Nashville – Governor Bill Haslam and Economic and Community Development Commissioner Bill Hagerty announced last week that, effective Feb. 15, Obion County will be designated a Tier 3 Enhancement County, eligible to offer expanded Job Tax Credits to spur job creation in the wake of the announced closing of the Goodyear tire plant in Union City.
On Feb. 10, Goodyear announced plans to close the facility by the end of the year, idling approximately 1,900 local workers.
“This is a challenging time for the people of Northwest Tennessee,” said Governor Haslam. “I am committed to working with local and federal officials to do our best to mitigate the impact of these jobs losses. Raising Obion County to Tier 3 distressed community status is just one step in our effort to help this community’s economy to recover.”
“A Tier 3 designation won’t change things overnight for a community facing significant job losses,’ said Commissioner Hagerty. “It will, however, give state and local economic developers some additional tools to go out and recruit new investment to create jobs and help the local economy rebuild.”
“I’m convinced through my discussions with Governor Haslam, Commissioner Hagerty and community leaders that we’re committed to working together to find a way to offset these job losses,” said Rep. Stephen Fincher (TN-08). “Giving the community a broader array of incentives is vital as we recruit new industry to the region.”
“Through our partnership with ECD, the tier 3 designation will expand the Job Tax Credit for Obion County, making it a more attractive community for industry,” said Tennessee Revenue Commissioner Richard H. Roberts. “It’s a first step in the process of recruiting new capital investment and helping unemployed Tennesseans find new jobs.”
The three-level tiered Job Tax Credit system was developed to encourage new industry to invest or expand in primarily rural communities challenged by high unemployment. To receive the maximum Tier 3 Enhanced Job Tax Credit of $4,500 per new full-time position created, companies must make a minimum capital investment of $500,000 in a 12-month period and create a minimum of 25 new full-time jobs.
A Tier 3 Enhanced Job Tax Credit designation allows a company to receive an annual jobs tax credit for five years as compared to three years for a Tier 2 designation and one year for a Tier 1 designation. Tier 3 status also allows a company to offset up to 100 percent of its Franchise and Excise tax liability with the annual credit during this five-year period.
State, local and federal officials held meetings to develop economic development strategies within 24 hours following Goodyear’s announcement that the company planned to close the Union City facility.
Officials have begun identifying Tennessee companies within the Goodyear supply chain which may be impacted by the announcement and developing processes to assist laid off Goodyear workers in expediting their unemployment insurance claims.
Commissioner Hagerty has asked his staff to review the residency of idled Goodyear workers to determine if additional Northwest Tennessee counties might also benefit from Tier 3 status.