Yesterday, Tower Investments filed a motion to dismiss the Nashville-chartered Metropolitan Housing and Development Agency’s Petition for Condemnation of the company’s 5.6-acre downtown property. MHDA is attempting to clear land for the proposed Music City Convention Center, the construction of which is currently projected to cost nearly $600 million.
What makes this case particularly interesting is that Tower doesn’t oppose the development plan per se; rather, it wants to build a hotel “in such a way that enhances and accommodates the convention center.” The problem is that the development authority’s master plan includes the construction of a similar hotel, but on the city’s terms and with public support. Given that a government-commissioned study of the development plan admits that the convention center will almost certainly lose money in the long-term, and that Nashville Metro is already more than $2 billion in debt, one might expect that an offer to lessen the public finance burden while achieving virtually the same ends would be a welcome act.
Unfortunately, local officials don’t see it this way. Earlier this year, the Metro Council refused to adopt a proposed financial accountability amendment to the ordinance authorizing the Music City Center development project. The amendment would have required the council to set a maximum public financing limit and mandate council approval of the financing mechanism. And just a few weeks ago, a Metro commission rejected a proposal to allow referendums on major public capital investments, which likely would have led to a vote on the convention center project.
Fundamentally, this case comes down to the almost-universal inability of municipal bureaucrats to understand that economic development can, does, and will occur without them waving their magic wands.