City Leader Say Tax Incentives are Worth the Risk after Pinnacle Tailspin
(Memphis) Pinnacle Airlines has left Memphis in a tailspin after announcing hundreds of jobs are leaving Memphis after the city gave the company millions of dollars in tax incentives last year.
People are saying Memphis got played by Pinnacle after they took a sweetheart deal and then ditched us for greener pastures in Minneapolis.
Giving companies tax breaks to move their business to Memphis is part of the game.
“We`ve got a lot more success stories than we do those situations. So tax incentives do work and every major city in America uses them,” said President of the Memphis Visitors and Convention Bureau Kevin Kane.
City leaders say they must offer aggressive tax incentives to compete with other cities and risk the chance of getting burned.
Kane says Pinnacle didn’t mean to maliciously take the money and fly away.
He says their plans got messed up last year when they had to file for bankruptcy, “Unfortunately you go into something in a good faith effort and there`s no way you can predict what the future holds.”
Any risk brings good and bad, and Kane says it`s the same tax incentives that lured hundreds of jobs from Electrolux, Mitsubishi, and KTG to Memphis.
“There are no guarantees when you have other cities and states competing for those same jobs to come in,” said Memphis City Council Member Edmund Ford Jr.
Mayor A C Wharton says he and other city leaders are working on a plan to bring more jobs to town.
Wharton says he is flying around the world, including Mexico City and Shanghai, to personally meet with companies and present everything the businesses can gain by moving to the ‘logistics center of the country.’
“Wherever there is a chance for a job you are going to find me there selling the virtues and assets of what I believe is one of America`s greatest cities,” said Wharton.
Wharton says there is a silver lining despite the turbulence Memphis is experiencing.
The officer space at one commerce square pinnacle is currently in will be prime real estate downtown ready for a new company, and Wharton says that`s something most other cities don`t have to offer potential businesses.