Dillard's Agreement Could Cost Taxpayers $9M 10-27-2010 - WSMV Channel 4

Dillard's Agreement Could Cost Taxpayers $9M 10-27-2010

Reported By Nancy Amons
NASHVILLE, Tenn.
The "Antiques at Music Valley" show opens Thursday at the fairgrounds for the last time.
After months of uncertainty, Nashville Mayor Karl Dean announced recently that the events that used to be held at the fairgrounds will move to the vacant Dillard's department store building in Hickory Hollow Mall in March.
John Jenkins, the show’s promoter, said he's glad that the uncertainty is over.
"I want it over and done. If Hickory Hollow is the final solution, great, do it," Jenkins said.
Will the new location end up costing Metro taxpayers?
Dean has said he's closing the fairgrounds because it loses money. The most recent financial statements show that, not counting the million-dollar loss incurred by the state fair, activities at the fairgrounds made only about $34,000 in the fiscal year that ended in June 2009.
Channel 4 News obtained a copy of the proposed lease for the Dillard’s building. The lease says the city will pay $1 million per year to lease the building, and that after four years, the city has an option to buy the building for another $5 million. In all, under the agreement, the city would pay $9 million.
City Councilman Duane Dominy questioned why the city would spend so much to lease property when it already owns the land it’s using now, free and clear.
"That just doesn't make sense," Dominy said.
If the fairgrounds events struggled financially in a paid-off facility, how will it break even with an extra $1 million a year in overhead?
"I'm sorry, you want to grab your head and scream," Dominy said.
On Wednesday, Dean couldn't address the dollars and cents.
"As far as the financial details, you have to talk to (finance director) Rich Riebeling about it," Dean said.
Riebeling said he hasn't finalized a budget yet, but said the city wouldn't be moving forward if it didn't think the enterprise would at least break even.
There are other complications in the Dillard's lease; one is parking.
"The lease said we can't hold events that require a lot of parking in November and December. Our largest flea market and Christmas Village occur in those months," Dominy said.



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