(The following story by Jane Roberts appeared on The Commercial Appeal website on March 19.)
MEMPHIS, Tenn. — Burlington Northern Santa Fe railroad today is expected to get up to $4.4 million in local tax breaks for an expansion that would more than quadruple its capacity here and add 150 jobs.
The median salary would be $31,200, 96 percent of the county’s per-capita income.
By 2007, BNSF plans to spend nearly $45.8 million, buying 91 acres near its yard at 5124 East Shelby Drive and making infrastructure improvements.
The Memphis and Shelby County Industrial Development Board will vote on a nine-year payment-in-lieu-of-tax package that would save BNSF more than $3 million in city and county taxes.
In a rare option, the package would balloon to 11 or 13 years if the railroad increases its annual “lift” capacity — the number of intermodal containers it transfers between rail and truck — from 500,000 containers to 750,000. It now transfers 180,000 in Memphis.
“This is not a routine case,” said Brian Pecon, Memphis and Shelby County Economic Development director. “Because of that, we can always get hiccups on the board. The figures are preliminary recommendations. The board can totally go the other way.
“Normally, you don’t have phases like this,” he said. “The railroad’s plan to increase to a million lifts is a long-range plan, in excess of 20 years.”
The maximum IDB package is 15 years. BNSF’s investment does not meet the 15-year criteria.
Over nine years, the project would generate $4.3 million in new taxes.
In late February, the IDB’s evaluation committee recommended approval of a nine-year PILOT with options to extend it to 11 or 13 years. At 13 years, BNSF’s tax savings would be $4.4 million.
The railroad is also considering a location in Marshall County, Miss., or expanding its 18-acre site in Marion, Ark.
“We are serious about Memphis,” said BNSF spokesman Joe Faust. “The meetings and proposals we have placed before the development board are part of our ongoing process to determine a preferred location.
“If Memphis agrees to the proposal, we will sit down and make a decision, which I think will be relatively quick,” he said.
BNSF now employs 186 people in Shelby County.