Your move, Schneider Electric USA.
Monday night the Williamson County Commission activated a resolution with a tax incentive for the company, in a unanimous vote, to open an office in Cool Springs that would eventually employ nearly 1,200- all jobs new to the county.
Last week both the County Budget Committee and the Williamson County Industrial Economic Development Board, in recommending passage, showed no resistance to the plan. In May the Tax Study Committee and Property Committee also approved the Tax Increment Financing plan, which rebates up to $2.11 million in taxes over 10 years if employment markers get met..
Now all the county can do is wait; Schneider still needs to make a final decision on Williamson County. The team leading the project will next present the project to the companies board for approval.
“We are still working through the final details but expect if everything else goes well that the decision should be made relatively soon,” Ryan Stanton, smart cities account manager for Schneider and part of the team representing the company at the meeting, said
The project is in competition with other projects for funding within Schneider, and Williamson County is also in competition with other places in the U.S., but, he is excited about the prospects.
“This is a project we have looked at over the years and come back to,” Stanton said. “Really at the heart of it though it is a discretionary project, but also competition in other states and areas for whether or not the project gets done in those other place. We will continue to look at our real estate portfolio and look at what makes the most sense for company, our employees and customers.”
In return for the rebate, the Paris, France-based global specialist in energy management and automation would agree to plug up to 1,140 jobs into the county, at the proposed office space at 6700 Tower Circle. The 150,000 to 180,000 square-foot space at Two Franklin Park would become Schneider’s showroom and research and development hub in Tennessee, as explained in the economic impact study of the $79-million project.
To earn the rebate, the 180-year old company, which has 180,000 employees around the world, 30,000 in the U.S. and 1,600 currently in the state, will have to bring 80 percent of the jobs projected in the deal- or 916- to the county by 2023.
Because the jobs will increase base disposable income spent here- they average a salary of $73,000 per year plus benefits- the county would make money back on the deal over time in property, and other, taxes and fees.
“It is one of the highest wage deals I have ever worked on in four decades,” said economic development lawyer, Thomas Trent, who is involved with the deal about the deal earlier this month. He said the goal of the TIF is to bring jobs- and they are excellent ones at that.
“You do this because it gives them a delta to consolidate their operations here,” Trent, who in a tireless effort explained the deal cogently and concisely at each of the committee meetings in past months, said to the commissioners.
However these are not all created jobs, but jobs new to the county. 250 of the jobs would be new to the state. Schneider currently has employees working in LaVergne, Murfreesboro and elsewhere.
Its national American headquarters are in Boston, with offices in Raleigh, NC, the San Francisco Bay Area of California, and Chicago.
“Consolidation is the goal here,” Stanton said. The jobs are to mostly be engineering and research and development positions.
Stanton said at the Tax Committee meeting that Chicago would lose Schneider employees that Williamson County gains.
Construction would be complete on the new office by 2018.
With the TIF, the county would, at maximum, give Schneider a $2,110,254 break in property taxes over ten years.
As explained by Trent, Tax Increment Financing can work over time, or as an upfront incentive. The company undertaking the project can arrange to make a loan through the Industrial Development Board. Then all or a part of the increase in property tax as a result of the project is called the increment. That dollar amount can be used to repay the loan, so that money is available up front.
All or part of the increment can also be used to simply pay for costs of the project being incentivized over time.
“The incentive is truly performance based,” Trent said. “If you don’t get the property tax increased, there is no increment.”
When a project is built or constructed on a tract of land, the property taxes will go up as the value of the site is increased. In the case of a TIF, the county trustee will pay the county an amount equal to the property tax for the year before the TIF plan is approved. In Williamson County, the next 42 percent of the increment (the increased taxes) will go to Williamson schools. Up to the remaining 58 percent of the increment could go back to the Industrial Development Board to provide an incentive for the company.
Schneider might be best kown in America for its Square D brand, which can be seen on electrical breaker equipment.
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