state buildings

42 legislators ask delay in outsourcing; contract signing ahead of schedule

A week or so after 42 state legislators called for a delay in finalizing higher education outsourcing plans, Jones Lang LaSalle officials signed the company’s contract with the state ahead of schedule.

The Times-Free Press initially reported on the legislators’ letter to Gov. Bill Haslam’s outsourcing czar, Terry Cowles. It asks “that the outsourcing process wait until the General Assembly is able to study and understand the effects on our public services, economy, and state workers.”

The Nashville Post reported Tuesday in an overview of recent outsourcing developments that JLL officials actually affixed their signatures to the contract document on Friday, a week earlier than planned.

The contract is under review by the comptroller’s office before the state can officially sign off on it, but that review could be complete by the end of the day Friday, according to comptroller spokesperson John Dunn. The state’s bond counsel is also reviewing the contract to insure compliance. According to Dunn, that office has been asked to expedite its review but no firm time frame for its completion exists.

But criticism is pouring in from legislators and students, as letters and complaints fly to and fro, and University of Tennessee at Knoxville students held a large protest on Monday.

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State sells 119-acre Nashville prison site for $12.1M

Rogers Group Inc. has paid the State of Tennessee $12.1 million for the 119-acre vacant former Charles Bass Correctional Complex property in West Nashville, reports The Tennessean.

The Nashville-based provider of crushed stone, sand and gravel, asphalt and highway construction declined to comment on its purchase of for the site, which sits across Richland Creek from its REOStone quarry on Robertson Avenue.

…A new quarry is among possibilities for the property, which could also be used for offices and warehouse, maintenance and/or river transportation-related activities.

Earlier this year, Rogers Group made the highest offer of $12.5 million among six suitors for the site at 7177 Cockrill Bend Blvd. The 119-acre location includes the shuttered 162,700-square-foot former medium-security correctional complex.

The property borders the Cumberland River and a pair of industrial buildings. It is a half-mile from the John C. Tune Airport in an area with many warehouses and light industrial businesses.

Old TRA/PSC/PUC building to be sold at auction by state

More than two acres of state-owned property in downtown Nashville, formerly used by the Tennessee Regulatory Authority (previously known as the Public Service Commission and soon to be known again by its ancient label of Public Utilities Commission), is being sold at auction on June 21, reports The Tennessean.

Chattanooga-based Compass Auctions & Real Estate LLC will oversee the auction… (of) two tracts on the north side of James Robertson Parkway and Gay Street … (including) a 45,294 square foot office building on the roughly 1.18 acres at 460 James Robertson Parkway (that) once housed the Tennessee Regulatory Authority (and)… the 0.87-acre parking lot site (nearby) will be offered in two separate, but adjoining, parcels and as a whole.

David Roberson, a spokesman for the state’s Department of General Services, said state law allows sale of properties by auction. “Because this is a high-profile property, we decided an auction would produce the highest and best price for Tennessee taxpayers,” he added.

Justin Ochs, vice president of national development for auction and real estate company Compass, said the property located near the NewsChannel 5 Network headquarters is already drawing interest from across the country.

“Downtown Nashville has become a place where families want to live and businesses want to operate,” he said.

Note: The TRA, once a major player on the Tennessee political scene under the name Public Service Commission, has become somewhat incidental in the overall lay of the state governmental landscape in the last couple of decades and is deemed no longer worthy of having a headquarters building (probably appropriately). The agency’s name is also being changed again in its days of dwindling significance to its original name — or, well, pretty close to it. See previous post HERE.

Haslam budget booster amendment: Surplus money for new state library, roads

With his tax package now approved by the legislature, Gov. Bill Haslam Tuesday proposed some changes to the 2017-18 state budget plan he presented back in February.

Maybe the most notable revisions are the addition of $55 million in supplemental one-time funding (from the current budget surplus) on road projects — beyond what is envisioned in his tax bill, which includes higher gas and diesel fuel taxes — and $40 million towards the $98 million needed to build a new state Library and Archives building, advocated for years by Secretary of State Tre Hargett.

Both of those proposals are virtually guaranteed approval of the legislature as lawmakers get into serious work on the budget next week. The publicly-released documents don’t say which road projects get the new advance funding (but one could speculate that projects in the districts of legislators who voted no on his proposl might not be a high priority). It also appears that the governor is leaving about $125 million in surplus money for legislators to distribute as they, collectively, decide how to spend.

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Bill to block state park privatization moving in House & Senate

Republican-controlled committees of both the House and Senate have approved a Democrat-sponsored bill that would block new privatization efforts at Tennessee state parks.

Key sentence in the bill (SB1110/HB1208), sponsored by House Minority Leader Craig Fitzhugh, D-Ripley, and Sen. Sara Kyle, D-Memphis:

“The management, operation, and preservation of state parks, including the management, operation, and preservation of any buildings, facilities, structures, or improvements upon state park property must not be the subject of any private contract or otherwise outsourced to any private company or individual.”

It doesn’t apply to contracts in place before July 1, 2017. But Fitzhugh says that existing contracts coming up for renewal after that date could be subject to the prohibition when they expire and come up for renewal.

In the Senate Energy, Agriculture and Natural Resources Committee, Kyle’s bill was approved quickly Monday without discussion  – Chairman Steve Southerland seconded the motion for passage — on a vote of 7-0-1. Sen. Delores Gresham, R-Somerville, abstained.

On Wednesday, the House Agriculture and Natural Resources Committee approved the bill on voice vote with no apparent opposition after a short discussion, including Fitzhugh declaring privatization of parks “is something the people do not want” and there is a danger of “overpricing” park visits under current plans so that average Tennesseans cannot afford them “when we try to make a profit out of state parks.”

At Fall Creek Falls State Park, current plans call for demolishing the present Inn, building a new one at a state cost of $22 million, then turning operations over to a private company with anticipation that the average cost of a room would be $151 per night, compared to $75 at the existing Inn.

Near unanimous Republican support for a Democrat-sponsored bill even remotely controversial is an oddity. But it remains to be seen whether the committee votes are a symbolic gesture that will be scuttled later in the process, a genuine defiance of the governor’s plans or something in between.

Note: See also Sam Stockard’s report following Senate committee approval, but prior to the House sub’s vote. The article notes that current Haslam administration plans call for getting a contract signed for the Fall Creek Falls private operations in May, which could mean the deal gets included in the grandfather clause for contracts in place by July 1.

Fall Creek Falls Park privitization to proceed with revised oversight

The State Building Commission will now have firmer control over building-related aspects of Republican Gov. Bill Haslam’s plans for outsourcing Fall Creek Falls State Park’s operations under amended rules for bidders approved on Thursday, reports the Times-Free Press.

But Treasurer David Lillard, a commission member, made it clear during the commission’s executive subcommittee meeting that the panel’s oversight jurisdiction does not extend to the request for proposals’ other major area: The outsourcing of hospitality functions at the popular Upper Cumberland Plateau park in Van Buren and Bledsoe counties.

Statutorily, those are “not within the Building Commission’s purview,” Lillard said, noting the excluded list includes current workers’ continued employment, pay and benefits in operational areas ranging from the park inn, restaurant and convention center to the golf course and gift shop.

But the SBC will retain strict oversight within provisions of the request for proposals over the park’s chosen vendor, who will be called upon to spend $22 million in taxpayer money to tear down the existing inn and rebuild it.

Members unanimously approved the tighter oversight in efforts to resolve a revolt by professional Tennessee-based architects and engineers.

…Critics see the revised request for proposals as the template for renewed administration efforts. Haslam’s proposed budget calls for new capital expenditures at several other parks.

Rep. John Ray Clemmons, D-Nashville, an outsourcing critic, said the amended request for proposals provides “more legislative oversight” over the park’s demolition and construction.

Note: The TDEC press release is below.

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On compromise and fundraising for a POW flag at TN Capitol

The Legislature’s Fiscal Review Committee staff calculates it would cost $100,000 to begin flying a POW-MIA flag over the Tennessee state Capitol at all times, as initially required by SB125. The Tennessean reports that a GoFundMe campaign has been launched to raise the funds and that Sen. Mark Green, R-Clarksville, sponsor of the bill, has personally contributed $10,000 to the cause.

The problem is that laws already require the flying of three flags over the Capitol – the American flag, the Tennessee flag and, when the legislature is in session, the official flag of the General Assembly. Because of the way flag poles are structured in the Capitol dome, or cupola, the addition of another flag would require a new flag pole and some rearrangement.

As things stand now, the Senate has voted to amend Green’s bill so the POW flag would fly only when the General Assembly is not in session, effectively replacing the legislature’s flag at such times (which, of course, is most of the year). The amended bill passed the Senate unanimously and awaits its first vote in the House.

Says Green (via Tennessean): “We had no idea the cupola was at its max capacity… It’s a bummer.”

Note: The fiscal note explaining the cost is HERE. The GoFundme campaign is HERE.

Ann McGauran named TN state architect

The Tennessee State Building Commission has voted to appoint Ann McGauran, now with the Department of General Services, as Tennessee state architect. She succeeds Peter Heimbach in the position involving oversight of state building projects and real estate transactions.

McGauran is the first woman to hold the position, created in 1955.

The press release is HERE.

Just three companies reported seeking contract for management of TN state buildings

Three companies are bidding for a contract to take over management of most state government building under a privatization plan pushed by Gov. Bill Haslam’s administration and involving a “virtually unprecedented procedure” that allow bidders to help fashion project specifications in advance, reports Cari Wade Gervin.

The company names are officially secret until the bid winner is announced. But Gervin reports that an email written by a University of Tennessee official indicates they are Aramark, Compass Group North America and Jones Lang LaSalle. JLL and Aramark already have other contracts with the state. Various officials refused to confirm or deny.

The three companies bidding on the RFP were among the top guesses of likely bidders by those paying attention. JLL, one of the largest managers of real estate in the nation (headquartered in Chicago; publicly traded and with $48 billion in assets managed), has already nabbed one outsourcing facilities management contract under Haslam’s tenure, along with a contract (now expired) to conduct building assessments for the state and to review real estate management operations; the contract was amended to also allow JLL to act as a leasing broker for the state. The state comptroller’s office found massive problems with the contracts’ implementations in 2013 and 2016. Haslam also used to have significant holdings in the company; it’s unclear whether he still does. (Although an ostensibly blind trust has been managing his financial holdings since he took office, he has refused to disclose all the details of his holdings.) 

Aramark — based in Philadelphia, publicly traded and with $14 billion annually in revenues — already manages the outsourced food services at UTK, even driving faux food trucks around campus. The company also signed a contract with the state last summer to manage food services for the Department of Corrections — despite the state of Michigan cancelling its correctional contract with Aramark 18 months early after issues like meal shortages, maggots and rodents in the food, and employees reportedly smuggling drugs into prisons and raping prisoners.

The Post was unable to determine by press time what, if any, state contracts Compass Group has. The UK multinational company had revenues of $24.6 billion last year. Its U.S. headquarters are in Charlotte, North Carolina, and it is reportedly the largest contract foodservice company in the world, with operations in over 50 countries. It manages multiple workplace vending operations in Tennessee and has lost at least one lawsuit over refusing to pay worker’s compensation.

AG says it’s OK for governors to hold political fundraisers at the executive residence

Attorney General Herbert Slatery has opined that Tennessee law permits fundraising events at the governor’s executive residence, but also requires disclosure of any related expenditures at such events.

The opinion was requested by state Rep. John Ray Clemmons, D-Nashville, after Gov. Bill Haslam hosted a fundraiser for U.S. Sen. Marco Rubio during the Florida senator’s unsuccessful campaign for the Republican presidential nomination. (Note: The full opinion is HERE.)

The Times-Free Press has a write-up on the opinion. An excerpt:

Tennessee governors, both Democrats and Republicans, have for decades held or allowed political fundraising at the mansion. Campaign fundraisers have been held in the past at other state-owned venues by Republican and Democratic legislators, as well. That’s because Tennessee’s “Little Hatch Act” specifically includes an escape hatch for the state’s elected politicians.

The provision declares it illegal to use public buildings or facilities for meetings or preparation of campaign activity in support of any particular “candidate, party or measure.”

That is “unless reasonably equal opportunity is provided for presentation of all sides or views, or reasonably equal access to the buildings or facilities is provided all sides.”

In his response to a series of related questions posed by Clemmons, Slatery also said the state’s Campaign Financial Disclosure Act “would require the disclosure of such [public] expenditures if they constitute either a ‘contribution’ or an ‘expenditure’ as defined under the Act.”

It’s unclear how a state campaign financial disclosure requirement would apply in Rubio’s case. It’s not known who or what entity footed the bill. Moreover, Rubio himself is a federal officeholder and presumably not covered by the state’s campaign disclosure law.

The story also notes a second, separate opinion (HERE) requested by Senate Majority Leader Mark Norris, R-Collierville, that says social media accounts set up by Tennessee municipalities may be subject to the state’s Open Records Act.