NASHVILLE, Tenn. (WTVF) — Tennessee is offering Starbucks $30 million in taxpayer-funded economic development grants to bring a regional corporate office and 2,000 jobs to Nashville — and the deal is drawing push back from an unlikely source.
Starbucks announced in April it plans to open a regional corporate office near downtown Nashville, representing a $100 million capital investment. "There's a real opportunity for Starbucks to build more stores, build more opportunities," Starbucks CEO Brian Niccol said during the announcement.
State officials say the incentive package is worth it. "These jobs create career ladders for Tennesseans and help retain college graduates in Nashville and the Tennessee region," Tennessee Commissioner of Economic and Community Development Stuart McWhorter said.
McWhorter, who was unavailable for an interview, made his case at a state funding board meeting last week, arguing the deal's benefits extend well beyond the direct job creation. "This project uniquely helps attract more professional services, vendors, suppliers, restaurants, real estate activity and innovation to the region," McWhorter said.
A spokesperson for McWhorter also provided a written statement defending the incentives.
Starbucks’ decision to establish a major corporate hub in Nashville represents a $100 million investment and the creation of 2,000 direct new jobs, reinforcing Tennessee’s reputation as a top destination for business investment and corporate growth.
These are high-quality jobs that will create long-term opportunities for Tennesseans across Middle Tennessee while generating broader economic impact well beyond the initial investment. Projects like this also help attract future jobs, innovation and additional corporate investment to our state.
We’re proud that Tennessee continues to rank among the top states in the nation for business, and Starbucks’ decision to grow here further validates the strength of our workforce, business climate and partnerships across the state.
But Pamela Furr of Americans for Prosperity Tennessee — a conservative political advocacy group typically aligned with Governor Bill Lee and Tennessee Republicans — is questioning why a profitable corporation needs public money. "Why are we giving money away to businesses who don't need that money?" Furr said. "Your money, my money, I could find other places to use that money."
Furr argues the practice amounts to picking winners and losers in the marketplace. "We have small businesses starting every single day here, who do not have those kinds of tax incentives, and are doing very, very well. So why does a company that's making billions of dollars need those kind of tax incentives from us?" Furr said.
The deal does include accountability protections. At the funding board meeting, Comptroller Jason Mumpower asked whether the state has recourse if Starbucks fails to deliver on its commitments. McWhorter confirmed those agreements — known as clawbacks — are in place and fully enforced.
The specific details of the clawback agreement in the Starbucks deal are not yet available. A spokesperson for McWhorter said the contract has not been fully executed, and state law prevents the release of that information until it is.
Furr said that timeline is a problem. "Yea, we need transparency there before the contract is signed," she said.
She also believes, with all of Tennessee's economic success, there's no reason the state should pour millions into convincing corporations to relocate. "It's a great place to raise a family. Why in the world would you need to be bribed to come here?" Furr said.
According to the Tennessee Journal, the move is also getting push back from a union representing some Starbucks employees.
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