Here's what incentives Tennessee, Nashville have promised Amazon in exchange for 5,000 new jobs

Joey Garrison | The Tennessean

Show Caption Hide Caption What you need to know about Amazon choosing Nashville to bring 5,000 jobs Amazon chooses Nashville to bring 5,000 jobs to downtown

Amazon is in store for $102 million in combined government incentives from the state of Tennessee and Metro Nashville in exchange for the 5,000 high-paying jobs the company's new operations site would bring downtown.

It's one of the most lucrative state incentive packages ever for Nashville, but an amount considerably less than was awarded to Volkwagen, Nissan and Hemlock Semiconductor for other past economic development announcements in Tennessee.

Tennessee Gov. Bill Haslam, Nashville Mayor David Briley and Amazon officials on Tuesday announced the deal for Amazon's Operations Center of Excellence to be housed at the new Nashville Yards development in downtown near The Gulch.

More: Amazon in Nashville: Company to bring 5,000 corporate jobs to Nashville Yards

The "performance-based direct incentives" are contingent on the company creating 5,000 jobs with an average wage of more than $150,000:

The state of Tennessee would award Amazon a $65 million cash grant for capital expenditures based on the company creating 5,000 jobs over the next seven years. That would be equal to $13,000 per job.

The state of Tennessee would provide an additional $21.7 million in job tax credits based on $4,500 per job over seven years to offset state franchise and excises taxes

Metro would give Amazon $15 million in all based on $500 for each job created over seven years.

During talks with Amazon, Metro and state officials dubbed the effort "Project Gardendale."

Amazon to bring 5,000 corporate jobs to Nashville Yards Amazon announced it is investing $230 million in Nashville and adding 5,000 jobs at a new executive operations center to run logistics.

Metro's $15 million contribution, which is supported by Briley, would require approval from the Metro Council. The council is expected to take up the incentives in the coming weeks.

Briley described the city’s incentive package as moderate in the context of the overall budget and said previous Metro incentive investments, including to Philips and HCA, have “paid off in spades.”

Unlike several other previous Nashville deals, Metro would not be sacrificing property tax revenue as incentives.

“It’s a relatively minor investment for the city," Briley said. "We will collect those revenues back in sales tax and property taxes associated with these developments very quickly.”

Haslam said each Amazon job is expected to produce another job and a half, putting the total impact at closer to 12,500 jobs. He expects to the state to paid back within a year from sales tax revenue and said the package is a deal for both the city and state.

“Fifteen million is a deal for the city of Nashville,” Haslam said. “Any mayor in this country would say ‘done.’”

Amazon's expansion into Nashville comes as an impressive consolation prize after Music City was among several cities that lost to Northern Virginia and New York in pursuit of Amazon's coveted HQ2 headquarters.

More: Was Amazon's headquarters search 'a giant ruse'? NYC, D.C. centers of power prevail

The Beacon Center of Tennessee, a free-market think-tank, slammed the pledged incentives in a statement, calling it "both unfair and immoral."

"Nashville was passed over for Amazon's second (and third) headquarters, yet city and state officials still got scammed into giving the company more than $100 million in taxpayer giveaways for a consolation prize, which includes $80 million in cash handouts," Beacon Center spokesman Mark Cunningham said.

Amazon's Operations Center of Excellence announcement is the largest single jobs announcement in Tennessee history — and it has the potential to dramatically reshape a part of downtown that is rapidly developing.

For perspective, Bridgestone Americas brought 1,700 jobs when it expanded south of Broadway. HCA was announced at 2,000 jobs when it consolidated the company's cancer research center, Sarah Cannon, and two health care back-office providers into a new office building at Charlotte Avenue and 11th Avenue near The Gulch.

Metro provided $66 million in local incentives to HCA and $56 million to Bridgestone, both through property tax abatement. In the late 1990s, Nashville awarded $122 million to Dell.

In past deals, the state of Tennessee awarded $800 million in incentives to Volkswagen, $600 million to Nissan and $400 million to Hemlock.

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Reach Joey Garrison at 615-259-8236, jgarrison@tennessean.com and on Twitter @joeygarrison.