Measure seeks to explore property transfers
NASHVILLE — A state policy research institution is expected to be tasked with developing recommendations governing the political and economic issue of property transfers from existing county school systems to newly created municipal districts.
Senate Education Committee members this week approved an amended bill by Sen. Todd Gardenhire, RChattanooga, that wades into the divisive issue.
Gardenhire’s bill fleshes out his own approach on how to come up with fair-market values on schools, facilities and school property such as desks. If counties and cities can’t agree on buildings, the issue would go to binding arbitration.
But Gardenhire also directs the Tennessee Advisory Commission on Intergovernmental Relations to examine the issue and present its recommendations to the General Assembly this January, effectively putting off action on the roiling controversy until 2019.
There’s a wrinkle, however, on the issue. Senate Education Committee members also approved a Senate joint resolution, sponsored by Senate Speaker Pro Tempore Ferrell Haile, R-Gallatin. And the resolution is broader, directing the advisory commission to study the general issue of revenue sharing between counties and municipal or special schools and to make recommendations.
Haile’s resolution notes current law already establishes requirements for sharing revenue — “both operational expenses and bonded indebtedness for capital construction” — among school districts within a county affecting the “fiscal health and operations of the county school system.”
But it notes those requirements “may create structural disparities in the resources available to county and municipal or special school districts and may unnecessarily increase the level of local government indebtedness for capital projects.”
Haile’s resolution is scheduled to be considered Monday on the Senate floor. Gardenhire’s bill had not been scheduled as of Friday afternoon and remains in the Calendar Committee.
The 26-member advisory panel includes state lawmakers, representatives of city and county governments, a member of the governor’s administration and two private citizens. It has studied and made recommendations on any number of politically and emotionally charged issues over the years.
Gardenhire said after moving his bill through the Education Committee that the “biggest complaint I’ve heard from people across the state that have dealt with these type situations is at the end of the process … big lawsuits come about on how much is owed and what the price is for buildings and assets.”
That’s resulting, among other things, in “hefty attorneys’ fees that everybody has to pay to decide how much the assets are valued at,” he said. “There’s no process in place to determine that.”
Gardenhire said he wants the advisory commission to look at the guidelines in his bill, emphasizing they’re “only guidelines” on coming up with a value on the assets.
“That way a municipality that wants to do this knows what they’re looking at financially,” the senator said.
If a city and county can’t agree, the issue goes to binding arbitration by an independent arbitrator when it comes to real estate, including buildings, he said, noting “each side gets to present their facts on what those assets are valued at.”
When it comes to equipment, a CPA or qualified appraiser would look at the original value and factor in depreciation, as well as what a local community may have contributed to those assets and other factors, he said.
Citing what occurred in Shelby County, where the issue erupted after various towns sought to create their own school systems after the Memphis and county school systems merged, Gardenhire said the county “would be made whole” minus the local community’s contributions under his approach.
After Gardenhire introduced his original bill in January, generating considerable disagreement on Signal Mountain, Sen. Bo Watson, R-Hixson, and Rep. Patsy Hazlewood, R-Signal Mountain, raised concerns, as did community members.
Gardenhire doesn’t represent Signal Mountain. But he said at the time that other cities or town such as East Ridge, which he does represent, may have interests in setting up their own school systems.
Hazlewood said Friday that from what she can tell, Haile’s resolution appears to be “looking at a lot of things about school funding and sharing of funds.”
“It seemed to me that rather than being a separate study, this [Gardenhire bill] could be a piece of this overall, broader study,” she said.
Efforts to reach Watson were unsuccessful.
Signal Mountain resident Elizabeth Baker, who has previously raised concerns about the county schools going to the city, said she’s “happy to hear that they’re doing some research, but I would like to see more studies on how it will actually impact residents, students, teachers in education by reallocating buildings. They’re not looking at who’s using the building.”
If a municipal school district is created and the county schools are handed over to it, that “still does not answer the question of those families that are using that building who do not live within the municipality,” she said.
“What happens to those students?” Baker asked. “It’s those students and those families who can’t be included in a municipal district. They can’t even vote on whether this happens. So in essence you have families, some with over a decade in schools, that someone else can take away from them.”
Contact Andy Sher at asher@timesfreepress.com or 615-255-0550. Follow him on Twitter @AndySher1.