VOL. 123 | NO. 156 | Monday, August 11, 2008
Bass Pro Moves Closer to Memphis Reality
By Bill Dries
WORKING TOGETHER: Robert Lipscomb, left, representing the city administration, and Jim Huntzicker, representing the county administration in the Bass Pro Shops-Pyramid talks, have taken different approaches to evaluating the proposed terms. -- PHOTO BY BILL DRIES
Bass Pro Shops officials say they are ready to sign on the dotted line to start the planning process for the return of The Pyramid to public use.
But Shelby County government is looking again at getting out of The Pyramid as the city government’s partner.
What has been termed a “pre-development agreement” between city and county governments and the hunting-fishing retailer faces a review by both local governments and a mid-September deadline for government approval set by Bass Pro executives.
Bass Pro Shops President and CEO Jim Hagale tentatively is scheduled to pitch the agreement to members of the Shelby County Board of Commissioners and City Council members at a special joint meeting city Housing & Community Development Director Robert Lipscomb said he hoped to set for Aug. 25.
“(Bass Pro) wants the city and county to approve this in the next 30 days or everybody move on to other projects,” attorney Doug Earthman told the joint city-county Pyramid Reuse Committee last week. “They are excited and they want to begin immediately. This thing has been extended longer than anyone expected. … They are the ones pushing to get this thing finalized and signed.”
County Chief Administrative Officer Jim Huntzicker isn’t pushing back. But he wants to see what’s new in the fine print. If it’s not substantive, he said political realities on the County Commission may not have changed much either.
“The real key is what are the city and county committing to in terms of additional funds,” Huntzicker told The Daily News. “That can take the form of redevelopment tax credits. There are credits available but you have to apply for them. If you can get those, that’s fine. If not, are there additional monetary contributions on the city and county? The County Commission has said in the past that the county is done funding The Pyramid.”
Lipscomb and Huntzicker haven’t always seen eye to eye on the course the Bass Pro negotiations have taken. Each agreed that a theme park proposal floated as an alternative didn’t have the verifiable financial details necessary to move to serious negotiations. But when the latest deadline for a Bass Pro commitment passed at the end of July, Huntzicker said the city and county should seriously consider an offer by Cummings Street Missionary Baptist Church to buy the arena for $12 million.
“The devil is always in the detail and we have two partners,” Huntzicker said last week. “We are going to need to have the agreement in hand and have enough time to review the agreement and have some back and forth before Mr. Hagale comes in for ceremonies.”
He then acknowledged the differences by telling Lipscomb, “My hat’s off to you for getting us to this point.”
The church’s offer and a proposal by DSG Capital Realty Group Inc. of Memphis to turn The Pyramid into a seven-story convention center and lease the first floor to Bass Pro were then both tabled by the Reuse Committee, which includes County Commissioner Deidre Malone and City Council member Reid Hedgepeth as well as Huntzicker and Lipscomb.
Lipscomb has been less cautionary than Huntzicker because by mutual agreement between city Mayor Willie Herenton and county Mayor A C Wharton Jr., Lipscomb has taken the lead in negotiations with Bass Pro, which began in August 2005.
“Peabody Place took us 12 years,” Lipscomb told The Daily News. “This was built as an arena. We’ll be the only city in America that has an arena in an adaptive reuse other than a church.”
Developer Henry Turley was the first to approach Bass Pro Shops about locating in Memphis. But Turley moved on, in part, he has said, because of the company’s reputation for lengthy and tedious negotiations.
Local entrepreneur Scott Ledbetter picked up the effort and teamed with Lipscomb. While Lipscomb said the still-forming deal has taken relatively little time, Ledbetter said it has been a long haul because of Bass Pro’s philosophy about such talks.
“They made a decision early on that they were not going to be a part of the lobbying for this,” he said. “They have so many cities, so many developers that are encouraging them to come to their cities, that they made a point in the very beginning that they were not going to try to lobby to be in Memphis. We had to want them for them to come.”
Making a commitment
Earthman, of Glankler Brown PLLC, told the four-member panel that if all parties approve the development agreement, a lease agreement could then follow a year from mid-September. Bass Pro Shops would pay $35,000 a month to the city and county during that year. And if the retailer walks away during that time, it would pay a penalty of $500,000. The company would also spend hundreds of thousands of its own dollars on plans. If it takes Bass Pro longer than a year to plan for a store as well as other attractions, it would lose the exclusive right to redevelop The Pyramid.
“Until they have a signed contract they’re not going to develop the actual architectural and engineering plans. This really sets in motion all of the work that needs to be done for us all to agree,” said Earthman, who negotiated with Bass Pro officials including Hagale.
Huntzicker said the Wharton administration will carefully review the terms against the fiscal bottom line for county government.
“There is almost no monetary gain to the county government … by going forward with the terms,” he said referring to the city-county-state split of sales tax revenue. “It may be that we need to step out of the way. But we want to look at it for the good of the whole county and be sure we’re not cutting our nose off to spite our face. The fact is that we want to know what our commitment is. At one point, we were being asked to guarantee $30 million, but I don’t think we’re in a position to do that.”
County Commissioner Sidney Chism formally proposed a county withdrawal in March but didn’t have the votes on the commission. The proposal did have the support of the Wharton administration.
When Huntzicker brought up the idea again last week, Lipscomb was quick to respond.
“My only comment is, I certainly hope so,” he said.
Lipscomb said later that the basic terms of the agreement remain the same ones announced this spring – an agreement to lease The Pyramid from the city and county and pay $35,000 a month, with the city and county committing to find $30 million in government money toward the project. The new element is a set of quarterly milestones Bass Pro must meet but which it has the chance to make good on if it gets behind schedule.