Photo: The Bridgestone Americas building in downtown Nashville. Photo Credit: Lchader / CC
By Anita Wadhwani [The Tennessee Lookout CC BY-NC-ND 4.
With great fanfare, state and local leaders announced in 2014 they had secured a deal with tire giant Bridgestone Americas to bring its U.S. headquarters — and hundreds of new jobs — to downtown Nashville.
On Wednesday, Bridgestone filed suit against Tennessee to compel state officials to make good on the promised tax breaks that helped seal that deal.
Bridgestone is seeking to recoup $11.7 million in taxes it says it overpaid the state between 2015 and 2018. It claims Tennessee officials failed to honor two key tax breaks that helped keep the company in Tennessee. Bridgestone had a presence in Donelson at the time and was seeking new headquarters, potentially in another state.
The company’s gleaming 30-story glass tower headquarters on Fourth Avenue South is a “qualified headquarters facility” under Tennessee law, entitling Bridgestone to a $20,000 per employee credit for each of the 461 employees who relocated to Nashville, the lawsuit filed in Davidson County Chancery Court said.
The company is trying to recoup a total of $9.2 million in state tax credits it says it is due under those qualified headquarter facility rules.
The rules apply to companies that invest a minimum of $10 million and create at least 100 new jobs paying at least 1.5 times the average Tennessee wage. Bridgestone has invested $200 million in establishing its new headquarters — which also includes a site in Antioch — and created 400 new high-paying jobs, according to the lawsuit.
The state has also failed to honor a credit for Bridgestone’s investments in computers, computer networks, software and other related purchases, the lawsuit said. Tennessee’s “industrial machinery credit” gives companies who meet investment thresholds a tax break of between 3% and 10% of the purchase price of certain business equipment.
Two years ago, Bridgestone received approval from the Commissioner of Economic Development to offset 100% of its state franchise and excise taxes using the machinery credit, the lawsuit said.
The company has yet to get that tax break either, which is calculated by Bridgestone to be $2.5 million.
State officials “failed to act upon either of Bridgestone’s refund claims…within six months following receipt of said claims, thus resulting in both claims being deemed denied,” the lawsuit said.
The suit asks a judge to find the state’s denial “unjust, illegal, incorrect and void.”
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The dispute does not involve any of the property tax or other tax breaks — estimated at $56 million at the time — granted by Nashville officials and it does not involve the concert venue Bridgestone Arena.
A spokeswoman for the Tennessee Department of Revenue referred questions to the state Attorney General’s office, which did not provide comment. Bridgestone officials did not respond to a request for comment, and the state has not yet filed a response. The lawsuit lays out a timeline to show that state officials agreed to extend the deadline for Bridgestone to file its lawsuit until this month while it reviewed the company’s claims, but failed to act in time to avert legal action.
“Bridgestone has not received its requested refunds of Tennessee franchise and excise tax” by the deadline, the suit said.
Anita Wadhwani is a senior reporter for the Tennessee Lookout. The Tennessee AP Broadcasters and Media (TAPME) named her Journalist of the Year in 2019 as well as giving her the Malcolm Law Award for Investigative Journalism. Wadhwani is formerly an investigative reporter with The Tennessean who focused on the impact of public policies on the people and places across Tennessee. She is a graduate of Columbia University in New York and the University of California at Berkeley School of Journalism. You can contact Wadhwai at awadhwani@tennesseelookout.com.
One Response
These states should not use tax dollars to give these companies free rides to do business in our state. The rest of us don’t get a penny of tax breaks. Usually after a few years in a state and soaking up these free breaks they close shop and move elsewhere to do the same thing. It’s fine to help a business but not all these free rides. If they can’t afford to pay taxes they are not in good shape anyway.