State Funding Board approves Fast Track grants for Starbucks and LEV Manufacturing after public comment

The Tennessee State Funding Board voted to approve two Fast Track economic-development projects after presentations by the Department of Economic and Community Development and a public comment urging the board to reject the Starbucks package.

Stuart McWhorter, commissioner of the Department of Economic and Community Development, presented the two projects and asked Jessica Johnson, assistant commissioner, to review Fast Track finances. Jessica Johnson said the program had an adjusted balance of $679,200,000, commitments of $535,300,000 and an uncommitted balance of $143,900,000 prior to the approvals. She said today's proposed grants totaled $31,008,000.

Pamela Furr, grassroots director for Americans for Prosperity, used her allotted two minutes during public comment to oppose a proposed $30,000,000 Fast Track incentive for Starbucks, saying Tennessee should not subsidize large corporations and pressing the board on transparency and clawback enforcement. "I urge this board not only to reject this Starbucks incentive package, but to reconsider the broader use of Fast Track grants moving forward," Furr said.

Commissioner McWhorter described the Starbucks proposal as a Southeast corporate office in Davidson County that the company has said would create 2,000 net new jobs and involve a $100,000,000 capital investment within five years. McWhorter said the company expects an average annual wage of $125,000 for positions associated with the office and that the Fast Track grant of $30,000,000 would be used to offset building expansion, retrofit and improvement costs. "Starbucks Corporation has committed to create 2,000 net new jobs and make a $100,000,000 capital investment within 5 years," McWhorter said.

McWhorter also presented a project for LEV Manufacturing Inc., proposing a 100,000-square-foot facility in Putnam County to support U.S. assembly and distribution for Rad Power Bikes. DECD said LEV committed to 288 net new jobs and a capital investment of just over $7,000,000; the agency proposed $1,008,000 in Fast Track job-training assistance. Jessica Johnson reported an average hourly wage for the LEV positions of $21.14 compared with the county median wage reported in the presentation.

The chair moved to approve the two projects "as described." Board staff confirmed both companies had signed incentive acceptance forms, that DECD's checklists had been completed, and that accountability agreements with clawback provisions exist and are enforced. The chair stated his office verifies clawback enforcement; DECD said the clawback provisions are enforced when companies do not meet their agreements.

Kayla Carr, staff member, called the roll. The Comptroller, Treasurer and Commissioner recorded affirmative votes and both Fast Track items were approved.

Votes at a glance - Starbucks Southeast corporate office (Davidson County): Fast Track grant requested $30,000,000; company committed to 2,000 net new jobs and $100,000,000 capital investment within five years. Vote: approved (Comptroller: yes; Treasurer: aye; Commissioner: aye). - LEV Manufacturing Inc. (Putnam County): Fast Track job-training assistance $1,008,000; company committed to 288 net new jobs and ~ $7,000,000 capital investment. Vote: approved (Comptroller: yes; Treasurer: aye; Commissioner: aye).

The board's approval followed a short public comment urging caution about the use of incentives and questions from board leadership about contract enforcement. The board did not specify further conditions in the public record beyond DECD's representations and the existence of clawback provisions.