Charles Belenky and Joe B. Kent represented the taxpayer in EDGE proceedings with the City Council and County Commission unrepresented. This absence of local officials occurred as incomplete, thereby bogus EDGE staff accounting reared its head again at the meeting and related to the Link Apartment project. 

If anyone has questions regarding the calculations in this blog, I welcome the scrutiny. So email me at jkent@pathtrek.net.

EDGE Recap – How Wealth Transfer Works

Wednesday, during public comment, the EDGE Board was publicly challenged with specific details regarding 1) affordable housing on the Loeb represented North Carolina based Grubb Properties Link Apartment project and on 2) the “But For Test” for project financial feasibility to justify the need for a residential PILOT as contained in EDGE residential PILOT program requirements. The question was answered in the EDGE staff led  Link Apartment presentation with a return on equity investment of 5.1% with a PILOT and .84% without. But there does not appear to be any continuity in EDGE’s “but for” threshold based on previously approved residential projects. 

One characteristic about the Link Apartment application is the contained proforma only provides a cash flow return on equity analysis without a PILOT. This is unique, as all other EDGE residential PILOT applicants submitted proformas with and without a PILOT. Given this, a proforma analysis was reconstructed for the Link Apartment application proforma found on page 10 for cash flow return on equity with a PILOT for the project. 

After close analysis of the Link Apartment application and the above reconstructed analysis, here are some facts about the Link Apartment PILOT:

Using the assumptions from the Link Apartment application for proforma reconstruction due to the omission from the application of a proforma with a PILOT, Grubb and Loeb Properties increases cash flows and their cash out price by $10M in year 5  from $24M to $34M while getting an additional $2M for the Broad property land and $2M in developers fees. The increased cash flow is due to the 75% abatement. The former results in an annualized return of 13.5% for the 5 year project. Without including the appreciation for land and developers fees the return on equity with a 75% abatement was 10.5%

The EDGE staff analysis only provided a year 4 “but for” analysis and not an analysis on the entire project showing only a 5.1% return with the 75% abatement.  This constitutes incomplete and therefore bogus accounting for the overall project. 

The unknown property management company will make a 14.1% annualized return on a $33M investment through increased property value, management fees and rental income over 15 years beginning in year 6 of the 20 year project.

Taxpayers will make 4% on their $17M abatement investment with positive returns not beginning until year 16 of the 20 year project.

Public commenter proposed a 40% abatement to the EDGE Board for the Link Aparment project which would have provided the developer with a 5.9% return on equity and 9.3% return when considering land sale and developer fees. The property management company would have made a 14.8% return. The EDGE Board, robotically stuck on 75% for all, did not take up the taxpayer proposal. Had the 40% abatement proposal been adopted, it would have saved taxpayers $8.2M.

When taking pictures of the EDGE staff “but for” calculations presented in the public meeting, seemingly concerned, Reid Dulberger asked a public audience member to sit down. The reason pictures were being taken is because the “but for” analysis is not contained in published public documentation. And further, taking pictures in public meetings is a typical occurrence as long as proceedings are uninterrupted. The “but for” analysis provided by EDGE statff is incomplete for year 4 only and not for the entire project life which may point to the reason for Dulberger’s concern. 

The Link Apartment project was approved by the EDGE Board with barely a quorum of 5 of 9 members present. Al Bright, due to some type of conflict, recused himself from voting. Bright’s conflict related recusals are rather common which is another reason that he should not have been reappointed for what will turn out to be a 16 yr EDGE Chairman appointment. The other 4 members unanimously voted for approving the 15 yr. 75% abatement for the Link Apartment project.  

With Shelby County being the only County in the State that offers residential PILOTs where any abatement at all is more than developers would get anywhere else in the State, EDGE does not have established “but for” criteria. Return on equity is all over the board, in their residential PILOTs based on a review of residential PILOT applications. And unfair to EDGE, the Downtown Memphis Commission’s data is effectively unaccessible. 

The Thrive @ The Park application reveals an average 13.4% return on equity with a PILOT. Without a PILOT, the proforma shows an average return of 6.65%.  That project did not need a 75% abatement or perhaps any abatement at all. But the EDGE Board is stuck on 75% for all. This one PILOT cost taxpayers $6.3M.

The EDGE Board moved to accept any state law that would allow them to meet telephonically. This will have the effect of blunting public participation in public meeting with public comment not read allowed. 

In short, its just more incomplete bogus accounting to justify excessive abatement awards fueled by a conspiracy of no governmental oversight and runaway elitism. 

How Community Wealth Transfer Works

The key concern that drove this analysis is that the Grubb/Loeb Link Apartment PILOT application did not contain a proforma with a PILOT as did the other residential PILOT applicants. 

The analysis in this section pulls together the Link Apartment application, developer proforma along with the EDGE economic project summary while realizing additional tax revenue from construction and operations. The below table shows how community wealth transfers works for residential PILOTs and a 75% tax abatement with values derived from the proforma and application. 

The developers’ 13.5% return, in this example, includes return on equity, land sale appreciation and developers fees. The unknown property management company generates their 14.1% return from real estate appreciation, rental income and management fees beginning in year 6 of the 20 year project. And taxpayers generate their measly 4% return through property tax abatements and only begin generating positive returns in year 16 of the 20 year project life. See below community wealth transfer table:

Conclusion

While bogus accounting rears its head again, there is no oversight of the public-private complex in Memphis. And more than ever, with Federal money coming in, its probably never been more important. But it comes amidst a culture of no oversight where legislators really don’t understand the pratice of rigorous taxpayer oversight. The list of examples is exhausting and includes: bogus accounting, unknown total tax incentive amounts, misappropriated funds, elitist giveaways with no contract deliverables and botched taxpayer funded initiatives.

All of that to say, the current Coronavirus could be used to reset the culture. But with EDGE holding telephonic meetings in the future while using bogus accounting in broad day light, who knows what’s next. One thing is for sure. Those tax abatements that have not worked for economic development and only for the small few corporate/real estate interests, are set to continue on the back of  a Memphis community in need. And those incentives will be on top of $120M in annually recurring tax incentives going well into the future. 

In the end, the conspiracy of no oversight hurts all to include even corporate/real estate interests while being anti-business and economic development. 

Nobody in local government knows the amount of total annual tax incentives occurring across Shelby County. And the information is certainly not published. Therefore, there is no measurement. 

This blog will share some analytical facts about incentives occurring in Memphis which also includes Shelby County tax abatements, as well new information on TIFs while revealing some unknowns. These unknowns leave taxpayers in the dark resulting in an inability to evaluate the return on investment for tax incentives. 

The data was compiled using the 2018 Shelby County Trustee Report and through a series of public information requests. 

City of Memphis

First lets draw some analytical conclusions from the table above. The table was derived from the 2019 Shelby County Trustee report that involves abatements occurring exclusively in the City of Memphis. You may need to click to enlarge the above table entitled “Memphis Public-Private Property Tax Conversion Scorecard”.

The scorecard communicates the impact of excessive tax abatements and deficient total wage growth on property taxes while calculating the needed property tax to make up the deficit for deficient public-private economic development results. Here are some conclusions from the scorecard for Memphis:

Excess tax abatements, when benchmarked against other cities, result in 2.7% Shelby County and 6.5% City of Memphis deficient tax revenues.

Excessive tax abatements translate into a Shelby County property tax increase from $4.05 to $4.16 and City of Memphis increase from $3.19 to $3.43 for a combined City/County increase from excessive abatements to $7.59

Deficient total wage growth results in a 3.8% County and 7.5% City property tax increase for a total combined tax increase when added to $7.59 of $7.99 Memphis property owners.

This revenue need comes from excessive County abatements of $21.5M and City of $17.3M and deficient County revenue from deficient total wage growth of $30M and the City of $20M for total deficient City/County revenue of $89M as of the end of 2019. Total deficient County revenue from this analysis is $51.5M and City of Memphis $37M

The City of Memphis PILOT report was discarded due to the fact that the City of Memphis could not answer questions regarding inaccurate PILOT information when compared to the County Trustee Report and involving large locally known PILOTs. This inaccurate information of the City report has the effect of greatly lowering the City taxes abated as shown on the 2019 City of Memphis PILOT report.  

County Overall and TIFs

Through an examination of public documentation and public information request, it is estimated that there are $123M in annual recurring tax incentives per year occurring across all of Shelby County. This $123M figure was updated from a previous published blog of $90M. The update came as a result of new information obtained by public information request from Shelby County that informed a $21.5M estimate for tax increment financing (TIF) incentives that was not part of the previous $90M total. 

In the public information response, Shelby County Government could only provide the annual TIF revenue figure of $6.5M. TIFs range from 65% to 100% of property tax revenue growth being restricted for use in the TIF district with local government recognizing 0% to 35% as revenue from increased property values. 

To derive the County TIF incentive figure, 70% was assumed as the total TIF incentive. Once the total County TIF incentive figure of $21.5M is derived from the given $6.5M in County TIF revenue, 65% of the $21.5M was assumed for municipal TIF incentives for a total of $14M.  The addition of these figures resulted in $72.5M in total Shelby County tax incentives and $51M in municipal incentives for a total of $123M in tax incentives occurring annually across all of Shelby County when adding the TIF totals to the abatement total.

Conclusion

A large portion of future tax increases or services cuts, in a Memphis community in need, comes from excessive incentives for the small few and deficient total wage growth. In exchange for tax incentives, competitive total wage growth and increased commercial property values are the carrots offered to local taxpayers. This resulting equation of excessive tax incentives and deficient total wage growth will never work for taxpayers and the business community as a whole in a Memphis community in need. 

Without taxpayer justice, forget about social justice, fiscal conservatism, workforce as a priority or moving Memphis forward. All of the former is a scam without taxpayer justice occurring in a city where mere taxpayer advocacy is politically incorrect. 

Inspired by flat property tax revenues, Ted Evanoff’s article on Tom Intrator, and the local rise of 30 yr abatement terms for urban renewal, this blog benchmarks $11.5M in annual Memphis/Shelby taxpayer shortfalls from Downtown Memphis Commission / Center City Revenue Finance Corporation abatements. The benchmarking is versus Kansas City MO’s similar 353 and Land Clearance Redevelopment Authority (LCRA) programs. The programs are offered by the Kansas City Economic Development Corporation (KCEDC).

The Downtown Memphis Commission (DMC) is administered by Jennifer Oswalt and Bobbi Gillis chairs the abating board within the DMC entitled Center City Revenue Finance Corporation (CCRFC). Thus far, this blog has focused its attention on excessive job incentives administered by the Economic Development Growth Engine (EDGE). This is primarily due to the fact that under Oswalt and Gillis, DMC abatement data is much harder to access, effectively making the data much less transparent than EDGE. 

At the same time, urban renewal real estate investment incentives require a different evaluation methodology than EDGE’s job incentives. To that extent, for this evaluation, Kansas City, MO was chosen for a benchmarking analysis based on its many similarities to Memphis. Kansas City is a border, river and barbeque town that like Memphis and unlike Nashville is not a boomtown. For the benchmarking analysis, two KCEDC urban renewal programs were reviewed for benchmarking. 

The Benchmarking 

The KCEDC 353 program appears to be a Kansas City municipal government only abatement program while the LCRA program can abate taxes for multiple taxing authorities within Kansas City MO’s Jackson County. Based on a cursory review of past KCEDC agendas, the LCRA seems to be the most popular program used in Kansas City for urban renewal which is possibly due to its broader abating authority. 

To that extent, here are each of the program benefits:

353 Program – Up to 75% abatement for 10 years and 37.5% for an additional 15 years for new capital investment (25 yrs)

LCRA – Up to 100% abatement on new capital investment for 10 years

Given LCRA popularity, KCEDC’s LCRA program is used for this benchmarking analysis with the maximum allowed abatement imposed on DMC approved PILOTs as found in the 2018 Shelby County Trustee Report. The 99 year Riverbluff Cooperative was removed from this survey as it appears the PILOT was designed to reflect a residential property assessment. 

The analysis took all DMC abatement properties, applied the current day Memphis/Shelby tax rates for the life of the PILOT to derive an overall difference for the entire abatement term of DMC managed projects vs KCEDC LCRA program. The overall difference is a Memphis/Shelby $299M accumulated taxpayer shortfall due to excessive DMC abatements that date back to 1981 well before the time of Oswalt and Gillis.

Historic tax rates were not applied, which perhaps provides a discount mechanism of sorts, to convert amounts into current day accumulated tax revenue shortfall amounts. But don’t get wrapped up in exact historical amounts, as the evaluation is about a comparison of program terms while the historic abatement numbers bring life to the evaluation.

The overall evaluation is then translated into percentage, which shows abatements for DMC managed urban renewal is 56% in excess and resulting in $11.5M in annual Memphis/Shelby taxpayer shortfalls. 

The primary excess driver costing Memphis/Shelby taxpayers is the lengthy abatement term of the DMC program. An example would be Auto Zone with a 40 yr PILOT that dates back well before Oswalt and Gillis showed up which current day taxpayers are still carrying around on their back and will be until 2033. This occurs as Auto Zone gets a new 15 yr 75% EDGE PILOT. On the other hand, while PILOT terms under the management of DMC have fallen over recent years, terms have never come close to averaging 10 yrs or less as is the case with the KCEDC program.

And, as of late, under Oswalt and Gillis, those PILOT terms have begun to climb again while abating 75% or more in taxes. Examples include Intrator’s 30 yr 75% PILOT, Loew’s 30 year and FedEx 22 yr 100% PILOT on new capital investment. 

It just seems there is never any negotiation with these PILOTs while being excessive in an already nationally low business cost environment. It would seem the longer term PILOTs should have been something more like KCEDC 353 program of 75% for the first 10 years and 37.5% for additional  years and up to 15 years (25 yr PILOT), with of course a 100% 10 yr abatement program as the other program option. 

But, in a rigged system without oversight, the elitists under a fiscally liberal mantra, have carjacked the taxpayer while programming in flat tax revenues with high property tax rates for years to come on the back of a Memphis community in need. So unfortunate….

Conclusion

Without taxpayer justice, social justice, fiscal conservatism, workforce development as a priority or moving Memphis forward will only serve as a pageantry scam.

In this blog, $11M in annual  Memphis/Shelby taxpayer shortfalls have been identified from DMC managed projects and $300M for the life of their projects. From this and previous blogs, add $11M for DMC, $25M for EDGE and $54M for deficient total wage growth since 2010 and one arrives at $90M in deficient annual Memphis/Shelby taxpayer shortfalls. And that does not include excessive TIFs or municipal PILOTs. 

And this question should summarize the overall problem. Per the Shelby County Trustee PILOT report and excluding the Riverbluff Cooperative, there has been $824M in development since 1981 under the DMC program with the County now getting annual tax revenue credit for $123M in new capital investment. If there were no DMC PILOTs, wouldn’t there have been much more than $123M in development since 1981 in the Downtown Memphis area?

And the $824M in abated but realized new Downtown capital investment under DMC management makes me wonder where the $15-19B in new capital investment figure even comes from…..