Whereas, The Metropolitan Government of Nashville and Davidson County (hereafter referred to as "Metropolitan Government") is vitally interested in the economic welfare of its citizens and wishes to provide the necessary leadership to enhance this area's capabilities for growth and development; and

Whereas, the provision of jobs to area citizens by local business is both necessary and vital to the economic well-being of the Metropolitan Government; and

Whereas, pursuant to the Industrial Development Corporations Act, currently codified at Tenn. Code Ann. §§ 7-53-101-311 (such act, as heretofore or hereafter amended, the "Act"), the General Assembly of the State of Tennessee (the "General Assembly") has authorized the incorporation of public corporations known as "industrial development boards" in municipalities in the State of Tennessee (the "State"); and

Whereas, The Industrial Development Board of The Metropolitan Government of Nashville and Davidson County (the "Board") has been duly organized and incorporated in compliance with the Act; and

Whereas, the General Assembly has found and declared that the Board is performing a public function on behalf of the Metropolitan Government and that the Board is a public instrumentality of the Metropolitan Government; and

Whereas, the Supreme Court of Tennessee (the "Supreme Court") has found that the Board is an agency or instrumentality of the Metropolitan Government; and

Whereas, the Act expressly incorporates by reference the statement of public policy set forth in Section 3 of Chapter 209 of the Public Acts of 1955; and

Whereas, Chapter 209 of the Public Acts of 1955 states that the declared purpose of the Act is to do that which the State welfare demands and the State public policy requires to alleviate the problems of unemployment, to raise family income, to provide a means by which the citizens of the community may promote and develop industry in their area so as to obtain a balanced economic development highly essential to the welfare of the State, and to promote the development of commercial, industrial, agricultural and manufacturing enterprises by the several municipalities so as to be given local benefits peculiar to each and general benefits to the entire State; and

Whereas, the General Assembly also has declared that the purposes of the Act include maintaining and increasing employment opportunities by promoting industry, trade and commerce by inducing manufacturing, industrial, financial, service and commercial enterprises to locate or remain in the State; and

Whereas, the Supreme Court has held that the purpose of the Act include the promotion of industry and the development of trade to provide against low wages and unemployment and that such purposes are public in nature; and

Whereas, the Board is empowered pursuant to the Act to acquire, whether by purchase, exchange, gift, lease or otherwise, and to improve, maintain, equip and furnish, "projects" (as defined in the Act), and to lease such projects to others; and

Whereas, "projects" under the Act may include, without limitation, a hotel, including any conference or convention center facilities related to such hotel; and

Whereas, Opryland Hotel Nashville, LLC ("Opryland"), which has its headquarters in Nashville, Tennessee, has announced its tentative decision to construct a major addition (the "Addition") to the currently existing Opryland Hotel and Convention Center which is located within the boundaries of the Metropolitan Government; and

Whereas, the currently existing Opryland Hotel and Convention Center and the Addition, which are identified on the map and legal description attached hereto as Exhibit A, and incorporated herein by reference, are hereinafter referred to, collectively, as the "Project"; and

Whereas, the location of the Project within the boundaries of the Metropolitan Government will result in significant employment and other commercial opportunities for area citizens; and

Whereas, pursuant to Tenn. Code Ann. § 7-53-305, all properties owned by the Board are exempt from ad valorem taxation in the State of Tennessee; and

Whereas, pursuant to Tenn. Code Ann. § 7-53-305(b), the Metropolitan County Council (the "Council") has the power to delegate to the Board the authority to negotiate and accept from its lessees payments in lieu of ad valorem taxes, provided that such payments are in furtherance of the Board's public purposes; and

Whereas, in view of the benefits to the Metropolitan Government of the location of the Project within the boundaries of the Metropolitan Government, and in exercise of its powers enumerated above, the Board wishes to acquire, by purchase, exchange, gift or lease, property that will be used with respect to the Project, lease that property to Opryland, and enter into one or more agreements with Opryland to accept payments in lieu of ad valorem taxes with respect to the Project; and

Whereas, Gaylord Entertainment Company operates the Project and is an industry recognized, award-winning expert at operating large-scale hotel convention center facilities and it is in the best interest of the Metropolitan Government for Gaylord Entertainment Company to continue to operate and control all aspects of the hotel and meetings operation at the Project, at its sole discretion; and

Whereas, the Board is not able to negotiate and accept payments in lieu of ad valorem taxes without authorization from the Council; and

Whereas, it is contemplated that the Board will issue its revenue bonds (the "Bonds") to finance a portion of the Addition and that said revenue bonds will be payable out of a portion of the payments in lieu of ad valorem taxes with respect to the Project as hereinafter more specifically described; and

Whereas, upon receipt of public funds, Opryland will endeavor to make sure that MBE firms are invited to participate in bids.

NOW, THEREFORE, BE IT ENACTED BY THE COUNCIL OF THE METROPOLITAN GOVERNMENT OF NASHVILLE AND DAVIDSON COUNTY:

Section 1: The Council of the Metropolitan Government finds that the Board's acceptance of payments in lieu of ad valorem taxes with respect to the Project is in furtherance of the Board's public purpose of maintaining and increasing employment opportunities, as set forth in Tenn. Code Ann. § 7-53-102 and the other public purposes described above.

Section 2: The Metropolitan Government hereby delegates to the Board the authority to negotiate and accept payments in lieu of all ad valorem taxes with respect to the Project for a period of 25 years, beginning on the date that the Board enters into a lease with Opryland with respect to the Project.; provided, however, that the Board shall not negotiate and accept such payments unless the commissioner of economic and community development and the comptroller of the treasury have determined that the agreement providing for such payments is in the best interest of the state. The amount of the payment in lieu of tax (the "Payment") that shall be required with respect to each year under such arrangement shall be one hundred percent (100%) of the Standard Tax (as defined below).

The term "Standard Tax" shall mean the amount of ad valorem real and personal property tax that Opryland would be required to pay with respect to a given tax year with respect to the real and personal property that is then subject to the payment in lieu of tax arrangement authorized hereby if Opryland owned such property. Opryland shall be permitted to challenge the assessment of any real or personal property that is then subject to the payment in lieu of tax arrangement authorized hereby in the same manner as if Opryland owned such property.

Section 3: (a) The payment in lieu of tax arrangement authorized by this Ordinance shall apply to all real property and personal property (tangible and intangible) comprising a portion of, or used at or in connection with facilities located on, the following properties described in Exhibit A.

(b) The payment in lieu of tax arrangement authorized by this Ordinance shall apply to all land, easements or other property rights, buildings, improvements, fixtures, construction in progress, equipment, furniture and other properties of any nature comprising a portion of, or used in connection with, facilities located on the properties described above. Such arrangement shall apply to such facilities and such properties in their current scope and configuration and to all replacements, enhancements, additions, expansions and improvements to such properties and facilities.

Section 4: The payment in lieu of tax arrangement authorized hereby shall apply to each of the properties and facilities described in Section 3 of this Ordinance and to each portion thereof so long as such property or such portion thereof is leased by the Board to (a) Opryland, (b) any successor to Opryland, including, without limitation, any corporation, partnership, limited liability company or other entity (i) that acquired, directly or indirectly, a controlling interest in Opryland (whether through merger, stock purchase, stock swap or otherwise), (ii) that merges or consolidates with Opryland, or (iii) that acquires substantially all of the assets of Opryland, and (c) any corporation, partnership, limited liability company or other entity that is controlled by, or is under common control with, any of the foregoing (the entities described in Sections 4(a)-(c) being referred to collectively as the "Opryland Entities"). Additionally, in connection with a lease financing or similar arrangement involving the Project (or any portion thereof), any of the entities described in the preceding sentences of this Section 4 may sell, transfer, assign or sublease its interest in the Project (or any portion thereof) to a third party, or may cause the Board to lease the Project (or any portion thereof) to a third party, without disturbing the payment in lieu of tax arrangement contemplated by this Ordinance with respect to the applicable portion(s) of the Project if such portion(s) of the Project are leased or subleased to, and operated by, an entity described in the preceding sentences of this Section 4.

Section 5: A portion of the payments in lieu of ad valorem taxes shall be pledged to the payment of debt service and required reserves for the Bonds in accordance with the terms of an Interlocal Cooperation Agreement to be entered into by the Metropolitan Government, the Board and the State of Tennessee.

Section 6: Upon receipt of public financing for this addition and approval of Resolution No. RS2007-2084, Opryland shall endeavor to make sure that MBE firms are invited to participate in bids, and Opryland shall strive to maximize, to the extent practicable, participation of minority owned businesses through both prime and second tier business contracting opportunities associated with this project.

During the construction of this addition, Opryland shall prepare an annual written report for the Metropolitan Government’s Director of Finance. The report shall describe the percentage of minority owned businesses that have been hired to complete this addition, including a list of the actual expenditures to minority owned businesses. The report shall be submitted to the Director of Finance at least thirty days before the Metropolitan Government is required to submit its report to the State of Tennessee pursuant to PL________.

Section 7: The final version of the payment in lieu of tax agreement authorized by this Ordinance must be approved as to legality by the Director of Law of the Metropolitan Government prior to being executed by the Board.

Section 8: All ordinances or resolutions, or parts thereof, in conflict with the provisions of this Ordinance are, to the extent of such conflict, hereby repealed.

Section 9: This Ordinance shall take effect from and after its passage, the welfare of The Metropolitan Government of Nashville and Davidson County requiring it.

Sponsored by: J. B. Loring, Charlie Tygard, Rip Ryman

Amendment No. 1
To
Substitute Ordinance No. BL2007-1556

Mr. President:

I move to amend Substitute Ordinance No. BL2007-1556 as follows:

1. By deleting the phrase “Exhibit A”, wherein it appears in the fourteenth recital clause and in Section 3, and substituting in lieu thereof the phrase “Exhibit 1”.

2. By substituting Exhibit A with the attached “Exhibit 1”.

Sponsored by: J. B. Loring

View Exhibit

LEGISLATIVE HISTORY
Introduced:	July 3, 2007
Passed First Reading:	July 3, 2007
Referred to:	Budget & Finance Committee Convention & Tourism Committee
Substitute Introduced:	July 17, 2007
Passed Second Reading:	July 17, 2007
Amended:	August 7, 2007
Passed Third Reading:	August 7, 2007 - Roll Call Vote
Approved:	August 9, 2007
By: