Tuesday, February 28, 2006

CITY BEAT: On Recalls and Redesigns

Why do newspapers and elections cater to people who ignore them?

Posted By on Tue, Feb 28, 2006 at 4:00 AM

Wonderful. In Memphis we now have newspapers designed for people who don't read newspapers and special elections for people who don't vote.

This is progress in journalism: a daily newspaper, The Commercial Appeal, chopped up into so many sections that it is as annoying to read as an online newspaper with pop-up ads on a slow computer with a dial-up connection.

"Honey, you mind handing me the front page?"

"You mean the front front page, the second front page, the front of the Greater Memphis section, or the front of the Memphis and Region section?"

"Hell, just give me the remote."

Judging from the e-mails I get from CA employees and the letters to the editor in the CA, I'm not alone in my confusion. I'm pulling for the print edition of the daily to survive and even prosper. I'm sorry to see them lose another good reporter, Oliver Staley. But I think they should quit pandering to their non-customers and start leveling with their loyal customers and share some of the financial realities that are driving the design changes.

As consumers, we know what Northwest Airlines earned and spent last year, what its CEO earned, what its pilots and mechanics and flight attendants earn in salaries, what its fares are, even more than most of us probably want to know about its pensions and benefits and debt load. We know the same things about the financially troubled companies in the auto industry, General Motors and Ford. So when we read about layoffs and plant closings and union contract negotiations, we can put things in perspective.

"Old Reliable" (the hoary self-imposed nickname for the CA hauled out of the attic last weekend by way of softening the shock of the changes) and its parent company, E.W. Scripps, don't disclose financials and profit margins for individual newspapers, although the Scripps newspaper division earned over $200 million in profits last year. Where are the numbers in those times-are-tough columns from the editor and publisher? What are advertising revenues for classifieds and displays ads? How much have they fallen? What is the profit margin? What does it cost to keep a reporter or editor? What is the daily and Sunday circulation? This is a business story of local interest, and it should be covered like any other business story, with facts not fluff.

Newspapers have to deal somehow with the loss of young readers. A former colleague, Rheta Grimsley Johnson, told me she spoke recently to college students interested in writing careers. She could understand them not knowing about Ernie Pyle and Mike Royko. But they'd never heard of Maureen Dowd, either. So I'll go along with any design change for a while, but don't shortchange me on the story.

Meanwhile, this is progress in democracy in Memphis: A recall campaign is officially under way to boot Willie Herenton out of the mayor's office. Backers need slightly less than 65,000 valid signatures of Memphis voters. That's more than twice as many as the 31,183 people who voted against Herenton in the 2003 mayoral election and well over half the number of people who voted, period (103,226, or a 23 percent turnout).

I don't think they will get them without a more broadly organized effort. Some of the current backers are mainly and perhaps exclusively interested in making a noise. Herenton fatigue is one thing; Herenton removal another. The language of the city charter indicates that Herenton's chief administrative officer, Keith McGee, would replace him. If recall supporters believe the mayor guilty of gross malfeasance and fiscal mismanagement, it's hard to see how installing his CAO or the survivor of a deal brokered by the City Council make things any different. And Herenton himself could run again in 2007, if not sooner.

Then there is the still unresolved matter of Ophelia Ford's seat in the Tennessee Senate. Challenger Terry Roland, the Republican who lost by 13 votes in a special election last year, says he was robbed. A do-over election is possible. But nine out of 10 voters eligible to vote in last year's special election stayed home. If either the Ford side or Roland side had expended as much energy getting out the vote as they have fighting over the results, the issue would have been settled long ago. 

                   

Friday, February 24, 2006

Utility Bill Sudoku

Comparing bills in Memphis and Nashville; Redbirds lawsuit hits Circuit Court.

Posted By on Fri, Feb 24, 2006 at 4:00 AM

The Flyer doesn't have Sudoku, the popular Japanese puzzle. When we want to torture our brains and chew up pencils, we compare utility bills.

Calculators ready? Relax, if a liberal arts graduate can do it, so can you.

Nashville gets its natural gas from Nashville Gas via Piedmont Natural Gas, based in Charlotte, N.C. Memphis, of course, has Memphis Light, Gas and Water.

In January, Piedmont gave its Nashville gas customers a 36 percent price cut on top of a 15 percent cut approved by state regulators two weeks earlier.

"With the recent sharp decline in wholesale gas prices, it is only appropriate that customer bills reflect these significantly lower wholesale costs," said Piedmont CEO Thomas Skains in a January 17, 2006, press release.

The wholesale price of natural gas, according to recent reports in The Wall Street Journal, has fallen from $15.40 per million BTUs in December to $7.48 per million BTUs in February -- a 51 percent decline.

Piedmont measures gas usage in therms and dekatherms (10 therms). MLGW bills measure usage in "ccf," or hundreds of cubic feet. A "ccf" is not exactly equal to a therm, but it's close. The conversion factor used by the industry is 1.04 (100 ccf equals 104 therms).

A residential bill sent out by MLGW last week shows gas usage of 146 ccf at a cost of $201, including the purchased gas adjustment of .611700/ccf, which was down 9 percent from .6749000/ccf the previous month. It would be less confusing if MLGW left out the seven decimal places, rounded this off to 61 cents, and simply gave us the all-inclusive unit cost in dollars and cents, but we'll do it instead: $1.38/ccf.

Piedmont charges Nashville gas customers $1.08/therm.

The Memphian who uses 100 ccf pays $138. The Nashvillian who uses 104 therms pays $112. In this winter of our discontent, Nashville's gas rate is 19 percent lower.

Anyone who has driven a car in Canada or Europe knows how confounding it can be to convert the cost of a liter of gasoline to the more familiar cost per gallon. This is what consumers and reporters have to do in order to compare natural gas rates. If utility companies standardized their unit costs the way gas stations do and made their bills clearer, the price differential for natural gas would be as plain as the price at the pump. A 19 percent differential, for example, means gasoline selling for $2 a gallon versus $1.62 a gallon. How many gas stations could stay in business if they're 19 percent higher than the guy down the street?

One year and a day after the death of Memphis businessman Willard Sparks, his estate filed a lawsuit in Circuit Court against Dean and Kristi Jernigan and Blues City Baseball, Inc., which operates AutoZone Park for the Memphis Redbirds Foundation.

Sparks, who died of cancer on January 30, 2005, was business partners with Dean Jernigan in Storage USA and the Redbirds. His widow, Rita Sparks, is president of the nonprofit Memphis Redbirds Baseball Foundation. Executors of the Sparks estate are his sons Brian Sparks and Robert Sparks along with David M. Johnson.

The lawsuit says that in order to fund its operations, Blues City Baseball borrowed $2.1 million from Trust One Bank in 2003. The note was guaranteed by Willard Sparks and the Jernigans. On May 6, 2005, Trust One Bank filed a claim against the Sparks estate demanding payment of the loan in full. On January 19, 2006, an order in favor of Trust One Bank was entered in Probate Court for $1,807,372. The lawsuit seeks a prorated portion of that from the Jernigans.

The Jernigans were the driving force behind building AutoZone Park and bringing the AAA St. Louis Cardinals affiliate to Memphis. The Redbirds have been one of the top two teams in minor-league attendance since coming to AutoZone Park. The stadium was financed with $72 million in bonds, with the public investment limited to about $8.5 million.

According to its 2004 tax form, the Memphis Redbirds Foundation had $18,305,962 in revenue, $20,256,941 in expenses, and a deficit of $1,950,979.

Tuesday, February 21, 2006

CITY BEAT: Utility Bill Sudoku

Comparing bills in Memphis and Nashville; Redbirds lawsuit hits Circuit Court.

Posted By on Tue, Feb 21, 2006 at 4:00 AM

The Flyer doesn't have Sudoku, the popular Japanese puzzle. When we want to torture our brains and chew up pencils, we compare utility bills.

Calculators ready? Relax, if a liberal arts graduate can do it, so can you.

Nashville gets its natural gas from Nashville Gas via Piedmont Natural Gas, based in Charlotte, N.C. Memphis, of course, has Memphis Light, Gas and Water.

In January, Piedmont gave its Nashville gas customers a 36 percent price cut on top of a 15 percent cut approved by state regulators two weeks earlier.

"With the recent sharp decline in wholesale gas prices, it is only appropriate that customer bills reflect these significantly lower wholesale costs," said Piedmont CEO Thomas Skains in a January 17, 2006, press release.

The wholesale price of natural gas, according to recent reports in The Wall Street Journal, has fallen from $15.40 per million BTUs in December to $7.48 per million BTUs in February -- a 51 percent decline.

Piedmont measures gas usage in therms and dekatherms (10 therms). MLGW bills measure usage in "ccf," or hundreds of cubic feet. A "ccf" is not exactly equal to a therm, but it's close. The conversion factor used by the industry is 1.04 (100 ccf equals 104 therms).

A residential bill sent out by MLGW last week shows gas usage of 146 ccf at a cost of $201, including the purchased gas adjustment of .611700/ccf, which was down 9 percent from .6749000/ccf the previous month. It would be less confusing if MLGW left out the seven decimal places, rounded this off to 61 cents, and simply gave us the all-inclusive unit cost in dollars and cents, but we'll do it instead: $1.38/ccf.

Piedmont charges Nashville gas customers $1.08/therm.

The Memphian who uses 100 ccf pays $138. The Nashvillian who uses 104 therms pays $112. In this winter of our discontent, Nashville's gas rate is 19 percent lower.

Anyone who has driven a car in Canada or Europe knows how confounding it can be to convert the cost of a liter of gasoline to the more familiar cost per gallon. This is what consumers and reporters have to do in order to compare natural gas rates. If utility companies standardized their unit costs the way gas stations do and made their bills clearer, the price differential for natural gas would be as plain as the price at the pump. A 19 percent differential, for example, means gasoline selling for $2 a gallon versus $1.62 a gallon. How many gas stations could stay in business if they're 19 percent higher than the guy down the street?

   One year and a day after the death of Memphis businessman Willard Sparks, his estate filed a lawsuit in Circuit Court against Dean and Kristi Jernigan and Blues City Baseball, Inc., which operates AutoZone Park for the Memphis Redbirds Foundation.

Sparks, who died of cancer on January 30, 2005, was business partners with Dean Jernigan in Storage USA and the Redbirds. His widow, Rita Sparks, is president of the nonprofit Memphis Redbirds Baseball Foundation. Executors of the Sparks estate are his sons Brian Sparks and Robert Sparks along with David M. Johnson.

The lawsuit says that in order to fund its operations, Blues City Baseball borrowed $2.1 million from Trust One Bank in 2003. The note was guaranteed by Willard Sparks and the Jernigans. On May 6, 2005, Trust One Bank filed a claim against the Sparks estate demanding payment of the loan in full. On January 19, 2006, an order in favor of  Trust One Bank was entered in Probate Court for $1,807,372. The lawsuit seeks a prorated portion of that from the Jernigans.

The Jernigans were the driving force behind building AutoZone Park and bringing the AAA St. Louis Cardinals affiliate to Memphis. The Redbirds have been one of the top two teams in minor-league attendance since coming to AutoZone Park. The stadium was financed with $72 million in bonds, with the public investment limited to about $8.5 million.

According to its 2004 tax form, the Memphis Redbirds Foundation had $18,305,962 in revenue, $20,256,941 in expenses, and a deficit of $1,950,979. 

Want to respond? Send us an email here.
 

Friday, February 17, 2006

Big Pointy Bait Shop

Face it. The Pyramid is a white elephant, and Bass Pro would be a catch.

Posted By on Fri, Feb 17, 2006 at 4:00 AM

The proposed marriage of Bass Pro and The Pyramid makes sense, and Memphis officials and business leaders should try to make it happen.

The wisecracks about bait shops are foolish, not funny. Anyone who has been in a Bass Pro store or any other modern sporting-goods retailer knows they sell $89 Merrill shoes, $1,000 fly rods, and $12,000 bass boats in addition to hooks and plastic worms. And that's just a tiny fraction of the merchandise, restaurants, and stuff to do at a full-fledged Bass Pro or Cabela's.

If they want to put a hologram or some other design of a bass on one side of The Pyramid, so what? The Sterick Building and the 100 North Main Building, the next tallest structures downtown, are advertising-free, but they also are either empty or nondescript. Is that better?

The Memphis skyline could use a little pizzazz. There hasn't been a new building more than 150 feet tall since The Pyramid, and there isn't likely to be one in the near future.

Hunting and fishing -- like casinos, basketball, and music -- cross color and class lines. There's more diversity in a crowded Bass Pro store than you'll find at Carriage Crossing or Laurelwood. Retailing hits Memphis in its financial sweet spot -- our 9.25 percent sales tax. As a taxpayer, I would just as soon someone else, preferably from out of town, paid a share of the cost of running our city.

The Pyramid is a landmark, with low mileage and acres of parking and an on-off ramp to Interstate 40. If the remaining city and county debt had been rolled in with the cost of FedExForum as part of the price of the Grizzlies, there would not be much grumbling about it. Anyway, tearing it down would cost several million dollars, and the debt would still be there. The glass-enclosed top of The Pyramid, accessible only by an interior stairwell, is one of the coolest spaces in Memphis, but few people have ever seen it. Comparisons to Diane's, the old revolving restaurant atop the 100 North Main Building, don't do it justice. Let's see if Bass Pro can make it accessible and maybe figure out a way to get more mileage out of Mud Island and the convention center to boot.

The financing will be complicated and questionable, but how many visitors are thinking about financing when they go to a Grizzlies game or a ballgame at AutoZone Park? Memphis officials want to use something called New Market Tax Credits, a federal incentive for low-income neighborhoods that provides a bottom-line deduction of 39 percent of the cost of the project over seven years. It's a stretch to call The Pyramid and neighboring Mud Island a low-income neighborhood. Downtown hogs way more than its share of such incentives. I would prefer to see them spent in Midtown where I live. I would prefer to see The Pyramid given to a casino company, which would pay all of the redevelopment costs and then some for the privilege of keeping gamblers' money in Memphis. But those things are not going to happen.

The right people are involved in this deal. Face it. This is a salvage job, a white elephant. Egos are not much of a factor. Nobody is going to be associated with The Pyramid in its next incarnation in the way that the late John Tigrett was associated with its initial approval and construction. Reuse committee member Scott Ledbetter was involved with the unsuccessful effort to lure the Grammy museum to The Pyramid in 2000. That's a handy bit of experience. Tom Garrott, another committee member, is a retired banker who helped drive the stock of National Bank of Commerce to lofty heights. What's more, he's rich, he's a sportsman, and he's from Tunica. There's nothing in this for him, and I want him on our side when Tunica inevitably makes its own pitch for Bass Pro or Cabela's.

Tunica and DeSoto County take hundreds of millions of dollars out of Memphis year after year. Big deals like FedExForum and Bass Pro, for all their costs, keep some of the dollars and entertainment in Memphis. If you're concerned about Bass Pro's foot-dragging in Buffalo, where a similar salvage job is under way, you haven't been to Buffalo. Memphis has its shortcomings but it also has its advantages, and it should exploit them to close a deal with Bass Pro. If it gets us a few Jeff Foxworthy jokes about bait shops, so be it.

Tuesday, February 14, 2006

CITY BEAT: Big Pointy Bait Shop

Face it. The Pyramid is a white elephant, and Bass Pro would be a catch.

Posted By on Tue, Feb 14, 2006 at 4:00 AM

New Page 3

The wisecracks about bait shops are foolish, not funny. Anyone who has been in a Bass Pro store or any other modern sporting-goods retailer knows they sell $89 Merrill shoes, $1,000 fly rods, and $12,000 bass boats in addition to hooks and plastic worms. And that’s just a tiny fraction of the merchandise, restaurants, and stuff to do at a full-fledged Bass Pro or Cabela’s.

 

If they want to put a hologram or some other design of a bass on one side of The Pyramid, so what? The Sterick Building and the 100 North Main Building, the next tallest structures downtown, are advertising-free, but they also are either empty or nondescript. Is that better?

 

The Memphis skyline could use a little pizzazz. There hasn’t been a new building more than 150 feet tall since The Pyramid, and there isn’t likely to be one in the near future.

 

Hunting and fishing — like casinos, basketball, and music — cross color and class lines. There’s more diversity in a crowded Bass Pro store than you’ll find at Carriage Crossing or Laurelwood. Retailing hits Memphis in its financial sweet spot — our 9.25 percent sales tax. As a taxpayer, I would just as soon someone else, preferably from out of town, paid a share of the cost of running our city.

 

The Pyramid is a landmark, with low mileage and acres of parking and an on-off ramp to Interstate 40. If the remaining city and county debt had been rolled in with the cost of FedExForum as part of the price of the Grizzlies, there would not be much grumbling about it. Anyway, tearing it down would cost several million dollars, and the debt would still be there. The glass-enclosed top of The Pyramid, accessible only by an interior stairwell, is one of the coolest spaces in Memphis, but few people have ever seen it. Comparisons to Diane’s, the old revolving restaurant atop the 100 North Main Building, don’t do it justice. Let’s see if Bass Pro can make it accessible and maybe figure out a way to get more mileage out of Mud Island and the convention center to boot.

 

The financing will be complicated and questionable, but how many visitors are thinking about financing when they go to a Grizzlies game or a ballgame at AutoZone Park? Memphis officials want to use something called New Market Tax Credits, a federal incentive for low-income neighborhoods that provides a bottom-line deduction of 39 percent of the cost of the project over seven years. It’s a stretch to call The Pyramid and neighboring Mud Island a low-income neighborhood. Downtown hogs way more than its share of such incentives. I would prefer to see them spent in Midtown where I live. I would prefer to see The Pyramid given to a casino company, which would pay all of the redevelopment costs and then some for the privilege of keeping gamblers’ money in Memphis. But those things are not going to happen.

 

The right people are involved in this deal. Face it. This is a salvage job, a white elephant. Egos are not much of a factor. Nobody is going to be associated with The Pyramid in its next incarnation in the way that the late John Tigrett was associated with its initial approval and construction. Reuse committee member Scott Ledbetter was involved with the unsuccessful effort to lure the Grammy museum to The Pyramid in 2000. That’s a handy bit of experience. Tom Garrott, another committee member, is a retired banker who helped drive the stock of National Bank of Commerce to lofty heights. What’s more, he’s rich, he’s a sportsman, and he’s from Tunica. There’s nothing in this for him, and I want him on our side when Tunica inevitably makes its own pitch for Bass Pro or Cabela’s.

 

Tunica and DeSoto County take hundreds of millions of dollars out of Memphis year after year. Big deals like FedExForum and Bass Pro, for all their costs, keep some of the dollars and entertainment in Memphis. If you’re concerned about Bass Pro’s foot-dragging in Buffalo, where a similar salvage job is under way, you haven’t been to Buffalo. Memphis has its shortcomings but it also has its advantages, and it should exploit them to close a deal with Bass Pro. If it gets us a few Jeff Foxworthy jokes about bait shops, so be it.

                                               

Want to respond? Send us an email here.
 

Friday, February 10, 2006

Election Deja Vu

What if Dick Hackett had made like Terry Roland after losing in 1991?

Posted By on Fri, Feb 10, 2006 at 4:00 AM

What's the difference between Terry Roland and Dick Hackett?

Both are Republicans and both lost incredibly close elections. But Roland challenged his defeat and Hackett didn't.

Hackett's act of statesmanship and political calculation in 1991 probably influenced the course of history more than anything he did during his nine years as mayor. And it's relevant to the current overblown controversy over Roland's 13-vote loss to Ophelia Ford in a state Senate race of less heft and consequence.

The lesson is this: What the news media report, what the courts rule, what the lawyers spin, and what the state Senate does are only part of the story. The X-factor is what individuals like Roland and Hackett do in the crucible of personal experience.

A quick lesson in history and deja vu: In 1991, Hackett lost to Willie Herenton by 142 votes out of 247,973 cast. Crank candidate Robert "Prince Mongo" Hodges got 2,923 votes. In 2005, Roland lost to Ford by 13 votes, 4,333 to 4,320. The same Robert Hodges got 89 votes. As a percentage, Ford's victory margin was greater than Herenton's.

The 1991 mayoral election was flawed. There were 609 "overvotes," a term coined to explain the difference between votes cast and signatures in the poll book. An accounting firm that audited the election results said "the differences are unreconciled, and the causes are undetermined." The majority of the overvotes were in Herenton precincts.

Hackett had the audit. He had the political savvy. He had two capable lieutenants, Bill Boyd and Paul Gurley, with vast experience in Memphis politics. He had more than $300,000 to mount a legal challenge or another campaign. And after three days of thinking about it, he decided to let it go. He did not hire lawyers or private investigators or order campaign workers or city employees to go out and search for dead voters, voters with felony convictions, voters who lived outside of Memphis, or voters who failed to sign either the ballot application or the poll book.

In 247,973 votes -- with the mayor's office at stake -- what would you say the odds were of finding some dead people, some felons, some nonresidents, and various other skulduggery? Given that Roland and his team found dozens of irregularities in an election in which fewer than 9,000 votes were cast, I would say they were pretty good.

Not only did Hackett let it go, so did almost everyone else. The Memphis Flyer, then less than two years old and full of bluster, did a cover story detailing the "irregularities," as Hackett called them, and bawled for reform and investigation. The Commercial Appeal, which has made such a fuss over Terry Roland, was mostly silent. Attorney Richard Fields, who represents Roland, was notable back in 1991 as one of two high-profile white citizens who openly backed Willie Herenton.

U.S. district judge Bernice Donald's ruling in the Roland-Ford case (in which Ford and her supporters are the plaintiffs) made no mention of the mayoral election. She cites another tainted cliff-hanger, the presidential election between George W. Bush and Albert Gore, in which there were some 110,000 overvotes. A large section of her order speaks to the issue of voters who fail to sign in twice, but it is silent on dead voters and felons.

"Although measures to detect substantial mistakes or illegality may be heightened," she wrote, "the standard used to invalidate votes should not be."

There is a difference between voting mistakes, and illegality and fraud. I am not learned in the law, but Donald's order seems to say that voters can't be disenfranchised because there were some mistakes but leaves hanging the issue of whether fraud, if proven, can void an election. All it says is that elections must be conducted by the same standards in every part of the state.

Donald's order doesn't resolve the Ford-Roland controversy. Senate action won't resolve it, because Ford's lawyer has already vowed to come right back to court if she is ousted. The manufactured outrage on both sides won't resolve it. Elections, at both the local and national level, are imperfect. And Dick Hackett knew what he was doing back in 1991.

Wednesday, February 8, 2006

CITY BEAT: Election Deja Vu

What if Dick Hackett had made like Terry Roland after losing in 1991?

Posted By on Wed, Feb 8, 2006 at 4:00 AM

New Page 1

What’s the difference between Terry Roland and Dick Hackett?

Both are Republicans and both lost incredibly close elections. But Roland challenged his defeat and Hackett didn’t.

Hackett’s act of statesmanship and political calculation in 1991 probably influenced the course of history more than anything he did during his nine years as mayor. And it’s relevant to the current overblown controversy over Roland’s 13-vote loss to Ophelia Ford in a state Senate race of less heft and consequence.

The lesson is this: What the news media report, what the courts rule, what the lawyers spin, and what the state Senate does are only part of the story. The X-factor is what individuals like Roland and Hackett do in the crucible of personal experience.

A quick lesson in history and deja vu: In 1991, Hackett lost to Willie Herenton by 142 votes out of 247,973 cast. Crank candidate Robert “Prince Mongo” Hodges got 2,923 votes. In 2005, Roland lost to Ford by 13 votes, 4,333 to 4,320. The same Robert Hodges got 89 votes. As a percentage, Ford’s victory margin was greater than Herenton’s.

The 1991 mayoral election was flawed. There were 609 “overvotes,” a term coined to explain the difference between votes cast and signatures in the poll book. An accounting firm that audited the election results said “the differences are unreconciled, and the causes are undetermined.” The majority of the overvotes were in Herenton precincts.

Hackett had the audit. He had the political savvy. He had two capable lieutenants, Bill Boyd and Paul Gurley, with vast experience in Memphis politics. He had more than $300,000 to mount a legal challenge or another campaign. And after three days of thinking about it, he decided to let it go. He did not hire lawyers or private investigators or order campaign workers or city employees to go out and search for dead voters, voters with felony convictions, voters who lived outside of Memphis, or voters who failed to sign either the ballot application or the poll book.

In 247,973 votes — with the mayor’s office at stake — what would you say the odds were of finding some dead people, some felons, some nonresidents, and various other skulduggery? Given that Roland and his team found dozens of irregularities in an election in which fewer than 9,000 votes were cast, I would say they were pretty good.

Not only did Hackett let it go, so did almost everyone else. The Memphis Flyer, then less than two years old and full of bluster, did a cover story detailing the “irregularities,” as Hackett called them, and bawled for reform and investigation. The Commercial Appeal, which has made such a fuss over Terry Roland, was mostly silent. Attorney Richard Fields, who represents Roland, was notable back in 1991 as one of two high-profile white citizens who openly backed Willie Herenton.

U.S. district judge Bernice Donald’s ruling in the Roland-Ford case (in which Ford and her supporters are the plaintiffs) made no mention of the mayoral election. She cites another tainted cliff-hanger, the presidential election between George W. Bush and Albert Gore, in which there were some 110,000 overvotes. A large section of her order speaks to the issue of voters who fail to sign in twice, but it is silent on dead voters and felons.

“Although measures to detect substantial mistakes or illegality may be heightened,” she wrote, “the standard used to invalidate votes should not be.”

There is a difference between voting mistakes, and illegality and fraud. I am not learned in the law, but Donald’s order seems to say that voters can’t be disenfranchised because there were some mistakes but leaves hanging the issue of whether fraud, if proven, can void an election. All it says is that elections must be conducted by the same standards in every part of the state.

Donald’s order doesn’t resolve the Ford-Roland controversy. Senate action won’t resolve it, because Ford’s lawyer has already vowed to come right back to court if she is ousted. The manufactured outrage on both sides won’t resolve it. Elections, at both the local and national level, are imperfect. And Dick Hackett knew what he was doing back in 1991.

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Friday, February 3, 2006

Deferred Gratification

As endowments soar, Memphis and Mississippi State are among the growth leaders.

Posted By on Fri, Feb 3, 2006 at 4:00 AM

If you're going to college, plan to go to college, or paying for someone else to go to college, a recent report on endowments might surprise you.

College endowments are loaded, and they're growing as much as 25 percent each year. The increase is due to a combination of exceptionally large gifts and investment gains. The University of Memphis has been one of the big winners, with a $175 million endowment and a gain of nearly 16 percent last year.

Other colleges and universities in Tennessee and the Mid-South saw gains ranging from 5.2 percent at Rhodes College to 23 percent at Mississippi State University. A bigger endowment means more financial aid for students, said David Easley, chief financial officer of the Mississippi State University Foundation, where about half of the endowment income goes toward scholarships.

The National Association of College and University Business Officers publishes a report each year on endowments of 746 colleges and universities in the United States and Canada. Their Web site, nacubo.org, has the full report.

Harvard, with $25.5 billion, has the largest endowment. The only university in Tennessee with an endowment of more than $1 billion is Vanderbilt, with $2.6 billion.

The big gain at Mississippi State was due to fulfillment of a $25 million pledge from a private donor. The university earned a return of 8.4 percent on its investments, which is slightly below the 9.3 percent average return for all colleges in the 2005 survey. At the University of Memphis, three gifts of more than $1 million boosted the endowment, said Julie Johnson, vice president of Advancement.

For students, parents, and donors, endowment surveys point out things that may not be heralded in the institution's alumni publications or fund-raising appeals.

Endowment gifts, as opposed to, say, gifts to the athletic department, don't get spent right away. Donors are helping future generations of college students live off the interest. College financial officials say that, on average, they spend only 4 to 5 percent of the endowment each year. If inflation takes 3 percent and management fees another 1 percent, a 9 percent return keeps the endowment at roughly the same level.

It's never a good thing to lag one's peer group, and endowments are no exception. The difference between a 5 percent gain and a 10 percent gain on $200 million is $10 million. That translates to thousands of dollars per student at a time when tuition exceeds $5,000 a year at public colleges and $25,000 at some private colleges.

The rich get richer. Yale, with an endowment of $15.2 billion, also consistently has one of the best investment returns of around 16 percent. Stanford, with a $12 billion endowment, grew 19 percent last year thanks to investments in the stock of Google and emerging companies in Silicon Valley. On the other hand, size can be a disadvantage. Givers may wonder how much is enough? What difference does a $100 gift make to a university with an endowment of more than $1 billion as opposed to a similar gift to the local food bank or high school?

Endowment growth, coupled with the Tennessee Lottery, is good news for college students. Lottery proceeds, constantly replenished by gamblers, are projected to be $240 million this year, and most of it gets spent. By statute, the lottery reserve fund is only $50 million. Some 70,000 students will get a $3,300 scholarship if they attend a four-year in-state college.

Here's a summary of the national rank, size, and growth of endowments of colleges and universities in the Mid-South:

Vanderbilt University, 23rd: $2.6 billion, 14.5 percent.

University of Tennessee system, 81st: $714 million, 7.3 percent.

University of Arkansas system, 83rd: $691 million, 10.4 percent.

University of Mississippi, 135th: $397 million, 8.3 percent.

University of the South, 187th: $253 million, 5.4 percent.

Rhodes College, 202nd: $223 million, 5.2 percent.

Mississippi State University, 207th: $211 million, 23 percent.

University of Memphis, 236th: $175 million, 15.8 percent.

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