Council resolution seeks to authorize $300K loan to CVB

Thursday, November 11, 2010 at 5:57pm

A resolution to go before the Metro Council next week would essentially let the council ratify the Convention Center Authority’s earlier decision to loan $300,000 to the Nashville Convention & Visitors Bureau.

In October, the nine-member authority unanimously voted to give a $300,000, no-interest loan to the CVB to help the agency offset funds it used to keep conventioneers in Nashville following May’s flood, which forced the closure of Gaylord Opryland Hotel. The loan, which still hasn’t been transferred, is to be paid back over three years.

Several council members questioned the loan, arguing that Metro’s commissions and authorities shouldn’t be in the “lending business.” In addition, council attorney Jon Cooper opined in a legal analysis that it is “questionable whether the [Convention Center Authority] has the legal authority to loan these funds without council approval.”

A new resolution, sponsored by Councilman Rip Ryman, who chairs the council’s Convention, Tourism and Public Entertainment Facilities Committee, would amend Metro’s agreement with the authority, clarifying the permissible uses of the convention center fund balance.

In effect, signing off on the resolution would authorize the authority to use dollars from the convention center fund balance to provide the CVB the $300,000 loan.

“This resolution allows the Convention Center Authority to do that, whether it’s a grant or a loan,” Ryman said.

Ryman said the resolution stipulates that no revenue collected through the city’s hotel/motel occupancy tax is to be used to pay back the loan. 

11 Comments on this post:

By: slacker on 11/11/10 at 5:17

It appears the city will lose the interest that the $300,000 would have earned in 3 years.

By: producer2 on 11/11/10 at 5:59

far less than they would have lost if those groups went to another city and did not stay in Nashville.

By: govskeptic on 11/11/10 at 6:51

Producer2 to the rescue, PR at it's finest! Subsidizing Hotels,
shopping malls, health care, elietist parkers, PR agencies,
what else will be next?

By: girliegirl on 11/12/10 at 8:16

Actually, the CMA proved just that ....Producer2 would be correct, sadly. It's really a lose/lose scenario....just the better of 2 choices.

By: JeffF on 11/12/10 at 8:42

I am amazed that no one in the media has asked this question: if they cannot use hotel/motel taxes to pay back the loan, when will the council quit calling it a loan and start calling it another gift to this poor excuse of an "industry?"

The CVB exists on the taxes collected from businesses who pay for hotels rooms. The city pays for administrative costs with taxpayer money. What other income is the CVB going to use? They have the highest paid staff in the country but cutting their salaries will not work because of the income restriction.

You have just witnessed one of those "restrictions" in a Metro produced law that will be used against us and common sense when the time is right. Just like the restriction they put in the hotel/rental car tax in order to keep the money theirs.

By: bfra on 11/12/10 at 8:44

The flood was in May, what does that have to do with CMA?

By: producer2 on 11/12/10 at 10:14

JeffF,
Got your lobbyist shoes on today?

By: producer2 on 11/12/10 at 10:18

girliegirl,
It's not really lose/lose, it is just not as much to gain as it would have been without the flood.
Govskeptic,
Just curious, is anyone who supports this administration "working" for them? I clearly remember that the Mayor won an election based upon the very thought process he is carrying out.

By: MAmom on 11/12/10 at 8:45

JeffF.

Media in Nashville does not investigate anything Dean says. They just print it.

By: JeffF on 11/12/10 at 9:21

Ever notice that the hospitality/tourism industry does not provide money to it's own projects? They will volunteer to raise taxes on their customers and the rest of us, but they have never cut into their own revenues to fund these things that help them out.

Hmm.

How much revenue do you contribute to these Metro projects from your meeting planning business Producer?

By: tomba1 on 11/13/10 at 11:40

This is absurd. Perhaps it's common practice but it's still absurd. So does this mean that the CCA has the money to "lend" and is only seeking council approval to lend it? I thought the council created the CCA with the mission of developing the convention center and hotel? What does that have to do with the CVB and its' convention retention activities after the flood? It's the CCA's job to build it. It's the CVB's job to get them to come. It's the Council's job to fund it all.

So let's use a bunch of "extra" construction money to fund the marketing of the things we haven't built yet. Perhaps CCA will need that money, and the interest they could be earning on it, when they go over budget.

Since the CCA has so much "unobligated" cash in its' pockets, perhaps they could bail out the Fairgrounds Board while they are in the lending mode? Just in - Nashville's newest financial institution, the CCA Bank, is now open and has plenty of "Dean Dough" ready to lend. No department gets turned down; just get in line. For more information, contact your CCA loan officer, aka Councilperson.

C'mon Council - QUE PASA ???.