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FedEx deal a 'gamer changer' but could cause congestion

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As local leaders tout a $189.5 million investment here by FedEx, the proposal still must go through Murfreesboro's annexation and rezoning process and a traffic study to determine how to move delivery trucks on congested roads.

Chamber of Commerce economic recruiter Brian Hercules calls the FedEx deal a "game changer" for Murfreesboro because the Fortune 500 company's decision to come here shows the area is seen as a "viable option" for major employers.

Yet, Hercules cautions, "this is not just a slam dunk," because now the process for keeping traffic rolling will commence, and it probably means more than just putting up a red light.

The Rutherford County Industrial Development Board recently passed an incentive package to land the ground hub, but it considered only financial matters, not potential transportation or planning problems.

In fact, Murfreesboro leaders have received no information from FedEx on the number of tractor-trailer and delivery trucks projected to be moving in and out of the nearly million-square-foot facility, according to Ram Balachandran, the city's chief traffic engineer.

Balachandran said he requested FedEx to conduct a traffic study and "superimpose" the amount of traffic expected to be generated on roads surrounding the proposed site to determine the impact on those key intersections.

FedEx promises 41 full-time jobs with an average wage of $53,500 and 29 more part-time positions in exchange for a $3.2 million tax incentive on personal property over seven years. The local tax benefit is $14.6 million, including $12.1 million on real property in that time frame, giving it a 4.47 benefit/cost ratio, which easily passes the IDB's tax-break guidelines.

Industrial Development Board member Bill Jones, a key player in the jobs initiative Destination Rutherford, calls the FedEx hub an "important deal" because it brings good jobs and an international employer.

The IDB considered only the financial structure of the incentive deal, but city and Chamber of Commerce officials are aware of the potential impact of traffic, he says.

South Church Street is one of Murfreesboro's most congested roads during morning and evening peak periods, and traffic is heavy at South Rutherford's intersections with both South Church and Southeast Broad Street (Manchester Highway).

"I know the city is looking at things they can do to help mitigate that, but clearly that was something that was considered by the city as they looked at this deal," Jones says.

Murfreesboro resident Richard Baines, who follows local planning issues, says even though building a distribution facility in Murfreesboro makes sense because of the city's central location, approving tax breaks for the company before looking at its effect on roads and stormwater is backwards.

The Murfreesboro City Council and Planning Commission will have to approve annexation and rezoning measures after they go through staff review.

"My feeling is it's probably a done deal," says Baines, who calls this government process "putting the cart before the horse."

Church Street would be an illogical route for big-truck traffic to reach the FedEx site because it's "mayhem now," Baines notes. He's unsure about traffic at Joe B. Jackson and I-24, the route local officials say is most likely to be used.

The FedEx study will help determine whether tractor trailers hauling items to the facility should use the I-24 exit at South Church or I-24 at Joe B. Jackson Parkway and then travel up Manchester Highway to the facility, according to Balachandran.

Murfreesboro Mayor Shane McFarland agrees, "The traffic on South Church is rough."

But he points out South Rutherford was reconstructed several years ago with five lanes and a bridge over the CSX railroad tracks to prepare for this type of traffic. He also notes property surrounding the proposed site is primarily industrial, though retail and residential property is located on its east side.

The FedEx operation has been in negotiation for about a year, according to Hercules, and city officials are aware of the impact the ground hub could have on traffic.

"This is not the first building FedEx has built, and they understand the process," Hercules says, noting a "quality" company making such an investment understands what needs to be done to ensure the project works.

The process

Property owner Thomas Hoover filed papers early last week giving FedEx and Stantec Consulting Services authority to seek annexation of a family-owned 217-acre tract south of South Rutherford Boulevard between Southeast Broad Street and South Church Street. Besides the need to be brought into Murfreesboro city limits, the farmland will be rezoned from RM (residential medium density), which is a Rutherford County government zone, to either Commercial Highway or Industrial.

FedEx Ground submitted a conceptual site plan to the city government for preliminary comments on the small package distribution facility and anticipates submitting a full set of site plans detailing drainage, landscaping and stormwater on Sept. 29.

Vans and tractor trailers will haul packages to the facility where they'll be unloaded onto conveyor belts, sorted and then loaded onto vans and trailers for delivery to their next destination, according to a Stantec preliminary rezoning application.

Phase one of the proposed 947,842-square-foot facility, with associated truck and auto parking, is expected to start in 2018. A second phase for the remaining 156,761 square feet will be built three to five years later.

Ultimately, the hub will have 962 parking spaces, and a main access to the hub will be from South Rutherford Boulevard for vehicles and tractor trailers with an access for employees to be located just south of the main access. A third access is to be built later.

From Murfreesboro's standpoint, making a concession on personal property tax such as equipment without giving up property taxes on an investment of nearly $190 million makes sense, McFarland says. Though FedEx is promising only 41 full-time jobs, he hopes that number is conservative and points to a number of spin-off jobs as well, nearly 30 more.

The mayor notes that any growing city needs a good mix of employment, including distribution and manufacturing. But he says Murfreesboro leaders still have a good deal of work to do in terms of economic recruitment, even as Japan-based M-TEK prepares to open a North American corporate headquarters here this week, a $13.4 million investment in a 63,800-square-foot building across Garrison Drive from Murfreesboro Medical Clinic.

The automotive parts manufacturer, which netted a 10-acre gift from Murfreesboro for its site, is to bring 250 jobs averaging $60,000 in annual salaries. But McFarland says early indications are it will create even more positions.

"We have to be diligent to get a higher mix of jobs, as well. That's one of the things we're working on," he says.

Sam Stockard can be reached at sstockard44@gmail.com.

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BUSINESS, DEVELOPMENT, ECONOMIC GROWTH, FEDEX
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