MEMPHIS, Tenn. (WMC) - UPS is expanding its operation in the backyard of shipping rival FedEx, and Memphis leaders approved a big tax break to make it happen.
EDGE, the Economic Development Growth Engine for Memphis and Shelby County, approved a $38 million PILOT (payment in lieu of taxes) for UPS.
The tax break is a generous incentive by local governments where businesses pay less in property taxes to set up shop or expand.
UPS was granted the $38 million tax break in exchange for building a $216 million expansion at its sorting hub on Swinnea Road by Memphis International Airport.
Currently, 1,300 employees work at UPS' Memphis distribution center. They move between 600,000 and one million packages a day.
The 270,000-square-foot expansion will include a new automated parcel handling facility.
It also adds 25 supervisor jobs, paying on average about $48,000 a year.
UPS received a 15-year PILOT to expand in the Bluff City.
The deal will generate $845,000 a year in new property tax revenue.
After the PILOT ends, the property tax jumps to $2.9 million a year.