Taxpayer group seeks GE-Alstom money

Taxpayer group seeks GE-Alstom money

December 16th, 2016 by Mike Pare in Business Diary

A taxpayer group on Thursday urged Chattanooga officials to try to collect $13 million from Alstom plant owner General Electric rather than take ownership of equipment worth that amount.

"Why would you want to own equipment at a steam turbine facility?" asked Helen Burns Sharp, founder of Accountability for Taxpayer Money, at a meeting of the city's Industrial Development Board. "That's a head-scratcher to us."

The two options were offered to GE recently by Chattanooga and Hamilton County, which are trying to recoup $13 million awarded to Alstom in property tax breaks when the turbine manufacturer announced a $300 million expansion nearly a decade ago.

Earlier this year, GE said it was shutting down manufacturing in Chattanooga and cutting 235 jobs by the end of this year.

Sharp said the city's first choice should be collecting the $13 million from an auction last week of the plant's equipment.

"That sounds wonderful in terms of the taxpayers made whole and money going to police, fire, community services, and streets, etc.," she said. "The other option was a concern to us."

Nick Wilkinson, the city's deputy administrator for economic development, told the panel the city is in conversations with GE.

"It's too premature to say too much about where those stand," he said. "We hope to have the matter resolved as quickly as possible. Some of those issues are in the hands of the company."

Sharp also urged that the money raised from the auction not be released to GE.

"This is a critical time right now to make sure the money realized in the sale doesn't go to GE until we get what the taxpayers are due," she said.

ATM member Franklin McCallie said the group wants the $13 million for schools, police, fire and infrastructure needs.

"We want it for our city," he said.

Wilkinson and City Attorney Wade Hinton said they didn't know if the auction money has been released to the company.

The Branford Group, which carried out the auction for GE, did not return a call on Thursday. GE didn't immediately return an email on the issue.

In the letter to GE, the city and county said they wanted an agreement on the $13 million before the release of equipment from the company's steam turbine manufacturing facility on Riverfront Parkway.

Under a 2008 payment-in-lieu-of-tax agreement, the city Industrial Development Board took ownership of about 100 acres of land as well as the steam turbine plant's equipment and then leased them back to the company in exchange for new Alstom investment and jobs.

About a year ago, U.S.-based GE completed a $10.6 billion acquisition of the power and transmission division of France-based Alstom, including the Chattanooga facilities, and later announced the shutdown. GE plans to keep about 50 people in Chattanooga.

Contact Mike Pare at mpare@timesfreepress.com or 423-757-6318.


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