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Study: Local Hiring A Boon

Local businesses, on average, generate about 2 percent more in taxes for Hamilton County than out-of-town contractors hired to do the same work, according to an economic study released Friday.

Dr. Bruce Hutchinson said his review of local government contracts showed that, for every $1 million in contracts awarded, Hamilton County nets about $23,000 more in taxes when the work is done by local firms and workers compared to out-of-town contractors.

"Not all contracts are the same, but as a general rule of thumb, the local government will be advantaged roughly 2 percent of the value of the contract if a local firm is used," said Dr. Hutchinson, a professor of economics at the University of Tennessee at Chattanooga.

Local companies pay more local taxes directly and tend to employ a larger share of local workers, Dr. Hutchinson said. Local workers, in turn, spend more money in the local area and generate more tax revenue than those employed by out-of-town contractors, he said.

HireHere, a coalition of local businesses, unions and volunteers who support hiring Chattanooga workers and companies, paid for the UTC study.

At a news conference Friday, Dr. Hutchinson and some elected officials said the study underscores the advantages of buying and contracting locally. If a local bid is less than 2 percent higher than an out-of-town contractor's bid, "the local government benefits by letting the contract to a local business," he said.

But officials at the news conference backed away from endorsing a proposed city ordinance to grant a local preference in awarding contracts. City officials have asked the state attorney general for a legal opinion on the proposed ordinance.

"The point here is that when you start looking at relatively equal scenarios between two companies, there is an advantage if we hire locally for local dollars spent and government revenues collected," state Sen. Andy Berke, D-Chattanooga, said during the news conference.

Sen. Berke and City Councilman Andraé McGary said they aren't necessarily pushing for specific local content rules.

"This study certainly indicates that it is our best interest to at least look into this issue," Mr. McGary said.

Dr. Hutchinson said his study did not consider any specific legal requirements for a local preference, or the potential that other communities might try to restrict Chattanooga companies from selling goods in their cities.

Roger Tuder, executive director of the Associated General Contractors of East Tennessee, said his group opposes a city preference ordinance because it is unnecessary and could trigger limits on local contractors doing business elsewhere.

"If Chattanooga gives a preference to its city contractors, what's to prevent Cleveland or Marion County or even East Ridge and Red Bank from adopting similar ordinances that might disadvantage Chattanooga companies?" he asked.

Chattanooga Firm Gets $1.88 Million VW Contract

A Chattanooga construction firm has been awarded a $1.88 million contract for work at the Volkswagen plant.

Thomas Brothers Construction will do site work and erect fences at the Training Center at the huge new plant at the Enterprise South Industrial Park.

The firm will erect chain link fences with barbed wire around a portion of the Training Center as well as picket-type fencing in more public areas at the center, where VW workers will go through training.

Bid packages were sent to 24 vendors and it was advertised. There were three bids received.

Steve Leach, city public works administrator, said 160 construction workers in two shifts are striving to meet the Dec. 18 deadline for completing the Training Center.

He said, "We are pushing as hard as we can to get that completed."

Chattanooga State will operate the center.

A number of orders for specialized equipment for the center have been placed. Most are "single source."

The City Bond Board on Tuesday morning approved several equipment orders.

They included $126,960 from a German firm, Schatz AG, and $33,311 from Atlas Copco Tools and Assembly.

Another order that was bid was won by Turner Supply of Nashville $516,818. A Memphis firm also bid.

The contract for Moll Systems U.S. for conveyor equipment was amended and now totals just over $1 million.

Mr. Leach said progress is being made, despite the frequent rain, on extending the entrance road from I-75 to the Training Center.

Local Plumbers Take On $45 M Public Project

Last Updated on Monday, 19 October 2009 10:03

CHATTANOOGA – Hire HERE, a local community affairs organization, today commends the Hamilton County Water and Wastewater Treatment Authority for choosing to hire local plumbers to implement a $45 million, eight-year program to inspect and repair home sewer lines throughout Hamilton County.

“The leadership of WWTA gets it,” Ron Tanner, a HireHERE spokesman, said. “Every dollar invested with local business impacts our economy throughout the county. The effect of local investment multiples as that money passes from one local businessperson to another.”

Hamilton County Attorney Mike Carter recently told the county commission that the county could have put the work out for bid, which would probably have resulted in it going to a large out-of-town firm. He said after several meetings with local plumbers, the government decided to hire locally. “This is truly a private enterprise solution to a public problem,” he told the commission.

Plumbers will be required to go through a WWTA training program and agree to program terms. An outside engineering firm will decide the payment amount and there will be a set amount of work per foot and surcharges for work done outside the bounds of that agreement.

“When the public and private sectors work together, we’re able to find solutions to most of our problems,” Tanner said. “This is an example of how well that partnership can work.”

Hire HERE is an organization committed to its ongoing mission to educate local government and business leaders on the importance of hiring local firms and employees.

VW to Begin Taking Applications

VW's human resources chief in Chattanooga, Ryan Rose, told the Chattanooga Times Free Press that applications must be submitted online during the three week period.

Workers will be hired over the course of next year and in 2011, when production of a new midsize sedan is to begin.

The starting pay for the body and paint shop, welding and assembly jobs is $14.50 per hour, increasing to $19.50 per hour over 36 months. The company will offer a benefits package.

To apply, go to www.VWJobsChattanooga.com starting Oct. 26.