Metro Council Member Courtney Johnston (District 26) says that the recent request by the mayor’s office that the city’s legislative body approve the stadium term sheet between Metro Nashville and the Tennessee Titans is a matter of “the cart before the horse.”
Johnston initially made the point during the October 26 meeting of the East Bank Stadium Committee – at which time the mayor’s representative, Finance Director Kelly Flannery, asked for approval of the resolution attaching the term sheet, a one-percent increase in the hotel occupancy tax (HOT), and advancing a request for proposal to seek a developer for the stadium campus – and reinforced it several times, relative to more than one point, during a telephone interview with The Tennessee Star on Saturday.
Johnston did repeatedly express appreciation for the administration responding to criticisms of the mayor’s office and prior administrations by involving the council early in the process.
On the one hand, they said the administration and even prior administrations have gotten plans for working out these contracts, and these agreements, and all of this kind of stuff to where it’s like a definitive agreement, and then it comes to council where it’s like, wait a minute, we don’t agree with this and why didn’t y’all bring us in earlier.
So then, on the flip side, they said, well, we want to bring it to you really, really early. And, so because of that, there are some unanswered questions. There’s just a lot of questions. There’s a lot of stuff that can’t be answered, actually, but we wanted to bring you in early.
Rather than submitting her questions in writing and waiting for a response, as with the East Bank Committee’s published questions and answers, Johnston had just come off of a 70-minute meeting she requested with representatives from the administration before talking with The Star.
On the point of being brought in early, Johnston said she told the administration, “I think maybe that was lost in translation, when at the same time you’re not just bringing forth a term sheet in a draft form and work in progress, you’re asking us to approve a resolution with that term sheet attached to it and you’re also asking us to turn on a hotel tax that is specifically for a new stadium. It can’t be used for anything else.”
Johnston said she pointed out several things she thinks should have been addressed in the term sheet that would have given people a higher comfort level with it.
One such topic Johnston requested the administration add to the term sheet are the meaningful details regarding the revenue streams included in the enabling state legislation, to clarify whether or not they are in perpetuity. This would be of benefit, Johnston contends, for the 39 part-time council members as well as the public, to whom the term sheet has been published.
Johnston disagrees with the arrangements outlined in the term sheet for parking facilities and thinks that it needs to be better negotiated.
Since the administration maintains that parking in the form of a garage is part of the scope of the project, Johnston says the cost she estimates to be $50 to $60 million needs to be included in the budgeted project cost of $2.1 billion. Johnston bases the estimated cost on a parking garage being built at the Nashville Zoo, which is located in her district, that has a cost of $35 million for 1,100 parking spots.
According to Johnston, the Titans would be able to collect all of the parking revenues from the 2,000 parking spaces for all events with the exception of TSU games and the five civic events Metro is able to hold. Currently, the Titans collect the revenues from 7,500 parking spaces on game days.
Johnston says the difference in the current and proposed parking revenue arrangement is that with the current “big slab of asphalt,” there is no garage with a fiscal note to it.
“I’m at least going to receive the revenues up to at least [when] those revenue bonds are satisfied, at least until I can get rid of my liability.”
Johnston acknowledged that there will be a continued liability in the form of maintenance and repairs of the garage, rather than an asphalt field which she compared as “not really a big deal.”
Another topic Johnston wants to see addressed is the additional parking accommodations included in the term sheet for a mutually agreed-upon number of spaces for players, premium/VIP, and additional parking that will be established in future, definitive agreements.
According to Johnston, the 1,000 parking spaces currently available to the Titans will take up too much acreage in the new stadium area, which means it will probably have to go in the Stadium Village that Metro is supposed to develop.
“So do we need to change the footprint of the ‘stadium’ to include a small parking garage for [the Titans]?” Johnston questioned. “Because if it’s in the Stadium Village and we’re responsible for developing that, then we’ve got a problem.”
Johnston called the parking revenues “a big one,” as well as infrastructure – the cost of which the administration says it does not yet know.
Johnston said they at least have a ballpark, and she would like them to give her a range in the cost. She offered, only as an example, a high-side assumption of $200 million, in order for her to know the all-in cost that needs to be budgeted for.
“I want to budget for that much, so that I know my all-in is going to be at the most X number of dollars, and how is that all going to be paid for, who’s paying for it; whatever revenue is generated from it, how is it split, where does it go, for how long? These are the things that need to be answered before I feel comfortable.”
Johnston appreciated the project being brought to the council early, but thought it was probably too early.
“I think they should not have attached a resolution and this ordinance that would turn on a hotel tax, when that’s not where we’re at quite yet,” Johnston added.
With the resolution already having been filed, Johnston says the hotel tax ordinance increasing the rate by one percent, would pass the council at their meeting on December 6.
“No, no, no, no, no,” Johnston said emphatically, “We’re not going to be anywhere near ready to turn on a tax that is specified for a new stadium, when we don’t even know if we’re building this new stadium. But we don’t have the terms hashed out, to understand that that’s 100 percent of what we’re doing.”
“Again, cart before the horse,” Johnston said.
The full report from VSG, which is expected to detail the $1.75 to $1.95 million reportedly needed to renovate the current stadium to the “first-class condition” required in the current lease agreement, is to be presented to the East Bank Committee at the meeting scheduled for November 7. VSG’s report may be available one week in advance, which Johnston said would be on November 1.
Johnston said she feels that they should have already had that report in its entirety, as part of her “cart before the horse” position.
“It would have been much better to say, hey, the current lease obligates us to do this. We’re going to look and see what this is going to cost and then come back with the cost with all this stuff and go, oh my God, we’re in a serious situation right now because there’s just no way fiscally possible that we can do it. There’s no way, without massively increasing taxes – which nobody wants. So, then that’s when the idea of introducing a new stadium should have been brought up. But, instead, it was just like, let’s just make something shiny and new.”
“I’ve said this several times. I think sometimes it’s not what someone is trying to do, but how they’re doing it that things get lost in translation and it just goes sideways real quick,” Johnston concluded.
“As it stands now,” Johnston said of the legislation that the council is being asked to pass with the term sheet attached, “I don’t agree with this term sheet.”
“I’ll have a list of amendments and I’m sure other council members will have a list of amendments as well. And, we’ll see how we better design this term sheet so that everyone is on the same page, so that we really know 100 percent what we’re putting ourselves into and what we’re putting our taxpayers into, because it’s a long-term obligation. We’re looking at probably a 30-year term on this bond. And, at the end of the day, even 50 years from now, the building is still ours. So, we still have to have something in place to fund capital repairs and maintenance and all that kind of stuff.”
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Laura Baigert is a senior reporter at The Star News Network, where she covers stories for The Tennessee Star.
Photo “Courtney Johnston” by Courtney Johnston. Background Photo “LP Field” by Kaldari. CC0 1.0.
