Nashville council members seek referendum to let public decide MLS stadium

Joey Garrison | The Tennessean

Show Caption Hide Caption Nashville soccer stadium plans at the fairgrounds for the MLS team Nashville was awarded a MLS team in 2017 and now the city is pushing to build a stadium for the team to play in

Two Metro Council members are seeking council action to add a referendum to the November ballot in hopes of letting Nashvillians decide the fate of the city's proposed Major League Soccer stadium at the fairgrounds.

But the last-minute effort is expected to face legal questions over whether the project's financing can be decided by a public vote.

At-large Councilman John Cooper and Tanaka Vercher, the council's Budget and Finance Committee chairwoman, filed two resolutions Tuesday that the council will take up next week that seek a public referendum on the MLS stadium project.

It comes as the council on Aug. 21 will also consider three separate actions needed to advance the project.

One resolution that Cooper and Vercher filed seeks to let Nashville voters decide whether to issue $50 million in general obligation bonds for fairgrounds improvements needed for the soccer project, $225 million in revenue improvement bonds and a lease for a 10-acre private development next to the stadium.

The second resolution — billed as an alternative to the first — looks to put both bond proposals before the public, but not the private development piece.

Cooper, an outspoken critic of the MLS stadium project, pointed to section 7.05 of the Metro Charter, which allows the council to call for a referendum with the purpose of "ascertaining the will of the qualified electors" on the issuance of certain bonds.

"The deal has clearly changed since it was voted on," Cooper said, referring to the council's preliminary 31-6 vote last November to approve $225 million in revenue bonds contingent on the project clearing future hurdles at the council. "The 10 acres have moved (to a different part of the fairgrounds) and also most voters are not aware of all the components to the deal.

"The charter gave us a tool, and it seems like the council should think about using it," he said. "At the end of this long and somewhat complicated discussion about it, this was always the right answer."

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But city attorneys have historically interpreted the referendum clause to make clear that such votes can be held on issuing general obligation bonds that are repaid through the city's general fund, but not revenue bonds, which are paid back by dedicated revenue sources.

Nashville's $275 million stadium project would be financed by $225 million in revenue bonds and $50 million in general obligation bonds, the latter of which would be used for infrastructure and other upgrades at the fairgrounds.

The private development ground lease, targeted in one of the referendum resolutions, does not involve bond financing at all.

"The Department of Law just learned about the proposed resolution and has not had time to adequately review it," said Metro Law Director Jon Cooper, the top attorney in Mayor David Briley's administration, which has been working to get the stadium approved.

Clint Brewer, a spokesman for the Nashville MLS ownership group, led by billionaire businessman John Ingram, pointed to the legislative process already underway in the council.

“We received initial approval last year from Metro Council which ultimately allowed us to win a Major League Soccer expansion team for Nashville," Brewer said. "The MLS stadium project requires additional approvals by the Metro Council, not a public referendum. We look forward to going before the council again next week as we move through the final approval process.”

Ahead of the council's 2010 vote on financing Music City Center, a public referendum was pursued by former Councilman Eric Crafton on bonding for the $623 million convention center project.

He sought a Metro charter amendment that would have let voters decide whether to issue bonds above a certain amount if they would be guaranteed by general fund dollars and used to build projects that are "not necessities." But his effort failed.

Council attorney Mike Jameson declined to say when asked whether he has any legal questions about the referendum resolutions related to the fairgrounds. He intends to issue a legal analysis Thursday.

The general election targeted for the referendum is Nov. 6.

By state law, a referendum must be added to the ballot no fewer than 75 days before the election, according to the council members' resolution. That would mean the council must act by Aug. 23, setting up a make-or-break vote for the referendum proposal at the council's Aug. 21 meeting.

In a statement, Councilman Colby Sledge, whose district includes the fairgrounds and who supports the MLS stadium project, said he appreciates "members' willingness to ensure we are working to do the will of the people."

"Through the public discussions we have had for more than a year, my sense is that the vast majority of folks are asking for a vibrant fairgrounds we can visit for years to come, a Major League Soccer team we can cheer on together, and a plan that benefits as many Nashvillians as possible through a community benefits agreement," Sledge said. "Working together, we can achieve all of those goals, and I have faith that we will do so.

He said he "hesitate(s) to consider any action that puts any of those goals in jeopardy."

"I'm going to continue to work hard and listen intently with those goals in mind, and I'm certain my council colleagues will do the same."

On multiple occasions, Sledge has derailed legislation in the council deemed hostile to the MLS stadium project by invoking the council's Rule 8, which allows a council member to trigger an automatic deferral of a resolution when its subject matter deals directly with just one council district.

But it's unclear whether he would be alowed to do the same for the new referendum resolutions.

The council voted last week on a procedural first of three readings to advance three ordinances needed for final approval of the MLS stadium. It sets up a critical second of three votes next week, putting the project on track for final consideration on Sept. 4.

One ordinance would rezone 10 acres of fairgrounds property for the mixed-use development, as recommended by the planning commission. Another would demolish existing buildings on the site. A third would approve a ground lease for the team's private development.

Separately, a resolution that would issue $50 million in general obligation bonds was deferred last week to the council's Sept. 4 meeting to line up with the other bills.

The council voted 31-6 in November to issue $225 million in revenue bonds for the stadium project, but it was contingent on the proposals now before the council passing. Nashville was awarded an MLS franchise in December.

Reach Joey Garrison at 615-259-8236, jgarrison@tennessean.com and on Twitter @joeygarrison.