frank_talk (2005-37)

Insurmountable Problems

Just a few years ago downtown

by Frank Cagle

The pace of development in downtown Knoxville is such that it’s hard to believe where we were just four years ago. Half-way through Mayor Victor Ashe’s last term of office, the senior staff had to make an assessment: What could be done in the remaining two years, and what would be left to the next mayor?

Ashe would leave a legacy of new and improved parks, miles of greenways, 600 miles of roads paved and about $40 million in investment that transformed the waterfront. He also built the convention center that the business community insisted on; whether that was a good idea, I leave for you to decide.

But the state of downtown development was problematic. After several grand proposals were shot down for a variety of reasons, Ashe went to Market Square and, as term limits loomed, made a speech outlining what he proposed to do. The city would encourage residential development. An alternative building code was adopted.

Incentives were used to get the Sterchi Lofts and the Emporium projects moving. A single building inspector was named to manage downtown renovations for consistency and to expedite construction. Market Square was redeveloped through KCDC.

Those city initiatives were enough to get the ball rolling. People like Leigh Burch, David Dewhirst, Scott and Bernadette West, Wayne Blasius and others have kept the momentum going.

Here are some insurmountable problems the staff considered just four years ago:

• The Candy Factory, the Sunsphere and the Victorian houses on the World’s Fair site were city assets that had long been a liability. While it was nice to have space for arts groups, it was totally unrealistic for the city to own thousands of square feet of deteriorating buildings, with high maintenance costs, and no tax revenue. While some of the properties could be unloaded individually, no one wanted to take on the whole project. Development would have required the use of every square foot of the properties, meaning wholesale eviction of all community groups, no public meeting space reserved and, most likely, a city subsidy. The prospect of removing the arts organizations and eliminating the community space was a political cost no one wanted to pay. The current proposal on the fair site properties is a testament to the momentum of downtown development over the last three years. Downtown property values have improved to the point that some of the space can now be reserved for community use. The numbers work now; they didn’t then.

• It has long been recognized that a downtown movie theater, to generate traffic and to produce sales tax, was a high priority. A movie complex was one of the elements of the ill-fated Renaissance Knoxville proposal. But Regal Cinemas was adamant that they had enough screens in Knoxville, and downtown was not a priority. The excitement downtown these days and the selling job by current Mayor Bill Haslam has a movie theater in the works. It’s a complicated deal and one of the high points of Haslam’s first term—convincing Regal, finding private investors and working with County Mayor Mike Ragsdale to get the property. But it wouldn’t have been possible without the “buzz” being generated and the profits being made by downtown entrepreneurs.

• There is a provision in state law that allows sales tax generated in downtown redevelopment that would normally go to the state to be diverted to local government. Four years ago the prospect of significant sales-tax increases downtown seemed to disappear with the evaporation of the Universe Knoxville project. But now there is the prospect of sales tax generated at the Mast General Store, a grocery store and at the movie theater that can be applied to convention center debt, getting it off the backs of city property owners.

It has long been lamented that downtown Knoxville is circumscribed by the river, the campus and Interstate 40. But compactness has its advantages. A nice development on one block can change the dynamic enough to encourage more development.

Those insurmountable problems have melted away.

Frank Cagle is a political analyst and the editor of Knoxville Magazine . You can reach him at frank@frankcagle.com .

© 2005 MetroPulse. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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