January 15, 2008

Sen. Jackson Repeats the Bredesen Ballroom Lies

The report in today's Tennessean about yesterday's Legislative Fiscal Review hearing on the ballroom project at the governor's mansion could have enlightened taxpayers as to the real cost of the ballroom, but settled for merely presenting what each side of the dispute claims is true.

During the discussion, Sen. Doug Jackson, a Democrat from Dickson, observed that $3.8 million of the money for the underground hall will come from taxpayers. That money will be used to install a new driveway and features such as elevators to make the hall and mansion accessible to those with disabilities. The other $4.8 million to build the hall itself is being donated by the foundation.

Susan Kaestner, vice president of the TAG group, said Jackson's comment misrepresented the facts. "It will save taxpayers $8,720,000 if it is not built,'' she said. "So to suggest it's only costing taxpayers $3.8 million dollars is wrong."

Jackson was repeating administration talking points when he said the underground ballroom is being donated by the Tennessee Residence Foundation, using private funds. He is correct from a legal standpoint, but Kaestner is correct in saying that canceling the ballroom project would save taxpayers more than $8 million.

Here's why - and these are facts that Sen. Jackson either willfully ignored, doesn't know, or doesn't understand, none of which would suggest the Dickson Democrat is doing his job well.

The Tennessee Residence Foundation raised several million dollars to pay for renovation of the existing mansion, a project that is almost done. On paper, the Foundation is donating $4.8 million of that private money to the ballroom project. But on the same day the Foundation gave that gift to the state, the state gave the Foundation millions of dollars in proceeds from a bond issue.

Is it technically true that, on paper, the accountants show money being donated by the Foundation to the ballroom project? Yes. But the Foundation, run by Gov. Bredesen's wife, could not have donated that money if the Bredesen administration had not simultaneously given the Foundation an almost equal amount of tax dollars.

It's a financing shell game designed to fool the public into thinking that the ballroom is privately funded.

The private money that the Foundation, on paper, "donated" to the ballroom project was raised originally to pay for most of the $9.5 million cost of renovating the existing governor's mansion. But because of cost overruns and the shell-game move of funds, on paper, to the ballroom project, it is the taxpayers who have paid more than $7.7 million of the mansion renovation, with the Foundation paying less than half a million dollars. Part of that $7.7 million is due to higher-than-expected construction labor and materials costs because of Hurricane Katrina and because the deterioriation of the mansion was more extensive that originally believed. But a big part of it is because taxpayers are subsidizing the Foundation's "gift" to the ballroom project.

That's not partisan political spin, it is fact, documented in State Building Commission minutes and spreadsheets.

TAG - Tennesseans for Accountability in Government - calculates the current cost to taxpayers of the ballroom, including direct costs and the cost of subsidizing the Foundation's "gift" of "private funds" to the ballroom project, at more than $8.7 million. I think it is actually higher than that - after all, the state gave proceeds of a bond issue to the Foundation, and bonds have to be paid back with interest.

Sen. Jackson ought to do better in his oversight role than merely repeat the administration's deceptive talking points. And the Bredesen administration ought to level with the people of Tennessee and tell the truth, for once, about the true cost of the ballroom.