Plans for a new 88-acre industrial park in Chattanooga, carved from much of the former DuPont plant property, moved ahead Monday as a key part of the financing came into focus.
A city panel recommended a special tax district to help with the building of sewers, roads and stormwater infrastructure for what developers said is a $102 million industrial park that could provide 600 full-time jobs when built out. Under the tax arrangement, developers spend money related to a project up front, then are paid back with interest over a period out of additional tax revenues generated by the development.
Four buildings totaling 800,000 square feet are slated to go up in the new North River Commerce Park, with work to start in late summer and the first structure is set to open in 2023, said Matt Phillips, a partner in Access Road LLC and Rise Partners development group.
Phillips said at a meeting of the city's Industrial Development Board that light and heavy manufacturing, along with warehouse space, could straddle both sides of North Access Road near Hixson Pike.
He said businesses already in Chattanooga want a place to expand.
"National companies want to service this area," Phillips said. "We believe this project is in dire need."
The city panel recommended approval of the $8.7 million tax financing setup to the City Council and County Commission.
The former DuPont site once employed more than 5,000 workers producing industrial nylon as one of Chattanooga's biggest employers. But Jermaine Freeman, the city's economic development officer, said at the meeting the site became underutilized as DuPont and successor Invista phased out operations.
"It's an opportunity for in-fill," he said. "It's an underutilized area that can support much more industry. Chattanooga gains new spaces which can be marketed."
According to Phillips, Hamilton County public schools are receiving about $16,000 a year in property taxes from the existing site. After the development, he said, the school system is projected to receive $429,000 per year.
Chattanooga, meanwhile, is receiving $36,000 annually in taxes now from the site, Phillips said. Post-development, the city is estimated to receive $322,000 per year, he said.
"There's a great economic story from a dollars-and-cents perspective," Phillips said.
Helen Burns Sharp, founder of the citizen group Accountability for Taxpayer Money, said at the meeting the project appears to be a good candidate for the special tax financing.
Also, she said, the project presents an opportunity to jump-start the North Chickamauga Greenway project.
The applicant is willing to donate land rights to a parcel on the Tennessee River as a community benefit, and the city already owns riverfront property south of the soccer fields at DuPont Park, Sharp said.
Meanwhile, nylon fiber maker Kordsa owns the part of the former DuPont plant site that Invista doesn't, including riverfront property, she said.
The city could approach Kordsa to see if it would donate or sell land rights, Sharp said.
Parks are considered infrastructure under state law, so the costs associated with the greenway could be added to the project and paid for with the added tax revenue, she said.
Charles Wood, the Chattanooga Area Chamber of Commerce's vice president of economic and talent development, said four such tax districts are in use in Hamilton County. But he said at the meeting that he sees them as a more useful tool in the future.
Wood said the risk associated with the tax financing is "highly limited."
"The risk is with the developer," he said.
DuPont shut down its North Access Road plant in 2015 after nearly 60 years of production.