Wed
Dec 17 2014
04:16 pm

The City of Knoxville says they only got one bid for the Cumberland Ave. street redesign project, and it was more than double their original estimate. The project will be rebid, which will likely delay the start for a few months. More details in the press release after the break...

CUMBERLAND AVENUE CONSTRUCTION TO BE REBID; CITY REMAINS ‘100 PERCENT COMMITTED’ TO CORRIDOR PROJECT

City of Knoxville officials will be rebidding the contract for construction of the comprehensive Cumberland Avenue street redesign project, which will push the start of construction back from early 2015 to summer 2015.

Only one company had submitted a bid to perform the work, and that bid came in higher than budgeted. City consultants had estimated the construction work at about $11 million, and the sole bid was for more than $25 million. So the project will go out for rebid early next year after several elements of the bid package have been reworked.

City officials remain committed to doing the major traffic-flow redesign and utility upgrade along Cumberland Avenue, even though it appears that the project will wind up being costlier than first anticipated. Additional funding sources will be identified during the rebid process as well.

“The Cumberland Avenue Corridor project is a very complicated urban road project, and we knew it would present a number of challenges,” said Bob Whetsel, the City’s Director of Redevelopment.

“But we are 100 percent committed to this project, which has already helped spur more than $200 million in investment by private redevelopers. We’ve pledged to partner with residents and merchants in the Corridor by doing our part and modernizing the infrastructure, and we intend to follow through with what’s really a once-in-a-century major overhaul.”

The Cumberland Avenue project still will be done in two phases.

Phase I of the Cumberland Avenue project will ease traffic clogs on the western end of the corridor, the stretch of Cumberland Avenue between 22nd Street and Alcoa Highway.

Phase I improvements – especially the smoother-flowing intersections at Volunteer Boulevard and at Alcoa Highway – will give motorists more options for avoiding the Phase II construction work, said Project Manager Anne Wallace with the City’s Office of Redevelopment.

Phase II calls for a redesign of Cumberland Avenue from 22nd Street to 16th Street. Both phases of work include new underground utilities, new signals, new sidewalks, the addition of turn lanes and new medians, plus landscaping, benches and pedestrian-scaled lighting.

Work will include putting in new underground stormwater, water, sewer and gas lines to replace antiquated lines and to support new commercial and residential developments in the area. The project also will add and widen sidewalks, resurface the road and purchase new, higher-performing traffic signals.

“We realize there will be inconveniences, and business owners will want the upgrades to be done as quickly as possible,” Whetsel said. “We want the same thing. But the fact is, much of the utility infrastructure in this area predates World War II. Just last month, a stormwater pipe beneath Cumberland collapsed. It is time for these critical improvements to be made.

“At the same time, we recognize the need to increase utility capacity to support the hundreds of new apartment units and retail outlets that are infusing new energy into the Cumberland Avenue Corridor.

“We’ll be creative and responsive in working with the University of Tennessee, merchants and stakeholders once work gets under way.”

Topics:
michael kaplan's picture

maybe the city itself should

maybe the city itself should do it. hire subcontractors. hire workers. pay them union wages. get the thing done.

Average Guy's picture

Henley Bridge I get

But I'm with you in this one.

With all our resources; altering a road, adding some landscape and a sidewalk is too much?

If so, divest the resources and sub everything. I'm sure JLL would gladly step up.

Tess's picture

?

I am not a planner nor do I want to be one...but everybody says the same thing about this project.

How can you cut off a major road to downtown without an alternative route being assigned for direct travelers within the plan?

Rachel's picture

There's a very good

There's a very good alternative route, the one I take now unless I have business on the strip on campus. It's called Neyland Drive and it's way underused. And tons quicker from Bearden to downtown than Cumberland is.

R. Neal's picture

Same here on Neyland. Last

Same here on Neyland. Last time I was on Cumberland, briefly, was to go to Publix.

We come home via Cumberland after a downtown concert sometimes when it's late and no traffic. Plus, late nite Krystal.

Pam Strickland's picture

There are multiple ways to

There are multiple ways to get from west to downtown without taking Cumberland. Cumberland is the lazy way.

zoomfactor's picture

Maybe We'll Make it After All

Hell, they shut down the freeway through downtown and that was the most pleasant 1.5 years ever. (Like we never even needed it, but oh, well.) My point is, the importance assigned to travel routes by commuters and road builders always seems to be vastly overstated.

michael kaplan's picture

Jane Jacobs, the great

Jane Jacobs, the great Canadian-American planner, argued that when you close roads traffic tends to simply disappear (i.e. find alternate routes). I think the closure of I-40 proved that locally.

Tess's picture

Whatever

Rachel, you just said, "unless I have business on the strip" and that is of course what I was talking about...

Rachel's picture

But then you're not through

But then you're not through traffic. So I don't see the problem.

Bad Paper Original 's picture

only way to screw this up more...

Add in come 30 year TIF's. Obviously no lessons were learned from closing the Henley Street Bridge. Tin Roof packed it in. Wonder if Copper Cellar will stay? I don't think people will take the two alternative routes. They will just stay away. UT cannot support those businesses on the strip alone. It takes more than that. And football games will be more of a nightmare during construction. Esthetically better in the future, but not economically better for the businesses that are there now.

When country controlled Metro is pitched soon, this and the James White Parkway will be two big reasons. And the 30 year TIF's. And the debt. And the retirement debacle. The city has big ideas. And breakeven's are very long.

reform4's picture

Tin Roof

How are they related? Tin Roof also owned a facility in Rocky Hill that closed at the same time?

(I would argue the food was pretty sub-standard and couldn't draw repeat diners).

Bad Paper Original 's picture

restaurants are an endangered species in Knoxville

Between the City and KUB, you will be seeing a lot of restaurants go out of business. But the City always has a big TIF for a Walmart or the South Knox Water front. This is poor government at work. The City doesn't care enough about existing businesses. But it sure cares about new ones. And the Chamber? AWOL. Too busy trying to run the schools and bring back Midway.

hey Madeline, where is the TIF for the restaurants?

(link...)

jbr's picture

From BizNik ...About 9,000

From BizNik ...

About 9,000 new restaurants fail each year.

According to the National Restaurant Association, the real number is closer to 30% for the first year. Another 30% fail within the next two years.

Before You Open Your Restaurant

National Restaurant Association

Bad Paper Original 's picture

true

It's a tough business. But endless road construction and $20,000 KUB grease traps make it much tougher. My point is that existing businesses don't get TIF's but new businesses do. And it will be a miracle if that UT Walmart is in business 20 years from now when the TIF expires.

michael kaplan's picture

it would seem that the parcel

it would seem that the parcel of land would be more valuable to UT than it is to the city in potential tax income ..

Somebody's picture

Incrementalism

If I understand vaguely how TIFs are supposed to work, an existing business couldn't get one because there'd be no increment in the taxes upon which financing could be generated. For a TIF to function, you have to start with un- or underdeveloped property. The increment comes from the change in tax value before and after improvements are made.

j.f.m.'s picture

Right. And businesses don't

Right. And businesses don't get TIFs anyway -- properties do. TIFs are based on property tax assessments, so the beneficiaries are the property developers and owners.

Joe328's picture

Tenant benefits from TIF

While the tenant doesn't receive the TIF, they usually pay lower rent. WalMart usually move after the TIF expires and move to another location with a new TIF. Is there any evidence that the tax base has increased from a TIF? It seems every time Oak Ridge approves a TIF they have to raise property taxes and old established business closes. Before long residents will be the only ones paying property taxes.

michael kaplan's picture

For the duration of the TIF,

For the duration of the TIF, city/county services to the project are paid for by taxpayers. The amount is stated in every Redevelopment Plan that contains a TIF project. The assumption is that, by the end of the 15- or 20-year period, the project will succeed and be paying full (higher) taxes, thereby recompensing taxpayers.

As far as I know, nowhere in the local calculation are the tax monies lost from businesses that fold, or - more important - the social cost of these folded businesses.

Joe328's picture

Taxes lost

When a TIF expires and the business moves from the city to the county for a new TIF, city sales taxes are lost. The landlord seldom receives the high rent with a run down building and sells it. The new owner can request an appraisal based on the sales price. In Blount County WalMart moved from Alcoa to Maryville and was planning another move to back to Alcoa when the two cities realized how TIFs really worked.

bizgrrl's picture

Walmart did not move from

Walmart did not move from Alcoa to Maryville. The Walmart in Alcoa stayed open after a new Walmart opened in Maryville.

Joe328's picture

Maryville Alcoa WalMarts

When the developer announced his plans for a WalMart on 411 in Maryville, Alcoa was upset over the loss of sales tax revenue. In the news Alcoa said %25 of their sales taxes were paid by WalMart. Maryville and Alcoa reached an agreement that kept both WalMarts open.

There is no material evidence that TIF's have increased property tax revenues for local governments. In my opinion, any parcel that receives a TIF should require that every employee of the tenant pay a living wage and provide health insurance for ALL employees.

fischbobber's picture

On living wages

+1

j.f.m.'s picture

Tax base

Is there any evidence that the tax base has increased from a TIF?

Here's a slightly outdated chart of City of Knoxville TIF projects during the last 10 years. (It still shows University Commons and the Arnstein Buildin as in progress rather than completed.)

(link...)

Altogether, it shows a $50 million increase in the tax base. And even during the various TIF periods -- when properties do pay a portion of the new assessment -- the city and county combined are receiving an extra $490,000 a year in new tax revenue.

Keep in mind also that the assessed tax value of, say, the Arnstein Building does not drop if a tenant like Urban Outfitters leaves. The assessment is based on the market value of the building or property, not its occupancy. University Commons is valued much higher now than it was when it was an undeveloped brownfield, and that would remain true even if one of its tenants left.

Joe328's picture

You provided a selected

You provided a selected sample of TIF projects mostly in the downtown district where historic buildings attracts customers. TIFs have been approved in urban areas where big box stores were located in low cost structors. Twenty years later the building are empty, the roof is leaking, ceiling tiles are falling, and the parking lot need repaving. The market value of the building is greatly reduced and it is sold at the reduced price.

Customers shopping at University Commons are paying the same amount of sales taxes as they were before the commons were built. The only difference is a the retail store that collects the taxes, so revenues to the City are unchanged. As customers leave established retailers to shop at the University Commons, established businesses close, land lords will be forced to reduce rent or even raze the empty building.

Chapman Highway is a good example of failed TIFs. Chapman Ford and Chapman Plaza were build with approved TIFs. Both are mostly empty, market value decreased and property taxes adjusted lower. McDonalds at Chapman Ford received a TIF and the building was razed shortly after the TIF expired. Walgreen moved a half a block with a landlord receiving a new TIF. Several buildings along Chapman Hwy are being razed to reduce property taxes while developers are applying for TIFs to build new locations.

Section of Kingston Pike, Clinton Hwy, Broadway and a few more major areas are razing buildings to reduce property taxes while TIFs are building new location they will also be razed shortly after the TIF expires.

I like the use of TIFs in historic districts such as downtown, but TIFs in urban and rural areas are destroying the mom and pop stores.

Once again, there is no evidence that TIFs have increased TOTAL tax revenues to the City.

j.f.m.'s picture

You provided a selected

You provided a selected sample of TIF projects mostly in the downtown district where historic buildings attracts customers.

It's not a selected sample, those are the redevelopment projects approved for TIFs since the City started using them 10 years ago. The only one I can think of that's been added since that list was compiled is the redevelopment of the Baptist Hospital site -- which, like University Commons, is on a vacant urban brownfield.

I can't speak to how other governments here or elsewhere use TIFs, but the City explicitly uses them to make it possible to redevelop the urban core. (The sole exception was participation with the county in a TIF for the stalled Northshore Town Center project.)

And they are already providing increased tax revenues, even during the TIF period. None of the projects the City has participated in that I'm aware of includes tenants who displaced from other properties within the city. And again, even if a tenant leaves a redeveloped property, that does not in itself affect the assessment. Now that University Commons is redeveloped, it will remain assessed at a much higher value than in its vacant brownfield state.

Bad Paper Original 's picture

.

"Is there any evidence that the tax base has increased from a TIF?"

Not all TIF's are bad. But not all TIF's pay off. The shorter the life of the TIF the better. When you have 20 and 30 year TIF's. That is poor government. That is picking/making winners and losers. It creates huge inequities. And it funds projects with dubious break evens. No taxes are increased when a person shops at a closer Walmart. The same purchase is made. So it is stupid to penalize the existing Walmart to favor the new Walmart.

If a project has to have a 20 or 30 year TIF, that project is too risky to go forward. The City has a spending and monument building addiction. The pitch for county dominated Metro is being made now behind closed doors and that is a big part of the message. Take away and cut up the teenagers (the City) credit cards because they aren't responsible enough to have them. You can put a smiley face on the city's revenues but the city's debt is not a smiley face. One thing you can say about Burchett, he understands debt.

(link...)

Bad Paper Original 's picture

true

You are right. A TIF would not apply. But rewarding new business just for being new and ignoring existing businesses for not being new is the recipe for churn. Other than Stefano's, the Copper Cellar, and maybe the Long Branch, what is on the strip that was there thirty years ago. Oh, and McDonald's.

Should it be "what have you done for me lately" on giving out prizes from government? It is very inequitable.

michael kaplan's picture

it's worse than that. some of

it's worse than that. some of the 'existing businesses' are going to be put out of business by the big boxes. read this and weep ..

and be sure to watch the TED video

Pilot Lite's picture

Boondoggle Budget Buster

This is rich.

A bids coming in at over twice the estimated cost--by $14 million. The Mayor is a planner and this lack of judgement should speak volumes. It is shocking. Shame on them all.

Sell one project, deliver another.

Just imagine the horrific cost overruns if this trophy project ever gets built. As planners (in partnership with developers!) they had to know an $11 million estimate was way off. Or, perhaps, they did not know.

In either case they have disqualified themselves to manage or plan such an undertaking. Dishonesty or incompetence. Take your pick.

Think carefully about this, KUB is in the midst of replacing gas, water, storm drains, and sewer lines all over the city. This alone should have given them an accurate cost idea and estimator for a major component of this project.

A plethora of trophy projects are currently being floated by the office of the Mayor: a host of downtown projects including proposed narrowing of Henley (so much for the renovated and widened bridge), sidewalk projects, major developments in the Warehouse District, and a new major mixed use facility on the Supreme Court property.

Add grandiose plans for a new civic performance space, sports arena, skating facility, and removal of the Civic Auditorium, and one quickly sees financial disaster on the way to Knoxville.

Stick's picture

Sad

Someone is talking to himself again...

Rachel's picture

+1000

+1000

Bad Paper Original 's picture

.

Esthetically better in the future, but not economically better for the businesses that are there now.

Glad to hear from someone who moved away. Good work.

KC's picture

Only in K-Town would making a

Only in K-Town would making a heavily traveled road smaller be seen as an "improvement."

Neyland? That won't really help all the hospital workers and patients. There is no alternative route for them.

Factchecker's picture

Clinch?

Clinch? When I have to go to/through there, that's often the street I use.

bizgrrl's picture

An acquaintence got hit by UT

An acquaintence got hit by UT students on Clinch two times in the past ten years. I avoid Clinch like the plague.

bizgrrl's picture

Coming from the West, it

Coming from the West, it appears Cumberland will still be four lanes to Twenty-Second Street, where most people go to get to the hospital. I would think most people coming from East or North might go Western Avenue/Dale Avenue/17 Street. The South Side/Chapman Highway side will have to make the main adjustment, but hey they're used to those crazies across the river messing everything up.

Joe328's picture

Federal Hwy Administration Road Diet

The Federal Highway Administration is who recommends reducing some 4 lanes to two lands with a continuous turn lane. Accidents are greatly reduced, bicycle traffic increases and vehicle traffic flow is the same.
California discovered this by accident years ago when they reduced a 4 lane through a rural town to two lanes with a continuous turn lane to slow traffic in town. The amount of traffic remained the same, travel time improved, and were accidents reduced. Bigger is not always better.

reform4's picture

Tazewell Pike

Come watch Tazewell Pike just east of Broadway during afternoon rush hour. The incredible miss use of that center turn lane is deadly. Two people in our office at accident regarding that center turn lane just in the last three months. People here are too fucking ignorant to properly use a continuous center turn lane properly. They just zoom down at 40 miles an hour like it's just another lane built just for them.

Rachel's picture

Cumberland won't have a

Cumberland won't have a continuous center turn lane. It was originally going to, but the Rogero administration changed that to a turn lane only at intersections; median elsewhere. Must safer, and more aesthetically pleasing as well.

And Jesse, didn't the Camden people get a TIF for the project next to Island Home Park? Of course that is also in the south waterfront, and so is an infrastructure TIF. The $$$ will go for road improvements and a section of Riverwalk.

Bill Lyons's picture

River's Edge Project near Island Home Park

I will step in here. I hope Jesse has a chance to spend this nice afternoon with his family. The River's Edge project near Island Home Park did not apply for and was not eligible for tax increment financing for the project itself as is the case for TIFs downtown for historic buildings. The project is in the South Waterfront TIF District. Therefore the new tax increment it generates is dedicated to infrastructure in the waterfront district at large. Of course this includes, but is not limited to the public infrastructure - river walk, etc. - associated with the project.

Rachel's picture

Thanks, Bill. I knew the tax

Thanks, Bill. I knew the tax increment was paying for the infrastructure; I guess I was just confused about the developer having to apply in this particular case.

Treehouse's picture

Traffic lights

If they would just coordinate the traffic lights up and down Cumberland to all be green if you drive 25-35 MPH, it would alleviate all sorts of trouble for those trying to get through that area. I hate going, stopping, going, stopping (for no reason), etc. I think if the thru-traffic could go, it would be much easier on those who need to turn, walk, etc.

redmondkr's picture

Never Go to the ER on a Game Day

Did I ever tell you about coming down Cumberland from Gay an hour before kickoff time while having a heart attack a few years ago? I raised up from my seat a couple of times to see a world of pot-bellied orange sweat shirts on pedestrians who refused to let us make the turn from Cumberland to 17th until my friend held the horn and inched forward through them.

I think I know how Tricky Dick felt in South America.

Rachel's picture

And please remember that some

And please remember that some of this work will IMPROVE traffic flow on Cumberland. Like, for example, no backups when somebody wants to turn left because there will be turn lanes at intersections. That's safer, too.

jmcnair's picture

Getting the beer and other

Getting the beer and other delivery trucks into real alleys instead of blocking a lane of Cumberland (pet peeve) will also be a win.

Bill Lyons's picture

Cumberland merchants and University Commons

It is important not to leave unexamined the assumption that the businesses in the area of University Commons are in some way victimized by the project. For decades Cumberland merchants have faced difficult challenges leading to a lot of unfortunate failure and turnover and vacancy. The main challenge the owners articulate to City staff in our regular meetings is their dependency on the UT calendar for their customer base.

The Cumberland Avenue project has at its heart the transformation of Cumberland to a year round retail/dining destination. All, or virtually all of the Cumberland businesses looked favorably upon the University Commons project because it serves as an anchor that brings people to the area over a twelve month period.

The big retailers at University Commons do not compete with the merchants on Cumberland with the possible exception of Walgreens, and Walgreens sees itself as greatly benefiting from the large increase in student housing within close proximity to the Cumberland store. These customers will walk to the store just as people in the area are now walking, biking, and taking the trolley to University Commons. The Cumberland project was key to the increase of student housing and key to the investment in University Commons.

These continued conversations are helpful because they help us get beyond the usual abstract ideologically driven narratives and help us focus on the reality of what can we do to invest in brownfields in underserved areas in the core of our city. These investments pay off in every way, culturally, socially, and economically. I could see all three at work when I rode the trolley to University Commons with a number of people who lived in near East Knoxville and who were literally thrilled to have access to a great grocery store and a large retailer that they could get to without an automobile.

Bad Paper Original 's picture

?

"These continued conversations are helpful because they help us get beyond the usual abstract ideologically driven narratives and help us focus on the reality of what can we do to invest in brownfields in underserved areas in the core of our city."

You could have put in park, a soccer field, and a rugby field and saved taxpayers a bunch of money.

If it was so great for everyone, why a 20 year TIF? We have a bunch of Walmarts in this county that aren't open in the same location for ten years. And again, University Commons didn't create new purchases, it only moved them from other existing stores further away. And not much further away at that. The City spent a fortune with a PILOT building a Food Lion near the News Sentinel building that is a very short trip from the new Publix at University Commons. And it wasn't for 20 years. It was for 11.

You penalized existing businesses to favor a new business that didn't need to be. Sorority Row could have been at that site. Winners all around. A business park could have been where Sorority Row was built.

You all are getting to far ahead. 20 years is too long. And 30 years is ridiculous. You're acting like the Federal government. Being concerned about ridiculous debt is not, as you claim, "ideological". It's math.

Joe328's picture

Property Tax Abatement

Property tax abatements have been around for years, the programs makes slight changes and gets a new acronym every few years, but it's still a property tax abatement program. With every new retail development funded by tax abatements, an established business closes and stops paying sales taxes. If the property owner is unable to find a new tenant, the building is razed to reduce property taxes.

Before property tax abatements, developers struggled making payments on new building, but once the mortgage was paid, the profits improved. Today older building struggle to compete with new developments that don't pay property taxes, so the answer is raze the building to reduce taxes that parcel.

When calculating the increase in tax revenues from TIF programs. Don't forget to deduct the lost taxes when established businesses close and the building is leveled.

j.f.m.'s picture

"older buildings"

Today older building struggle to compete with new developments that don't pay property taxes, so the answer is raze the building to reduce taxes that parcel.

As the list of projects shows, the vast majority of TIFs in Knoxville have been for older buildings. TIFs have not led to older buildings being razed, they've led to them being renovated, restored and repopulated. With the result of a real net gain in the urban center of residents, businesses and sales and property taxes.

That's not to say the problems you're describing haven't happened somewhere. Like any tool, these incentives can be used well or poorly, carefully or recklessly. But if you look at that list of Knoxville projects, you see an awful lot of urban revitalization in the last decade.

jbr's picture

Streets as Places: Transportation to Create a Sense of Community

This kind of looks like what is planned for Cumberland Ave.

From "Project for Public Spaces" ...

Streets as Places: How Transportation can Create a Sense of Community

Rightsizing Streets

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