You probably have never heard of Sedgwick Claims Management Services. They are bringing in new jobs, are expected to make millions of dollars, and now have a deal where they won’t have to pay all of their property taxes. Local 24’s Mike Matthews gets behind the controls and talks about PILOTS.
The company is Sedgwick Claims Management Services. “We’re the leading global provider for risk services on a world wide basis,” says company CEO Dave North.
Company officials announced their expansion and new jobs Monday, a holiday, so it might have slid under your radar a bit.
It’s not a General Motors sized company, but it’s certainly not a mom and pop shop sized place either. “We have nearly 900 colleagues here in Memphis,” Dave North says, “…and we have career opportunities to keep home grown people in Memphis, which we are very proud of.”
In return for the expansion, Sedgwick wanted breaks. They got one big one. A 15 year PILOT, payment in lieu of taxes deal. It means they pay a flat rate, not the assessed tax rate, for 15 years.
The company saves money, but people like Shelby County Commissioner Terry Roland say Shelby County gets the short end of the stick by losing tax money.
Shelby County Mayor Mark Luttrell has heard all the arguments before. “Pilots are very important for us in Shelby County and Tennessee,” Mayor Luttrell says, “… because we just don’t have that many incentives to reach out and offer potential clients.”
Other states can swoop in, offer tax deals and incentives, and companies end up moving away.
It’s a dog eat dog world out there when it comes to keeping a business. “Really,” Mayor Luttrell says, “… we’ve got to be very very creative when it comes to how we use these. We certainly understand and are very sensitive to the fact that its abating taxes. We need tax revenue for other purposes.”