Jared Felkins: Cumberland Corner plan isn’t anything unique

Jared Felkins • Updated Apr 17, 2018 at 11:00 AM

“The basic idea that if you increase government spending or you cut people’s taxes that stimulates the economy and lowers the unemployment rate, is a very widely accepted idea. It’s in every economics textbook, that’s what we teach our undergraduates, and I certainly try to teach them the truth.” 

— Christina Romer, economist

So we’ve arrived at the decision on whether the Lebanon City Council will approve or deny an $850,000 donation to Cumberland University to buy about 3 acres of land that is planned to be developed into Cumberland Corner to provide more student housing for the growing university, as well as a college store and possibly a coffee shop or something similar.

It seems, everywhere you turn lately, there’s an opinion on the issue. There are some pretty good arguments from both sides of the issue, and then there’s quite a bit of misinformation out there. One of the most outlandish remarks I saw was that the deal would cost Cumberland $100 million and effectively bankrupt the university. Folks, that’s just flat-out false. The best estimates I’ve seen are that the development will cost Cumberland between $15 million-S20 million, but only if the council approves the $850,000 donation Tuesday night to buy the land.

In the most simple of terms, Cumberland can’t wait any longer, which is why time is of the essence. It doesn’t have the available cash currently on hand, because all of its capital funding is tied up in existing projects. The university will get four years to build the development or return the donation to the city. If the donation is approved, Cumberland will apply for a bond to pay for the development that it will be able to pay back over time at a low interest rate. 

If the donation isn’t approved, it will be quite difficult for Cumberland to grow, and growth is necessary for the university’s ability to remain competitive and remain successful.  

In my view of several debates on social media, there are several terms that keep cropping up from those opposed to this plan like unique, unprecedented and record. Well, there’s no dispute from me these terms are accurate – when you’re talking about Lebanon donating to Cumberland University. It may be the first time, but it’s not unique for taxpayers to fund private university projects. 

In fact, Vanderbilt University is a private institution, but its police department is under the authority of Metro Nashville police, meaning it’s publicly funded. That means taxpayers pay for about 260 personnel, including 90 sworn officers, primarily to protect private students at a private university. I’m not sure what that costs, but it’s comparable to Lebanon’s police force, which costs taxpayers more than $8 million annually. Lebanon’s proposed police budget for the upcoming year includes funding for 90 sworn officers, 24 civilians, three part-time security officers and seven crossing guards. And all are much appreciated. 

There are several instances where the Metro-Nashville City Council also provided funds for several projects in the past at Lipscomb University, Trevecca Nazarene University and Belmont University, all of which are private institutions. The council also annually gives about $100,000 to the Vanderbilt School of Nursing at Vanderbilt University Medical Center. It has for at least the past six years. 

I know. It’s difficult to compare Metro Nashville’s budget with that of Lebanon’s, but my point is to merely show that the act of donating is far from unique. 

And it’s accurate to say in this case Lebanon can afford the Cumberland donation. The city currently has about $10 million in available funds in its general fund, and the donation would be 8.5 percent of that amount. It’s important to note the money won’t come from the city’s rainy-day fund, which is currently tied up in certificates of deposit earning interest. The rainy-day fund has about $12 million in it. 

I’ve heard a lot of references about this deal as shady and underhanded, and that the city is hiding something. I’ve also heard that somebody must be lining his pockets somewhere. I can assure everyone, both the city and Cumberland officials were nothing but transparent through the entire process. 

And, the donation is legal, despite what many have said to the contrary, as well as an opinion from the state comptroller’s office questions. Lebanon’s charter authorizes the council to give donations to entities such as schools. 

“The charter expressly authorizes the city to donate to charitable organizations and educational institutions,” said Lebanon city attorney Andy Wright. “It does not set forth a limit. The same authorization exists in statutory law for general law chartered cities. The legal ability to do it is clear. Whether we should is up to the elected officials.” 

One last point I want to make is that this plan is essentially no different than any payment in-lieu-of taxes plan dozens of industries received and continue to get all across Lebanon and Wilson County. Amazon received a lucrative PILOT, as did Under Armour and several others, which means they don’t pay property and several other taxes for several years in exchange for locating here. These are for-profit companies, but no one was up in arms about those. 

I really believe all Cumberland wants to do is educate students, nearly half of whom are from Wilson County, and send them out into the workforce. Cumberland graduates make up about 10 percent of Wilson County’s working population. 

But what I don’t understand is the opposition, and I don’t mean the average everyday taxpayers. People are entitled to their opinion, and I respect that. But there’s some money behind the effort for this not to happen. I have some doubts about the transparency of an anonymous Facebook group and other prominent Lebanon folks’ opposition to a plan simply to keep the city from facing financial turmoil, or so they claim. I just wonder if there’s more to it than what the opposition has said. We may never know. 

What we do hope to know is the outcome of the council’s decision Tuesday night. It’s my hope the council does what’s best for both Lebanon and Cumberland and approves this donation. 

Jared Felkins is editor of The Democrat. Email him at [email protected] and follow him on Twitter @paperboyfelkins.

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