Interesting take on the ruling for this mixed-use project, especially the PILOT. The ordinance was pretty clear, it would seem to me on what it wanted to prohibit and not prohibit.

"..this prohibition shall NOT (emphasis mine) apply to the City's existing authority to otherwise provide for tax or lease abatements."

The PILOT is how taxes are abated under Tennessee state law. That authority existed at thet time of the ordinance and exists today. I don't know how it can be much clearer that the voters approved an ordinance that allowed for a PILOT.

The ruling is strong and unequivical. The plaintiff had to prove two points - that this was a convention center hotel and that funding was used in violation of the ordinance. They did neither. This project, which is not a convention center hotel by any common industry use of the term, is privately financed with the exception of dollars generated from the project (PILOT) as specifically allowed in the ordinance and EZ bonds, which are resources of the federal government. There is no burden whatsoever placed on city taxpayers.

Interesting take in this headline:

Ruling allows hotel to be built in downtown Knoxville

I didn't think there was any law against building a downtown hotel. Just against the city subsidizing it.

Just like the earlier post today. We know who wears the money pants.

However this is about whether the proposed project violates the hotel ordinance. Clearly it does not.

Clearly it does not because Fansler says the ordinance is unclear.

But I so think the project is exactly the kind of thing the voters didn't want City $$ spent on.

However, I personally have no trouble with the in lieu of taxes part.

BTW, Bill, I assume the design of this structure has to comply with downtown design guidelines. I'm concerned about this because the initial published drawings looked like they came from somebody who hadn't even read them.

This is unbelievable.

I think the people of the city of knoxville should be presented a second chance (and a third or more if necessary) to clarify the ordinance to determine if they want to have any form or fashion of taxpayer whatever involved in any downtown projects.

It should be put on an election ballot before anything proceeds.

When they (the people) voted to not fund a "convention center hotel" they didn't realize there should have been a lot more meetings and lawyers to clarify the verbage to ensure the "money pants" people (realtors, developers, Cazana, etc.) did not return to maneuver every last semblance of intent to work around the will of the people.

One point of order. Bill Lyons is correct that the ordinance does not prohibit tax abatement:

"this prohibition shall not apply to the City's existing authority to otherwise provide for tax or lease abatements."

As always, though, I differ somewhat in the definition of "no city funding" when talking about TIFs and PILOTS, but no need to beat that dead horse.

The free federal "Empowerment Zone" funding is amusing though. (Wasn't that a Clinton program?)

HUD

The Federal Government has been actively engaged in assisting the designated communities in realizing their revitalization strategies. By providing tax incentives, grants, loans, and technical assistance, the Initiative has helped spur private investment in communities that have experienced severe economic decline. The program provides performance-oriented, flexible Federal grant funding so communities can design local solutions that empower residents to participate in the revitalization of their neighborhoods.

The urban EZs have used their Federal seed money to create partnerships that have leveraged more than $12 billion in public and private investment. Strategies resulting from these partnerships have generated jobs; provided business assistance and services; trained and educated youth and families; improved access to childcare, healthcare and transportation; and increased residents' safety and involvement in their neighborhoods.

P.S. Here are the specific complaints:

Plaintiff avers the development agreement improperly calls for the use of public funds or the City's credit or financial resources to support the development of the "new convention center hotel" in seven ways.

First, plaintiff says that the development agreement requires the City to designate a portion of the City's tax-exempt empowerment zone (EZ) bonds for allocation to the Industrial Development Board. Second, plaintiff says the agreement requires the IDB to use 2,85 million dollars in rental payments to purchase land for the project. Third, plaintiff says proceeds of the bonds issued by the IDB are public funds of a city agency. Fourth, plaintiff says that the Development Agreement contemplates a payment in lieu of taxes (PILOT) transaction, which is also prohibited by the ordinance. Fifth, plaintiff says the City is providing land for the development by quitclaiming to the State of Tennessee the City's interest in an abandoned alleyway in front of the property currently owned by the State of Tennessee. Sixth, plaintiff says the IDB will be required to pay to the developer the purchase price of the land plus costs of improvements but in any event not less than the amount of the leasehold mortgage developer may take on the property in the event the developer defaults. Last, the plaintiff says City employees have spent considerable time in negotiating and drafting the development agreement in support of a new convention center hotel in violation of the ordinance.

The ordinance had within its body, in plain language the following..."... this prohibition shall not apply to the City's existing authority to otherwise provide for tax or lease abatements."

Of course it did. Haney had to leave himself a loophole.

It all depends on what the meaning of taxpayer money is?

Perfect.

This is pretty funny. Apparently the English Language is not sufficient to convey the will of the voters.

You have to feel for the taxpayers and the voters. When will they ever learn? We decide these issues in court in this town and the taxpayers have to pay the legal bills. It is like getting screwed twice.

This should be a wake up call on Knox County Charter Amendments 3 and 4. Don't be fooled again. Vote AGAINST Charter Amendments 3 and 4. They are written even more poorly than the City referendum for the Downtown Hotel that Chancellor Fansler threw out.

It's your money. Just say no.

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