Thursday, March 15, 2012

VW's Corporate Taxation Moved Onto Workers, Residents

What did Roane County have to do to land 45 jobs for a VW warehouse? Simple: remove property taxes on the now-for-free location, throw in a few million dollars more in tax funding (corporate welfare), and rely on the tax rates on workers and residents to compensate for the loss of corporate taxation.

"There's the 100 percent property tax break for 10 years, the $435,000 worth of local matches of two state grants totaling more than $1 million, and a break-even land purchase deal.

In exchange, the company will invest $40 million in a 400,000-square warehouse that will result in 45 jobs in the Roane Regional Business and Technology Park. The annual payroll is pegged at $3 million. The facility can be expanded to 600,000 square feet, officials said.

The long-term payoff, says Roane County industrial recruiter Leslie Henderson, is the cachet the Volkswagen name will lend to Roane County and the likelihood more industries will locate there because of the prestigious automaker's presence.

"We're going to promote the heck out of this," said Henderson, president and CEO of The Roane Alliance. "This will be a magnet for more projects."

So you'll pay more in taxes on income, more for property taxes - but you'll get something called "cachet".

And some other large companies in the construction biz will get loads of money from VW, and Roane politicos will now have to offer the same kind of freebies to attract another 45 jobs.

Rest assured - someone will make a lot of money (VW). But it won't be you. It isn't personal - it's business.

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