(Patrick Lantrip/Memphis Daily News) 

After multiple delays, lawsuits, and revamped plans, the next phase Elvis Presley Enterprises’ expansion plans have been approved by the Economic Development Growth Engine for Memphis and Shelby County.

But while EPE’s latest plans for approximately 80,000 square feet of exhibition space on the Graceland campus were given the greenlight to advance, the battle for its 6,000 to 7,000 seat arena has just begun despite also receiving an affirmative vote from the board.

At times, the normally light-hearted EDGE board meeting felt more like a high-stakes court battle, with multiple attorneys for both the city and EPE arguing their cases before the board.

“I have spent my career trying to find ways to get projects done in the development and redevelopment of the city,” EPE legal counsel James McLaren said. “This is one of the projects that I’m proudest of, and you should be too.”

McLaren cited the effect of the Guest House at Graceland and Elvis Presley’s Memphis has had on the surrounding Whitehaven area as the source of his feelings about the project and why the EDGE board should continue to work with EPE on the Graceland expansion.

“But it takes a public-private partnership to do these deals, they can’t be done without incentives,” McLaren said.

However, the main concern for the board appeared to be whether or not the exhibition space could be or would be used in a manner that might violate the city’s usage agreement with the Memphis Grizzlies that prohibits them from funding a project that could compete with the FedExForum.  

“Is it truly an exhibition space, what about concerts,” EDGE board chair Al Bright Jr. specifically asked EPE president Jack Soden. “Could you do a concert within the facility?”

Soden responded that, while arguably one could host a concert anywhere, it is not their intention.

“It would be difficult to do with the columns in place,” McLaren added. “…part of the development agreement is that there will be permanent walls that will be moved, dividing each of the 20,000-square-foot facilities from the rest of the space. We tried to anticipate all of these issues when structuring this project.”

While the former project received a unanimous vote from the board, it was EPE’s second request that was met with much more trepidation.

EPE was requesting to amend the Graceland Economic Impact Plan, pending judicial review, to include an increase in the Tax Increment Financing, or TIF, percentage from 50 to 65 percent, if they promised to build a proposed 6,000 to 7,000 seat arena without using any of the additional money they would receive.

While EPE’s legal counsel maintains that neither project violates a noncompete agreement the city has with the Memphis Grizzles over publically financing projects that may compete with the FedExForum, not everyone in the room was in agreement.

City of Memphis COO Doug McGowan said that while there’s no denying that the Guesthouse at Graceland and Elvis Presley’s Memphis have far outperformed expectations in the area, and that the city would like to see more development in the area, they are of the legal opinion that this arena will in fact be in violation of the agreement.

“Therefore we are hesitant to throw our endorsement behind something that could put us at risk for violating the use agreement,” he said.

He added that even if the arena is privately funded, the timing of the increase would only add to the case that it is a violation.

“If there is culpability for violation of the use agreement, adding public money to a project at the same time as you’re approving an arena actually strengthens the case that public money is being used,” McGowan said.

McGowan also argued that the financial success of the existing Graceland plan negates the need for additional tax incentives from the city and county.

After hearing both interpretations of the use agreement from the opposing camps, Councilman Martavius Jones, who is a non-voting member of the EDGE board, weighed in with his insights as to how the city council may vote.

 “Whitehaven is in Super District 8, which I represent on the council, and I, like anybody would love to see this, but I’m just having a problem seeing how we can get out from under the provisions that we’ve talked about,” Jones said. “Without the judicial review, I just think it’s going to be hard for the council to approve this as it is.”

Ultimately though, the EDGE board voted to advance the project pending four other approvals that include the Memphis City Council, Shelby County Commission and a judicial review.

The vote itself resulted in a rare 5-3 split between the board with Bright casting the deciding vote, as only eight members were in attendance.

Bright commented after his vote that his sole reason voting yes was so that the City Council and County Commissions would have the opportunity to review EPE’s case.

After the meeting, EPE principal Joel Weinshanker told The Daily News he feels confident the arena project will be advanced through both the remaining governing bodies and the judicial review.

“From the get-go, we wanted to alleviate any potential liability from the city,” Weinshanker said. “From the start we’ve wanted a judge to basically step up and say, ‘this violates or it doesn’t violate.’ If it doesn’t violate then the city has no liability.”

When asked if he thinks it will be a long process, Weinshanker said he believes it will be wrapped up sooner rather than later and that he feels confident with his upcoming dates with the city council and county commission.

“Nothing I ever do is a long haul,” he said.  “You’re going to see movement very quickly.”

However, when asked if the affirmative vote resolves the pending lawsuit in Chancery Court with EDGE, he said no. 

“EDGE made a ruling that the judge has to make a determination, so at the end of the day we’re just getting started,” Weinshanker said. “With EDGE, it’s a question of whether or not they even had the ability to change the structure of the agreement. There’s even a question with what they’ve passed today whether they’re allowed to, within their structure, do that.”

Also after the meeting, city attorney Bruce McMullen expressed his displeasure with the outcome to The Daily News.

“I was disappointed in what happened today because I wanted to see to the Grizzlies work it out with EPE so that it’s not tied in court up and they could get to work on this as expeditiously as possible,” McMullen said.

“But some interesting questions were asked and some interesting things came out of this,

 “it’s my understanding that they got the TIF increase, but not to be used on the arena, but I did not see any pro forma or anything on what they were going to use the money for and why they needed it.”

Later in the day, McGowan indicated his position and maintained that he make the same case to council if necessary.

“While the prospect of a 6000+ seat arena is certainly exciting, we believe it puts the City at risk of violating the use agreement with Hoops, Inc., something that we do not desire and therefore cannot support as presented,” McGowan told The Daily News.

He also added that conditions have changed considerably since the development by EPE started, so additional incentives may not even be necessary.

“What was once an unbankable project is now performing so well that additional phases can be built using the existing public revenue streams, and as EPE asserts, the arena can be constructed with private resources and commercial financing without directly applied public incentive,” he said.