No WhiteWash!

Last night the Kingsport, Tennessee Board of Mayor and Alderman voted to borrow $41.1 million for various projects.  According to the Kingsport Times-News quote below, the total debt has doubled in the last five years.  I might add that this has occurred during Mayor Dennis Phillips terms as mayor and John Campbell as city manager.

With this bond issuance, Kingsport’s total debt has doubled in the past five years, from $110 million in fiscal year 2006 to $218 million in fiscal year 2010, according to city records. Kingsport’s general fund debt will increase from the current amount of $92.6 million to $103.4 million for fiscal year 2010, while total city debt will go from $173.5 million to slightly more than $218 million.

Read more via Kingsport BMA approves $41.1 M in bonds – Kingsport Times-News Online.

Things must really be in bad shape for the city because they are borrowing $200k to replace a roof on the Renaissance Center and financing it for 20 years.  Borrowing money to replace a roof should be a maintenance item that is planned for and funded from within a yearly budget.

It would not surprise me that Kingsport will be the subject of many discussions by other cities on Kingsport’s management practices or lack thereof. 

Mayor Phillips, when can we expect the property tax increase?

Below is the spending that was approved

The City of Kingsport for the last few years have been telling the citizens how great things are going in Kingsport.

The City of Kingsport is fortunate to have Eastman, the largest employer in Tennessee, located in Kingsport.  Having a large employer is great for the revenue that it brings the city, but it also allows the city to become complacent.

In the table below you can compare Johnson City, Kingsport, and Bristol retail sales growth from years 2000-2008.  Johnson City has led the Tri-City area with the best growth with Bristol’s growth coming in second.

It should be pointed out that Kingsport in the last 7 quarters has only had two quarters that have been positive growth when you compare the same quarter against the same quarter the previous year.  The two positive retail sales growth quarters can be attributed to new store openings.  While it may look like it good growth, one needs to keep in mind that this is incremental growth.  The real challenge will be whether Kingsport can keep up this growth given the unemployment situation in Kingsport and  another real question is how much money can you get the citizens to give up in a bad economy?

Bristol’s growth mostly started in year 2004 and then took a nose dive in 2008.  Most of that growth could be attributed to Exit 7 stores, but the Exit 7 stores have taken a beating and many have closed.

Kingsport was fat and happy with Eastman and Sam’s Club.  But when Sam’s Club decided they would close and move to Johnson City and Bristol, then Kingsport had negative growth in the year 2007.

One can say that Kingsport has had growth, so what’s the big deal.  Read more on this below.

The retail sales data is from the following link.  Tri-Cities Retail Sales Report

Using the Kingsport retail sales dollars and applying the yearly inflation percent tells a different story.  Note the “% Growth after Inflation” column below in orange tells a different story.  The year 2003 had a positive growth of 2.53% after inflation was applied.

One can say that the retail sales for Kingsport in 2001 actually meant more for the city in buying power than the current retail sales numbers.

The graph below needs no explaining and one can see that Kingsport is not as progressive as we are led to believe.

In the City of Kingsport city population table below it shows that the % growth from 2000 to 2007 resulted in a negative growth (-1.6%), while Johnson City had the best growth of 8.2%.  Morristown growth was 4.2%.  Bristol and Greeneville both had 0.3% growth.

Sullivan County growth is static and Kingsport is even more dismal.  Even with Kingsport going the route of captured growth through forced annexations, they cannot even keep up with the death rate.

City Population Table

Kingsport has led the Tri-Cites area with the highest unemployment rate of 10.5 percent for January, 2009.  For well over a year, Kingsport has been running a higher unemployment rate which cannot be blamed solely on Eastman.

Kingsport’s unemployment rate is likely to rise even more as the full impact of the Eastman layoffs kick in.

The sad news is that as these unemployed folks look for employment to support their families, they may be forced to move out of Kingsport to take jobs elsewhere.

To view Tennessee unemployment for January, 2009, go to Labor Force Estimates

Above is the data with no spin on the data.  It is up to you to decide if Kingsport is going in the right direction.  One needs to look at who is in charge of the Kingsport government for the periods above.  Will investing in more retail or hospitality type businesses bring good paying jobs for the citizen?  What is the city doing to help the citizens?  To me it seems that the city is only looking out for itself.  I also feel that if you can get the citizens to succeed, then the city will prosper.

I am sure the Kingsport will say that they are addressing the problem with the higher education center.  But what effort is underway to get employers to locate here with jobs to handle the thousands of students that complete their training.  My guess would be that these students will have to leave the area to find good jobs.

Based on the above data, do you feel that Kingsport is as progressive as they claim to be?  Feel free to comment.

Tri-City Christian School is the owner of the old Lynn View Middle School that they acquired from Sullivan County, TN and has now closed the school and wants to sell the property.

When the county sold the school to Tri-Cities Christian Schools (TCCS), both sides signed a contract that gives Sullivan County “first right of refusal” if the private school system decides to sell the property.

The sale of the Tri-City Christian School has gotten messy with different players getting involved.  Read the links below for more background.

Sullivan County Commission divided on Lynn View

BLOUNTVILLE — Sullivan County could have less than a month to invoke a buy-back option on the former Lynn View Middle School before that option expires.

The price could be $0.

And Kingsport officials are interested in leasing or buying the property from the county for use as a community park and recreation center.

So far, however, none of that has lit much of a fire under county commissioners.

A proposal to take the first step — to say the county wants to exercise the buy-back option — failed last week to gain support from any of the Sullivan County Commission’s three primary committees.

One wonders what is really going on with this property.  Read the comment by Pastor Boyd Holder. Jr. and the concerns that he has with Commissioner Wayne McConnell.

But, it appears that the City of Kingsport is the main problem that the church has in purchasing this property.

Kingsport, Sullivan County close to pact on acquiring old Lynn View Middle School

Kingsport Mayor Dennis Phillips and City Manager John Campbell met last month with McConnell and others to discuss the future of the facility.

On Monday, McConnell came before the entire Kingsport Board of Mayor and Aldermen to further discuss acquiring the property.

The property in question consists of two pieces — the school building on the north side (6 acres) and the ball fields on the south side (10 acres). A day-care center is located in the facility, and the Optimist Club operates its youth sports programs for about 900 children each year on the fields. The BMA would like to see both of these operations continue if Kingsport acquires the property.

Since the City of Kingsport appears to want the property, I would like to suggest that Pastor Boyd Holder take his entire congregation to the next BMA meeting.  Then on TV explain to the BMA why you want the property.  The congregation should feel comfortable in the courtroom where the BMA meeting is held because the seats look just like church pews.

Who do you think should purchase the school?

Stimulus Watch has a list of  “shovel-ready” projects for which the mayors of this state have requested federal stimulus funding.  I guess Kingsport, Tennessee Mayor Dennis Phillips and City Manager John Campbell are happy with the unemployment  rate (Dec. 8.4%) for Kingsport, because Kingsport does not have any “shovel ready” projects listed.  It is interesting that Johnson City submitted 11 projects.

Where are our great economic development politicians when we need them?  Why is it they just want to spend our local tax generated money when billions of dollars are available from the feds?

Kingsport citizens deserve better leadership!!

See Tennessee projects

Find projects by state or territory

The Kingsport Times-News article, Fiscal year 2008 audit OKs Kingsport financial health does some explaining on the recent audit of Kingsport’s finances.

However there seems to be some things left out or a press release issued by the city that never made it into the newspaper.

The press release below in the last two paragraphs state that the five enterprise funds had $16.3 million in cash.

Enterprise funds have to be self-supporting and we know that the Cattails Golf Course does not make any money and the MeadowView Convention Center ended the year with a $1.3 million loss

This would mean that the city is running a profit center in the water and sewer departments.  The raising of water and sewer rates each year has helped this cash position.  How else could they have gotten all of this extra cash?

If the City of Kingsport is doing so well, then how come they did not want to refund the 1/4 percent regional sales tax, back to the citizens when the MeadowView Convention Center was paid off?   Alderman Marsh and Shull tried to get the regional sales tax refunded back to the citizens but was voted down by Mayor Phillips, Vice Mayor Mallicote, Aldermen Munsey, Joh, and Shupe.

Press Release

KINGSPORT – Kingsport garnered a clean opinion of its financial statement for fiscal year 2008 from auditors Blackburn, Childers & Steagall, and rectified all four findings reported in the prior year.

“This audit represents what the citizens of Kingsport expect from their local government, transparency in financial reporting and responsibility with the taxpayer dollar,” Kingsport Audit Committee Chair and Alderman Larry Munsey said Tuesday. “I’m pleased to note that city finance staff corrected four items identified in last year’s audit, while auditors, whose job it is to go over things with a fine-tooth comb, only found three items in need of some work going forward into 2009. By any measure, our city continues to stand on firm financial ground.”

Auditors noted in their 2008 findings the need for a change in the way property purchases and sales are recorded by the Kingsport Industrial Development Board; better record keeping on the disposition of city capital assets; and better segregation of duties within payroll processing.

“We’re very pleased with this report, and already have projects underway to address the findings on capital asset recording and payroll processing,” Kingsport Finance Director Jim Demming said Tuesday. “The third finding on KIDB is just a matter of changing from net reporting to include all costs related to property acquisitions and sales.”

Demming also noted that the addition of a new internal auditor position and realignment of finance staff duties should quickly correct the findings.

Meanwhile, as of June 30, Kingsport posted $14.84 million in its unrestricted fund balance for 2008, with another $3 million to be added over the next few years as the general fund is repaid funding it advanced for the construction of Cattails Golf Course. Board policy is to maintain a minimum of $11.4 million at all times.

City Manager John Campbell said the pace of city government has quickened with regards to a number of key areas, including the development of a higher education center; greater internal support for job recruitment and retention efforts; expansion of commercial and tourism development; and implementing technology to increase efficiency.

“We have the staff in place to ensure we offer the greatest transparency possible,” Campbell said. “At the same time, we continue to operate well within the self-imposed debt limit of 10 percent of assessed property value, with new capital projects funded by the debt service roll-off as old debt is paid off.

“Without a doubt, the Board of Mayor and Aldermen is making sound investments that position our community for continued growth, which is how we keep property taxes low for everyone.”

Kingsport City Government is organized into six reporting units, starting with the general fund which covers emergency services, development services, leisure services and administration.

Five enterprise funds include the water fund, for the production and distribution of clean water, funded solely by user fees; a sewer fund, again self-supporting through user fees; a solid waste fund for garbage collection and disposal, reported separately but funded through property taxes; and two funds that cover MeadowView Conference Center and the golf course.

Collectively, enterprise funds reported $16.3 million in cash as of June 30, a strong cash position Campbell said he intends to maintain.

The Kingsport Times-News article, Mike McIntire files petition to run for Kingsport alderman, to me revealed that Mike Mclntire does not offer much except to say that he agrees with the direction that Kingsport has been going in the past.

It is my opinion that Mike McIntire has been hand picked to run as an alderman, because his views coincides with the majority on the Board of Mayor and Alderman.  It appears that Mike McIntire and Tom Parham are being used to replace Pat Shull in this upcoming election.  But at least Pat Shull has put out information that shows he is willing to think outside of the box.

There are no fresh ideas, he has no problem with the debt the city has and states that  he understands why some people think MeadowView is for the elite but he is for the MeadowView expansion.

Both Mike Mclntire and Tom Parham could be labeled as “insiders” because of their past involvement with the City of Kingsport and I am not sure this is what we need.  Currently, we have the “gang of five” (Phillips, Mallicote, Munsey, Joh, and Shupe) on the BMA that almost vote the same on every issue.  It is my opinion that this “gang of five” does not reflect the views of the majority of the citizens of Kingsport, but instead caters more to the special interest groups.

What Kingsport needs is not another person on the BMA who agrees with everything Mayor Phillips and City Manager, John Campbell wants.

This election is not about special interest groups.  It is an election for the citizens of Kingsport to elect BMA members that reflect their views on the direction that the city should go.  The citizens need to tell the elites, that this election cannot not be won with the elites money.

Is this what the citizens want?  Read the Times-News link above, make comments on the Times-News webpage and also here.

Please leave a comment.

Kingsport, Tennessee City Manager, John Campbell gave an update on how the City of Kingsport is doing at the local Kiwanis Club meeting on January 16,2009. A Kingsport Times-News article discusses what he said and the newspaper did a follow-up poll. The results of the poll show that 61 percent do not share John Campbell’s upbeat outlook for the city.

The City of Kingsport, Tennessee has removed an old family cemetery on the construction site of the John Adams School in the Rock Springs Road area that was recently annexed.

I recall quite some time ago, a WJHL TV interview with Kingsport’s City Manager, John Campbell that indicated that they had a problem because they recently discovered a cemetery at the site of the future John Adams School.

It is interesting that this “recent discovery”, that was discussed in the interview had a new road cut around the family graveyard many months before leaving the graveyard about eight feet above the road.

This graveyard was know to local residents and was listed on the U.S. Geological Survey topographic map as the Hargis Cemetery. It was also listed on many web sites giving the longitude and latitude coordinates for the exact location of the cemetery.

I was aware of the cemetery because of my interest and research in genealogy. I do recall that the ancestors in this cemetery were from the 1800’s or earlier.

It is sad to see that the City of Kingsport chose to remove this cemetery when it is quite possible that the folks buried there fought for the freedom that we have now in this country. The school buildings were not being built on the graveyard site, but I guess the city felt it was an eyesore.

I would like to tell the City of Kingsport that before you jump onto your bulldozers in recently annexed areas in the county, you might want to check out the old cemeteries. There are lot’s more in the Rock Springs Rd. area.

Can the city move the cemetery, yes they can. Can you vote for leaders that reflect your views and positions, yes you can.

The Kingsport, Tennessee Convention and Visitors Bureau is again devising ways to spend the taxpayers money.  First, they were able to convince the BMA to fund the $15 million convention center expansion and now they have conducted a study that has recommendations to expand Kingsport’s sports facilities and skate park. Consultant recommends Kingsport expand sports facilities and skate park

The consultant stated that the projects would cost around $17.1 million and would have an economic impact that could exceed $15 million a year, which is more than double the present results.

As far the economic impact,   The Kingsport Convention and Visitors Bureau states that since 1989, there has been $44 million in economic impact to Kingsport and the surrounding area.  Now, they state the expansion of the sports facilities and skate park would generate $15 million per year.  One needs to keep in mind that the entire economic impact does not go to Kingsport alone, but is shared with the surrounding area.

According to Kingsport Convention and Visitor Bureau, over $650,000 has been given back to area high school and athletic programs since1989 through hosting AAU national events.   During this time period, this $650,000 would not cover the upkeep of the present sports facilities in Kingsport.

It appears that there may be some double counting of economic impact dollars.  For example, Meadowview hotel states that the current revenue is $11 million per year and I am sure that the sports study are including hotel stays also.

You might want to get used to the phrase “destination city” since City Manager, John Campbell made the following statement.  “Investments in quality of life, hospitality and tourism, including the aquatic center and MeadowView, will help Kingsport begin to take on qualities of a true destination city,”

Don Schumacher, president of Sports Marketing Management and Consulting did the sports study.  You should also be aware that he recommended that the aquatic center be located at MeadowView.  To me, it appears that the aquatic center will be marketed to visitors to the Kingsport area.  I thought it was for the citizens of Kingsport.

It appears that maybe John Campbell has taken the Don Schumacher course in “Executive Program in Destination Management”

Maybe, the City of Kingsport could set up gift shops around the city to sell post cards and other tourist items to help defray the cost of this proposal.

The largest source of revenue for Kingsport Convention and Visitors Bureau, is the Hotel/Motel Tax funds that the City sends them.  Many years ago, the city reached an agreement to provide 87 1/2 cents on every hotel/motel tax dollar to the KCVB and the City retains the rest.  Tennessee law does require that the hotel/motel tax revenue be devoted to tourism promotion.

What are your views on this spending?  Please leave a comment.

Apparently, the announcement by Eastman Chemical’s $100 million cost reduction has gotten the attention of Mayor Phillips and City Manager John Campbell.

There was an article in the Kingsport Times-News on December 17, 2008, that was a press release (below) issued by the City of Kingsport, Tennessee and on the same day of Eastman Chemical’s announcement in the Times-News.

It has been my view that the Kingsport officials have been in denial that the region is in a recession because of the way they like to talk about how great things are going in Kingsport and their out of control spending.

I feel the Eastman announcement shocked them that things aren’t as well off in Kingsport. The big issue is that there will be less money coming to the city government because of the economy.

The press release below is the City of Kingsport‘s attempt to put their “spin” on how great things are going in Kingsport.  It appears that they are defending their out of control spending such as the MeadowView Convention Center expansion and the aquatic center.

No where in the press release do they mention that they are cutting back and it appears that it is business as usual.  Citizens have been cutting back for some time and there was a recent directive by the State of Tennessee to reduce spending by as much as 20 percent.

University of Tennessee executive staff will take a voluntary 5 percent pay cut and relinquish their UT-provided cars.  UT staff take pay cut

Recent announcements by Domtar and Cooper Standard to shut down over Christmas because of lack of orders also shows that the recession is affecting local firms.  Domtar, Cooper Standard to shut down over Christmas

City Manager, John Campbell stated “Investments in quality of life, hospitality and tourism, including the aquatic center and MeadowView, will help Kingsport begin to take on qualities of a true destination city,”

Wow, this is news that Kingsport is going to be a tourist attraction.  Could John Campbell provide a list of attractions so the locals can visit them.  Will the citizens aquatic center be shared with the tourists?

The City of Kingsport recently contracted with a Michigan firm to do a study on directional signs to help direct motorists and pedestrians to various city destinations.  This study will cost $81,410 and does not include the signs.  Save the money on the study.  Here are some suggestions for the signs;  Dollywood 95 miles, Nashville 281 miles, Asheville 83 miles, etc

Campbell stated . “But we know that Greater Kingsport has one of the higher personal saving rates in the country, and that helps position the region to weather the storm.”  How does he know about the personal saving rates of citizens?

Anyway, it really smarts that Campbell expects citizens to use personal savings to weather the storm while the city’s spending is out of control.  The city would not even stop or give back to the citizens the regional sales tax after the tax had paid off the current convention center.

It is apparent to me that the City of Kingsport is not going to stop it’s spending on such projects as Meadowview expansion, aquatic center, V.O. Dobbins center, etc.  The press release below is their attempt to justify the spending.

If money gets tight for the city, what I would like to see is for Mayor Phillips to propose cutting city services like garbage collection to every two weeks, reduce police and fire protection coverage in order to continue the spending pattern that the city has shown to the taxpayers in the past.  Go ahead Mayor Phillips, make good on your threat’s about cutting services.

It could get very interesting in an election year, if the mayor did push for cutting services.  Fasten your seatbelts if he does.

Kingsport, what are you doing to reduce spending?

Kingsport officials say region, city positioned to succeed despite national downturn

KINGSPORT – While regretting the impact of the national recession on a major regional employer, city officials said Wednesday that Kingsport and the region remain positioned for success through economic diversification and a strong focus on education and workforce training.

“As difficult as today’s announcement by Eastman Chemical is, it dispels a number of rumors about what we can expect going forward,” Mayor Dennis Phillips said Wednesday. “It also serves as a positive indicator of how well positioned that company is today as compared to a decade ago.

“At a time when many companies like Toyota are talking of leaving a brand new plant shuttered, or, in the case of Dow Chemical, laying off thousands, Eastman is positioned to meet current economic realities with far more limited measures. And that is really a success story for Kingsport and the region.”

Meanwhile, other indicators of continuing buoyancy in Kingsport and the regional economy are made clear with AGC Industries, formerly AFG Industries, recently announced the $34.6 million reconstruction of a glass manufacturing plant in Church Hill, creating 120 new jobs by 2010.

“Just this afternoon, we expect an important positive announcement from Domtar,” Phillips said. “And through the continued work of NETWORKS, KEDB and city staff, we are working to diversify our economy, recruit new jobs and encourage existing employers to expand.”

City Manager John Campbell indicated that continued economic diversification remains vital to the long-term success of Kingsport.

“Investments in quality of life, hospitality and tourism, including the aquatic center and MeadowView, will help Kingsport begin to take on qualities of a true destination city,” Campbell said. “At the same time, by offering more opportunities in higher education, we help create the workforce necessary to attract new employers and expand existing Kingsport businesses. There are both short term job gains, and longer term strength, to be expected from the investments the board is making or considering today.”

Working within the city staff structure, Campbell said the creation of a new economic researcher position will boost the internal and external capacity for recruiting retail, home builders, medical, and other services.

“We are also strengthened by the fact that Kingsport and the region continue to do well in terms of the appreciation of home values, with depreciation being a major cause of much economic difficulty nationally,” Campbell said. “Kingsport has ranked 14^th in the country for much of the year in terms of appreciation. The key investment that most people own, their home, remains a sound investment in Kingsport.”

While making strategic investments in key areas of return – education, workforce retraining and economic diversification through hospitality and tourism – Campbell indicated that continued softening in the regional economy is to be expected given national conditions.

“Nationally, October was the month everything shut down, particularly in the retail sector, and we expect to see some softening in that area,” Campbell said. “But we know that Greater Kingsport has one of the higher personal saving rates in the country, and that helps position the region to weather the storm.”

A report by East Tennessee State University shows that Tri-Cities’ retail sales outperformed those of Knoxville, Chattanooga and Tennessee overall.

“If you look back since 2006, we’ve had $370 million in new construction, much of that in the retail and commercial office sectors,” Campbell said. “That is definitely helping Kingsport recapture lost market share.”

Looking forward, with ongoing work on projects like the reuse of Quebecor, the pending mall renovation, and expansion of Meadowview Convention Center, 2009 could still be a good economic year in Kingsport.

“No community is immune to the economic circumstances of the rest of the country,” Campbell said. “But we’re doing all we can to retain and recruit the jobs of tomorrow.”