LOCAL

Metro Council approves Oracle deal on East Nashville riverfront in final hurdle for $1.2B development

Yue Stella Yu
Nashville Tennessean

Editor's note: The story has been updated to correctly spell Jennifer Birk's last name.

Metro Council members voted unanimously Tuesday night to approve the development plan of tech giant Oracle Corp. in East Nashville, clearing the last hurdle for a historic $1.2 billion investment on Music City's industrial riverfront. 

Metro Council's approval Tuesday night means Oracle can now begin its work on a more detailed design of its 65-acre riverbank campus, according to company spokesperson Jim Murphy. Construction could begin as early as June. 

The development, hailed by some supporters as "transformational" and "once in a lifetime," marks the biggest economic development deal ever made in Tennessee. The proposed investment will transform the cityscape along the East Bank of the Cumberland River into the city's largest business hub.

A rendering of Oracle's proposed campus along the Cumberland River.

"This is the largest private investment and the largest job creation deal in our history – all with no expense in our budget and no new debt," Mayor John Cooper said in a statement moments after the council vote.

The deal could bring a record number of jobs to Nashville. The company hopes to create 8,500 new jobs in Nashville by the end of 2031, with an average annual wage of $110,000. The project is also expected to bring almost 11,500 ancillary jobs and 10,000 temporary positions during construction. 

A view down Dickerson Pike Monday, April 19, 2021 in Nashville, Tenn. Software giant Oracle is pursuing a $1.2 billion investment in a 65-acre parcel of land on the East Bank of the Cumberland River. The new development could bring major development along Dickerson Rd.

By approving the deal, Metro government also has signaled its intent to use half of the annual property tax revenue generated from the site to pay for affordable housing, in addition to any funding already allocated for that purpose in the budget. The actual dedication of the funds, however, will still be at the council's discretion.

The language, proposed by At-Large Council member Zulfat Suara, was added to the development plan during a Monday budget and finance committee meeting and was approved by the council Tuesday. 

As part of the deal, Oracle will receive a 25-year, 50% property tax discount in exchange for its up-front $175 million investment in public infrastructure near Germantown. That includes streets, parks, greenways, a pedestrian bridge from the Oracle campus to Germantown and an expanded sewer system. 

More:Board approves Nashville Oracle deal after lengthy discussion, heads to Metro Council

While the deal received an overwhelming support from the council Tuesday night, many council members and local activists have voiced concerns about Oracle's proposed job creation, commitment to diversity, as well as its actions to address affordable housing with a booming workforce.

Community advocacy group Stand Up Nashville posed 20 questions about the Oracle deal and received responses Monday. The group challenged the way Metro government does business with the tech company and demanded actions from Oracle to address the affordable housing crisis and hire minority workers.

"Overwhelmingly, we hear from our communities that housing and economic inequality are the priority," Stand Up Nashville co-founder Odessa Kelly said in a Tuesday statement. "What the answers to our questions tell us is that while it is good that Oracle wants to be in Nashville, and this deal is better than deals of the past, it was not a community driven process and we can still improve the way our city operates."

Community concerns:Unions cry foul on economic development deal: 'Demand accountability from Oracle'

Leaders applaud deal, look forward to job growth

Both local and state leaders have welcomed the development.

"Oracle’s $1.2 billion investment will create thousands of quality jobs and help our kids succeed in the digital economy," Cooper said Tuesday. "After a challenging year, this helps kick off Nashville’s next decade of prosperity."

Council member Mary Carolyn Roberts said Tuesday the deal could attract other tech giants to land in Nashville as well.

"We are in a position to have a deal changer in Nashville," she said.

Tennessee Economic and Community Development Commissioner Bob Rolfe also urged council members to approve the deal during a Monday committee meeting.

"This is transformational, once in a lifetime," Rolfe said. 

Howard Schiller and Don Allen of Monroe Investment Partners applauded the vote in a statement Tuesday night. The company created River North, the 100-plus-acre mixed-use development district where the campus would be located.

“My partner has been investing in the east bank of Nashville for 20+ years and I am truly excited to see his vision of River North become a reality,” Schiller said in a text message.

Monroe will continue to own a significant amount of property at River North after the transaction with Oracle closes.

“This is an exciting day for the State of TN and the City of Nashville," Allen said in a text. “We look forward to working cooperatively with Oracle and the City and State as River North continues its transformation into a vibrant mixed use environment."

Concerns voiced around housing, jobs and diversity

But at the Monday meeting, many council members feared the historic-scale development may be too large for Nashville to swallow. 

The development and the workforce it may bring, they said, could drive up the cost of living in Nashville and force out low-income families. 

"You see a house on the market. Before you click on it, it's gone," Suara said Monday. "You have students that cannot afford to pay for housing in the neighborhood that they grew up in. You have people being gentrified out of their homes." 

In response to Stand Up Nashville's questions on affordable housing, the company pointed to Suara's amendment and Cooper's proposed budget, which would allocate $30 million in local and federal funds to affordable housing initiatives

Doug Kehring, executive vice president of corporate operations for Oracle, said Monday the company does not intend to exacerbate Nashville's affordable housing problem. 

"How we support housing may come through ownership, may come through donations, may come through other support mechanisms, but we are very focused on making sure there's enough (affordable) housing for employees," he said. "We don't want to come to Nashville to create a bigger problem. We want to come to Nashville to create a great solution."

It is also unclear how many of the proposed 8,500 jobs are high-paying positions and what the lowest hourly wage would be for most employees. Council member Emily Benedict posed the question Monday, but received no direct answer from Oracle representatives.

"I haven't been able to find out in the past two weeks, the multiple times that I've asked, what is the lowest wage that you pay your full-time and part-time employees?" she asked.

Jennifer Birk of Oracle said Monday the company would like to make local hires "as much as we can." But under Tennessee law, Metro government has no power to establish local hire mandates or require the level of workforce diversity, the company said in its Monday response to Stand Up Nashville

Job creation:What we know about the 8,500 jobs in Oracle's Nashville hub proposal

Multiple council members also demanded concrete actions from Oracle advocating for the LGBTQ communities. The company is considering moving to Tennessee as the state legislature passes several bills targeting LGBTQ youths. Gov. Bill Lee, a conservative Republican, became the third governor this year to sign into law a measure barring transgender students from playing sports under their gender identity.

Related:'Why do they hate us so much?': Frustration grows among transgender Tennesseans as bills targeting youth advance

Oracle last month joined 94 businesses in signing a letter by the Human Rights Campaign opposing anti-LGBTQ legislation across the country. But the company has not threatened to pull out of the state because of the legislation.

At-Large Council member Bob Mendes asked Oracle on Monday what concrete actions the company would take apart from signing the letter. He previously defended the letter-signing on social media as an important move "even if a fight can't be won today."

"We get real criticism from well-meaning people that we are just engaging in nonsense theater and it doesn't actually mean anything," he told Oracle representatives. "How do you match (what you said)? Are we just being hypocrites?"

Business impact:Tennessee's 'onslaught' of anti-LGBTQ legislation could lose Nashville millions of dollars

Kehring responded by arguing the company has a track record of diverse culture and values. 

"You have the opportunity to attract companies that can help your effort, or you can push those companies away in your attempt to deal with the concern you just raised," he said. "We are gonna bring our culture and values."

Council member Jonathan Hall urged the council Tuesday to invest in education and workforce training to supply quality candidates to the job market Oracle would create. Council member Colby Sledge cautioned his colleagues Tuesday night to continue to address the community concerns around the Oracle deal.

"We will have invited the horse in," he said. "For it to be useful to the people of Nashville, it will take all of us working together to tame that horse. If we do not, it will trample our people."

Sandy Mazza contributed to this report.

Reach Yue Stella Yu at yyu@tennessean.com and on Twitter @bystellayu_tnsn.

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