There would still be a role for the Beale Street Development Corp. in the second phase of development of the entertainment district.
And the city of Memphis will move quickly starting next month to find a new manager and developer for the district.
Memphis Mayor A C Wharton Jr. outlined those next moves Wednesday, Jan. 9, for the district once federal bankruptcy Judge Jennie Latta finalizes the bankruptcy case involving Performa Entertainment, the long-time manager and developer of the district.
Latta is expected to approve the bankruptcy settlement Jan. 27 and Wharton told the Memphis Kiwanis Club that his administration will move quickly probably in mid-February with a search for a successor to Performa.
The approval of the settlement clears the way for Performa and its founder John Elkington to end their role in development of the three-block district, which began with the renovation and opening of the district in the early 1980s.
“I will not be running Beale Street,” Wharton said as he talked of the city regaining day-to-day control of the running of the district in order to determine “what kind of structure should manage Beale Street.”
“We will not try to manage it out of City Hall,” he said.
One possibility is an improvement district board with appointments to it made by the mayor based on nominees from the entertainment industry.
The long bankruptcy court case is one of two legal challenges to moving forward. There remains a Chancery Court dispute.
“We’ve got a little bit of litigation in Chancery Court to tie up,” Wharton said. “But the heavy part of the litigation is behind us. The Beale Street Development Corp. – there is still a role for them. And Judge Latta has told them to sit down with us and work with us.”
The development corporation is a nonprofit organization founded as a sort of watchdog of the street’s culture and history. It leases the land in the district from the city of Memphis and then in turn subleased it to Performa. The BSDC claimed it was owed $6 million by Performa. Latta rejected that claim in November in the bankruptcy case.
In the first in a series of speeches on the year ahead, Wharton also said that he supports a renewed drive for a referendum on a half-cent citywide sales tax increase as well as plans by several City Council members to reduce the current city property tax rate of $3.11.
But Wharton said he wants to keep that portion of the tax rate that is currently used to fund Memphis City Schools. The city’s obligation to fund public education ends with the new fiscal year that begins July 1 because of the merger of Memphis City Schools with Shelby County Schools.
“It will be my request that the council retains that portion,” he said. “My logic is quite simple on that. One way we have funded schools in the past is that we have pulled out of pockets of money that were not designated for schools. We have never had a portion of the tax rate that was large enough to drive the total funding needed for schools.”