Brakes hit on rec center

May 1—The Crossville City Council put the brakes on its proposed indoor recreation center last week after outcry from residents on a potential property tax increase.

The council unanimously rescinded action it took April 14 to proceed with the next steps borrowing money for the project, which still doesn't have a final design or estimated cost.

"We want to move forward in a responsible and transparent method so that all citizens know exactly what the council is doing and why we are doing it," Crossville Mayor R.J. Crawford said Thursday.

"We need to have a better answer to how much this thing is going to cost and how we pay for it before we move forward."

Crawford said there had been some misinformation regarding the initial bond resolution and public misunderstanding on the topic.

For that reason, he moved to rescind the council's action approving an initial bond resolution for up to $55 million.

Council member Art Gernt supported the motion, which was unanimously approved.

The action resets the bond process. If the council wants to issue bonds in the future for the recreation center project, it would have to publish a new notice.

"I believe after obtaining more information, then the council can decide how to move forward on this issue," Crawford continued.

"Decisions such as cost, the repayment methodology or whether to have a notice or referendum in the paper and projects can be addressed at that time."

Crawford also asked the council to consider holding a special election for a vote of the city's residents and property owners if repayment will require an increase in property taxes.

Council member Mike Turner said, "I just don't think that it's right to put anything like this on the back of the taxpayers without a referendum vote. And if you vote in favor, then we go with it."

But that's not what Turner said he's been hearing from his constituents.

"Everyone who's been talking to me says we're having a hard enough time keeping gas in their car, food on their table, kids in schools — everything has went up so much," Turner said.

The council voted to approve an initial bond resolution — which does not obligate the city to issue bonds or take on debt.

Part of the resolution included placing a public notice in the Crossville Chronicle, published April 18, stating the city could take on up to $55 million in debt.

The public notice is a state requirement when a municipality looks to take on additional debt.

An ad taken out in the Crossville Chronicle April 25 encouraged residents to be at the 4 p.m. Thursday meeting, saying the indoor recreation center would cost $65 million and result in a "huge tax increase."

The ad was paid for by James Morrow.

But there's been no final decision made on the recreation center, Crawford said.

"At no time did the city council vote to approve the expenditure of even one dollar for the indoor recreation facility," Crawford continued.

While the city has been discussing an indoor recreation center for several years, there's been no final decision on what the recreation center will include, how much the city will spend — if it will spend anything — or how to pay for such a facility, such as a tax increase, Crawford said.

"There was no action regarding the issuance of bonds, the building of the indoor recreation facility or the expenditure of any funds or raising of property taxes," Crawford said. "At this point, no decision has been made on any of those issues."

Council member Rob Harrison said he had supported the initial resolution, but believes there are still several steps in the process before a final decision is made — primarily final design of the facility and town hall meetings to inform the public.

"I'm glad the people are aware," Harrison said. "I was thinking we'd eventually get our ducks in a row and then we would ask everyone to come out and have a look at this."

Crossville businessman Butch Smith said the resolution allowed the council to approve a bond issuance with only a majority vote of the five-person council unless 10% — about 730 voters — of registered voters signed a petition within 20 days to force a referendum.

"If nobody had talked in this last week and that notice went forward, wouldn't that give you the right, the council, to issue those bonds with one more, three-person approval for that?" Smith asked. "If you hadn't come tonight, that could have went into effect."

Crawford said issuing bonds would require three readings by the council.

Council member Scot Shanks said the council has discussed an indoor recreation center for many years, with surveys showing support for the project. Shanks said he views the recreation center as an investment in the community, for both the children and the community overall.

"I think this rec center will be a huge investment to help Crossville moving forward," Shanks said. "I think it can help revitalize our downtown even moreso than what it is. There will be a lot of additional development from having this rec center.

"I'm always having people ask about new restaurants. We don't have a lot of control over that, but that will do nothing but help have more restaurants, offices, businesses come here. It will help keep businesses here, to help businesses keep employees here."

Shanks and Harrison developed a brochure made available at the meeting and included with this article online, that outlined different options for a rec center and the potential monthly property tax each would require — from $6 a month for a property valued at $100,000 for a "bare bones" option up to $13 a month for a rec center with two indoor pools, an outdoor pool and multi-purpose court.

Memberships for the facility would vary on family size and the type of facility built. The brochure says the council's goal is to provide a special rate for city residents.

Resident Dale Braun said he opposes the recreation center because it would directly compete with private businesses in the community — gyms and fitness centers and pools available at the state park.

Crossville resident Caitlin Chamberlin said she believes a recreation center would benefit many area residents, from children to adults and older residents.

"This rec center is about so much more than just fun," Chamberlin said.

It could provide a place for youth with summer programs. It would encourage better health and physical activity while also teaching about water safety.

Many parents in the community are driving to Cookeville to access such a facility, she said. She also pointed the recent closure of the Rocky Top 10 cinema, reducing one activity that families and children used.

"The gap of safe and accessible extracurricular activities in our community is only getting larger," Chamberlin said.

Previously, City Finance Director Fred Houston told the council he believed a property tax increase would be necessary to pay the debt on the construction costs of the proposed facility.

Using the current revenue per penny on the city tax rate — currently 60.59 cents per $100 of assessed value — a $55 million loan would require an additional 71 cents on the property tax rate.

But the city has significant reserve funds, about $22 million. It could also reduce the cost of the facility by scaling back on amenities, such as phasing in an outdoor pool or eliminating a multi-purpose court.

Shanks said he'd heard people saying property taxes would "quadruple" to build the recreation center.

"I can't say that property taxes won't have to increase some — I don't know," Shanks said.

But Crossville's property tax rate is lower than some of the other municipalities in the area — and significantly lower than other counties when looking at the combined city and county tax rate — currently $1.135 per $100 of assessed value and a combined city-county tax rate of $1.7409 per $100 of assessed value.

Cookeville property owners, for example, pay a combined city and county tax rate of $3.292 per $100 of assessed value. Jamestown residents pay a combined tax rate of $2.63. Sparta residents pay a combined rate of $2.9683.

"A worst-case scenario, if we were to fund this recreation center completely through property taxes — which I do not want to do — it could be done by currently doubling our city property tax — which again, I'm not for doing that," Shanks said. "But if we did ... of all the counties around us, guess who would have the least property tax. The people in Crossville."

Shanks said he believes sales tax can help pay for a significant portion of the recreation center, though Houston has said increases in sales tax helps pay increased operating costs for the city.

Turner said he thinks about people who live on fixed incomes or have limited means being able to afford a property tax increase.

"If this could be financed through sales tax — our own finance director has told us the property tax will have to go up," Turner said.

Tim Wilson, owner of The Gardens RV development, said one of the reasons retirees look to Crossville to relocate is the low tax rate.

"An amenity like this is a great amenity. I'd love to see it," Wilson said. "I'd love to see a different way of paying for it. Talking about doing all this out of property taxes was the torpedo that sunk it."

Tom Isham, 2nd District commissioner, said everyone he's heard from has been against the project. He pointed to the 2008 recession when sales tax dropped in the county, and he said he believes there would be a recession sooner or later.

"Be cautious on what you spend and how much you spend," Isham said. "I don't believe the people of Crossville's going to support this. The people need to decide on this."

Heather Mullinix is editor of the Crossville Chronicle. She covers schools and education in Cumberland County. She may be reached at hmullinix@crossville-chronicle.com.