Shelby County ad hoc panel to draft PILOT reforms, prioritize community engagement and financial analysis

Janice Banks, project manager for SPW Community Strategies, told the Shelby County PILOT ad hoc committee that a binder of materials from a May 2 working session and follow-up responses from industrial development boards (IDBs) showed incomplete or non‑specific answers and would be the basis for the committee's next steps.

The committee said it will prioritize drafting reforms to local PILOT processes, pursue a clearer financial analysis of tax revenue loss from existing agreements, and design community engagement—particularly outreach to tenants and nearby residents of PILOT properties—before returning to the pilot‑granting agencies for comment.

Why it matters: PILOT agreements and tax abatement programs can reduce property tax revenue that funds local services. Committee members said the existing responses from IDBs and pilot‑granting agencies often lacked specificity about metrics, financial analyses and compliance monitoring, leaving elected officials and the public without clear data to evaluate costs and benefits.

Janice Banks, SPW Community Strategies, said the binder includes minutes from the May 2 pilot working session, follow‑up questions sent to IDBs and the responses received, PowerPoint presentations and the agencies' policies and procedures. "They provided the exact answers that they wanted to provide," Banks said, summarizing her review of the materials and explaining why the committee should proceed to drafting reforms and public engagement rather than ask for more written responses.

Members flagged several gaps and potential next steps. Natalie McKinney of Whole Child Strategies said the committee needs an up‑to‑date estimate of tax revenue the county may have lost and could continue to lose under current PILOT terms: "we lose about $43,000,000," McKinney said, characterizing that figure as fluid and urging a reappraisal of participating properties to capture current market value. A.T. Harrison of Rhodes College echoed the need for more precise valuation and recommended a targeted property survey or a reappraisal of the 500‑plus properties in the pilot portfolio, noting that many properties may not have been inspected inside and their assessed values may be outdated.

Several committee members proposed creating or commissioning a third‑party evaluation function separate from pilot‑granting agencies to provide objective inspections and valuations. Harrison suggested the county could consider a dedicated team—potentially inside but operating independently of the assessor's office—to produce a repeatable survey and create "another set of facts" rather than relying solely on developer‑provided data.

Cardell Oren asked the committee to clarify its immediate goal: whether members sought a moratorium on new PILOT agreements or instead wanted to move directly to drafting enforceable reforms. The committee coalesced around drafting reforms and conducting community engagement in parallel, rather than a moratorium, because members warned a moratorium could prompt an influx of applications and delay structural changes. One member summarized the view: draft reforms now, obtain legal review, then invite IDBs and granting agencies to comment on the proposed changes before taking proposals to the public and the county commission.

Public comment reiterated financial concerns and specific alleged practices. Joe Kent, a community advocate, told the committee he had reviewed agency reports and posted that "the Memphis Health Ed Board has $15,000,000 in excess cash on their balance sheet," and urged smaller abatements than the 75% commonly in use. Kent also criticized predevelopment abatements, saying they frequently cover existing property value rather than only new construction; he asserted EDGE routinely abates predevelopment taxes and estimated that one large project yields roughly $6,000,000 per year in abatement.

Committee members discussed the role of prior reports and analyses included in the binder: a DMC‑commissioned fiscal impact review and an MLK50 article documenting compliance and monitoring gaps. Members noted prior attempts at reform in the last five years had sometimes been reversed or modified under political pressure, and they said legal review would be necessary to avoid statutory conflicts or predictable legal challenges.

Decisions and directions recorded in the meeting included: (1) proceed to draft recommended reforms rather than pursue a moratorium as the primary next step; (2) prioritize a community engagement plan that centers residents and employees of affected properties; (3) seek a financial analysis or reappraisals to better quantify tax impacts and consider a third‑party inspection model; and (4) set a timeline to complete draft recommendations before the legislative session begins in January and to have a working draft by the Thanksgiving period, with the project manager to circulate a proposed timeline to committee members.

The committee set its next meeting for August 21 at 11:00 a.m. and said it will return to the binder materials and start drafting reforms for legal review before wider public release and formal proposals to the county commission.

The discussion included concerns about transparency, compliance monitoring and the distribution of any reserve or administrative funds held by boards; committee members asked staff to identify where agencies report administration costs and any reserves so the committee can consider whether funds are being used consistently with public expectations.