YOU HAVE TO ASK YOURSELF WHAT ARE THEY SMOKING DOWN AT CITY HALL?

THE PYRAMID/BASS PRO DEAL , FAIRGROUNDS, ELVIS PRESLEY, HIGHLAND AVE AND NOW $600 MILLION FOR A NEW CONVENTION CENTER!!!

HAS ANYONE PAID ANY ATTENTION TO THE OVER $3 BILLION UNFUNDED OPEB LIABILITY FOR RETIREE HEALTH CARE PROMISES MADE BY THESE POLITICIANS? OUR DEBT AS A PERCENTAGE OF THE LEGAL DEBT LIMIT HAS RISEN FROM 50% IN 1998 TO 75% IN 2007.

We are now seeing a rush of deals being put forward by City Hall and local developers. What they are saying in their sales pitch is that "This building or this area is dead and we can bring it back at no risk to the taxpayers". Is that true?

I want to concentrate on the Pyramid deal as this is the current one that is being promoted by the City and the County.

After reading the Development Agreement, the following is a list of my thoughts on this agreement which need to be addressed before we decide whether to go ahead.

• We need an accounting of all the current tourist development zone (TDZ) bonds and what portion of the increased income tax stream takes precedence over the Bass Pro deal. I talked to the State of Tennessee Department of Revenue concerning TDZ financing and they said that they start with a base of taxes in the TDZ zones and that only the increases over the base goes to pay the TDZ bonds. The state portion base is increased annually by the average sales tax increase for the whole county (not just the TDZ) and therefore only the tax portion over the average increase goes to pay off the bonds. They pointed to several TDZ deals in Tennessee that had zero increase in the TDZ tax rebate due to their average increase in sales tax receipts not being greater than the county average increase.
  
• The next thing that needs to be done is to survey other similar tourist development zone (TDZ) deals around the country that have been in effect for at least five years to compare terms of agreement and to see how the initial promises made in fact turned out such as sales, new tourists, sales taxes, etc. I have attached an article about a similar deal in Texas that was done by a competitor of Bass Pro. Also I have attached a list of Bass Pro and Cabela stores.
  
• Herenton and Lipscomb claim in the document that "Under the terms of the Development Agreement, local government would have no financial risk or local government funding in the Pyramid redevelopment project". However they fail to state that the bonds that would be issued in a TDZ project are full faith and credit bonds and that if the additional tax income is not there, then the taxpayers of Memphis and Shelby County are on the line as they are for all the other downtown projects financed by TDZ bonds.
  
• Bass Pro gets a large tax credit which means that they will pay less federal income taxes. And yet they are competing with Walmart and other smaller hunting and clothing goods stores in the area that pay property taxes and income taxes. Is that fair? We need to hear from these people.
  
• The agreement calls for the City and County to complete a title search and review of the surrounding site as well as those parcels of land which may be beneficial to the success of the project. This raises the question of emminent domain similar to the Kelso case and the prospect of the City and County taking property away from owners by emminent domain.
  
• Finally, as in the past, if we decide to go ahead with the deal, we must be assured that we hold our investment at no more than the $30 million plus the remaining debt. I can envision a scenario where we start on front end infrastructure work and invest a lot of money and then they pull out and say the market is not right, goodbye. We need an arrangement that we are protected by a clause that makes Bass Pro guarantee payment for these expenditures if they pull out during the construction period. Our history here in Memphis is to walk into a deal and once we get involved, we have to go forward when unexpected things happen. Look at the past Convention Center debacle.
  

Click here to read about similar deals in Texas involving Bass Pro and a competitor, Cabela

Click here to see where Bass Pro and Cabela have stores in the United States