Soccer standoff

As the standoff between the Mayor and the soccer team persists, I find myself wanting to be in favor of beginning stadium construction immediately. I’m not 100% there, but absent some new details about what’s going on behind closed doors, that’s my strong inclination.

Let me start by saying that I think it is fair to say that the Mayor has a mandate to change the way Metro does economic development. It is also fair to say that people expect a balance where change happens in a way that furthers the city’s success. To put it another way, you can’t make growth more equitable if you shut down growth.

Sometimes, when a party has a lot of leverage in a negotiation, one of the challenges is to know when and how to win. When you have backed someone into a corner, is it your intent to leave them a way out or is it your intent to force them to fight so you have the opportunity to crush them? If you leave them a way out, you risk being perceived as having left value on the table. If you force them to fight, anything can happen. You might crush them, but often everyone does worse. This is where I see the Mayor and team right now – at a decision point where the Mayor either can push the team further into a corner and risk a fight, or leave them a realistic path away from the confrontation.

The majority of Nashville would prefer that the stadium be built. In a very public process, the city already approved the stadium financing and the related 10 acres of development in September 2018. Since the recent election, the Mayor has said there are new facts to consider – more costs, a potential racing deal, and a need for open space. While those aren’t all new facts, the Mayor has exercised his leverage on the team and they’ve put more money on the table.

It’s less clear where things go from here. We don’t know how close the Mayor is to hitting the tipping point where the team feels forced to fight.

My sense from the sidelines is that the negotiations are very close or already at that tipping point. On paper, “Parcel 8C,” which is the several acres still in dispute, is appraised to be worth about five million dollars. Why would either side blow the deal over this parcel? Each side presented their arguments last week in a public exchange of letters. But those don’t give the rest of us a clear picture of why each side cares so very much about Parcel 8C.

With this imperfect information, we are left trying to map the current deal onto the city’s goals and make a guess about whether it’s time to keep pushing or to accept a final deal.

While some might argue about how to balance individual goals, I think there is consensus about the goals for Nashville:

  • Bring major league soccer to Nashville;
  • Fully honor historic Fairgrounds uses, including auto racing;
  • The stadium should pay for itself;
  • Be fair – don’t give away things to wealthy insiders;
  • Be fair – make sure the landmark community benefits agreement succeeds; and
  • Be fair – protect Nashville’s reputation as a reliable business partner.

Again, as of September 2018, the city democratically weighed all of these factors and approved the deal. At that time, everyone knew what the site layout was, including Parcel 8C. Everyone knew that the racetrack needs improvements. The only new factor that we know about is the added infrastructure cost, and the team has committed more money for that. This feels like enough of a win on all goals that the city should not be risking a fight, or risking its reputation as a fair, reliable business partner.

Maybe there are more facts that aren’t public yet that would change the calculus for me. Absent that, any reasonable resolution close to what has been publicly disclosed is better for the city than a fight. Finish the new deal or tell us why this needs to be pushed to a fight.

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P.S.  The idea of Nashville being a fair, reliable business partner is a big deal. The city can’t be a ‘no’ on all the economic development deals that were underway at the time of the election. I support the Mayor’s desire to change the ground rules for how economic development works in Nashville. I have long argued that the city needs to do a better job of explaining what it wants to incentivize and how it is going to measure incentives. Last term, I appreciated unanimous Council support for my incentive reform legislation. That said, it would be bad to be perceived as immediately switching with no lead time to a new set of ground rules for economic development in Nashville.

Metro should not force feed immediate change. Residents and businesses groups should not be surprised or left guessing about what’s to come. Above all, business craves predictability. To keep the economy thriving and new businesses interested in coming to Nashville, they have to feel the vibe that, although economic development and incentive standards may change, it will be manageable and they’ll be given time to react.

I suspect that part of the difficulty with negotiating over Parcel 8C is that it looks like there is nothing new to know about this. Every argument about that parcel could have been made, and was made, in 2018. And then there was a vote. I think there will be a connection between who gets this parcel now and whether Metro is viewed as trustworthy and reliable.

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Previous post about soccer stadium: Protect the community benefits agreement.

Bob Mendes

Bob Mendes represents all of Nashville as a Council-At-Large member of Nashville’s Metro Council. He is Chair of the Council’s Charter Revision Committee, a member of the Metropolitan Audit Committee, and a member of the Council’s Budget & Finance Committee, Rules & Confirmations Committee, and Ad Hoc Affordable Housing Committee. Bob also practices business law at Waypoint Law PLLC. Bob’s complete bio is here. You can follow Bob @mendesbob.