Music City Center avoids debt to NES through land swap - WFSB 3 Connecticut

Music City Center avoids debt to NES through land swap

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NASHVILLE, TN (WSMV) -

An unusual series of land deals helped Nashville's new convention center avoid a $2.7 million debt it owed to Nashville Electric Service. The deal allowed the Music City Center to walk away from a construction debt to NES, in exchange for a piece of property it didn't own.

The land swap flew under the radar and was never approved by members of Metro Council. When Channel 4 reporter Nancy Amons told councilwoman Emily Evans about the transaction, she was surprised.

"First and foremost, I believe it's unprecedented," Evans said.

She said council members had never been consulted.

The land transaction involved a 25-acre piece of property off Myatt Drive. Metro government and the Metro Transit Authority bought 67 acres in 2010. The land had been part of the Peterbilt plant.

Metro used a portion of the land for its new police precinct and crime lab, and MTA used part for its operations center. MTA had 25 acres left that it had earmarked for a future driver training course.

In October of 2013, MTA gave the land to NES in a quitclaim deed. NES didn't pay for the land. About the same time, Metro's finance office transferred $2,050,000 from the city's general fund into MTA's capitol budget account. MTA documents confirm that metro paid it the full appraised price of the land.

In essence, metro taxpayers spent $2 million to buy the land from MTA in order to give it to NES in exchange for forgiving the Music City Center debt.

"And the convention center authority gets $2.7 million to boot," Evans said.

Metro Council was never asked to sign off on the land transaction, nor the transfer of $2 million to MTA.

"This has skirted the attention of council and I think it's unfortunate," Evans said.

Metro finance director Rich Riebeling orchestrated the deal.

"I don't think it cost the taxpayers any additional money," Riebeling said.

He said the swap settled a long-running dispute between NES and the Music City Center about the amount of the debt.

"And to me it was just a good solution to solve a problem that could have gotten to a bad place," Riebeling said.

Whether taxpayers will feel it was a good solution is another matter. They ended up picking up the tab for an electric bill owed by the convention center authority despite the Dean administration's pledge that the project would be funded only with tourist tax dollars.

The convention center project had come in over budget because a court battle drove up the cost of the land. If the convention center authority had to pay the $2.7 million NES debt, the project would have been further over budget.

Copyright 2014 WSMV (Meredith Corporation). All rights reserved.

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