CLARKSVILLE, TN (CLARKSVILLE NOW) – The Montgomery County Commission is looking to take out a bond to help pay for the roughly $11 million of a downtown parking garage next to the F&M Bank Arena.
At an Industrial Development Board (IDB) meeting last month, county leaders stated they were looking to do the project without Riverview LLC, which was supposed to lease the land and garage from the county upon completion. As costs continue to rise, county leaders said that arrangement no longer made sense.
Rising costs of garage
The 724-space garage is being built on land donated to the county by the Hand family, which owns the Riverview Inn next door, and it will be partially funded through a $14 million grant from the state of Tennessee.
At Monday night’s County Commission meeting, Mayor Wes Golden explained the situation.
“At the time the $14 million was granted to Montgomery County, that would have been close to what it would cost to construct a parking garage like we need. That is not the case today,” said Golden, who later noted the project will cost an estimated $25 million.
He attributed the rising costs to the infrastructure downtown and the substantial increase in the price of concrete.
Golden said that when it comes to the operation of the garage, the county is looking at all options. Officials are considering having the Clarksville-Montgomery County Economic Development Council oversee the garage but are also actively looking at third-party options. The mayor said the garage will come with the hardware needed for daily operations.
“Revenue collected would go towards paying the debt for this garage. For the $14 million, based on the projected numbers, we’re looking at revenue coming in at about $700,000 a year. That’s not enough to completely cover the debt service for the garage, so we’re looking at other ways to pay for that debt, whether it be other parking opportunities around the downtown area as well as revenue off of PILOTs,” Golden said.
The county is looking to authorize a 15-year bond issuance that does not exceed $14 million. The county is also looking to enter into an agreement with the IDB and EDC to develop the most cost-efficient plan for the project.
Gallant: ‘We don’t have a choice’
The resolutions saw vocal support from multiple members, including Commissioner Ryan Gallant.
“Regardless if it is $25 million or not, it is worth the investment. It is worth the time, considering the business and the economic structure that we have coming into Clarksville. This is only going to be beneficial. At this point, considering the amount of plans we have in motion, we don’t have a choice,” Gallant said.
The plan saw further support from Commissioner Jorge Padro. “It’s due time that we look into the future. Clarksville is not getting any smaller. This will have a revitalizing effect on the businesses downtown,” he said.
Commissioner Billy Frye asked if the county has considered a scaled-down version of the project so that only state funds already provided would be used.
“With an arena that can hold 6,000 people, I think we would be doing ourselves a disservice to scale it down,” Golden told Frye.
Frye said he didn’t think the current plan was the only option. “Private enterprise will come in and have lots and shuttles,” he said. “This isn’t the only way.”
Economic picture
While the county is looking at fronting $11 million for the garage, that is still less than half of the total cost of the project, as the state has provided $14 million. Additionally, the land for the garage is free, as it was donated to the county.
“We’ve gone from a parking lot that wasn’t going to be ours, that we weren’t going to own and run by somebody else, to having the opportunity for half of the price,” Commissioner John Gannon said. “Basically, we’re getting control of it. We’re going to get the revenue from it when the note is paid off and be able to run it and make sure it runs efficiently the way we want to run it. I think it’s a win-win situation for the county.”
Additionally, the mayor noted the cost will be offset by tax revenue generated from the arena, hotel, retail and restaurant businesses coming to the downtown district.
“That’s really one of the reasons that the state came to the table with the money, because they saw the economic impact that it would have on our community,” Golden said.
The commission will vote on the intergovernmental agreement and bond issuance on Monday, Dec. 12, at 6 p.m. at the County Courthouse.