In a T-G article Oct. 19, 2017 Jason Reynolds reports, Board member Chad Graham asked for an update on selling the Shelbyville Central vocational building to the state for a Tennessee College of Applied Technology-Shelbyville expansion. "I thought we had talked about starting conversations" on footprints and related topics, he said. Jason also reported that “Board member Amy Martin said it is her understanding the board must declare the vocational building as surplus first.” Superintendent Don Embry said, “That is a Commission decision.” Mr. Enbry is correct, the BoE does not have the authority to declare a property surplus or to designate to whom such property may be sold.
In anticipation of the coming demands by the BoE to declare the current SCHS Vo-Tech 50,000 sq, ft, building surplus in hopes of selling it to TCAT, I want to review my understanding of the proper procedure to sell County owned property.
Laws and Rules governing the Acquisition, Control and Disposition of County Property:
First I look to Tennessee Code Annotated.
TCA 5-5-121 The county legislative bodies have power to erect or control, and dispose of public county buildings, as provided in chapter 7 of this title.
TCA 5-7-102 All deeds, conveyances or grants that have been, or may be, made to any officer or person for the use or benefit of the county, vest in the county the title as fully as if made to such county by name, but such conveyances hereafter shall be made to the county.
TCA 5-7-101 Each county may acquire and hold property for county purposes, and make all contracts necessary or expedient for the management, control and improvement thereof, and for the better exercise of its civil and political powers, and may make any order for the disposition of its property.
This simply means the full authority to purchase, maintain and control, and dispose of all public property lies with the County Commission. That the title to all County property resides with the County and not with any particular person or department. Only the County Commission may decide which property to sell. The various departments and boards may request for property, real or otherwise, to be declared surplus, but the final authority lies with the Commission to establish the status of all property.
The County Attorney has stated in his letter dated Aug. 9, 2017, the Financial Management Act of 1981 is the controlling statute on disposition of property
TCA 5-21-118 (within the ’81 Act)
(a) The director or a deputy appointed by the director shall serve as the county purchasing agent and shall assist the committee in developing policies and procedures for implementing an economical and efficient purchasing system.
(b) The following shall be the responsibility of the director:
(1) The contract, purchase, or any obligation of the county for supplies, material, equipment, contractual services, rental of machinery, buildings, or equipment, transfer of materials, supplies, and equipment between county offices or agencies;
(2) Supervision of storeroom or warehouse;
(3) Contracts for building construction and the purchase of land;
(4) Public sale of all surplus materials, equipment, buildings and land; and
(5) Any other created obligation of the county.
I disagree. the ’81 act (TCA Title 5, Chapter 21) defines the responsibility to publicly sell surplus property as belonging to the Finance Director in his role as Purchasing Agent. I believe the controlling statute is TCA 5-7-101 for the declaration of the status of property as surplus and then to the Finance Director in properly disposing of such property which has been deemed unneeded and thereby surplus.
The County Commission has established and adopted the Local Rules of the Board of Commissioners of Bedford County, TN (latest edition Jan 2017), and these rules establish and control the local Standing Committees, which are designed to be recommending committees to the full Commission. The Standing Committees are defined along with their purposes and duties in Rule VI.
Rule VI, Section F:
AUTHORITY OF COMMITTEES: The role and jurisdiction of a Board of Commissioners Standing Committee is to investigate and study matters, provide information and to present recommendations to the Board of Commissioners, as generally described in the title of the Standing Committee and as more specifically defined in the subject areas listed under the title. Should any question arise as to the jurisdiction of any Standing Committee, it shall be referred to the Rules and Legislative Committee for determination, subject to an appeal to the Board of Commissioners at its next regular meeting.
Per this rule, and the established actions of the Commission in the previous years, the Courthouse and Property Committee is the proper committee to hear requests from boards and departments on declarations of surplus property and to make recommendations on the disposal of such property to the full Commission. Only after an affirmative vote from the Commission declaring property surplus may the Finance Director begin the process to publicly sell the surplus property.
In defining what is and is not “surplus”, I look to Mirriam-Webster’s dictionary
Definition of surplus
1 a :the amount that remains when use or need is satisfied
b :an excess of receipts over disbursements
2 :the excess of a corporation's net worth over the par or stated value of its stock
In this context, it would be improper to declare a building that is in full utilization and for which there is no immediate replacement as “surplus”.
Since the Financial Management Committee, under the ’81 Act, has the duty and authority to establish the policies and procedures for the Finance Department, I also referred to the latest version (July 2016) of the BEDFORD COUNTY FINANCIAL MANAGEMENT POLICIES AND PROCEDURES MANUAL for directions for the disposal of surplus property. Interestingly, there is no section in the Table of Contents referencing surplus property. A careful review of each page of the document reveals some interesting statements.
Chapter 4: GENERAL ACCOUNTING at the end of the first paragraph of Section 4.2 No individual within the County has the authority to legally bind Bedford County without the authorization of the County Legislative Body.
I did not add the italics to the above section. This sentence was the only one in that section which was italicized. To me that indicates special attention to this statement was desired and that no individual ,including a member of the Board of Education, should have proffered or attempted to negotiate the sale of the current Vo-Tech building, and if any person did so, any such negotiation would be non-binding upon the County.
Chapter 10: FIXED ASSET ACCOUNTING ; Section 10.2 Accounting Policies ; F. Surplus Equipment:
1. Existing county policy regarding the sale/disposal of surplus equipment will continue to be followed. A complete accounting of the assets and any proceeds must be reported back to the County Department of Finance so that these items can be removed from the system.
2. A list of surplus equipment removed from capital assets records will be presented to the full County Commission on at least an annual basis.
This is the ONLY reference to surplus property in the POLICY manual. I would like to know what is the “existing county policy” that “will continue to be followed’ that is mentioned, and where would it be written if not within the Financial Management Policy.
I fully understand, recognize and appreciate the important role that the TCAT center plays in our community. It is an important asset in Bedford County. If we are to have any type of industrial growth, we must have a well qualified work force, and TCAT helps fill that need. In fact I have received certifications from classes I attended at TCAT back when is was known as the Tennessee Technology Center of Shelbyville. One is Comptia A+ Certification for computer repair, and the other is for Basic Auto CAD.
With the introduction of Tennessee Promise, where all students may receive a free two year education, the demands on TCAT have greatly multiplied. They say they are out of space for classes and given their current location, have no other avenue for expansion at this campus other than to occupy the SCHS Vo-Tech center. To meet their increased demand, TCAT is currently building a new campus in Winchester. I wonder how many students, currently enrolled in Shelbyville TCAT will attend there when it is completed ?
My argument is this:
Why is the Board of Education, (whose elected duty and responsibly is to K-12 and not post secondary education), so demanding and insistent that we give up more than 50,000 square foot of education space at an overcrowded SCHS for the benefit of TCAT? Who is pushing this proposal and why? Why would they want to place the needs and wants of TCAT (a state funded organization) ahead of the needs of our elementary schools? We are greatly overcrowded at the Elementary level and have portable classrooms at every school.
Why would the County ever consider selling any property that is not in distress and is being fully utilized for 25% of the replacement cost?
I propose that if TCAT wants the property so badly, it should build an equivalent size building for SCHS and then we may be able to do a title swap. That process would have to be defined by the County Attorney as to whether or not that would even be legal, but it could be a starting point for a conversation.