KINGSPORT, TN (WJHL) – The City of Kingsport’s invested a record amount of taxpayer dollars on economic development projects, but those projects have largely failed, stalled or are still pending.
With roughly $15 million in outstanding debt connected to the projects and limited success, City Manager Jeff Fleming said leaders intend to be more cautious moving forward.
“We were in a situation where we were trying to do everything we could to prime the pump to create jobs, and maybe we got a little aggressive and now we’re being a little more conservative,” Fleming said. “We will definitely measure twice and cut once as we go forward in the future to make sure we don’t continue to add to these contingent liabilities.”
Fleming said the aggressive investments all started after people who live in Kingsport asked city leaders to “get in the game” and work harder to bring in jobs.
After Pure Foods went bankrupt, we started reviewing the city’s so-called “contingent liabilities.” Those are projects taxpayers are on the hook for long-term if things fall through. Our review identified more swings and misses than hits over the last six years. Those misses forced leaders to regroup and restart in some cases.
Luckily for Kingsport, both the former Pure Foods building and C&F manufacturing property now have new owners. Meanwhile, a lease approved Thursday will turn what used to be Heritage Glass and then EnviraGlass into storage space, with the possibility a future company could still buy the site, according to Fleming.
Leaders hoped to attract economic development on the General Shale Property, but with little demand, the city changed its plan and now expects to use the land for tourism purposes, according to Fleming.
More than four years after helping with the Bray Property, leaders are still waiting on a developer to turn the site into lofts. Fleming said leaders just granted a short extension on the project.
Kingsport leaders hope one of its most recent purchases at Center Street and Clinchfield Street will help expand the Academic Village and the other at Main Street and Cherokee Street will attract economic growth.
Despite delays and several restarts, Fleming says the millions of dollars in taxpayer debt are now protected.
“We believe we have everything covered,” he said.
“Is there still a risk that some of these projects may fall through?” we asked.
“There’s always a risk,” he replied. “We do everything we can to minimize that exposure.”
Fleming does not view any of the past projects as failures, but promises a more cautious approach in the future.
“You have to try,” Fleming said. “You have to constantly try. You have to vet your prospects as best you can, but they don’t always work out…The easiest thing to do is withdraw and never try, because you’re risk averse, so we try to manage that risk.”
Kingsport’s Economic Development Board is a key player in the approval of these projects. We’ve left multiple messages for Chairman Bill Dudney, but haven’t heard back.
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