Tennessee officials give car-seat manufacturer a boost at taxpayers’ expense

Tennessee officials give car-seat manufacturer a boost at taxpayers’ expense

Tennessee taxpayers are shelling out more money — this time $600,000 — so another manufacturer can train new workers.

In exchange, state officials aren’t placing stringent expectations on the company, Chattanooga Seating Systems, in terms of measurable outputs.

The money would be used to train nearly 200 CSS employees, according to the contract between the company and the state. The same contract has a vague requirement that CSS commit “to increase the number of employees within the state of Tennessee.”

CSS will build car seats for Volkswagen, which also operates out of Chattanooga.

Carly Schroer is spokeswoman for the Tennessee Department of Economic and Community Development, the agency that gave out the money.

She said CSS won’t immediately receive the cash.

Carly Schroer (photo courtesy of the ECD's official website)

Carly Schroer (photo courtesy of the ECD’s official website)

“The grant is reimbursement only, meaning the company will not be paid until it has hired an employee and kept them on their payroll for a certain amount of time,” Schroer said in an emailed statement.

“They get reimbursement of half the amount per job ($3220 total per job) at 90 days and the other half after 180 days.”

Per the contract, state officials say, any CSS employees who benefit from this grant must work in Tennessee during their training.

The program, Schroer went on, “does not require individual employees to remain in Tennessee.”

According to the Chattanooga Times Free Press, CSS is a joint venture between the Michigan-based Hollingsworth International and the Canada-based Magna Seating companies.

No one at CSS or Hollingsworth returned repeated requests for comment this week.

Tennessee Watchdog submitted several questions to Magna spokeswoman Tracy Fuerst via email, but she did not respond before this week’s deadline.

According to ECD records, state officials previously gave $450,000 in incentives to CSS in 2013, and a total sum of $933,750 to Magna between 2012 and 2015.

State officials deliver the money through what’s known as the FastTrack Job Training Assistance Program, which the Tennessee General Assembly passed into law in 2005.

The grant contract between the state and CSS ends July 31, 2021, according to ECD documents.

Contact Christopher Butler at chris@tennesseewatchdog.org 

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