Tennessee State Representative Chris Hurt Talks Ford Deal Points and Growth for West Tennessean’s

Tennessee State Representative Chris Hurt Talks Ford Deal Points and Growth for West Tennessean’s

 

Live from Music Row Friday morning on The Tennessee Star Report with Michael Patrick Leahy – broadcast on Nashville’s Talk Radio 98.3 and 1510 WLAC weekdays from 5:00 a.m. to 8:00 a.m. – host Leahy welcomed Tennessee State Representative Chris Hurt of Haywood County (R-District 82) to the newsmaker line to discuss details of the Ford mega site deal as a big win for West Tennesseeans.

Leahy: We are delighted to welcome to our newsmaker line State Representative Chris Hurt, who represents Haywood, Crockett, and Lauderdale counties. Welcome, Chris! Thanks for coming to the program.

Hurt: Good morning. Thanks for having me.

Leahy: Well, I think for you, this week’s session which ended in the approval of an appropriation of $884 million in financial incentives to help bring Ford Motor and Electric Battery Company into the Memphis Regional mega site was a big day for you. Would you consider that to be a big success in your legislative career?

Hurt: Oh, absolutely. It was a huge step for our state in general, but more specifically for our region over here in West Tennessee. And, yes, it was a highlight of my service so far, and I was excited to be part of the General Assembly when this opportunity came upon us.

Leahy: Now that mega site out there, it’s had a very long and twisted history. Give us a background on how the mega site came about, how long it’s been there, how long it’s been empty?

Hurt: The discussion started in the early 2000s and the property was purchased in 2007. The property has been there and the state has owned it for 14 years, and it has had a rocky road. Early on there was some excitement about it through the years without being able to attract a tenant.

There was a lot of interest loss. There was the question of the wastewater, the infrastructure build-out which really felt like a commitment there needed to be made in order to attract a tenant.

But I don’t want to say it was on the chopping block a couple of times, but it was definitely a lot of concern in the General Assembly and with involved leaders that if we would ever be able to get anything there because of the infrastructure questions.

But each year before me, we had local leaders that continued to battle for it and keep it in the budget to keep some funding and keep trying to move forward.

And then leaders there in the legislature, fortunately, with Governor Haslam, and don’t let me get started with Governor Bredesen, but through the Haslam administration, into the Governor Lee administration, we were able to keep it there and keep it alive to be ready for this opportunity.

One of the drawbacks was it was so large. It ended up being a plus, but through the years it was a 4,100-acre track that a lot of tenants didn’t quite want that much.

And then they were concerned about what would be done with the rest of the track if they didn’t utilize it. Also, through the years, it had a rough road.

But fortunately, through what I feel is good leadership we are able to keep it there and be able to capitalize on this opportunity with Ford.

Leahy: Now, see if I have this right. Did Ford promise that this facility, both their electric pickup manufacturing facility and the electric battery manufacturer that’s coming in as part of the partnership that by 10 years from today, they will create 5,800 new jobs? Is that part of the deal?

Hurt: That is part of the deal and through the ECD commitment, it actually, I think in 10 years they have to have continued to provide I believe it was up to 90 percent of those jobs. So that would be 5,100 is the way I understood it.

Leahy: Got you.

Hurt: Or at that time, the state could utilize some of the clawback featured parts of the agreement to go in and start pulling back and getting repaid some of those incentives. So yes, that is correct. That was the way I understood it.

Leahy: In terms of accountability for this, I’m going somewhere with this question. They say, okay, the deal is and it’s $884 million, $500 million looks like it’s just cutting checks to Ford or the subsidiary that set up with the joint venture with the electric battery company if we get to ten years and they don’t have to reach 5,100 jobs, how much of that money will come back to Tennessee taxpayers?

Hurt: Well, there’s a formula. If they’ve only produced 80 percent of those 5,800 jobs, then 20 percent of the clawbacks would go into effect. So there’s a percentage right scale there that if they were going to only produce 50 percent of the jobs, let’s say around 2,900, then they would have a 50 percent clawback.

And the way I understood if there was a penalty there also with interest that would be added to that at a pretty good I believe I’m stating that I may have been on another discussion. I know it’s a percentage based on the number of jobs they’ve provided based on what they promised.

Leahy: So let me play Devil’s advocate here. Let’s say we get 10 years from today and we find instead of 5,100 jobs, they’ve created half of that 2,550.

And it’s 2032, and we do the count, and it’s only half. Will the state bill them for $250 million? And will that money come back?

Hurt: Yes. The way I understand it is they will pursue 50 percent of the investment. And of course, it will have to go through a legal process to pursue that. But yes, that’s the way I understand it.

Are there other expenses related to this expansion that isn’t covered? For instance, will this mean that Haywood County and the related counties will have more money spent on the construction of public schools, for instance? And is that incorporated in this plan?

Hurt: There’s what they call the term in the legislation was, I believe, a pilot program. And Ford does beginning in year two, which is two years, not this year, but in a year from now, they will begin paying the locals a set amount on a scale over the next 30 years.

And the total they will be paying to the locals, which would be Haywood County, and then part of it lies in Fayette County also with a couple of 100 acres there. So to those local counties, they would pay a total of right at $270 million over the next 30 years.

And that’s in lieu of taxes. So, yeah, they will be obligated to pay to the locals. I think the first couple of payments, it’s own scales for years, two through five. I say two. It begins in a year, which will be their second year into it.

But anyway, a couple of years there’s like, $10.1 million and then it increases to a total of about $270 million over 30 years payment to the locals in lieu of taxes for infrastructure needs just as you’re talking about whether it be roads, schools to handle what’s coming to that area.

Leahy: Will people employed by Ford and the electric battery plant there be required to be members of unions?

Hurt: That will be up to the workers? I think Volkswagen has faced that and voted it down twice, and that was definitely a lot of the discussion this week as we worked it through the committees.

But that will ultimately be up to the workers. And I have faith. We’re a right-to-work state. Of course, we’re trying to get the constitutional amendment completed. And I have faith in Tennessee workers on how they’ll vote on that. So that will be up to them.

Leahy: So on a one to 10 scale, one being not so big, 10 being really big, how big is it that this deal has been done in the special session?

Hurt: I would say a 20. (Laughter) I’d say that because in this electric vehicle space it’s a waste to see who’s first. And Ford started speaking with Governor Lee and ECD and I believe they contacted the state in February for a project like this.

They recorded 14 other states. 15 total. Came back in July and basically wanted to come to Tennessee and started working through the best package they could get from us.

All that being said, once the offer was made, the memorandum of understanding was signed and then they were ready to start. Of course, we had to do the go through the legislative process.

But they’re ready to get going right now because they’re hoping to be in production in two years. So the fact that we could come in a special session, work this through and get support at the legislative level and get all these packages through, it’s huge.

Not only for us here in rural West Tennessee where they’re even talking about up to 30,000 construction jobs over the next two years during the construction of this project but then moving forward to know and to see this come to fruition, the ball, begin rolling this quick and not wait for session and to work it through session and then something to come out of it next spring, it’s big for Ford to know that we appreciate their commitment.

And that we’re moving forward with our end of the obligation. But also to the people here and my constituents and even the constituents all over rural West Tennessee.

And in Shelby County to see that, hey, this is a serious deal, and we’re moving forward and Ford is serious and they’re ready to start moving this project forward is absolutely huge for us. And I say that to say that they’re talking another 20,000 or up to 25,000 jobs in ancillary companies tier two and tier three.

Leahy: So there could be a lot of economic benefits if people buy electric pickups. Right?

Hurt: There you go.

Listen to the second hour here:

 

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Tune in weekdays from 5:00 – 8:00 a.m. to the Tennessee Star Report with Michael Patrick Leahy on Talk Radio 98.3 FM WLAC 1510. Listen online at iHeart Radio.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

State Representative Scott Cepicky Talks Why He Voted No on Ford $900 Million Deal

State Representative Scott Cepicky Talks Why He Voted No on Ford $900 Million Deal

 

Live from Music Row Thursday morning on The Tennessee Star Report with Michael Patrick Leahy – broadcast on Nashville’s Talk Radio 98.3 and 1510 WLAC weekdays from 5:00 a.m. to 8:00 a.m. –  host Leahy welcomed Maury County, Tennessee State Representative Scott Cepicky to the newsmaker line to discuss his concerns with the Ford mega site deal for Haywood County and why he voted no.

Leahy: We are joined on the newsmaker line by a good friend from Maury County State Representative Scott Cepicky. Welcome, Scott.

Cepicky: Good morning, Michael. How are you doing?

Leahy: Well, I’m doing great. Yesterday, you were one of three members of the Tennessee House of Rep. Representatives who voted against this $884 million incentive package for Ford to open up an electric vehicle plant that is purportedly going to employ 5,800 people over a period of 10 years at the Memphis Regional mega site.

The vote was like overwhelming in favor of it. In the state Senate, also overwhelmingly in favor of it in the state House. I, however, have the same view you do. I was very skeptical about this deal. Tell us why you voted no on this bill.

Cepicky: There were two bills. The first bill, 8001 Michael, created this mega site authority that was given unprecedented powers to negotiate, enter into contracts, keep contracts secret, and also have the power of an eminent domain, and bypassing the local county commissions or city authorities.

And then it didn’t have any provisions in there about reporting to the Comptroller, doing audits, or reporting back to government operations in writing. And you know as well as I do, the most important thing to have in that bill is what do the words say?

The good thing about the amendment that we tried to make was that addressed most of those issues when the vote was taken to table that amendment, 24 other of my colleagues agreed with us that there need to be more guard rails and more oversight over this mega site authority.

And then the other bill we had was the appropriations bill of the $884 million. And I spoke very plainly on the floor Michael. In good conscience with what’s happening with all of our teachers, our doctors, our nurses, airline pilots, employees across the state that are losing their jobs because of exercising their liberty and freedom to choose what goes into their bodies in good conscience.

I could not vote to give a Corporation $884 million before we address the pressing needs of those things that are happening right now in Tennessee in regards to COVID. It’s not even getting into about children that are having to wear masks, and RSV which is skyrocketing in our hospitals right now, and then college and university students that are being segregated and discriminated against for being unvaccinated.

It was a stand up principle. I hope that Ford will come to West Tennessee. I hope that Ford will understand what it means to be a Tennesseean, and I hope that all of these jobs come to fruition, and I hope that it transforms West Tennessee into economic opportunities that they’ve never had in their entire existence.

Leahy: I got the impression that there was just a stampede of political support for this. And frankly, my impression was this was a bit of a rubber stamp, A.

B, I don’t think many state legislators looked at the details as you did and should have. I think there are going to be all sorts of problems with this deal as it plays out. Am I reading that right from afar or what’s your take?

Cepicky: (Chuckles) We’re not talking $100 here, Michael. We’re talking almost a billion dollars when you factor in interest. I have been told by members and leadership that the amendment that we had on the House floor, there were certain things that they did like about that, and they want to bring those back up in January.

But they just didn’t think that yesterday was the time to go ahead and add those into the bill. And then Robin Smith, one of my colleagues who blue lighted the bill who voted present not voting along with Justin Lafferty present not voting, Robin had a very good amendment that was also piggybacked on mine was a secret ballot for the organization of labor that would be an option to those individuals out there.

Leahy: So in other words, if you work there, are you going to have to be a Union member? I guess that’s what we’re getting at.

Cepicky: And that’s what we’re looking at right there.

Leahy: We don’t know do we?

Cepicky: We don’t know. We don’t know yet.

Leahy: That sounds like a formula for disaster to me.

Cepicky: Possibly.

Leahy: My view is I’m very much in the minority in analyzing this, and I would not have voted for. I’m not in the state House. You are. I applaud you for your vote on it. Now, the money they gave them $884 million.

There are two elements that look like it’s a direct payment for stuff they ought to be doing, $138 million for infrastructure, demolition of structures, and more that’s being paid to the regional mega site.

But then they get $500 million of incentives. And State Senator Bo Watson says, yeah, we’ll pay them that money as they bill us for expenses. How’s that going to work?

Cepicky: That’s the devil in the details. None of us, as far as I know, no one has seen the contract. No one understands the clawback. No one really has a good understanding of the clawbacks that are in this contract.

No one has a good understanding of exactly what the obligation of Ford was. If you look at most of my colleagues’ talking points, it was all about jobs, jobs and jobs. Now we’re building a TCAP center out there to help provide the educational training and the technical training to go to work in this facility.

One of the things that we wanted Ford to do, as we’ve experienced in Maury County and Williamson County with the General Motors plant, over the last 37 years, we’ve had to build 14 schools that surround that GM plant. Fourteen schools.

Leahy: Who’s paying for that?

Cepicky: That was one of the amendments we had in my bill was that the Ford or whoever the tenants are for Haywood and Fayette Counties would have to pay the assessed value of the property tax on their facilities.

That what percentage was allocated to schools in those two counties to help defray the cost of all of the schools and infrastructure that these two very rural counties are going to have to build.

I think in Haywood County, Brownsville is the only incorporated city in the whole county. If you move like they’re talking upwards of 20,000 people into that area Michael, you’re looking at probably 20 schools.

Leahy: And the local taxpayers are going to have to cover that. Let me just say that what you just told me, confirming that nobody really understands the details of when the $500 million is going to be paid to Ford and what the clawback provisions are.

That is stunning. And I salute you for opposing this. In my view, this bill should not have been passed. Your last comments on this.

Cepicky: I hope that none of that comes to fruition, Michael because there are a billion dollars of taxpayer money on the line. I hope that Governor Leon and I know Governor Lee is a businessman.

I’m sure he will work hard with Commissioner Rolfe to make sure the T’s are crossed and the I’s are dotted. But that’s where we have to bring the Government Operations Committee of the House and Senate in on this state.

Listen to the first hour here:

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Tune in weekdays from 5:00 – 8:00 a.m. to the Tennessee Star Report with Michael Patrick Leahy on Talk Radio 98.3 FM WLAC 1510. Listen online at iHeart Radio