Some Hopeful New Energy Behind PILOT Reform

Memphis Councilman Tom Marshall's comments about changes in the PILOT program elicited an immediate response here: "Amen."

Like only a few members of our local legislative bodies, he has seemed to understood from the beginning the importance of acting on recommendations by consultants to reform the programs giving away tax freezes in a number unprecedented in the rest of the state.

Councilman Marshall rightfully observed that the City Council and County Commission members must have a voice in decisions that affect budgets, tax revenues and tax policies, all of which are in their purview. Most of all, he should be applauded for ignoring the perpetual bogeyman conjured up by real estate developers - the unverifiable notion that Memphis will be bypassed altogether by companies unless we sell ourselves at a discount.

The fact that other cities don't have to give away the store to get new companies to locate and expand there seems to be inconsequential to many of the PILOT proponents. The fact that our obsession on DeSoto County is disproportional to the problem caused by it since Memphis remains one of the most solid centers for metro jobs in the country. The fact that if we are going to talk like a region, we should walk like one, too, and quit treating adjacent counties as enemies. The fact that real estate development is far different than economic development.

As Councilman Marshall breathes a breath of fresh thinking into the PILOT deliberations, here's a quote by the widely-revered David Birch, former Harvard and MIT academician and now president of a company that advises companies on where to locate:

"The cities growing fastest right now have the highest taxes, most expensive workers, most expensive land...To say you want the cheapest worker is an old way of thinking. What you really want is a talented labor force, not the least expensive labor force." Birch says the days are over when companies selected locations for new factories or offices on the basis of where business costs are cheapest.

Or as Professor John Eger puts it: "The effort to create a 21st century city is not so much about technology as it is about jobs, dollars and quality of life. In short, it is about organizing one's community to reinvent itself for the new, knowledge-based economy and society; preparing its citizens to take ownership of their community; and educating the next generation of leaders and workers to meet these global challenges...At the heart of this effort is ultimately defining a 'creative community.'"

In the end, it seems logical that the overriding question about current tax freeze policies is whether they are encouraging the reinvention of Memphis into a creative community known for its quality and innovation. The answer seems obvious, and so then is the rationale for changes to the PILOT program.