Everyone’s heard, “Memphis would be nothing without FedEx”. Stated over and over, in various ways, the former becomes a governing belief system that fuels a public beat down and corporate runaway elitism on the back of a Memphis community in need. With documentation, this blog will discuss how a beat down leads to an actual up to $3M FedEx taxpayer “carjack” involving its World Trade Center. It’s a metaphorical carjacking, in the sense, that it is financially what might as well be happening to the taxpayer.
Fred Smith created and administered the growth of FedEx. But the fact is, the Memphis taxpayer built FedEx. This fact is missing from the local discourse. Recently, in a story on Fred Smith, Michael Nelson of the Daily Memphian (DM), reminded locals that Memphis is Shreveport without FedEx – a beat down that paves the way for excessive incentives and runaway corporate elitism. Michael, C’mon Man, the Memphis taxpayer built FedEx !
The local press and university community avoids raising questions of elitist policies. And the Daily Memphian’s, Dr. Otis Sanford who serves as University of Memphis Hardin Chair of Economic Excellence and Managerial Journalism, who one would think would write about such economic subject matter, instead go, focuses on political commentary for the DM.
All the while, corporate elitism remains unquestioned in the local discourse, even though research based documentation reveals $300M+ in excessive local tax incentives. In this way, there is no progressive social justice or fiscal conservatism while leaving corporate elitism locally unchecked.
But the Shelby Count Mayor and County Commissioners are well on their way to the indefensible reappointing of Al Bright as EDGE Board Chair and one of the primary authors of local runaway elitism. And if reappointed, Bight will serve 16 yrs, longer than local officials can serve. Mayor and County Commission, C’mon Man !
The Carjack
So how does this metaphorical FedEx WTC carjack occur? Well like any other carjack occurs, with a beat down vulnerable target and an unlocked door or window as an access point. In this case, the public sector is beat down believing they are nothing without FedEx. Then their is ambiguous PILOT contract language as the access point.
This email chain, obtained from the County, reveals the ambiguous contract language of “substantial completion” as the access point for the FedEx WTC PILOT extension. It’s virtually impossible to verify or define “substantial completion” 20 years ago. But one can verify that more than 50% of the value of real property building permits were pulled 1 year prior to the FedEx WTC PILOT start date of 12/31/97 for a 20 year PILOT that was originally scheduled to expire on 12/31/17.
If the public sector were not vulnerable and beat down, the answer to FedEx is: “FedEx, we appreciate your business but we can’t do that at this time based on our records that indicate there was substantial completion at the time the PILOT started on 12/31/97. With that stated, we are happy to begin your new 75% tax abatement that will expire in 2032. This will, in effect, give you a 35 year 82% tax abatement.”
But that is not what happened with an overall 82% 35 year PILOT not good enough for FedEx. FedEx wanted to stay on their old 100% PILOT and not go on the new 75% PILOT that was approved in 2016. Here is what happened:
In 2017, FedEx initiates contact with the Collierville Industrial Development Board attorney and requests an extension to the 100% PILOT based on ambiguous “substantial completion” contract language.
Collierville IDB contacts Shelby County Assessors office and without negotiation, the Assessor’s office agrees to the extension without Collierville IDB public meeting approval.
In 2019, there must have been some type of lapse in implementation, where similar emails were sent, with this time, an attorney intervening notifying the Shelby County Trustee’s office of the PILOT extension.
Using values contained in the email chain, the total carjack potential cost of the original PILOT extension to Shelby County taxpayers is $3.3M. See below table.
Hey FedEx, even with high property tax rates, Memphis is a nationally low business cost operation center. C’mon Man !
Conclusion
There is no progressive social justice or fiscal conservatism while rewarding and allowing a rigged system and runaway elitism to persist. Historical and research based root cause analysis reveals that flat property tax revenues exist due to excessive corporate/real estate incentives.
Blame should be assessed to the political advocates of such elitist policy while rewarding the public with greater political access, genuine social justice and fiscal conservatism as expressed through rigorous oversight and taxpayer advocacy.
Besides, the FedEx/Memphis Tomorrow complex already owes the taxpayer $1.5B. Don’t listen to them or the donor driven Daily Memphian.
And C’mon Man ! Memphis remember, you built FedEx……