Everybody, I'd like to go ahead and call this meeting to order of the City of Chattanooga Industrial Development Board.

Today is Monday, August fourth.

Just want to note for the record that we do have a quorum present, and this meeting was uh duly noticed.

Uh, board members, you will have the minutes from our July fourteenth meeting, which is the last time we met in your packets, and invite you to have a look at those, and if there are any questions or things we need to discuss.

Please say so.

All in favor say aye.

Good morning.

Helen Burn Sharp accountability for taxpayer money, APM is a public advocacy group that focuses on tax incentives and transparency.

And this is my comments are about both today.

Master Machine Inc.

plans to relocate and expand its Chattanooga workforce, projecting about forty-five new jobs.

That is good news.

It sounds like a great company.

Number one, did the City Council establish the high growth and investment program by resolution, as they did with your growing small business program.

Number two, if so, what are the criteria that must be met?

From the information provided in your agenda packet, it appears that the informal program criteria may be 25 new jobs over three years and an average annual wage of at least 80% of the current Hamilton County wage.

That's a pretty low bar.

The other criterion for this program seems to be that the project is not eligible for a pilot, where you and the city council have established standards on the number of jobs, amount of investment and wages.

Third question is there a but four test in this program?

In other words, is a tax incentive necessary for a project.

Recent press releases on this particular request read like the expansion decision on this project has been made.

In fact, your resolution even states the grantee will commence construction on or before July 15th, 2025, which was last month.

Here's why this issue matters and is timely.

Local property taxes are paid into the city and county general funds, which are the primary funding source for police parks, libraries, and a myriad of other city and county services.

Tax abatements pilots and tax diversions TIFFs reduce revenue that would have gone into the general fund to pay for these services.

In 2024 alone, about $27 million was not collected due to these incentive programs.

Many of these incentives, like the VW pilot and the Stadium and Bend TIFFs, last 20 to 30 years.

The city council currently is in the unenviable position of needing to improve an increase in property taxes.

The public is questioning how much belt tightening has been done by the mayor's office and preparing their recommended budget.

What sort of message does it send when the IDB is asked to give what would have been taxpayer dollars if they had been collected to a business that was going to expand here anyway?

It sounds more like a more of a reward than an incentive.

The funding source for the high growth and investment program is economic development fees paid by pilot and TIFF recipients.

When this program was established over 10 years ago, it was set up to bypass the city council.

The mayor's office recommends how the IDB should spend this money.

It is typically for economic development activities, but last month, you may recall you were asked to approve funding for the James A.

Henry housing related project on the West Side.

Conclusion, you're in an unenviable position.

The company has likely been told that the grant is a done deal.

I recognize the total dollar amount in the larger scheme of things isn't huge.

But I think we're in an era of where you know public trust really could be increased if people felt like that the policymakers were really looking at this and were trying to do some belt tightening and we're only spending property tax monies in areas where they're really needed.

So my request to you is that you please discuss these issues and recommend future changes that would improve transparency.

Thank you.

Thank you.

Anyone else with sure justice board this time?

If not, we will move to our first item number five, a presentation by the Chattanooga Chamber regarding Master Machine Inc.

expansion opportunity.

Good morning, Board Shrey Down, Senior Advisor for Economic and Workforce Development here at the City of Chattanooga.

I'll start by reviewing the staff report that we provide for each of the items that we bring to this board.

The staff is recommending approval of this item.

It's a performance-based grant in that the company has to create the jobs before the performance is paid out.

That would happen over a number of years.

The maximum is up to 135,000.

Those jobs are verified annually before a payment comes through in April of every year.

There's a state statute on your staff report that points to the provision that provides authorization for this.

Keeping in mind this is a recruitment project where competitive against another state, and these are jobs that we would like to see happen here in Chattanooga.

The last piece is the Chattanooga climb tire strategic plan, which is funded by both the city and the county on four priorities, creating more high quality jobs, developing skills for a new economy, growing stronger businesses, and increasing increasing regional prosperity for all.

I'd also like to like to add that the state of Tennessee has a stronger focus moving forward on nuclear energy and nuclear assets.

Again, because of this company's operation in the space around nuclear, that's why we'd also would like to have those jobs here in the state of Tennessee versus having those go outside the state.

So in summary, we're recommending approval of this item.

There's a little background information, and then obviously we're looking at the fiscal impact.