Drew speaking of expansion here is some news about Dell's Tennessee expansion plans.
Tennessee counties hunt for Dell incentives
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By Karin Miller
Associated Press
Published: April 29, 1999
NASHVILLE, Tenn. -- Dell Computer Corp. gets a tax rebate for every Dell computer sold in Texas. And the company wants the same kind of deal before it puts a manufacturing plant and office building in Tennessee.
But there's one problem. A direct rebate would be illegal.
So, Nashville area communities trying to lure the nation's second-largest personal computer maker had to come up with options that would offer Dell the same economic punch.
Not to do so would be a "breaking point," causing Dell to look outside Tennessee, Nashville Mayor Phil Bredesen said.
"That's not a Davidson vs. some other county kind of issue. That's just a baseline," Bredesen said. "If they can't solve the issue in some fashion, it makes the state a lot less attractive."
Tennessee counties in the hunt for Dell -- and its promise of 3,000-plus jobs -- include Davidson, Rutherford, Williamson and possibly Wilson.
Dell officials say the community that lands its expansion would get about $1.2 million the first year in local tax revenues from the sale of its products in Tennessee.
Bredesen says he reached a handshake agreement last week with Dell after offering free land and other incentives. Now, he's working on the details -- including how to get some of that $1.2 million back to the company.
The general idea is to funnel the money through the local industrial development board.
The Tennessean reports Bredesen proposed giving Dell what would amount to 75 percent of the local sales tax revenues Nashville would gain from the sale of Dell computers and parts. The money would be used for infrastructure and other company improvements. Bredesen said the numbers are fluid.
"What we're trying to do is structure something that would make it economically equivalent to them," Bredesen said. "If we can't make it economical for them, they're going to expand somewhere else."
Six years ago, officials in Round Rock lured Dell's headquarters from Austin by promising to rebate a portion of every dollar the city received from the sale of Dell computers in Texas.
At the time, the tax was 1.5 percent, and Dell got back 41 percent, or $440,000 the first full year. Dell now gets 31 percent of the 2 percent tax, collecting $2.2 million last year.
From August 1994 to February of this year, Round Rock got $20 million in Dell sales tax revenues, returning to the company $7 million, according to Dell spokeswoman Cathie Hargett. The money is used to help maintain Dell buildings and construct new ones, creating new jobs.
The company started with one building and now has six in Round Rock, increasing the number of workers from 1,000 to 12,000 by the end of this year, she said.
"It's our way of reinvesting locally and supporting our local growth," Hargett said.
From an Associated Press report provided by the Austin American-Statesman. |
