Thursday, March 6, 2003

Barons of the Bluff

Stacking the deck: A new plan would divert still more tax money to downtown.

Posted By on Thu, Mar 6, 2003 at 4:00 AM

If a lottery, as someone said, is a tax on stupidity, then a subsidy is a tax reward for cleverness and initiative.

If the Tennessee General Assembly can work out the details, by the end of this year Memphians, stupid or otherwise, will be able to advance the college educations of children of the middle class by buying lottery tickets at convenience stores all over town. As the director of the Georgia Lottery told Tennessee lawmakers recently, the goal is pretty simple: Get people to play early and play often!

While the lottery makes headlines, another plan to game the tax system is working its way through the Center City Commission (CCC) en route to the Memphis City Council and Shelby County Commission. Like the lottery, this one keeps public money out of general funds and dedicates it to a specific area or group -- in this case, the CCC and downtown.

In the works for several months, the plan is called a tax increment financing or "TIF" district, encompassing much of downtown from the Wolf River to Crump Boulevard. Some 25 years ago, the CCC started giving subsidies in the form of property tax freezes to -- to date -- approximately 200 downtown projects, from apartment buildings to The Peabody. The idea was that the subsidy would help downtown get back on its feet, at which time developers and property owners would start paying taxes like everyone else.

The older tax freezes are starting to expire. But if the plan goes through, the tax payments won't go into the city or county's general fund. They'll be captured by the TIF district and stay right at home to finance projects on the CCC's $588 million, 30-year wish list, including a land bridge to Mud Island.

What could be controversial about this plan as it makes its way into the public agenda is that downtown has no monopoly on need and blight. Every dollar that goes into the land bridge is a dollar that won't be used to fill a pothole or pay a policeman in Raleigh, Frayser, Whitehaven, or Midtown.

The difference is that downtowners hold all the high cards. The Uptown redevelopment around St. Jude Children's Research Hospital, the Riverfront Development Corporation (RDC), the Memphis Convention & Visitors Bureau (CVB), the Center City Commission, the expanded Memphis Cook Convention Center, and the FedEx Forum already get dedicated public revenue streams or tax subsidies or both. Developer Henry Turley as well as Jeff Sanford, Benny Lendermon, and Kevin Kane -- head honchos of the CCC, RDC, and CVB, respectively -- all live or work on the bluff. City councilman Rickey Peete, chairman of the CCC board, is head of the Beale Street Merchants Association. Fine fellows and independent thinkers one and all, but a stacked deck is a stacked deck.

Where does the shoe-store owner in the Mall of Memphis or Raleigh Springs Mall, which have lost their anchor tenants, go to get a tax subsidy and a TIF to fight blight?

Where in Midtown does Stewart Brothers Hardware, which is getting squeezed by Home Depot and trolley disruption, go for special treatment and dedicated taxes? Or Ken Barton's Car Care, whose insurance premiums are going through the roof because cars are being stolen right off his lot?

Where do the residents of Frayser and Whitehaven go to ensure that the Ed Rice Community Center and the Roark-Whitehaven Tennis Center are as well maintained as the riverfront and the South Bluffs for the next 30 years?

To which special agency, professionally staffed and with a board stacked with politicians and business leaders, do neighborhoods go to attract a fraction of the thousands of new expensive houses and market-rate apartments that have been built downtown in the last decade?

They go to City Hall. They don't have special agencies. They have elected representatives who are stretched thin and associations staffed by volunteers, and they compete for scarce tax dollars in the messy public process.

A big tax storm is coming. The insiders are loading up now so they can live comfortably while the cold winds blow. The outsiders get to buy fur coats, mittens, and hot chocolate for the insiders. Which are you? As they say in poker, if you look around the table and you don't know who the chump is ...

Their minds are made up. Don't confuse them with facts. David Pickler, the chairman of the Shelby County Board of Education, doesn't miss a chance to knock the Memphis City Schools, urban school systems, or school system consolidation. The Commercial Appeal turned him loose in an op-ed column last weekend. "Enrollment in the Nashville-Davidson County school system has declined from nearly 82,000 pupils at the time of consolidation to just 48,000 today -- during a period of unprecedented growth in Middle Tennessee," Pickler wrote.

No, it has not. The actual enrollment, according to the Metropolitan Nashville Public School System and the Tennessee Department of Education, is 68,277. Apparently plus-or-minus 30 percent is close enough for the county board and the CA, which did not correct the error. School system consolidation, by the way, occurred in 1964. If Nashvillians are still reeling from it, that's one heck of a hangover.

The ability of people with no first-hand experience with an urban school system to intuit the motives of thousands of people 200 miles away for 39 years is amazing.

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