Monday, September 21, 2009

Nashville Mayor Dean won't relax push for major goals despite recession

Recession fails to stymie vision By Michael Cass • THE TENNESSEAN • September 21, 2009 As Nashville Mayor Karl Dean moves into the second half of his term, he hopes to take a page from his last two predecessors when it comes to economic development. Where Phil Bredesen aimed to move Music City into the big leagues with pro sports facilities and teams and other downtown growth, and Bill Purcell focused more on enriching the "quality of life" embodied by schools, parks and neighborhoods, Dean is trying to do both. The mayor, who turned 54 on Sunday and will discuss his economic development goals with the Rotary Club of Nashville today, has long said public education and public safety lead to economic growth. He's also pushing the biggest, most expensive building project in the city's history, an approximately $600 million convention center, while harboring ambitions to help spur creation of a regional mass transit system. Yet most of Dean's first two years in office have coincided with the worst economic recession in 70 years, making it tough to do much beyond keeping the city budget intact. "To say this is a difficult time is an understatement," said David Penn, an economist at Middle Tennessee State University. Dean and Ralph Schulz, president and CEO of the Nashville Area Chamber of Commerce, say the city has had its share of successes anyway. In the past year, 102 companies have announced major expansions or relocations here, generating 7,286 jobs and $1.9 billion in investment, according to chamber data. Dollar General and Standard Candy, for example, added 150 jobs each, while Asurion added more than 500. Two food processing companies, Five Star and Supreme Oil, brought more than 400 jobs combined when they moved here from Texas and New Jersey, respectively, said Paul Ney, outgoing director of the Mayor's Office of Economic and Community Development. But those gains have only offset some of the city's recent losses. Tom Frye, managing director of the Nashville office of CB Richard Ellis, a real estate brokerage, said Nashville has lost 30,000 to 35,000 jobs in the past year. Still, the officials tasked with recruiting businesses to Nashville have been seeing more action lately. "We've had more economic development activity in terms of leads we're following in the past month than we've had in a year," Dean said in an interview Thursday as preparations for Live on the Green, a new concert series, went on outside his courthouse office. Big projects in mind As the economy begins to show signs of life, the mayor starts the second half of his term today — exactly two years after his inauguration — with some big projects in mind. First and foremost is the convention center, which still needs final approval from the Metro Council later this year. Last week, Dean ordered the construction team in charge of the project to bring the facility in for less than $600 million, knocking at least $35 million off the price that had been on the table for the past 20 months. Some council members still have questions about the project's viability in this economy, however, and think it will be difficult for the city to find much, if any, private financing for a 1,000-room, approximately $300 million hotel. But Dean continues to push the convention center, saying Nashville needs it and the accompanying hotel to maintain and strengthen the city's No. 2 industry, tourism. "I don't think we can afford not to do it, frankly," he said. Dean also plans to continue focusing on mass transit, an area in which the city's budget problems have stymied some of his ambitions. He and a group of suburban mayors took an important step in the state legislature this year, securing the right to create a new funding source to pay for transit programs. Now it's time to take the next, more politically difficult step of finding a way to come up with the money, which Dean said could be reallocated from within the city's budget. "We're the hub of the region," he said. "We can't be afraid to lead by example. Clearly I'm going to keep pushing this issue." Dean noted that the two cities he compares Nashville to the most, Charlotte and Austin, opened light rail systems in the last year. "In the long term, for this city's health, this has to be a place where people can move around," he said. 100 Oaks a model Another aspect of economic development Dean's administration wants to examine is how to grow strategically. Alexia Poe, Dean's incoming economic and community development chief, said she wants the city to grow "in a thoughtful and strategic way" so that it controls sprawl and doesn't have the traffic problems of a place like Atlanta. Poe, a political and government communications veteran, as well as a former lobbyist for Gaylord Entertainment Co., will participate with Dean, downtown developer Bert Mathews and Metro Planning Director Rick Bernhardt in an Urban Land Institute program that will help the city look at ways to develop major corridors like Charlotte, Gallatin and Murfreesboro pikes. The Urban Land Institute program will also enable Nashville to focus on infill development, the process of renovating or redeveloping properties within urban areas. Dean said he sees Vanderbilt University's recent $99 million renovation of 100 Oaks Mall as a model, and he hopes to see similar projects at other struggling malls. Poe will start work on Oct. 5, replacing Ney, an attorney who will return to legal work after a low-profile 20 months on the job. No quick turnaround Despite some promising signs that the economy may ease during the second half of Dean's term, analysts said the city might not see a full turnaround for a while. Frye said office vacancy rates, like the job loss numbers, have been unusually high. Corporate executives have hesitated to pull the trigger on office relocations, he said. But Nashville remains visible and attractive, and he believes the proposed convention center would help bring some companies here. "They don't want to sign a big lease now and find out six months later that they could have gotten a better deal," Frye said. "Once we get a break in the economy, I think we'll be fine." Penn, the MTSU economist, said it would take Middle Tennessee longer than most of the nation to recover from job losses because the manufacturing mix here has been especially sensitive to the downturn. "We know the stop sign is out there, but we're not able to see it real clearly," he said. Dean said he's confident about Nashville's chances to add jobs and make downtown an even "cooler" place. He said he started working downtown as an assistant public defender in 1983, before there was an arena, a stadium, an art museum, a symphony hall, the existing convention center or many other attractions. "This is not a young city," he said, noting 19th century water and sewer equipment Metro is getting ready to replace. "But in many ways, there is a dynamic air about Nashville."

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