Capitol View Commentary: Friday, August 27, 2010

Capitol View Commentary: Friday, August 27, 2010

CREATED Aug 27, 2010


By Pat Nolan, Senior Vice-President, DVL Public Relations & Advertising

August 27, 2010


Throughout this long process over the past several years of building a new downtown convention center for Nashville, Mayor Karl Dean has been consistent whenever the naysayers came forward and predicted failure. He would say: "Nashville's not those other cities. We're a special place. We have a unique appeal as a convention destination."

OK. I admit it. As a native of Nashville, that kind of remark always appealed to my civic vanity and love for this city. Did I always believe it?

Maybe not

But I think I do now. Mayor Dean and his Finance Director Rich Riebeling have pulled off what appears to be a fiscal and political homerun, announcing a predevelopment agreement for a $250 million, 800-room Omni Hotel (including two ballrooms, several restaurants, retail space, a pool, spa, fitness center and 560 parking spaces) to be built as the headquarters hotel for the new Music City Center. It will also support and allow for the expansion of one of the city's signature tourist attractions, The Country Music Hall Of Fame, which adjoins the new convention center and hotel.

Why is all this particularly remarkable? Don't convention centers always have adjoining headquarters hotels? Yes, that's true. But in today's financial markets, all "those other cities" building convention centers found they had to literally own at least a portion of the hotel to get it financed and built. That often puts the government potentially in competition with the private sector, and frankly several of those hotels have not done well.

But that's how it appeared it had to be done, if Nashville wanted a convention hotel. And as the new Music City Center is rising out of the ground quickly south of Broadway, it was becoming more and more obvious that without a headquarters hotel being built, selling conventions to come to town would become tougher and tougher.

There were other issues as well. Where would Metro find the revenue stream…the money to finance and at least partially own a hotel? Given the cost to build the new center (including a back-up pledge on the city's General Fund to use non-property and sales tax revenues if hotel room taxes weren't enough), it appeared the city had no wiggle room for that.

But then came the owners of the Omni Hotel group, who seem so positive about Nashville and its future, they are ready to finance and construct the hotel themselves "without incurring debt" reported THE TENNESSEAN (August 25). I think that means in cash! Wow!

Now don't misunderstand. This is still a business deal, a public-private partnership that city leaders and voters will need to look at carefully over the next couple of months before it is approved by the Metro Council. After all, Metro will be obligated to an incentive package that will give Omni an economic enhancement grant totaling $103 million dollars in tourism taxes over the next two decades (generated by the taxes which come from the hotel's operations).

Metro is also giving Omni another $25 million in tax-increment financing (TIF) to help pay for the land involved, as well as allowing Omni to make an lieu of tax payment that amounts to a two-thirds break on the property taxes that would come from the development (Omni would just pay an amount equal to the portion of local property taxes going to support public schools).

There could also be questions about Omni's owner Robert Rowling and whether he has a conflict of interest because of his on-going relationship with the Gaylord Entertainment Company, whose Nashville hotel and convention center would be a major competitor for business. Rowling has now resigned from the Gaylord Board, but apparently is maintaining his large stock holdings in the company.

Finally, there may be questions about the Country Music Hall Of Fame expansion. It's clear the city will be asked to give several million dollars to that cause in the near future. Where will those funds come from?

But in exchange for all that Metro may have to do, there are some reported benefits. The project will generate a 1,000 temporary construction jobs and 300 permanent jobs when the hotel opens, with 200 of those guaranteed to go to Davidson County residents. There is also a commitment by Omni that there will be diversity business participation of at least 20% in the project with at least 20% of the project's construction costs also guaranteed to be spent with local businesses.

Now, as I said, there are still a lot of I's to be dotted and T's to crossed to vet this deal before it's approved. The city is once again using its General Fund as a backup source to pay for the incentive package if tourism taxes don't generate enough. Are we potentially committing the same tourism taxes twice for both the Music City Center and now the hotel?

Others will question the size of the incentive package, the TIF support and the property tax break. All this does add up to large dollars, much like the convention center project itself which is the largest in the city's history. But all the incentives Metro is giving are ones used before with the Titans, the Predators and other developments downtown. And Metro has a history in the past of supporting the Hall of Fame, including giving it the land to move to its present location downtown.

Going this way to develop the hotel also allows the city to avoid going a new direction (if it could afford it) of financing and owning the convention hotel, and/or using property or sales taxes directly to pay for this project. Both of those options are likely political non-starters.

So this may be Metro's best (and only) way to get a convention hotel built. And it something that most folks thought couldn't possibly happen even just a few weeks ago

So given all that, I would wager heavily that Council approval of this deal (expected before Thanksgiving) is likely to be slam dunk, so construction can begin quickly in 2011 and the hotel opened in 2013 not long after the Music City Center is complete. Just like Mayor Dean said it would.


I told you a few weeks ago that the controversy over the hiring of new Chancellor for the State Board of Regents was only going to build. Last week on INSIDE POLITICS (August 20-22), we devoted the entire program to the issue.

Now, the matter has moved to yet another level as Governor Phil Bredesen told reporters he found questions directed to him about the matter "offensive." Specifically the Governor was asked "if was far-fetched" to say the best-qualified candidate for chancellor "just happened to be" his Deputy Governor John Morgan?

That immediately put the Governor on the defensive, saying: "If you look back over my time, I've got a really good record of not messing around behind the scenes to make political things happen for friends or something like that."

I would agree with that statement. The Bredesen administration has been pretty clean when it comes to scandals, particularly compared to some previous state regimes. For example, I broke in on Capitol Hill during the administration of Governor Ray Blanton (1975-1979). If you remember or know that period of Tennessee history, the order of the day was always scandals and political patronage.

In particular, the Governor himself has managed to personally stayed out of sticky situations. So I can understand his back getting up a bit when questioned. But I think he should remember that that's what reporters do. They ask questions. He should know that doesn't necessarily mean that's what the reporter thinks or that he or she has an agenda (although sometimes, some do).

What I think the Governor should do is take a step back and look at how this Chancellor selection process has come down: with qualifications changed to no longer required a doctoral degree; to make a key qualification to be hired detailed knowledge of the state's new higher education law (which John Morgan helped write): and finally, the extremely large pay raise the Board of Regents offered John Morgan to take the job (more than double what he made as Deputy Governor, although he has now declined it).

Based on that process, reporters asking questions seems legitimate to me. And if the Governor finds that "offensive", he better get his asbestos underwear ready because when Republican state lawmakers convene their hearings into the matter, sometime in September, they'll likely to be asking even more pointed questions in the media or even making specific charges about how this matter was handled by the Board of Regents itself.

Is that politics? Sure it is. There is an election in a couple of months in case you've forgotten. Anytime the opposing party detects a weakness, a mistake or an opportunity, they are going to try to take advantage. Nobody should be surprised by that, even if they decide to take offense.


It took nearly three weeks, involving 5 counts and recounts of the ballots, but there is now a Democratic nominee in the 21st District State Senate race.

He is long time incumbent Senator Doug Henry who edged attorney Jeff Yarbro by just 17 votes. While both candidates and their supporters should be commended for their sterling conduct during the difficult period when the final outcome remained in the doubt, this was far from a shining moment for the Davidson County Election Commission.

While it is clear that Henry won. He was ahead in 4 of the 5 vote tallies (with the first one where Yarbro was up 18, clearly being released too quickly before everything was counted). But consistency and counting all the votes accurately continued to be problem, as the ongoing recounts never came up with the same vote totals twice, and one recount even discovered an entire voting machine that had been previously overlooked.

I can't remember a primary election statewide that had the number of problems that occurred August 5, from Memphis to Nashville to Murfreesboro to other counties across Tennessee. Even the state's election computer crashed because it just wasn't ready to handle the vote and the on-line interest that would generate. Is all this because it's the first time in modern history that Republican-controlled election commissions ran the process? That's hard to say, although it did happen on their watch and it's their job to get matters cleaned up for November.

As for the general election campaign in the 21st Senate district, Doug Henry will be a heavy favorite to win an unprecedented 11th four-year term in the upper chamber. Despite all the brave talk from the state GOP, Henry's efforts will be bolstered in the November election because many of his long time Republican supporters will be able to support him again, something they couldn't do in August because they wanted to vote in the record-breaking GOP gubernatorial primary.

That means it is likely to be a very uphill battle for the Republican nominee, Dr. Steve Dickerson, who is running his first race for office. Just how uphill? The only elected GOP official in that Senate district, State Representative Beth Harwell, has made it clear she remains strongly in support of her long-time friend, Senator Henry.


After sometimes talking like a Republican in recent months, retiring Nashville state representative Ben West, Jr. has now endorsed the Democratic nominee to take his place. That's Metro Councilman Sam Coleman. The other four primary candidates who Coleman defeated have also endorsed him.

This kind of unexpected support (particularly from West) could give Coleman's campaign a boost. If it will be enough to defeat a fellow Metro Councilman, Jim Gotto who is the Republican nominee, remains to be seen.

This district, which features parts of the Antioch area, along with Hermitage and Old Hickory has seemed primed for the GOP to make an historic pick up. If Gotto wins, he would be the first GOP state representative from Davidson County outside the Belle Meade/Forest Hill/Oak Hill area in modern history.


While the Democrats are trying to unite in that Nashville state legislative race, unity seems hard to find for the Republicans in the 6th Congressional District.

State Senator Diane Black won the primary by a narrow margin that remained in doubt for a few days. Now the other GOP primary candidates tried to gather together recently to show a sign of unity behind their party's choice. But it didn't really work as one candidate (the one who finished second and less than 300 votes behind) did not show up to give her support….and may never do so.

The hard feelings between Black and party activist Lou Ann Zelenik are not healing. Zelenik has never really conceded the race, and is reportedly talking to some supporters about running again in two years for Congress or perhaps taking on another former opponent, State Senator Jim Tracy for his seat in two year (or even challenging State Representative Joe Carr, who defeated her in another bitter race in 2008).

Black and Zelenik are still set to fight it out in court over a lawsuit concerning some of TV ads that ran during the race (that's why Zelenik says she is not on the unity tour because her lawyers told her to stay away). Meanwhile there continue to be reports that Zelenik is considering a write-in campaign for this fall. So far, no one has found a way to defuse this matter. And while the Republicans I talk to in that area don't believe this feud will hamper Black's effort to take over the congressional seat for the GOP this fall, there is a lot of growing anger and resentment which can't be a good thing for the party going forward.

There is late breaking news as I write this column from THE TENNESSEAN's web site: Nashville Judge Hamilton "Kip" Gayden has ordered the parties to the Black-Zelenik lawsuit (including the drug testing company owned by Diane Black's husband) lawsuit to seek mandatory mediation on the matter to try and work things out. If that can't happened by September 27, then the full case will be heard in court.

Judge Gayden says: "The courts are very reluctant to interject themselves into political disputes. I would like to give you all a window to solve this before it explodes in court." From a list of three, former judge and attorney Robert Echols has been selected to be the mediator. Good luck.


So former Columbia/HCA health care executive Rick Scott is now the Republican nominee for governor of Florida? I know lots of folks in Nashville are sure surprised about that.

They remember the Rick Scott who purchased HCA and moved it from Nashville to Louisville some years back angering many folks in town. Then even after then-Mayor Bredesen lured the company back to Nashville, there was that Medicare fraud scandal that had the company paying a record $1.7 billion fine to the federal government and ultimately bringing control of the company back into the hands of the Frist family after Scott left.

The Medicare scandal was certainly raised by Scott's opponents (and will surely be raised again by Democrats in the fall). But so far, at least in the primary race, the issue has not mortally wounded him as Scott has spent tens of millions of dollars of his own funds to defend himself and to convince voters to support him.

The Scott victory seems to be yet another sign how strong and deep voter anger is this year, especially in the Republican Party where several long time incumbents or party insiders have lost or just narrowly won primary races for the House, the Senate and Governors seats. Clearly there is more going on than just the Tea Party movement. Will this weaken the GOP for the fall, or will voter anger rise up to help them defeat the majority Democrats in Washington as well as help the GOP take over a large share of governorships?

It's still too early to say for certain, but much like the 6th District congressional race here in Tennessee, party unity in Florida is still in doubt in the governor's race. Scott's opponent, Florida Attorney General is so far refusing to endorse him and continues to level criticisms of Scott saying he has "serious questions about his character, his integrity, his honesty."

If this winds up being a temporary spat because of a bad political hangover, those words could be hard to take back, so will this be an opportunity for the Democrats to capture a key leadership post in a large swing state for the 2012 elections?

I know there will be folks here in Nashville paying close attention.


On INSIDE POLITICS this fall, we are going to spend some time looking at the competitive congressional races in our area. It seems to me there are more active contests than I can remember in recent years.

We will begin this weekend (August 27-29) with the 7th District race between incumbent GOP Congressman Marsha Blackburn and Democratic challenger, Austin Peay State University political science professor, Dr. Greg Rabidoux.

This may be as close as Rabidoux gets to being on the same platform with Blackburn (although not at the same time). She has declined doing any debates, saying she wouldn't want to discuss the issues with anyone who plans to vote for Nancy Pelosi to continue as Speaker of the House (translated: I think I am comfortably ahead and don't need to elevate my opponent's profile and chances by debating him).

Rabidoux has tried to take advantage of Blackburn's remarks saying she must think he has a chance to win since she is worried about how he would vote in the Speaker's race. By the way, the professor claims he is not committed to voting for Pelosi or anyone to be Speaker (although I challenged him about that during the show).

Rabidoux is a well spoken but under-funded candidate, seeking office in a Republican leaning district which runs through Middle and West Tennessee from the Nashville suburbs to the suburban parts of Memphis. And he is running in a year when Republicans seem energized, while Democrats are not so much so.

But Rabidoux believes he has a chance to pull the upset because he thinks voter anger in the country is aimed at all incumbents, not just candidates on the Democratic side.

Rabidoux also used the opportunity on INSIDE POLITICS to introduce his new economic plan called SMART (Strategic Management of Accessible Resources and Technologies which he says "aims to make the 7th District a highly connected, integrated powerhouse" focusing on the economy, education and the environment along with suggested key cuts for ways to "reduce our deficit and debt."

In a campaign news release after the INSIDE POLITICS taping, the Democratic candidate was also critical of Congressman Blackburn for a recent economic plan she reportedly released on Fox News, consisting of firing the President's economic team; keeping the Bush tax cuts; repealing the new national healthcare act and making a 5% across the board budget for all federal agencies and programs.

Rabidoux claims his opponent "is choosing a few a la carte items from a menu of bad choices." He adds Blackburn might have come up with her economic plan after he released his. I don't know about that, but I can tell you in my interview with Congressman Blackburn (which was taped after Rabidoux's), she mentioned almost every one of her proposals during the conversation.

You can watch INSIDE POLITICS several times each weekend on NEWSCHANNEL5 PLUS. We are on Comcast and Charter cable channels 250 as well as Channel 5's over-the-air digital channel 5.2. Our broadcast times are Friday (August 27) at 7:00 p.m., Saturday (August 28) at 5:00 a.m. and 5:30 p.m. as well as Sunday (August 29) at 5:00 a.m. and 12:30 p.m.

Remember is you don't have cable or an over-the-air digital TV, you can watch excerpts of this and previous INSIDE POLITICS shows by going to www.newschannel5.com and entering INSIDE POLITICS in the site search engine.