Tennessee approves $30M state grant for Starbucks

Tennessee has approved a $30 million state grant for Starbucks' expansion into Nashville, stoking controversy.

The money, approved by the Tennessee State Funding Board on May 20, is tied to Starbucks' March announcement that it would open a new corporate operations office near downtown Nashville. The deal hinges on Starbucks' promises to invest $100 million in Tennessee and create new jobs. The Nashville office will host up to 2,000 employees, with an average salary of $125,000, over the next five years, according to state officials.

The $30 million state economic development grant will help Starbucks offset its expenses, such as expanding, retrofitting and improving buildings, according to state officials.

Starbucks did not immediately respond to a request for comment.

The incentive has sparked debate as some in the southern state argue that taxpayer money shouldn't go toward corporations.

Pamela Furr, a grassroots director with the free-market advocacy group Americans for Prosperity, voiced her concern at the Tennessee State Funding Board's meeting last week.

"If Tennessee is already one of the best places in America to do business, why are taxpayers being asked to subsidize one of the largest corporations in the world, a corporation, by the way, that is cutting jobs and closing stores?" she said.

Starbucks announced plans to lay off about 300 workers earlier this month. More than 2,300 Washington-based Starbucks employees have been laid off since February 2025, according to state data.

Starbucks has reiterated that its global headquarters will remain in Seattle. But as other states lure corporations with cash and tax incentives, many in Washington worry the state isn't doing enough to keep home-grown businesses close.

Washington recently gained national attention for passing a "millionaires tax" - a 9.9% levy on any income over $1 million, fueling fears that wealthy people would flee the state.

In a Wall Street Journal op-ed published earlier this month, former Starbucks CEO Howard Schultz took a jab at Seattle's mayor and its business climate for what he called "hostile" and "socialist rhetoric."

The billionaire, whose move to Miami made waves just months ago, had a variety of complaints about Seattle - among them, a general sour disposition toward corporations.

He specifically called out Seattle Mayor Katie Wilson, who urged Seattleites to boycott Starbucks at a Nov. 13 union rally as mayor-elect.

"I am not buying Starbucks, and you should not either," she told the crowd.

In a statement in response to Schultz's op-ed, Wilson said Starbucks is part of Seattle's culture and identity, and that she wants the company and other large employers to continue their success in the city.

Although Tennessee may be friendly toward Starbucks, the corporation is likely to run into trouble with local politicians in Nashville as well.

More than half of the Metropolitan Council of Nashville's 40 members signed a letter to Starbucks CEO Brian Niccol the same day Tennessee approved the $30 million grant, urging Starbucks to finalize a contract with union baristas.

"We are proud to foster a pro-business climate in our city and state," the letter said. "At the same time, we must be clear that being pro-business or lower-cost than other locations is not an invitation to take advantage of our residents, pay unlivable wages, or interfere with workers' legal right to organize."

Information from Seattle Times archives is included in this report.

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This story was originally published May 27, 2026 at 2:13 PM.