Thursday, January 14, 2010
Breaking News Council Committees Vote Thumbs Up on Music City Center, Fitch Ratings Votes Thumbs Down
Posted by Jim Ridley on Thu, Jan 14, 2010 at 10:38 PM
Fitch Ratings takes the following action on the Metropolitan Government of Nashville and Davidson County, Tennessee (Metro) as part of its continuous surveillance effort: --approximately $1.6 billion general obligation (GO) bonds, rated 'AA', placed on Rating Watch Negative; --approximately $71 million district energy system bonds rated 'AA-', placed on Rating Watch Negative."While Fitch believes that the convention center may enhance economic activity in Nashville's downtown," the report says in summary, "even the moderate amounts of general fund support that appear possible for debt service and operations would contribute to increased strain on the government's finances to a point where the rating is no longer consistent with the current rating category." UPDATE: The CP's Joey Garrison has details of the vote.
Comments (24)
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CM Megan Barry has it both ways:
Is there a risk? Of course....But in my analysis, I conclude that the risk is manageable — not trivial, not minimal, but manageable. I see that as a risk worth taking in order to achieve the economic development outcomes that are realistically in the cards.
That is the most uninspiring, equivocating load of technocratic jargon used outside Metro Finance to justify the trickle-down tourist box, yet.
I guess a thick description or a vision of how MCC fits into the "fabric of Nashville" is too much to ask of an at-large CM casting her vote for our largest capital project ever.
I'm still kicking myself for not asking for clarification of who the "you" was in her 2007 campaign slogan "I'll be your voice on the Metro Council."
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Sounds well thought out to me. She looked at the positives and negatives and made a decision. She even went as far as to attend a "pitch" b the CVB to a potential organization that was interested in using the new facility for their meeting. She saw first hand how the process works and what the temperature is for those who will decide to come or not to Music City. That to me is doing your job. And by the way that group has booked. In fact in all this talk about faulty projections, not once did the objectors even consider the amount of contracted bookings in their argument. There are over 270,000 room nights already generated. The goal by opening day in 2013 (3 years away) is 1 million and they are already a third of the way there. This debate is not about how the form of the building intersects with the fabric of Sobro, it is about economic stimulation and how this City can be proactive to moving itself forward. You may or may not like the choice, but you can't say that Councilwoman Berry did not do her homework.
Creating mixed-use, sustainable neighborhoods Downtown is about economic stimulation and how the City can be proactive in moving forward. Boxing Downtown into a tourist mecca with little diversification and few small local merchants and artisans is not.
Also, I don't think you want to open that Pandora's box of exposing our finances to undue risk in a recession.
That's right S-Town, Those surface parking lots are along with Greyhound and Christy's Cabaret are just the neighborhood I want to live in. No thanks, I'll take my chances(and I have since I do live downtown) on the MCC being a catalyst for more services which will expedite people actually wanting to live there. Many cities currently co-exist in their downtowns with both tourism and livability. Nashville will do the same. As far as your Pandoras box scenario, even the report issued yesterday said that IF projections were missed for 8 straight years then we would be at a limited risk to using non tax revenue funds. Two points, first one would hope that 8 years from now there has been some recovery from our current recession and second under this scenario the case is made that the non revenue General Fund money would be a total of $35 million or 5% of the total cost of the facility for the life of the loan. this scenario does not take into consideration any of the economic spending scenarios or other revenue generators that will also take place while this facility is in operation. The notion that the "whole $600 million" will be on the backs of the taxpayer is nothing more than a scare tactic with no validation.
Two rating agencies say Metro finances are fine and so is the MCC project. Ratings are strong. One rating agency gives a good rating but puts Nashville on a "watch."
The MCC opponents latch onto the "watch" as a sign that the Four Horsemen of the Apocalypse are riding down Deaderick Street to the Courthouse.
Not surprising . . .
producer2:
Straw man. I've not advocated keeping parking lots or Christy's Cabaret.
MCC concept is not a concept for creating sustainable neighborhoods because the Mayor failed to incorporate 24/7 community elements into it. We had a chance to do something bold and he blew it. It is a complete sweep for the tourist and restaurant industry and for those lucky few to whom jobs trickle down. It truly is conventional.
It is a sin that the Mayor exposed the general fund, which serves the larger community, to risk for special Chamber interests. If Nashvillians who don't stand to directly benefit from the tourist box are pulled in to back the obligation, we should have had a greater yield in terms of residential/commercial developments and public amenities that served us within the concept itself.
We'll see if parking lots decrease or increase after the build, because people-movers and mass transit weren't part of the concept. I hope you can gloat then. I wouldn't be surprised should you be cowed into silence or forced to make excuses.
Please also allow me to point out that it was strong Music City Center booster Jerry Maynard who sponsored a "beer cabaret" bill a while back that advanced the interests of strip clubs like Christy's and other awkward-to-acknowledge campaign contributors.
If Christy's is the obstacle to you living Downtown, CM Maynard is on the MCC side. Use your access to take it up with him.
Correct me if I'm wrong, but I believe Mayor Dean is working with the governments of Nashville's doughnut counties to put together a mass transit system. I think the name of the group is Nashville MPO.
Also, the "Chamber of Commerce interests" that the MCC opponents rail against are strong supporters of mass transit. In fact, mass tranist will never become a reality in Middle Tennessee without them.
I also want to point out that these "Chamber of Commerce interests" that the MCC opponents cry so loudly about are Nashville business people. They live in Nashville. They pay taxes in Nashville. They create jobs in Nashville. Contrary to the overblown hogwash of the MCC opponents, they have no interest in destroying our city. They are the very people that have worked so hard to build this city up over the last three decades.
The question that everyone should ask is "Where have the opponents been all this time? Why have they suddenly become so interested in the welfare of our city?"
Cheetos, why do have to continue to spread lies about MCC opponents at the very same time that your identity is lie on comment boards?
I've been interested in the welfare of this city for decades and I've been blogging to express that interest for 5 years now. We've been here all along. Stop trying to render us as invisible as your actual identity.
What happened to the vision of Nashville’s future, as seen by the people of this city, over more than a decade of countless community visioning seminars, meetings, and design forums? These blueprints are expressed in The Plan of Nashville, and the Nashville Civic Design Center. They created The Plan for Sobro, but it’s cast aside for Karl’s-Bad-Cavern.
According to the following articles, TDZ style funds (special tax districts), rental car taxes, and even hotel taxes, commonly support transit . So, if the percentage of sales tax above the county average is redirected back to the thing that spurred it’s surplus, it should be transit induced, not MCC induced, especially along West End, Downtown to 440, which is an obvious opportunity for a transit corridor.
“Last year a survey of 1,800 Nashvillians found that public transportation was their most prominent concern… Common revenue sources [for transit] usually consist of taxes on vehicle registration, HOTEL ROOMS or RENTAL CARS…” (http://nashvillecitypaper.com/print/483833)
“[Ft Worth] has also discussed funding part of the [streetcar] project with money from the SPECIAL TAX DISTRICTS that pay for amenities downtown and in the cultural and medical districts, Councilman Joel Burns said.” (http://www.star-telegram.com/traffic/story/1833442.html)
Adam, read my previous comment.
Mike, give it a rest. You view the world with a black-and-white, us-vs-them absolutist self-righteousness that would make a five year old proud.
Without some of these "Chamber of Commerce interests" that you hate, Nashville wouldn't have the symphony hall or the public library. I could go on, but why bother? You aren't listening.
Grow up a little and discard your messianic delusions and you might find a great many people that are working to make Nashville an even better city.
You also might find that a great many of those people that you hate agree with you more than you think.
For the record I've worked on the same causes that Chamber interests have. But the MCC concept as it stand reflects the ugly patronage system that at times runs from the Chamber to the Courthouse and back again.
And you know what? I didn't exempt Gaylord when they participated in it, either. Go back and read my blog. Now I'm on the same side that they are. Tomorrow I'll be their critic once again.
This is not demonization. It's fighting the good fight.
On the Fitch negative outlook, they have placed the entire municipal bond sector on negative outlook (as have Moody's and S&P), so that is not surprising. Staying stable with a positive outlook is the equivalent of an upgrade in today's atmosphere.
As to the Fitch negative outlook, all three rating agencies have placed the entire municipal bond sector on negative outlook, due to the deterioration in general fund revenues. It's not surprising they would say what they did.
Cheetos= Mark Brown
Brownie, how much is Cooley paying you anyway?
At least S-town is doing it for free.
Heck of a job Brownie!!
Ratings, the other two agencies gave Nashville solid marks. I notice you didn't mention that.
Sorry, fake Lt. Gov. Ramsey, I'm not Mark Brown. Cheetos Bastardo is a concept, really. An ideal to which we should all aspire. Cheetos Bastardo is all things beautiful and right in this world. ;-)
As if knowning who I am makes any difference. Of course, the MCC opponents would rather talk about anything other than the facts - the primary one of which is that the Metro Council is about to do the right thing and approve this project.
Just enjoy the authentic cheesy goodness that is Cheetos Bastardo and don't sweat it. The MCC will be successful. It will create jobs, and it will generate economic activity.
It's all good 'cause it's all Cheetos.
Mike, you're just wrong about the entire MCC project.
This project really started when Nashville built the current convention center and entered the convention market. When he opened the Nashville Convention Center, then Mayor Richard Fulton told Nashville to start planning for a new convention center because the current one was too small for Nashville's future needs. He knew how strong the convention business would be for our city.
Go back and look into the convention center task forces and study groups that Mayor Bill Purcell established. See how many hours that private citzens put into researching an expansion of the current convention center first, and, when the evidence indicated that wasn't feasible, researching the construction of a new facility.
My point is that this process has gone on for years and it has been driven by people that viewed this project as beneficial to the city they loved. They were not driven by unbridled greed or some monstrous (and illogical) desire to screw the taxpayers.
Let's also not forget that these "Chamber of Commerce interests" aren't necessarily multi-millionaire fatcats. We're talking about a large number of small businesspeople that will benefit from the business the MCC will bring in.
Now, I freely admit that I haven't always conducted this debate in the most civil way. I've thrown my share of punches. That being said, it's time we all stepped back and got a little perspective.
Quite a few Nashville businesspeople, politicians, and others have staked their reputations and their futures on the success of the Music City Center. They wouldn't do that if they did not sincerely think it will be successful, and they wouldn't do that merely as some scam.
I don't believe for a second that Megan Barry voted to approve this project in exchange for campaign contributions. Frankly, Mike, without some proof, you shouldn't throw around baseless accusations.
You and I may disagree on how to do it, but I feel certain in saying that we want to see Nashville become an even better city than it is now. That goes for most everyone on both sides of the MCC debate.
Cheese Wiz- Call me lactose intolerant, but whenever you throw down, the results are gassy and smell bad. Pee yoo!
If you'd ever gone to an MPO (Metro Planning Org) meeting, you would know that they can plan til the cows come home, but no dough, no show. Even MTA doesn't know how they'll pay for their Master Plan, not to mention the $2.8 million siphoned out for Karl's Bad Cavern.
Bottom line: We need dedicated local funds to be eligible for federal money. The MCC will not generate between $4 and $9 for every $1 spent on it, as transit is projected to generate, not to mention the broadest social benefits that Nashville could possibly achieve with public works.
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