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Opinion

Not So Smart Growth

Leadership punted when it came to the future of Memphis.

On the day that the Memphis City Council was scheduled to vote on annexation, Mayor Willie Herenton sent out an audio promo on his upcoming boxing match with Joe Frazier. Talk about picking your fights. The incoming chairman of the council, Tom Marshall, recused himself.

Harold Ford Jr. and Bob Corker spent a million dollars on negative ads, but nobody spends a penny selling the pros and cons of annexation to 36,000 new Memphis residents or 670,000 current ones.

Specially created authorities are fine for running pieces of the city such as the airport, industrial parks, or the riverfront. They can build arenas and ballparks. But they’re powerless when it comes to a decision that will impact our neighborhoods, taxes, public schools, and services for years.

The Urban Land Institute, which includes developers from the Boyle, Belz, and Turley companies, is great if you need a critique of a plan for a land bridge to Mud Island or a speaker about the past and future of cities. But its members were strangely silent on the messy and complex issue of annexation here and now.

Suburban developers are good at making profits, drawing annexation lines, and building subdivisions. Lawyers are good at keeping Southwind, Windyke, and other subdivisions out of Memphis as long as possible so that residents can enjoy a personal tax freeze. Real estate agents are good at putting up signs that tout the benefits of enjoying public services without having to pay city taxes for them. But it’s not their job to represent the common good.

Local television news isn’t much interested in a bloodless story with lots of dots that have to be connected. A “Does It Work” segment on annexation doesn’t.

The Memphis Board of Education has 118,000 students to worry about. The Shelby County Board of Education has 45,000 students to worry about.

The Office of Planning and Development says annexation will net $100 million in new taxes and fees over several years. But the same report includes stretchers like this one: “Memphis City Schools makes decisions about the need and location of all city schools for students in the city.” If only. In fact, Memphis City Schools acquires schools in annexation areas from Shelby County, and the sites were chosen by county school officials and developers.

And wouldn’t you love to have seen Police Director Larry Godwin’s face when he read that “The city of Memphis Police Department will provide many services that will result in a significant improvement over and above the services currently being provided by the County Sheriff’s Department.” The Southeast Extended annexation area has averaged one murder a year for the last five years. How much better can you get?

Whatever it does on annexation — yes, no, wait — the Memphis City Council will be criticized, which is unfortunate because they’re the only ones looking squarely at the issue and its consequences and making a decision that matters. Shelby County mayor A C Wharton and the Shelby County Board of Commissioners, whose predecessors crisscrossed the suburbs with six-lane and eight-lane roads, are waiting in the wings to see how the hand plays out. The rest of us are just kibitzers.

Annexation opponents get all the publicity, but it’s the current residents of Memphis who ought to be mad. Their combined city and county taxes — roughly twice the tax burden of residents of unincorporated areas — paid for the sewers, roads, and schools in the annexation areas while devaluing their own neighborhoods and undercutting city schools and shopping centers in the process.

Doing nothing has as many consequences as doing something. Either way, students have to be assigned next year to the new Southwind High School. Overcrowded schools have to be relieved. Or both the city and county systems could take matters into their own hands and build new ones. Either that or find some more vacant grocery stores.

In the end, annexation is just too big — the challenge, not the area.

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Opinion

Ready or Not

Members of the Memphis City Council face one of the most important and trickiest votes of their political careers next week.

The issue is annexation, and the stakes include 37,000 new Memphis residents, population bragging rights, several million dollars a year in property taxes, and custody of seven schools in the annexation areas.

There are wild cards aplenty. Residents opposed to annexation, which includes the areas of Bridgewater east of Cordova and Southeast Extended south of Nonconnah/Bill Morris Parkway, are getting organized for next Tuesday’s public hearing. Mayor Willie Herenton is wary of expanding the city at a time when the police department is already stretched thin. And politicians, lawyers, and developers have already struck deals exempting a few neighborhoods next to the annexation areas, including the exclusive gated community Southwind and a subdivision adjoining the new Southwind High School, which is one of the main things driving the whole process.

Time is short. The annexation is supposed to take effect on January 1, 2007. The City Council has already approved it on two of the three required readings. The Land Use Control Board has approved the plan for implementing services. The new high school is scheduled to open next fall, taking students — most of them black — from Germantown and Houston high schools. Southwind High School will eventually become part of the city school system.

Here’s a closer look at the key issues and players.

Bragging rights. If the annexation goes through, Memphis will grow to just over 700,000 people. Thanks to previous annexations of Cordova and Hickory Hill, Memphis has been able to stay off of the list of shrinking cities such as Detroit and Buffalo. Memphis, currently the nation’s 18th-largest city, would become the 16th-largest.

Schools and race. Because of the surrounding neighborhoods and the boundary lines, Southwind High School will be a majority-black school the day it opens. In Memphis and Shelby County, the trend is that such schools steadily lose most of their white students, as Kirby High School did in the 1990s and as Cordova High School has more recently. The city school system is more than 90 percent black and Hispanic.

Germantown High School is a majority-black school even though the city of Germantown is less than 5 percent black. Many of those students will be shifted to Southwind.

Separate and unequal taxes. The annexation map creates three classes of citizens: Memphians, Shelby County residents, and provisional Memphians. In several places, all three groups share the same street and live within sight of each other, but the city residents will pay roughly twice as much in property taxes. Real estate agents and homebuilders sell subdivisions along Shelby Drive and other east-west roads with signs saying “COUNTY SCHOOLS” and “NO CITY TAXES.” A sign that says “MEMPHIS CITY LIMITS” might as well say “WEST NILE VIRUS ZONE.” One tax oasis, the Whisper Ridge subdivision by Signature Builders, is immediately west of the new high school and nearly surrounded by annexed territory.

Another kind of tax haven is represented by Southwind and Windyke, along Winchester. Residents negotiated their way out of annexation until 2013. For the next six years, 494 homeowners around the Southwind Tournament Players Golf Course will save as much as $30,000 a year, while 517 middle-class homeowners in Windyke will save about $1,500 a year. Collectively, county assessor’s figures show Memphis is exempting 1,011 homes and leaving $19.7 million in property taxes on the table.

Fear of foreclosures. Memphis, as everyone knows, is the bankruptcy capital of America. A real estate closing attorney and a developer say thousands of soon-to-become Memphians in Bridgewater are living on borrowed money, with little or no equity in their homes. Five or 10 years ago, they bought starter homes with interest-only loans. Put another $125 a month in taxes in their tight budgets and bankruptcy lawyers could be the next ones doing a land-office business.

Mayor Willie Herenton is on record saying that “mayors don’t annex” and that the Memphis Police Department needs 650 more officers. In previous annexations, Herenton’s division directors met with community groups to buck up their spirits. If the mayor criticizes the plan of services or is a no-show at the council meeting, it could make some council members decide to oppose annexation or take it off the table.

City Council chairman Tom Marshall, the council’s senior member and most adept compromiser, may find himself in an Justin Fox Burks

Tom Marshall

uncompromising position. An architect by trade, Marshall is the link with the Memphis City Schools and the Office of Planning and Development. He has been meeting with developers and planners for the city and county and the two school systems to draw the all-important line. He has mayoral aspirations, so don’t look for Herenton go out of his way to help. If this annexation goes through, it will be because of Marshall, not Herenton.

The black middle class: A fixation on the past plus the Memphis City Schools’ take-the-money-and-run certification of schools as low-income so that students can get free lunches gives a distorted picture of the city. The black middle class is thriving, among other places, in subdivision after subdivision in southeastern Shelby County. Rufus Washington, head of a neighborhood coalition opposed to annexation, has lived in his home for 13 years. There is a county public library less than a mile away on six-lane Shelby Drive and Germantown Road. Sheriff’s cars patrol the streets. Neighborhood children attend Highland Oaks Elementary School and Southwind elementary and middle schools, all county schools with higher ratings than city schools. The notion of “county services” as rural or second-class is outdated.

When is a deal not a deal? Putting off annexation for another day has its own problems. Memphis and surrounding suburbs reached a historic agreement on annexation reserve areas six years ago. If densely populated subdivisions that are clearly within the Memphis annexation reserve area cannot be annexed, then the deal is meaningless. The City Council represents 670,000 Memphians already in the city limits. Their taxes have helped pay for the roads, sewers, and schools in the suburbs. Now that the bills are due, will the council collect?

Costs and benefits: Property taxes account for 63 to 65 percent of city and county revenue, according to Shelby County trustee Bob Patterson. It takes roughly 12 years for an annexation to pay for itself, Patterson says, but less than that if libraries, schools, and fire stations are already built. But there’s another risk that can be called the Fox Meadows Factor. Twenty-five years ago, Fox Meadows was a thriving southeastern suburb near the then-new Mall of Memphis. After it was annexed, the mall closed and tax collections declined. The same thing is happening in Hickory Hill.

The bottom line. Annexation opponents’ best hope is delay, probably pegged to 2013, like Southwind and Windyke, in return for a promise not to file a lawsuit. If they simply engage in Memphis bashing, they will anger council members who may accuse them of being ungrateful freeloaders who don’t pay their share.

Proponents have to unite the city powers-that-be — including Herenton, Marshall, police director Larry Godwin, and Superintendent Carol Johnson — in a sales job and a promise of safe streets and safe schools. But the damage may already have been done.

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Opinion

Off Track

The toughest job in Memphis is selling annexation to the 36,000 residents of southeast Shelby County and Bridgewater who are supposed to join the city next year.

By comparison, selling Grizzlies tickets to Shane Battier fans, extra homework to seventh-graders, and E-Cycle Management to state legislators is a piece of cake.

After 50 years, during which Frayser, Raleigh, Parkway Village, East Memphis, Whitehaven, Hickory Hill, and Cordova were annexed — boosting the population of Memphis to 672,277 and the land area to more than 300 square miles — the policy appears to have run off the rails. The proposed annexation of land 20 to 25 miles from downtown would further stretch an already undermanned police force and shake up the uneasy truce between the city and county school systems. Politicians and lawyers have gerrymandered the boundary line to exclude the wealthy residents of Southwind while taking in their middle-class neighbors who share the same roads, sewers, stores, and public services. Mayor Willie Herenton all but pulled his support for the annexation this week, warning that the cost of extending city services could outweigh the increase in tax revenues.

And, most important, many of the Memphians-to-be feel the same way as Rufus Washington, president of the Southeast Shelby County Coalition.

Last week the Memphis City Council set the wheels in motion to bring Washington and his neighbors into our fair city on January 1st, 2007, by passing an ordinance on the first of three required readings. Due to a procedural screw-up by the council, however, Washington and 20 others who came downtown to protest the annexation were denied a chance to speak until a public hearing on November 21st. In an interview last week, he said he and his neighbors were “bamboozled” by the City Council.

“A lot of people are pissed off,” said the 68-year-old retired RPS/FedEx Ground manager, grandfather, and ex-Marine captain, who can still fit into his dress blues.

Washington bought his house in 1993 for $165,900. Today it is appraised at $189,000, giving him a negative annual return when adjusted for inflation, while suburbanites outside the annexation have enjoyed double-digit annual appreciation.

“Annexation does nothing for me,” said Washington. “It is not a value-added move. It’s all about revenue, all about the dollar.”

Eleventh-hour protests may not do Washington and his neighbors much good. “If you don’t have a solution you are going to get annexed,” says Jackie Welch, who developed Washington’s subdivision and others along Winchester. An attorney familiar with annexation procedures agreed.

“The most effective strategy has been to negotiate it out several years, which the city has been more than willing to do,” said the lawyer, who spoke on condition of anonymity. “But the opponents are not going to beat it.”

The delaying strategy allowed thousands of residents of Cordova and Hickory Hill, most of them white, to move outside the ever-expanding city limits and avoid paying city property taxes for as long as 10 years. The importance of the boundary line and the effective date of annexation is especially clear in the case of Southwind, the gated residential community around the Tournament Players Golf Course.

According to the Shelby County Assessor’s Office, there are 494 dwellings in Southwind with a total appraised value of $308 million. Thanks to an agreement negotiated by their attorneys and agreed to by city attorney Sara Hall in May, the residents of Southwind and Windyke, a less-exclusive area south of Winchester, will not be annexed until 2013.

“It was an unfortunate turn of events in the courtroom,” said City Council chairman-elect Tom Marshall. “It should have required the approval of the council.”

In Southwind alone, the city is leaving $2.6 million in property taxes on the table for six years, or $15.8 million total. Using the Memphis Crime Commission’s figures, that $2.6 million would pay for hiring and training 26 new police officers.

After annexation, Washington will pay another $1,620 a year in property taxes. A neighbor in the nearby Richwood subdivision, former Shelby County Mayor Jim Rout, will pay an extra $2,145 a year on his house, appraised at $250,000. But Southwind’s residents get a six-year tax holiday. Jerry West, president of basketball operations for the Memphis Grizzlies, will save $31,727 a year on his $3.7 million house, and Alan Graf, chief financial officer for FedEx, will save $14,577 a year in taxes on his house, which is appraised at $1.7 million. (As part of the deal, which neither Graf nor West had anything to do with, Memphis has annexed a commercial strip along Hacks Cross Road and, therefore, its share of the sales tax from businesses as well as the world headquarters of FedEx at Winchester and Hacks Cross.)

Higher taxes and last week’s little lesson in parliamentary procedure was only a taste of what the city has in store for its future citizens. In addition to being denied the right to speak until the third reading of the ordinance — which won’t become effective until the minutes of that meeting are approved later, giving council members yet another chance to change their minds — this is what comes with the annexation deal:

* City schools instead of Shelby County schools.

* Law enforcement by the Memphis Police Department, which Herenton and Police Director Larry Godwin recently said is understaffed by 650 officers. Asked this week if annexation would further stretch law enforcement, Herenton said “the mayor does not annex” and suggested that the City Council and planning office give the matter “careful analysis.”

* City parks, which tend to become overgrown and neglected every time the city coffers run dry or the mayor wants to make a statement, as he did in the summer of 2005.

* Roads and sewers, which residents already have in abundance but haven’t had to pay for, or at least not the city share.

* Garbage service and the bills and add-ons that come with it.

* Streetlights and annual car inspections.

If the annexation is completed, the population of Memphis will “grow” overnight to more than 700,000, or more than twice the population of St. Louis, which cannot annex. Schools and libraries, including the new Southwind High School opening in 2007, will sooner or later shift to the city, if the city doesn’t immediately take possession. And the history of Memphis since 1950 suggests that over time most white residents who have not left already will move out of the annexed areas into Germantown, Collierville, and other parts of Shelby, Fayette, and DeSoto counties beyond the grasp of Memphis.

The annexation line in the Southeast Extended area is so gerrymandered that it looks as if it were drawn by a drunk with the shakes. At one point, just east of the new high school, it makes an elaborate jigsaw cut to exempt a developer’s partially completed subdivision, while taking in others a few hundred yards away. Marshall said it is possible that the line will be redrawn to conform to more logical natural boundaries.

Overriding all annexation decisions is this stark reality: Directly west of Southwind’s gated community, on the west side of six-lane Hacks Cross Road, there is an attractive, tree-covered parcel of land that retains the pastoral look of this area 20 years ago. When Nonconnah Parkway, now Bill Morris Parkway, was extended to Collierville in 1997, a developer put in streets, curbs, sewers, and utility hook-ups for a high-end residential subdivision. But the property was inside the Memphis city line, if only a stone’s throw from Southwind. Today, not one single house has been built.