Talk about the end of an era. Fred Harris, who has worked in economic development circles since 1960 and has been Nashville’s top business recruiter for 22 years, is retiring.
Harris has been a key player in virtually every important economic milestone in Middle Tennessee during the last two decadesfrom the development of the American Airlines hub to the return of HCA to the recruitment of the Dell assembly plant.
His most noteworthy achievement was probably his first. As a newly hired recruiter at the Nashville Area Chamber of Commerce, where he has been for the last two decades, Harris was one of a handful of local and state officials tasked with convincing Nissan to build an assembly plant in Middle Tennessee. At a time when there was no car industry in the South and few Japanese companies with a presence in Tennessee, the job was full of challenges. “Back then, people here knew very little about Japanese culture,” Harris says. “But we tried to do everything we could to make the executives feel comfortable here. My wife even tried to make sushi at home.
“I don’t remember how the sushi came out, but I think they appreciated the effort.”
In October 1980, Nissan announced it would build its assembly plant in Smyrna. And ultimately, the plant’s presence was a major factor in convincing General Motors to locate its Saturn division in Spring Hill.
Today, several hundred companies make parts for Nissan and Saturn at manufacturing plants sprinkled all over Middle Tennessee. “The Nissan decision was a major turning point for Tennessee,” says Lamar Alexander, Tennessee’s governor at the time of the announcement. “It not only began the migration of the auto industry to the South, but it also was one of the main things that caused Tennessee to move up from being one of the poorest states in the country. I believe it was and continues to be a great money magnet for the people of Tennessee.”
Harris is a throwback to an era when corporate recruitment was more about relationships than tax breaks. He still eats lunch at the men’s table at Satsuma restaurant on Union Street. An avid golfer and the former president of the Hillwood Country Club, he will swear that the most important business decisions usually are made outside the office. And in an era when chief executive officers and economic development types frequently mislead the press, he always has believed that the best policy is to answer questions honestly.
Harris says that one of the most noteworthy changes in business culture over the years is the nature of the handshake deal. “There was a time when if folks looked you in the eye and told you something, it was going to happen,” says Harris, who once worked for Gov. Buford Ellington recruiting industrial manufacturers to West Tennessee. “Today, a lot of what we do is negotiated on paper with lawyers sitting at the table.”
Harris also says that the days of a business owner looking over a proposed site and making a decision about whether to build there are long gone. “There was no such thing as the Environmental Protection Agency, no such thing as the Clean Water Act,” he says. “Today, half our time is spent trying to set people up with the right person in state government to help them get the right permit.”
Harris’ retirement comes at a critical time for the chamber’s economic development office. The loss of locally owned financial institutions such as First American and J.C. Bradford, coupled with the decline of locally owned companies such as Shoney’s and Service Merchandise, make Nashville’s economy more dependent on recruitment of outside companies than ever before. “We need to attract more headquartered and decision-maker-led businesses to the Nashville area,” says chamber president Mike Rollins.
Rollins says it can be extremely difficult to convince a company already in a large city to relocate here. But he says that the opportunity does exist to find companies based in smaller markets that would stand to gain from moving to a place such as Nashville.
A perfect example of this phenomenon is Dollar General, which was based in Scottsville, Ky., before 1988 and now has its corporate headquarters in Goodlettsville. Another is Caterpillar, which moved its financial subsidiary from Peoria, Ill., to Nashville in 1992.
Harris’ colleague Janet Miller will succeed him in March. Miller began working as Nashville’s lead recruiter for some companies and business sectors several years ago and now counts among her achievements the recruitment of the Dell assembly plant and the Sprint PCS Applications Center. “I have found over the years that no matter what kind of obscure question a prospect comes up with, Fred will know the answer to it,” she says. “But we do have totally different management styles. He is pretty conservative, and I am more likely to try new things.”
Despite all the boosterish talk about the NFL Titans and Tennessee’s lack of a personal income tax, Harris is unequivocal about Middle Tennessee’s greatest economic advantage: its location. “Most of the companies that come to Nashville do so because we are very close to the center of the population in the United States,” he says.
Harris knows that there is a widespread perception these days that local and state governments give away too much to big business when it comes to tax incentives. But he says Tennessee is surrounded by states that now give away far more than the Volunteer State.
“When we recruited Nissan, the state spent about $30 million building a four-lane road to the plant, upgrading the water and sewer system and railroad line out there, and in helping to train employees,” he says. “At the time, people thought that was way too much.”
In more recent years, other Southern states have gone to much greater lengths to seal the same sort of deals. Alabama’s efforts in the early 1990s to recruit a Mercedes plant were so extremelawmakers pledged $250 million in tax abatements and other incentivesthat the deal created a rancorous debate throughout the state. And last fall, Mississippi lawmakers called a special session just to vote on legislation giving away the farm to Nissan.
“Now we look back on that and look at what Mississippi and Alabama are doing today,” Harris says, “and we can’t believe how little we had to do for Nissan.”
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