Jameson wants answers on Convention Center Authority

Thursday, August 20, 2009 at 2:33am

District 6 Metro Councilman Mike Jameson believes the inability of the finance director to answer a series of questions pertaining to legislation that would create a new Convention Center Authority shows the mayor’s administration tried to fast-track a complicated resolution that needed more debate.

Jameson issued 12 questions for the Council office or Finance Director Richard Riebeling to answer on Tuesday. Later in the day, at the Council convention center, tourism and public facilities committee meeting, Riebeling promised he would have answers to Jameson's questions by the end of the week.

At the Council meeting, Jameson evoked an obscure Council rule to force the legislative body to reconsider the resolution that would authorize the creation of the Convention Center Authority. The resolution passed with a 37-2 vote and would have been reconsidered at the Sept. 2 Council meeting.

However, at the request of District 10 Councilman Rip Ryman and others, Vice Mayor Diane Neighbors has scheduled a special meeting for Friday at 4:30 p.m. to reconsider the legislation.

Jameson said he hopes Riebeling will have answers to his questions by that time.

"The fact we couldn't get fair questions answered only demonstrates that this resolution was fast-tracked," Jameson said.

Although Mayor Karl Dean’s administration had always planned to have the Convention Center Authority oversee development of the proposed $635 million Music City Center project, the timetable was moved up after the revelation that Metro was over-spending on communications for the project.

Dean called for an independent audit after it was revealed that the Metro Development and Housing Agency had spent $458,000 on public relations for a contract that was originally for just $75,000. The PR firm, McNeely, Pigott & Fox, has stepped down from the communications contract.

Dean called for immediately filing legislation to create the nine-member Convention Center Authority, which would take over development responsibilities from MDHA. The board would be appointed by Dean and approved by Council. The Convention Center Authority would have to give quarterly reports to Council, which many members believe gives Council more oversight of the project.

Jameson's 12 questions pertaining to the Convention Center Authority are listed below.

1) Does the Resolution language approve even future actions?

The last section of the resolution establishing a Convention Center Authority ("CCA") provides: SECTION 3. All acts and doings of the Metropolitan Mayor, the Director of Finance and any other officer of the Metropolitan Government that are in conformity with the purposes and intent of this Resolution shall be, and the same hereby are in all respects, approved and confirmed as may be necessary or appropriate in order for the Authority to be formed in accordance with the Act.

Doesn't that wording seem excessive? I can't find any provision under the state law that requires such resolution language in order to establish a CCA. The Council would be preapproving and confirming all future actions to form the Authority. Is that in the best interests of the Council as an institution? Who drafted that provision and why is it included?

2) Would the prior authorized agreements between the Metro Council and MDHA prevent the CCA from conducting business until after a finance package is voted on and sold and construction plans are ready for a convention center to be built?

As I understand it, at this time, all "predevelopment activities" for the convention center are to be undertaken by MDHA. All tourism taxes are to be transferred to MDHA for these activities, and MDHA issued debt obligations for land acquisition (in July for $64 million). Is Metro Council in a position to "take the convention center away" from MDHA? Or are we required to allow their continued control over the spending until Metro is in a position to issue its own bonds and pay off MDHA's debt obligations? Looking at RS2009-698 and the attached Intergovernmental Project Agreement, section
1(g) states:

"For so long as any MDHA Debt Obligation or any related refunding obligation issued pursuant to this Agreement are outstanding, the Metropolitan Government will transfer the Convention Center Tax Revenues to MDHA as described herein and will not repeal or amend the ordinances authorizing the collection of the Convention Center Tax Revenues in such a manner as to reduce the amount of Convention Center Tax revenues payable to MDHA pursuant to this Agreement." (emphasis added)

Is Metro Finance and the Council legally obligated to continue to provide CC tax revenues to MDHA to carry out all "predevelopment activities" as defined in the agreement between the city and MDHA?

3) Do we know the status of the State's review of the TDZ application?

Do we know the current status of the State's review of the "qualified public use facility", the "master development plan", and the approval of the Tourism Development Zone under 7-88-108? (In light of the reported loss of sales tax revenues at the state level of $60-plus million I'm just wondering whether the State relishes the diversion of additional sales and use taxes in a 3 square mile area downtown.)

If we don't know, should the Council approve an Authority before determining whether these approvals are in place at the State level? (i.e., before we know whether financing is in place to understand how an Authority would allocate revenues). If the TDZ has not been approved, are there any "official" revenue streams to deploy?

4) How would the CCA operate, in relation to MDHA and the CVB? Given MDHA's pre-ordained role, would the CCA have control over MDHA? Or would MDHA have control over the CCA? Or neither?

5) Is Finance in a better position than MDHA to conduct (temporary) pre-development activities?

The press release accompanying the resolution states that the Finance Department will staff the Authority until employees can be hired. Does that defeat the point of having an Authority if the intent is to establish independence and better management? How would the Finance staff manage design and hotel teams better than MDHA? Do they have any experience in those realms, and don't they have an enormous amount of other obligations pressing upon them (city budgets, city finances, etc)?

6) Description of what the CCA can do As you know, the state legislation on convention center authorities is 30-plus pages long. But the proposed Resolution says nothing about what the convention center authority will do, what powers it has, and how this will effect the Council's oversight of the convention center. Is there any way that you could spend some time explaining the state legislation at the Committee meeting tonight (if I get the chance to toss you a question)?

7) Is the CCA immune from local zoning requirements? Under the state statute, the Authority would have the power to demolish buildings. If a national register eligible property were located in an area where the CCA wanted to build, would the CCA be required to consult with the historic commission and receive their approval prior to demolishing that building? Or are governmental entities like the CCA immune from these local zoning requirements?

8) Could the CCA hire consultants?

The bill gives the CCA the authority to hire professional consultants. So, once the bill is passed, would the CCA have the authority to hire professional lobbyists, public relations firms and other firms to help with the pre-construction activities of the convention center? Would we have any oversight over these hires and the contracts?

9) Can the CCA sell portions of property without consultation?

The state legislation gives the CCA the authority to sell property. Am I correct that the CCA only has to go back to the Council if all or substantially all of the property is sold?

In other words, while Metro funds would be used to secure the property and to develop the property, the Metro Council needn't be consulted when a portion of the real or personal property is sold off, right?

10) Could the CCA fund a hotel through the previously approved revenue streams? My understanding was that we did not know how the hotel would be financed. However, based on my reading of this bill, a hotel, or infrastructure improvements, parking and even parks and retail establishments could constitute a project that receives access to the tax revenue streams that were previously passed to fund the convention center. Is that correct?

11) Lease space question

The bill also allows the municipality to lease space from the CCA and to impose a tax to pay for that structure. Do we know when and how that would occur? How would the tax be imposed? Could this be used by the municipality to impose a tax on the citizens to cover the convention centers budgetary shortfalls?

12) Is there a rush?

Is there a reason why the Resolution must be passed tonight? Do you recommend that the Council vote to form an Authority for a convention center before the Council votes to approve the convention center itself? Do city governments typically form convention center authorities before the legislative branch decides whether to build a convention center?

30 Comments on this post:

By: idgaf on 8/20/09 at 3:21

This whole deal smells.

Let us vote on it.

By: producer2 on 8/20/09 at 6:41

I would ask why the councilman waited until now to ask his questions.
This legislation was proposed to and passed by the State Legislature back in early June. This is not a surprise that the CCA was coming, it has been known for some time.

By: JeffF on 8/20/09 at 7:02

Lets see, the council bill was introduced three days before the actual vote. Considering that the esteemed director of finance hasn't answered the questions even now two days after the vote I would guess the answer is obvious. Sandbagging by the mayor's staff and finance director and the need to always rush convention center related tasks through before questioning can begin is to blame, not the very act of questioning.

Not only is the convention center a big waste of citizens finite resources, it is apparently a vampire. The very threat of sunshine on its deliberations causes its supporters to shriek in pain.

By: nvestnbna on 8/20/09 at 7:32

Bravo, that someone is at least asking 'thoughtful' deliberative questions about this as opposed to some who have stated, 'this gives us oversight' so let's support it. That individual doesn't appear to even know what constitutes oversight. This CCA seems to be just one more example of how misguided this project has been and is continuing to be. I'm not sure if we're better or worse with the devil we know or the latest iteration.

This may not be the end to Jameson's career, but the beginning.

By: nvestnbna on 8/20/09 at 7:33

BTW, JeffF do you have a brother down in Columbia?

By: producer2 on 8/20/09 at 7:57

You did not answer my question. This legislation has been around since June, not just last week. Surely it is not a surprise to anyone in Metro Council, it was in all of the papers a couple of months ago. Has it changed since then? Why was there no outcry when it was passed by the State?

By: pandabear on 8/20/09 at 8:07

Finally.
Someone starts to wake up.
The "arrogance team" has hit a wall called "the rule", and
the percentage of people voting for it was astounding !

Ryman, who has already cost the taxpayers over $1Million dollars
because of his stupidity in Goodlettesville, is on the Deano team
and "fast tracking" his way toward another mistake.

Go Jameson go !

By: producer2 on 8/20/09 at 8:40

And Crafton cost us nothing? Pandabear c'mon we are not that stupid...any of us

By: Time for Truth on 8/20/09 at 9:09

prod, I doubt idgaf or Jeff or I could answer for Mr. Jameson. I certainly appreciate the fact that he is bringing intelligent questioning discourse to this debate. Especially in light of the fact that his district is one of the few, and perhaps the only one, where the MCC has popular support.

Ryman is an idiot and I never was a fan of Diane 'Car Wash' Neighbors. Your comment on Mr. Crafton is well taken.

By: girliegirl on 8/20/09 at 9:11

8) Could the CCA hire consultants?

You mean like......... McNeely, Piggot and Fox? AGAIN? LOL seriously

By: Time for Truth on 8/20/09 at 9:18

id, you are correct imo that there is a bad odor to this project. The fact that it makes no sense in the big picture of municipal needs has caused those wanting it to rush it through before it gets proper scrutiny. Dean and his backers also see the need to keep the voters from getting a say, since it is clear it would be defeated in a referendum.

By: producer2 on 8/20/09 at 9:48

Mr. Truth,
What do you base your statement of "it makes no sense in the big picture" on? Just curious as to how or what you think might make more sense for the city.

I heard much the same noise on the English Only initiative about how it would pass with flying colors if brought to a vote. We have votes on this subject and they come from elected officials who are put in place to serve the public. Much like the EO issue which did not need a public referendum to draw a logical conclusion neither does this one.

By: JeffF on 8/20/09 at 10:03

"You did not answer my question."

There seems to be a lot of that going around Produce, glad it is hitting the other side now. The state act was only enabling legislation with some preliminary rules. The Metro legislation carried a lot more stuff that at many times conflicted with what council members were being told by finance and the mayor. These aren't just question Jameson are asking, he wants in writing from the administration which side in a conflict will be used.

It makes no sense because a convention center is not an actual government activity. The stench is related to profteers kidnapping our elected government and the revenues it takes in until they get the business asset they want. Only after the building is built and the debt issued will we be getting our council members back. Until then they will not answer to common sense but instead to you and your NEEDY friends.

Nashville doesn't NEED this thing, you do.

By: Time for Truth on 8/20/09 at 10:12

prod, you may remember I was as critical of EO as you, and as critical of EO as I am of this project. Stupid is stupid, whether it's a bad piece of legislation or a bad project proposal. I'm sorry that I don't fit your profile of MCC opponents being xenophobic far-right rubes.

The only poll I know of on the MCC was one conducted here some time ago and 58 percent were opposed or inclined to be opposed to MCC. And this was before all the ugly little problems started bubbling to the surface. When I discuss issues with friends EO was a topic back then and roughly half supported it. Currently I can only think of one person among a large circle of friends who is pro MCC. Not very scientific but certainly at least as valid as any argument you've made that MCC has popular support.

When elected officials fail to serve the public and instead serve a small demographic of downtown business owners who talk them into running and bankroll their campaigns, those elected official have betrayed their trust with the citizens. Such is the case with Mr. Dean and he will pay for it when and if he faces the voters again. But in the meantime we are being saddled with a gigantic building that serves very few who live here.

The first priorities of any municipal government, roughly in this order, should be police and fire protection, schools and planning. The MCC takes resources away from the first three and arguably is a bad execution of the last. Those served by this project are small in number and those making use of this structure don't live here. And face the facts, the convention industry is a dying one and facilities to serve it are overbuilt. You will come back with the argument that the MCC will pay for itself but it is already stealing money from other tourist-tax venues and the numbers don't add up.

By: producer2 on 8/20/09 at 10:34

Can either of you tell me how much money was put into the General Fund the past few years from the tax benefits reaped from tourism?

By: producer2 on 8/20/09 at 10:47

Here let me help. Direct from the horses mouth:

The convention business affects our tax base. Tourism is responsible for over $100 million in direct tax contributions to our city – $100 million that goes to things like schools, public safety and parks. In fact, in 2006 a study from the University of Tennessee determined that without the contributions of Nashville’s tourism industry, every household in our city would have to pay an additional $1,029 in state and local taxes. It is one of the largest industries in Nashville, second only to healthcare, responsible for providing nearly 60,000 jobs. The 11 million visitors that travel to Nashville every year are responsible for $4 billion in direct spending in our community; and of that, over $1 billion comes solely from conventions."

These are verifiable facts not opinion. Look it up...

By: airvols on 8/20/09 at 10:54

Build it and they will come-Get over it, it's going ot happen and 5 people on a blog want make a difference.

By: Time for Truth on 8/20/09 at 11:56

Verifiable facts indeed, based on events that have taken place and are taking place already. Further evidence that spending a billion dollars is unneccessary. Taking money away from those attractions drawing people to Nashville by diverting all of the tourist tax funding to the MCC doesn't seem very smart, does it?

airvols, I hope we are able to surprise you. The lack of popular support for this project is finally starting to resonate with Metro Council. If Crafton can get a referendum for something as ridiculous as 'English Only', perhaps he or others can get this thing before the voters. And if it goes to a public vote, it will lose. That is why they are sneaking it through.

By: Time for Truth on 8/20/09 at 12:14

It just occurred to me:

Tourist tax support for current Convention Center: 450,000 a year

MPF invoices for tweets and lobbying for MCC: 450,000

So this poorly supervised pork spending to lobby for the white elephant is equal to the ENTIRE tourist tax contribution to the current center.

By: JeffF on 8/20/09 at 12:32

your definition of verifiable facts deviates from the norm. You quoted a consultant's theoretical paid opinion as fact! As we have seen the last few weeks, paying for an opinion or to argue a point does not make it factual (or even believable). The only verifiable amounts in this argument is recorded revenue. As you have admitted to on other posts there are people paying taxes that are not tourists or meetings attendees. I could give MP&F $100 and have them twitter that 98% of all these tax revenues are not coming from tourists and it still wouldn't be fact. The inverse is true, Don't pay someone millions of dollars to regurgitate the desired opinion then use that document as scientific fact.

Using a consultant proven historically wrong in dozens of other cases definitely does not help.

By: JeffF on 8/20/09 at 12:34

It would crack me up to have Jameson ask to see a list of cities (with references) in the last 10-20 years that have seen promised returns for their new building. Maybe he can ask to limit the list to just the cities our consultant worked with. He would be shocked to see how many cities underdelivered and attributed the problem to still being too small, thus asking for more money for an even bigger building. Atlanta is the poster child for this phenomenon.

By: producer2 on 8/20/09 at 1:20

Tough when all you can do is try and spin the truth. You are grabbing at straws, Now all you have is this episode to hang your hat on. this one issue that is really not an issue at all. Did you read the voluminous posts from all the outraged citizens? No? Maybe because there weren't any.
We have had this discussion numerous times yet you continue to recite the same issues that bear no weight on the outcome. You can find "buildings" all over the country that do not show large profits because they are not intended to show profits. So why do cities continue to build them?

"The convention business affects our tax base. Tourism is responsible for over $100 million in direct tax contributions to our city – $100 million that goes to things like schools, public safety and parks. In fact, in 2006 a study from the University of Tennessee determined that without the contributions of Nashville’s tourism industry, every household in our city would have to pay an additional $1,029 in state and local taxes. "
"This fact is indisputable: If we do nothing – if we do not build or if we significantly postpone building a new convention center in our city – the number of convention visitors, and the important revenue they generate for our city, will continue to decline. We have an opportunity to not only preserve our tourism industry, but help it grow substantially, and do so using dedicated funds from tourism-related taxes and fees. Let me be clear: This is not money that can be used for anything else. These funds come from revenue sources created specifically for this purpose. And by law, the development of a new downtown convention center is the only way that money can be spent. Most importantly, it’s non-property tax revenue.

Thank you Mayor Dean...

By: govskeptic on 8/20/09 at 2:07

Jameson's questions deserve to be answered before this special "Ryman-Neighbors" called meeting begins. Of course this day long dialogue is costing us $285.00 per hr
keeping the producer busy responding to each entry and thumbing through 100 pages of talking points. We all know that a majority of the council are follow the mayor on this, so I'm afraid we may all be waisting our time and superior intellects fighting phony projected numbers and a pink elephant with a fat pocketbook.

By: JeffF on 8/20/09 at 2:19

The economists at the University of Tennessee at annual meetings of government finance officers have labeled tourism and meetings as the poor cousin of real industry in this state. You use one study, we use another. The last time I heard one of the doctors speak he was reinforcing that investment in tourism by government was the single worst investment governments can make. A dollar invested in tourism rarely returns more than a few cents if anything at all, but money invested in EVERY other industry in Tennessee earns AT LEAST twice the amount of tourism.

The hidden problem with tourism is the public assistance that is provided to workers in this industry and the FACT that this industry hordes income more than any other industry. A worker in the hospitality industry is something link three time more likely to be on the seasonally unemployed and food stamps rolls and twice as likely to be without health insurance. So a government (state or local) is paying out more per capita to hospitality workers than to any other worker class in this country.

So we can invest a billion and see at most 2% economic return not including debt interest charges (best case figures) or we can build things that will generate an actual improvement in the lives of actual Nashvillians. Beck would disagree but it is never a waste to invest in schools and the children who go there.

By: JeffF on 8/20/09 at 2:20

nevest, sorry I forgot to answer your question again. No all my family lives in East Tennessee in Blount, Sevier, and Knox counties.

By: producer2 on 8/20/09 at 2:42

point me to your studies on this subject. I will be happy to read them. Also I would ask you to enlighten me about EVERY other industry we can invest in that would double our returns. Talk is cheap, show me some proof and I will be more likely to listen to your arguments.

By: JeffF on 8/20/09 at 3:17

Education, healthcare, transportation, ... you know the things government is supposed to be doing instead of making sure hotel maids and part-time banquet server get their 20 hours per week in.

I was seeing any url's or footnotes on your posts either big guy. As to the economists that was Dr. Matt Murray at the University of Tennessee. Haven't heard him in a couple of years but if you like you can contact him as to the validity of his statistics.

I have linked here several times to the quarterly Dept of Labor and Workforce Development with the industry statistics of salary and unemployment. In Davidson hospitality is 6th among industries in number of employees and 8th in total pay, 10th in average total pay. I am not sure where that 2nd largest employer bogus fact keeps coming from. I am certain no one would lie about the real importance of that "industry". One would have to dishonestly include employment from stadiums, arenas, performance venues, all of food service (restaurants), and most of retail to get up to 2nd in numbers. Even then that would not help the averages.

http://www.tennessee.gov/labor-wfd/lmi.htm

Dr. Murray once again will be presenting his annual state of the economy in Franklin on October 8. http://www.tngfoa.org/downloads/2009conf/2009-conference-brochure.pdf.

By: JeffF on 8/20/09 at 3:20

If you like I can rent a bus for Metro officials to hear from Dr. Murray down in Franklin. I would bet though that information would just get in the way of getting this "Need" built and there just isn't any time to stop and listen to anyone about this. All these naysayers should not have waited till the last minute (2 + years ago for most of us)

By: producer2 on 8/20/09 at 7:05

Apparently you missed this part:

"The convention business affects our tax base. Tourism is responsible for over $100 million in direct tax contributions to our city – $100 million that goes to things like schools, public safety and parks. In fact, in 2006 a study from the University of Tennessee determined that without the contributions of Nashville’s tourism industry, every household in our city would have to pay an additional $1,029 in state and local taxes. "

By: govskeptic on 8/20/09 at 7:13

producer needs more info on Tourism dollars. If you travel from Cookeville to Nashville as a salesman to buy a load of produce you are considered a tourist. How do I know this. These reports & numbers are just as wacky. As a former employee of the Tn Dept of Tourism we wrote the annual check to the professor from UT to update the annual report on the Economic empact of Tourism. It was a bargain rate with no backup nor inspection of any backup data. This info was then printed in bulk form, passed out to chambers across the state, we all pattied ourselves for another good yr.,because it always showed enough growth rightly or wrongly. The press reported it straight from the booklet So, it's not a question of no tourist dollars without building this. The main question is whether there will be enough added dollars and conventioners to justify a one billion dollar additional facility. The voter says NO WAY!