Are we headed for a charter crisis in Knox County?

By Steve Hunley, Publisher

publisher@knoxfocus.com

This past Wednesday, December 4, the Knox County School Board held their workshop meeting and discussed moving the Central Office of Knox County Schools from the Andrew Johnson building to the vacant east TVA Tower. This is an idea that first started in 2004 with then Knox County Mayor Mike Ragsdale and later was picked up by former county Mayor Tim Burchett. The fever quest to put the Andrew Johnson Building on the tax rolls has now spread to current county Mayor Glenn Jacobs. This idea has never made any sense for the taxpayers. It is a financial disaster. Now it may become a county charter crisis.

In the school board meeting Deputy Law Director Gary Dupler, who represents Knox County Schools, explained to the school superintendent and the school board that the Memo of Understanding which was prepared by Knox County Finance Director Chris Caldwell is not in legal form. It is in violation of the Knox County Charter Sec 3.08 D that states that the elected law director is to execute and administer all the legal affairs of the county, including the drafting of contracts. The Memorandum of Understanding (MOU) before the school board is not drafted by the law director and is very ambiguous and truly so poorly drafted as to be potentially unenforceable. Dupler went on to add the document conflicts with the prior MOU agreed to by the Knox County Board of Education and the Knox County Commission dated July 6, 2015. Dupler also stated Knox County is in potential breach of the July 6 2015 MOU in that it requires the county to have the Knox County Purchasing Department locate amenable sites and present them to the Board of Education of consideration. The BOE and the county would work cooperatively to select a site that is in the best interest of the BOE. That has not happened. It is a serious matter.

Just like in Washington, D.C. where laws are treated as mere suggestions rather than actual law this ‘Monkey see Monkey do lawlessness virus’ has spread to our own Knoxville. Just like the city of Knoxville may have ignored both state law and the city charter in ramming Recode through a few months ago now Knox County Mayor Glenn Jacobs’ administration may have ignored both state law and the county charter in this reckless pursuit to sell the Andrew Johnson Building and move the school system to the east TVA Tower. Those possible violations of state law and the county charter could be grounds for ouster and removal from office for Mayor Jacobs.

It’s not just the law that may have been ignored. Reason has been ignored also. Never has there been such a desperate and disingenuous effort to support such a horrible deal for the taxpayers. The Knoxville Focus has examined in detail the fallacy of selling the Andrew Johnson Building for less than half of its appraised value by the Knox County Property Assessor. The mayor’s office has countless answers to objections for the bid from BNA Associates of Nashville who won the high bid for the Andrew Johnson Building for $6 million dollars. The property assessor has the building appraised for $13.5 million dollars. How is it a good deal to put the Andrew Johnson Building on the tax rolls when the taxpayers receive only 23% of what they have invested over time in the building just so it can get a 25 year Payment In Lieu of Taxes? How many of us will be around 25 years from now? The taxpayers of Knox County have invested almost $26 million into the Andrew Johnson and the mayor wants to sell it for $6 million dollars and wait for 25 years to see tax revenue and declare that as progress? Progress for whom?

There has been very little transparency in this entire process. The Jacobs administration has prepared many versions of cost estimates for deferred maintenance estimates for the Andrew Johnson Building which show wild disparity. For example, the September 11, 2019, deferred maintenance estimates for the Andrew Johnson Building totaled $5,520,000. But the September 25, 2019, deferred maintenance estimates for the Andrew Johnson Building totaled $9,662,459. How is that possible in only two weeks? Was this $4.14 million dollar increase to make a better case to leave the Andrew Johnson Building? There were no supporting estimates from electrical contractors, plumbing contractors, HVAC contractors, or elevator contractors for these projections.

The entire pitch for the move to the TVA Tower seems to be based on numbers pulled out of thin air to make the sales pitch look good for taxpayers. It doesn’t and taxpayers know it. In a public meeting at Farragut High School on schools and county roads 5th District County Commissioner John Schoonmaker asked the 65 people who were present how many people wanted the school system to stay in the Andrew Johnson Building. Every single person raised their hand. Then Schoonmaker asked the 65 people how many people want the school system to move the east TVA Tower. Not a single person raised their hand. Mayor Jacobs’ obsession with the TVA Tower deal seems to be clouding his judgment.

The taxpayers have been told by Mayor Jacobs and his administration that the school system must leave the Andrew Johnson Building because it is so old and it will cost too much to stay there. But in actuality there is only one required American with Disabilities Act remediation that must be done in the Andrew Johnson Building: bring the elevator up to current ADA standards. Caldwell’s estimated cost for that is $1 million dollars. So taxpayers can spend $1 million dollars and keep the building they have paid out almost $26 million dollars for. Or they can sell that building for $6 million dollars for a 77% loss of equity and then spend an additional $25.5 million dollars to move to the east TVA Tower which they may only have for fifteen years and then have to move again. Do you think this is a good deal for the taxpayers? Lose $20 million dollars of equity and then pay out $25.5 million dollars to move to a place they have to lease rather than own? And then may be kicked out in 15 years?

The problem with this is much larger. As Deputy Law Director Dupler pointed out there was never a robust analysis of other properties the school system could move to. Neither the school superintendent nor the board of education had the opportunity to decide which site the school system would move to. The mayor’s office did the deciding for them. That could very well be a  breach of the July 6, 2015, MOU between the county and the school board. Supposedly there were twelve sites in consideration. Every site other than the east TVA Tower was disqualified by the mayor because they were allegedly too expensive to renovate, lease rate was too high, not centrally located, not on a bus line, had parking issues, or security issues. The entire process appears to have been slanted for one and only one site, the TVA Tower.

In the school board workshop December 4th school board member Tony Norman asked Finance Director Chris Caldwell about moving the school system to the soon vacant East Towne Mall also known as Knoxville Center Mall. Caldwell said it was too expensive to purchase and would cost too much to renovate. In my opinion, nothing could be further from reality. What you possibly don’t know is that East Town Mall was purchased in 2016 for a third of its value for the amount of $10.1 million dollars. Last month it was reported that the mall is 19 months behind on taxes and maintenance and security payments. Security bills now amount to $505,152, and janitorial and maintenance bills now amount to $439,746. The mall is behind in property taxes too: $200,000 to the county and $230,000 to the city. The total of these delinquent payments is $1.374 million dollars. If the East Towne Mall could be purchased by Knox County for between $8 million to $8.7 million dollars, this could be the deal of a lifetime for taxpayers. But the obsession for the white tower stands in the way.

WBIR reported on Friday, December 6 that Mayor Jacobs does not support moving the school system to the East Towne Mall. It appears Mayor Jacobs can see the TVA Tower as the only place to move the school system. It appears Mayor Jacobs suffers from “not invented here,” a common political malady. So what happens if the mayor does not show leadership and lets the East Towne Mall go fallow? After copper thieves strip the mall bare will it have to be demolished? Who will have to pay for the demolition of almost 1 million square feet of concrete and metal?

The taxpayers need leadership now. Where will that leadership come from? What we have is a mayor with an obsession with a white tower much like Captain Ahab had an obsession with a white whale. It didn’t work out well for Captain Ahab. The question is how will this work out for the taxpayers?

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