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Nashville Considers More Incentives For Developers

Posted at 6:28 PM, Jul 15, 2015

NASHVILLE, Tenn. -- Nashville could soon be setting aside more money for developers.

The Metro Development and Housing Agency (MDHA) wants the council to declare three more sections of the city blighted. 

It would allow them to hand out more tax incentives using tax-increment financing (TIF).

All three districts must be approved by the Metro Council.

But the president of the Service Employees International Union (SEIU), which represents many Metro employees, sent a letter to all council members asking them to delay approving the redevelopment districts until after a new mayor and council are elected.

"We're asking them to take a step back and take a deep breath," SEIU President Doug Collier said.

"To rush that through between now and election day is just completely unheard of."

Collier and SEIU have been critical of the city's use of tax incentives and specifically its use of TIF.

Last month, MDHA's board unanimously approved the North Gulch Redevelopment District, allowing developers up to $60 million in tax incentives to build in the area.

The board also recently approved $15 million for the Bordeaux Redevelopment District and another $30 million for the Cayce Redevelopment District.

If all three are approved by the Metro Council, it would increase the city's pool of tax incentives by more than $100 million.

"I just don't know how much this council and this mayor can give away," Collier said.

Collier questioned whether districts like the North Gulch are actually blighted.

By state law, redevelopment districts must be considered blighted in order for developers to be eligible for those tax incentives.

"I don't think any of that area could be termed as blighted to eligible for those funds," Collier said.

He questioned whether developers even needed the incentives to build there.

Construction is already underway in the North Gulch on the "Capitol View Complex." It will include 1000 new apartments along with retail shops, parking and a grocery store.

At the center will be HCA's new headquarters.

Joe Cain with MDHA told the board during his presentation on the North Gulch, "We've been considering this for a long time to kind of close in downtown, all of downtown, into one redevelopment district or another."

But the Service Employees aren't the only ones voicing concerns about the city's use of tax increment financing.

The heads of the fire and police unions want the city to reevaluate it's policy.

"Don't tell me how bad it is and then go out there with your gold shovel and take a picture and break ground on another 10,12, 20 million dollar project. Just please don't do that," said Danny Hale, who is president of the Fraternal Order of Police.

Even the current finance director told NewsChannel 5 Investigates earlier this year that the next mayor will have to decide if tif is affecting the city's ability to pay for city services.

"Going forward there will need to be a discussion as to whether it is having a detrimental impact on the city's operating budget," Rich Riebeling said.

But Collier said in the final months of this administration the council should not approve a large increase in tax-increment financing.

"We're talking about over $100 million, and the taxpayers of Davidson County are the ones that are going to be left holding the bag for this," Collier said.

Collier said some of the proposed redevelopment districts may need to be approved in the future.

He just wants the council to wait and allow input from the new mayor and the newly elected members.

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