Tenn. Senate passes Germantown school building bill
NASHVILLE — The Tennessee Senate Tuesday passed 22-8 revised legislation that could cede four Memphis Shelby County Schools to municipal districts but under different financial terms than the Tennessee House of Representatives approved last week.
With some reluctance, Tennessee Senate leadership supported the legislation, sponsored by state Sen. Brian Kelsey, R-germantown. Two Republican senators joined Democrat senators in voting against the bill, which addresses a school building ownership issue that has been pushed to the General Assembly by Germantown repeatedly in recent years.
It is not immediately clear when the House will consider the revised amendments to the bill, sponsored by state Rep. Mark White, R-memphis, who told The Commercial Appeal Tuesday he was in support of the revised amendment. If that body votes in support of the changes, White said, the proposed legislation will move to Gov. Bill Lee, who has not publicly indicated whether he plans to sign it.
If it becomes law, the signature win for the City of Germantown during an election year could be challenged in court by MSCS, bringing again to the courts for the second time in a decade the matter of ownership of certain county school buildings.
Germantown has been seeking Germantown Elementary, Middle and High schools, now part of MSCS, since the municipal district was formed a decade ago. The legislation could also require an agreement specific to Lucy Elementary, an MSCS school that is located in Millington, which has its own municipal district.
During a Senate floor session Monday, Sen. Ferrell Haile, R-gallatin,
Speaker Pro Tempore, brought forth the amendment with revisions that “adds some fairness to it.”
Passing the revised amendment “may help force” negotiations to take place, Haile said, describing one of three outcomes he saw with the legislation, HB2430/SB2315.
“If this bill fails, it’s going to come back to us again and again and again,” said Haile, who voted in support of the legislation Tuesday. “I don’t like being in the middle of this, I don’t like this at all.”
“The third option that can take place here,” Haile later described to senators Monday, “is that we pass this and they wind up going to court. Which in my personal opinion is where this decision needs to be if they can’t come to decision, not us making that decision. That needs to be within the courts.”
During the vote Tuesday, Sen. Jeff Yarbro, D-nashville, said the bill complicates an existing agreement and would only return so long as lawmakers were willing to take a side. “We’re choosing to be in this,” he said.
While MSCS has said it may sue, the district has contended an agreement recognized by federal court creating the Germantown district and other municipal districts settles the matter of the buildings.
The revised legislation supported by the Senate sets parameters on what kind of property transfer must take place if the municipal district and the county district don’t enter into an agreement by summer 2023.
Should the issue of the property end up in court, the proposed legislation about the building ownership would exist for courts to examine, Kelsey said Tuesday.
“And that’s what we’re defining here,” he said.
What the legislation does
The amended legislation supported by the Senate would define a transition period for current county students who go to the school buildings as well as stipulate particular payment timelines and appraisal processes. It also stipulates how proceeds would be divided if the new owner of the land sells it within 20 years of acquiring it.
If the proposed legislation becomes law, it would take effect in January 2023, but would require an agreement between the municipal district and county by July 2023.
Haile, the sponsor of the revised amendments, described the revisions like this: Under the revised proposal, if the municipality and the county district, MSCS, didn’t agree on terms, the revised amendment describes how property would be transferred to the municipal district or the municipality the district is located in.
The new owner of the building would pay 25% of the cost to the county district, MSCS, upon the deed transfer.
The price would be determined by the average of two separate appraisals, with the option for a third appraisal to settle any disagreements on the fair market value of the land and outstanding bonded indebtedness.
Then, the remainder of the payments would be made over the next 8 years.
During that time, students who attend the school while it is part of MSCS, the county district, could continue going there for a four-year transition period, Haile said. During that time, the new municipal owner couldn’t charge rent, a pivot from a proposed leaseback situation the city of Germantown had suggested could occur.
For those four years of transition, MSCS would be required to pay for the building utilities and maintenance.
The proposed legislation requires the local board of education for the county district and the municipal district both approve the agreement.
Laura Testino covers education and children’s issues for the Commercial Appeal. Reach her at laura.testino @commercialappeal.com or 901-5123763. Find her on Twitter: @Ldtestino