Nashville council defeats proposal to rescind Major League Soccer stadium deal

Nashville's soccer fans got a scare Tuesday, but they were able to relax in the end.

The Metro Council voted overwhelmingly to defeat a proposal to rescind Nashville's $275 million Major League Soccer stadium deal for the city's fairgrounds, a package that was one of the key reasons why Music City was awarded a new MLS expansion franchise.

The council voted 16-8, with seven abstentions, to strike down a plan to scrap funding for one of former Mayor Megan Barry's defining projects. It would have revoked the council's 31-6 vote in November to approve $225 million in revenue bonds for the future stadium.

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The move was supported by Councilman Steve Glover, a critic of the stadium, who gave notice at Tuesday's council meeting of plans to invoke the council's rarely used "Rule 36," which allows the council to rescind prior affirmative action of the council.

He announced plans to hold a vote at the council's April 3 meeting. But instead, Councilman Cloby Sledge — a stadium supporter who represents the fairgrounds neighborhood — surprised Glover by making a motion to force a vote on rescinding.

By rule, a motion to rescind requires 27 votes in the 40-member council — a high bar made higher because of several absences in the council Tuesday. Sledge recognized the votes weren't there.

In a face-off against Glover, Sledge argued his colleague's threat to revoke the deal would "hang over our heads" while the council seeks to work out a community benefits agreement involving the stadium.

"If we're going to go ahead and have this action to rescind then what's the point?" Sledge said. "Why are we asking community members to come out and spend their time?

"To me, I think it's disingenuous to say we would potentially do this and have this hang over our heads."

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In addition to Glover, council members John Cooper, DeCosta Hastings, Holly Huezo, Brenda Haywood, Mary Carolyn Roberts, Larry Hagar and Ed Kindall voted to rescind the deal.

Nashville, whose bid was led by billionaire businessman John Ingram, was awarded the 24th MLS franchise in December, beating out Cincinnati, Sacramento and Detroit for the spot.

Metro Department of Law Director Jon Cooper warned that rescinding the resolution would pose considerable liability concerns for the city because of franchise fees the team has agreed to pay MLS as part of its agreement with Metro.

Glover's push was inspired by recent reports from WSMV-TV scrutinizing preliminary work for the stadium. That included one story that found Metro Chief Operating Officer Rich Riebeling authorized $135,000 in predevelopment work overseen by Commonwealth Development Group that came from Bridgestone Arena's financial account. The Metro Sports Authority, which operates the arena, was unaware of the spending.

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"We have spent money that we never authorized," Glover said. "And until we get our act together, until we as a council fully understand what the expenses are, then I'm asking us to rescind it."

Although the council approved the bond resolution in November, the city has still not issued bonds. Future votes are still required for the project, including the demolition of existing buildings at the fairgrounds, a zoning change to accommodate a future mixed-use redevelopment on the site, and to approve a ticket tax that will generate funds for the stadium's construction.

Nashville's MLS steering committee — MLS2Nashville, which supports the Ingram's team — rallied soccer fans to the council Tuesday after catching wind of Glover's effort.

"We cannot let him derail the progress we have already made," an email to supporters reads. "We need your voice once again. Please come out to reaffirm your support for our expansion team and our soccer stadium at the Tennessee State Fairgrounds."

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Commonwealth Development Group is led by Larry Atema, a longtime friend of Riebeling whose firm has also received contracts for the construction of Music City Center and recent upgrades at Nissan Stadium, among other projects.

Riebeling sent a letter to the council on Monday apologizing but saying he was unaware action taken by the sports authority did not cover this work at the fairgrounds. He also said that "no funds have been improperly paid to Commonwealth," noting that the firm has a contract for construction project management services throughout Metro government.

"Clearly, I should have checked to make sure the sports authority had expressly authorized this work," Riebeling wrote. "I apologize for the failure to do so."

He added that Mayor David Briley's administration intends to take a series of actions to rectify the situation, including having the sports authority adopt a resolution to ratify all previous expenditures.

Nashville's MLS stadium was a top priority for Barry, who resigned earlier this month after pleading guilty to criminal theft related to a nearly two-year affair with her former police security guard.

Under the public-private deal approved by the council, the ownership team led by Ingram — majority owner of Nashville Soccer Club — is set to pay $25 million up front and $9 million a year over 30 years to help retire Metro’s annual $13 million debt for the $225 bond issuance. The city is supposed to pump an additional $25 million into upgrades at the fairgrounds site.

Sales tax revenue generated by the stadium, as well as a $1.75 ticket tax that would increase over time, is designed to cover the remaining $4 million. Metro will be on the hook to pay the difference if projections fall short. Metro is obligated to cover the gap for years from five through 10 of the stadium up to $3 million.

“Metro Council voted by a wide margin to approve the MLS stadium plan, and we are confident in their commitment," Clint Brewer, a spokesman for the ownership group, said in a statement. "We are also confident that thousands of soccer supporters in Nashville will continue to voice their support for the project. Soccer fans will want to know about Councilman Glover’s intentions so they can remain active supporters.”

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