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VOL. 128 | NO. 173 | Thursday, September 5, 2013

Council Gives Early Approval to Solid Waste Fee

By Bill Dries

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The Memphis City Council sent a proposed lease of Handy Park on Beale Street back to committee Tuesday, Sept. 3, for more discussion about the details.

The city sanitation fleet includes a majority of vehicles that are past their useful life and function.

(Daily News File/Lance Murphey)

And the council approved on the first of three readings a restoration of the city’s solid waste fee to $25.05 a month. But there were conflicting explanations about which part of an overhaul of sanitation services the restoration of the fee is supposed to fund.

The latest chapters in two long-running City Hall discussions about the future of the Beale Street entertainment district and changes in sanitation services each reflected some degree of trust issues between the council and Memphis Mayor A C Wharton Jr.’s administration.

In Tuesday’s executive session, Wharton and his administration repeatedly emphasized that the $25.05 solid waste fee it was seeking was not tied directly to a monthly retirement supplement of up to $1,000 for sanitation workers.

But council members argued it is the effect, even if indirectly.

The administration has said the money from bringing the rate back up to $25.05 after it dropped to $22.80 in July will be used to buy newer vehicles for the sanitation department. Those trucks set in motion other reforms, including 100 more stops per route each day and a broader use of recycling that allows more material to be discarded as recyclables.

The solid waste fee automatically dropped to $22.80 on July 1 because the council did not renew the old rate by the beginning of the current fiscal year.

The savings from the efficiencies that are a later part of the plan, Wharton said, are what will directly fund the retirement supplement.

“It is not a pension,” city chief administrative officer George Little said. “It is a capped contribution.”

Council member Jim Strickland argued it is a pension that could spike efforts to reform other city government pensions.

“I think if this body or the mayor’s office creates a pension … that (sanitation workers) have not contributed to, there is no way in the world reforms are going to be made to these other pensions,” he said.

Council member Shea Flinn said the solid waste fee has become “hopelessly entangled” in the retirement supplement issue.

“I don’t think we lose anything by getting all of these issues together,” Flinn said. “If not … I think we are painting ourselves into a corner.”

The administration negotiated the supplement and the plan to overhaul services with leaders of the American Federation of State, County and Municipal Employees, the union that represents sanitation workers.

Wharton said later the administration will amend the ordinance by third reading to reflect the specific timing of different parts of the larger plan to change sanitation services.

On the Handy Park issue, council members questioned why Handy Park LLC, a group of merchants in the entertainment district, got the lease without a request for proposal by the city of Memphis or some kind of process soliciting bids.

City Attorney Herman Morris said the group is substituting its lease for the long-term lease the city had with Performa Entertainment, the Beale Street development company headed by John Elkington. Elkington guided the running and development of businesses there even before the reopening of the renovated district in late 1983. The lease with Handy Park LLC includes the group paying $500,000 to $600,000 that Elkington borrowed to make renovations to the park.

The new lease is part of the settlement of a federal bankruptcy case by Performa Entertainment that is intertwined with Elkington and Performa’s exit from development and management of the district.

“This was part of a settlement that was entered into in bankruptcy court proceedings,” Morris told the council. “It requires the city to conclude this lease for Handy Park. … This group was willing to assume this particular obligation to allow the bankruptcy court order to be entered, which is basically the linchpin to resolving the entire Beale Street matter.”

Morris warned the council that the court gave the city and Handy Park LLC until the end of this year to make the lease a done deal. If the council tinkers with the terms, Morris said, it could undo the settlement of the larger case, in particular who controls day-to-day operations and long-term control of the larger entertainment district.

“We are back at square one,” he warned.

Council members, nevertheless, voted to send the item back for a discussion at their Sept. 17 executive session.

“If you knew it was coming, why didn’t we get an attorney-client meeting on this transaction?” asked council member Harold Collins. “To me, that’s a lack of transparency.”

PROPERTY SALES 0 133 1,342
MORTGAGES 0 131 1,047