Comment
on this story

With Nashville feathers in his cap, Bredesen believes it's his turn

by Bill Carey

Fifteen years ago, a handful of people were making the rounds of public meetings and media forums in the race to succeed Richard Fulton as mayor of Nashville. Prior to one of the events, a couple of candidates were chatting when one of them remarked that he had heard that someone new was about to run. "I heard," mayoral candidate and then Congressman Bill Boner said, "that there is some guy with a lot of money who has decided to get in the race." According to someone who was standing there, Boner couldn't remember the man's name.

That guy with a lot of money was a political neophyte named Phil Bredesen. He did enter the mayor's race in 1987, spending over $2 million of his own money. But he lost to Boner in the runoff, largely because Nashville political insiders such as road contractor Ray Bell didn't take him seriously. "I went with Boner that year because I thought Bredesen was a carpetbagger coming through," Bell says. "That was a big mistake."

A few months later, Bredesen ran for the Congressional seat Boner had vacated. Again, he opened his own wallet, this time spending about $1.7 million in the campaign. Again, he lost, this time in a close race to former TVA board member Bob Clement. So after one year in politics and two defeats, Bredesen went back to being a health-care executive about three and a half million dollars poorer. And many political pundits understandably thought that they would never hear from the man again.

However, a lot of things have changed since Nashville's voters rejected the rich Yankee twice. Boner's term as mayor was by some accounts a disappointment, by other accounts a disaster. Boner did not run for re-election in 1991, and Bredesen was easily elected to succeed him. Bredesen then served two terms as mayor of Nashville. He developed many high-profile projects while mayor and is perceived by many people in and out of Tennessee's capitol as having been successful in that role. Bredesen also ran for governor in 1994 and spent more than $6 million in the race (he now says he was recruited to run for governor by party elders, though he won't say who they were). The Nashville Democrat lost to Don Sundquist on the night Republicans scored major gains across the country and took both of Tennessee's U.S. Senate seats.

Last year, Bredesen decided to run for governor again. He immediately made two key decisions about how he would approach his second gubernatorial campaign. The first was to run a race funded by other people instead of himself, something he was advised to do by prominent Democrats such as former governor Ned McWherter because of the energy generated by a fundraising campaign. "A man who gives you $25 and comes to a bean supper in Carroll County or Lake County buys into you and works for you just as hard as the fella who gives you $1,000," McWherter says.

So far, the fundraising strategy has worked. Through July 22, the Bredesen campaign had raised more than $5 million and spent a reported $3.4 million. (At that time, Republican nominee Van Hilleary had raised $3.5 million and spent $1.1 million.) Bredesen proudly reports that, so far, he hasn't put in "a dime" of his own money. However, Bredesen says he has not decided whether he will eventually contribute to his own campaign, "because I don't have a president from my party out there raising money for me," referring to the likelihood that President Bush will work hard on behalf of Hilleary. (A state law passed since 1994—which is probably unconstitutional— prohibits candidates from donating more than $250,000 to their own campaigns.)

The other decision Bredesen made was to promise that if he were elected governor he would oppose a state income tax. With a similar pledge being made by Hilleary, Tennessee's voters have a choice in November between a Republican opposed to an income tax and a Democrat opposed to an income tax. "When I was thinking about running, I looked at the numbers and convinced myself that it is perfectly possible to run a responsible state government without an income tax," Bredesen says. "And I absolutely don't think that an income tax is the right answer to the issues we have been facing over the last couple of years." By pledging opposition to an income tax, Bredesen has (admittedly) married into the idea of Tennessee's high sales taxes, at least for his first term. In a state where somewhere between 30 and 45 percent of citizens (depending on which poll you believe) would agree to an income tax under certain conditions, there is always the risk that Bredesen's pledge will drive voters to a protest candidate such as the independent Ed Sanders. So far, at least, there is no evidence that this is taking place.

Bredesen's tax rhetoric caused quite a bit of rancor with the Legislature and has led to a subtle flip-flop in his campaign. Back in the spring, when the state was facing a budget shortfall, the former Nashville mayor was traveling around the state saying he opposed any kind of tax increase, implying that if he were governor that he could have run the state so well that no tax increase would be necessary. Since the Legislature passed a one-cent sales tax increase in July, Bredesen has continued to say that he could run the state better. But he now makes no promises about rolling back the sales tax increase, only saying he advocates the idea of a sales-tax "holiday" to help people save money on special occasions.

There are other differences between candidate Bredesen in 2002 and candidate Bredesen in 1994. His resume as a politician is a lot larger, since many of his mayoral achievements came since then. By many accounts, he appears more relaxed in public. "He is a much better campaigner than he was in '94," McWherter says.

However, there is one very important way in which Bredesen is doing exactly what he did when he ran for mayor and Congress in 1987, mayor in 1991, and governor in 1994. He is running on his record as a successful businessman, trying to convince Tennessee voters that his management skills are so acute that he can bring more efficiency to government and restore Tennessee residents' faith in their state.

So far, it's working. A recent poll by commissioned by the Knoxville News Sentinel showed that Bredesen has an eight-point lead over Hilleary. However, the poll showed that 29 percent of the voting public is undecided.

A physics major

There are a lot of politicians whose early life and family connections make it seem likely that they would eventually run for office in Tennessee. Not Bredesen.

Philip Bredesen was born in November 1943 in Ocean Park, New Jersey. His father, a Captain in the U.S. Army Signal Corps, left his mother when he was seven years old, after which Bredesen's family moved to his grandmother's house in Shortsville, N.Y. Bredesen lived there for most of his childhood, with his mother working as a bank teller and his grandmother making extra cash by doing odd sewing jobs out of the house. "I've never liked to think of us as poor," says Bredesen. "But we considered people who were things like insurance agents to be the upper crust."

Bredesen made good grades and, like many other teenagers during the post-Sputnik years, developed a special interest in science. Thanks to a combination of scholarships and student loans, he went to Harvard and majored in physics. After graduating in 1967 he landed a job out of college working for a Boston defense contractor (a job that merited a draft deferment).

By 1973, Bredesen had divorced his first wife Susan and moved on to another employer, a computer consulting company with a presence in Great Britain. Bredesen actually moved to England for a time; it was there that he married an American coworker named Andrea Conte (to whom he is still married; the two have one son, now in college). Eventually, Bredesen and Conte came back to the states, first to Chicago and then to Boston.

While in England, Andrea Conte had met several executives with Hospital Corporation of America, a fast-growing health-care company based in Nashville. In 1975, HCA hired Conte to run its international nursing department. Andrea and Phil packed their belongings into a Volkswagon Rabbit and moved to Nashville. A few months later, Bredesen got a job selling management contracts for an HCA competitor called Hospital Affiliates International. Bredesen eventually did other jobs for HAI and its successor firm, including heading a support group that helped solve management and technical problems for hospitals.

By 1980, Phil Bredesen decided he was ready to venture out of his own, and he came up with a business plan for a new managed-care company (Bredesen says he researched the plan at the Nashville public library). With $50,000 in cash and a $250,000 line of credit from the four men who had started HAI 10 years earlier, Bredesen called his new business Healthplans. It grew fast, acquiring 13 HMOs in its first two years. Healthplans eventually became a public company with 6,000 employees, several hundred of whom were in Middle Tennessee. In 1986, Bredesen and his investors sold the company to a firm called MaxiCare, each of them reaping a return of about $40-$50 million in the process. By the time Bredesen began his unsuccessful campaign for mayor the next year, he had helped start another managed-care firm called Coventry.

A powerful mayor

Bredesen has campaigned so hard on the idea that he wants to run state government like a business—an interesting strategy in an era of unprecedented corporate fraud—that it begs the question of whether Mayor Phil Bredesen ran Nashville's government like a business. Depends how you look at it. The notion of running government like a business would seem to imply that the mayor would spend most of his time trying to improve the way government serves it customers, such as collecting garbage, operating schools, and running parks. Bredesen preferred to devote his time to a series of what some people called "dynamos," leaving the day-to-day operation of government to his department heads. These dynamos were usually either big tax-break deals for large companies such as Gaylord Entertainment, HCA, and Dell Computer; capital projects in downtown Nashville such as the arena (now the Gaylord Entertainment Center), NFL stadium, and downtown library; or the merger between Nashville's two public hospitals.

How did Bredesen wield such power? Part of the reason has to do with the utter failure of his predecessor, Bill Boner. When Bredesen took office in 1991, there was a general feeling in the Nashville community that it was time to get behind the mayor, especially in the (Metro) Nashville Council and in the media. This sense of local patriotism is perhaps best demonstrated by the fact that during Bredesen's tenure, virtually every one of his major projects was supported and defended by both of Nashville's daily newspapers (the Nashville Banner went out of business in 1998) and by the weekly newspaper the Nashville Scene.

A second reason has to do with Nashville's governmental structure. A city/county with one government and a 40-member (term-limited) council, the local government of Nashville is very conducive to a powerful executive. During his tenure, Bredesen also had a very close relationship with the Metropolitan Development and Housing Agency, the quasi-governmental entity that runs the housing projects, does downtown development, manages public building projects, and has the power of eminent domain. In fact, if Bredesen wins, it is quite likely that one of his key cabinet members will be former MDHA director Gerald Nicely.

However, a large part of Bredesen's power rests with the man's style. Once Bredesen decided he was going to try to achieve one of his dynamos, he focused intensely on it and didn't like to talk about past or future projects. When the project was controversial in nature, he would lobby council members or the general public tirelessly for their cause. An intelligent man who makes up his mind and is not easily swayed, Bredesen could be quite dominant. When it came to projects in which he was especially interested, he did not so much work with other governmental entities as take them over. When Nashville started building the $160 million arena early in his tenure, Bredesen personally chose the location. In 1993, he decided that he wanted the Country Music Hall of Fame and Museum to leave the Music Row area west of downtown for a site next to the arena. He talked the head of the Country Music Foundation into it, and the two men announced the plan to move the facility before either of them had any idea how much it would cost or how it would be financed. (The new, $37 million Country Music Hall of Fame and Museum opened at its new location in 2001.) When Nashville chose a new library director, Bredesen interviewed the finalists and had a lot to do with the final choice.

Athletic director

The biggest and most controversial dynamo in Bredesen's tenure was the Tennessee Titans. In the summer of 1995, Bredesen was re-elected as mayor; he had no serious opposition and therefore didn't have to campaign. But he did make a few speeches during the weeks before the election about how he intended to focus on neighborhood issues in his second term.

A few days after the election, news leaked that the Bredesen administration had been talking to the Houston Oilers about the idea that the team might relocate to Nashville. For two months, discussions took place largely in secret, while Bredesen insisted to the media that a stadium could be built and the team moved without a property-tax increase.

Then, in October, Bredesen presented a plan to the Metro (Nashville) Council under which a stadium costing about $200 million could be built and the Oilers given a $35 million "relocation fee." In what is probably the most creative finance package ever put together by a mayor in Tennessee, Bredesen proposed that the stadium be funded through advanced ticket sales; by diverting part of the city's hotel/motel tax; by pledging all sales-tax revenues collected at the stadium site to the project; and by using $4 million a year of Metro Water Department "reserves." The Water Department's "contribution" to the stadium was by far the most controversial, because it meant that people would be paying a hidden stadium tax on their water bills.

During the next few months, more than 40,000 people paid between $250 and $4,500 each for PSLs, while nearly a hundred companies ponied up between $50,000 and $200,000 per year for luxury boxes. However, Bredesen made a major mistake by dismissing opposition to the project. In the fall of 1995, several councilmen started a petition drive to force a referendum on the stadium issue. Despite being almost ignored by the local media, it delivered over 43,000 signatures and forced a referendum. Through the spring of 1996, the Oilers debate raged; it seemed as if every other yard in Nashville had a sign out front that said either "NFL Yes!" or "Say No to Bud's Bonds"—in reference to team owner K.S. (Bud) Adams. In spite of the divisiveness of the debate, the pro-Oilers side had all the important cards: most of the money, help from the Chamber of Commerce, and support from Nashville's newspapers. On May 5, 1996, in a record turnout, 59 percent of Davidson County voters voted to move ahead with the stadium.

Bredesen's success in getting the stadium project through showed he had skills as a lobbyist on many fronts, from editorial board meetings to TV talk shows to private meetings with state legislators. The Oilers/Titans deal also gave some indication of just how complex a person Phil Bredesen is. A quiet man who likes to hunt and read in his spare time, he had never even seen an NFL game prior to his administration's negotiations with the Oilers (even on television). Bredesen risked his political career for an NFL team not because he likes football, but because he was convinced that Nashville needed big-time sports to become a big-time city. "A place like Nashville has lots of pluses, but I thought it had to move up a tier in order to compete with a Denver or a Charlotte or a Jacksonville for young people," Bredesen says. "And pro sports was one of those things we were obviously lacking."

Many of the people in Nashville who opposed the Titans deal have long since gotten over it and now support Bredesen in the governor's race. But that's certainly not true of everyone. Hal Wilson owns a residential real estate company that buys, renovates, rents, and sells homes in Nashville's inner city. He currently owns about 70 properties and estimates that he has bought and sold close to 400 since he first starting doing business in the 1960s. The Oilers/Titans deal upset Wilson so much that he actually moved to neighboring Williamson County. "I was strongly opposed to the deal because I didn't think it would help the city, and I think I was right," says Wilson. "After all, if it's helped the city so much, then why do my property taxes continue to go up?"

Wilson estimates that his taxes rose about 40 percent during the Bredesen years. (Although the property tax rate actually declined under Bredesen, appraisals in many parts of town more than doubled under his tenure.) "It has been a financial burden to me and an extreme hardship on a number of my elderly tenants," Wilson says. "And as far as I can tell, my services haven't gotten any better."

The education mayor?

Wilson's comments reflect the most common criticism one hears about former Nashville Mayor Phil Bredesen. Current Nashville Mayor Bill Purcell now estimates that Nashville's taxpayers are spending $21.3 million per year in debt service and operational subsidies for the NFL stadium and NHL arena. Some contend that Nashville would have been better off if that money had been spent on more traditional functions of government, most notably the day-to-day operation of the public school system. The main evidence many cite for this criticism is test scores. Between 1992 and 2000, the scores registered by public-school students in Nashville on the Tennessee Comprehensive Achievement Profile (TCAP) test declined for grades four through eight (they increased for grades one through three).

Hilleary has homed in on the test scores as proof that Bredesen failed as an education mayor. In an interview with Metro Pulse, Bredesen gave a long defense of his record on education. He says that, prior to his first term, there was not a tradition in Nashville of the mayor having any direct control over education. He points out that when he took office, Nashville's citizens had twice in recent memory rejected tax increases earmarked for education. "But I knew that the one thing that we could agree on is that the school buildings should not be falling down, which many of them were."

Twice in Bredesen's tenure, the mayor proposed and the council passed property-tax increases that were largely or at least in part to fund school construction. According to Metro schools spokesman Craig Owensby, the tax increases funneled $436 million into 76 new school buildings, while repairing and renovating several others. Along the way, Nashville built a series of strategically located schools that succeeded in getting rid of the city's two-decades-old system of integration-driven busing. The tax increases also funded the hiring of more than 200 art and music teachers, so that by the end of Bredesen's tenure, every single public school in Davidson County had teachers in those subjects (which is not the case in Knox County).

Early on, Bredesen didn't focus too much on curriculum or performance, in part because of his relationship with the schools superintendent. "I had depended on (superintendent) Dick Benjamin to work on the academic side, and that didn't work," he says. When Benjamin was replaced with Bill Wise, Bredesen got more involved in the process, helping to create a so-called "core curriculum" meant to standardize the order in which different topics were being taught in Nashville's public schools. (Current Nashville schools superintendent Pedro Garcia has since gone away from Bredesen's core-curriculum model.)

Despite the test scores, Bredesen thinks he went about things in the right order when it came to education. "Back in 1991, I wasn't thinking solely in terms of being judged by TCAP scores," he says. "There were a lot of more important things to deal with, such as the desegregation order and the fact that a lot of school buildings were falling down."

The candidate

Of course, if Bredesen claims victory over Van Hilleary on Nov. 5, it won't be the city of Nashville that he will be running, but the state of Tennessee. In the opinion of many people, the state's biggest problem is TennCare, its managed-care program for the poor. Bredesen says he is far more qualified than Hilleary to fix TennCare because of his experience starting and running managed-care companies.

The former Nashville mayor is short on detail about what he would do with TennCare. But he says he would pay more attention to its day-to-day operation, hinting (as does Hilleary) that there is a good chance that he will try to remove people from its rolls. "If we can't fix it, we will need to do something else, but I would like to try to fix it because I think it [TennCare] is a desirable thing to try to have." He dismisses Sundquist's claim that court orders and the federal government have made it almost impossible to make significant reforms in TennCare. "Part of TennCare's problem at the moment is that it is constipated with court orders," he says. "But there is not a single one of them that TennCare didn't deserve, so the court stuff is a self-inflicted wound. And as far as working with the federal government is concerned, I can't believe that with Tennessee's connections to the administration and with [U.S. Senator Bill] Frist that we couldn't work out these issues better."

Bredesen claims that, as governor, he will also find ways to improve Tennessee's sagging universities and come up with ways to better integrate higher education into K-through-12 education. He intends to vote for the lottery proposal. He is lukewarm on the idea of charter schools and generally opposed to private prisons. Largely because of attacks by Hilleary, Bredesen has appeared at numerous hunting events, talked a lot about how much he loves to hunt at his ranch in Wyoming, and insisted he is completely opposed to gun control in any form.

So how is Bredesen's message playing in Knox County, which has an obvious habit of voting Republican? For lack of a local poll, we won't really know until the day after the election. In his 1994 race against Don Sundquist, Bredesen got less than 36 percent of the vote in Knox County. Susan Williams, managing partner of the Ingram Group office here and a Tennessee Republican Party chairman in the early 1980s, doesn't believe Bredesen will do any better this time. "When people look seriously at Bredesen, they will get a lot of anxiety because of his record of raising taxes in Nashville and because he has wavered on the income tax," she says. Williams says President Bush will make appearances in Tennessee on Hilleary's behalf in order to keep the governor's seat aligned with the GOP. But she adds that one of her biggest concerns about the race is that Bredesen outspends Hilleary "10 to one," which she says "is a real possibility."

However, there are people within Knoxville's business and political community who say Bredesen is making far more progress here than he made in 1994. "I am in shock over the number of people who tell me that they will vote for Bredesen who have never voted for a Democrat before," says Pat Wood, a partner in the Lawler Wood real-estate firm.

Wood, one of the few Democrats among prominent Knoxville business leaders, would be expected to favor Bredesen. But Bob Talbott, the president of the Knoxville real-estate firm Holrob Investments, supports Bredesen and has even hosted a fundraiser for the former Nashville mayor, even though he almost always supports Republicans. "I didn't even support Ned McWherter," Talbott says.

Talbott cites Bredesen's experience in managed care, his record as mayor, and his ability to recruit businesses to Tennessee as reasons he is supporting him. "I think that Mayor Bredesen accomplished a lot for Nashville," says Talbott. As far as how much money Nashville spent to bring pro sports and other Bredesen dynamos to town, Talbott says, "I'm sure that the people in Nashville paid a lot of money for the things that they have accomplished. But my sense is that they really got a lot back for what they spent."

Then there is John King, a Knoxville attorney who was heavily active in Republican Jim Henry's gubernatorial campaign. After Hilleary defeated Henry in the primary, both Bredesen and Hilleary made pitches for his public support. King hasn't come out in favor of either candidate, saying he is back to focusing on his law practice. But when asked his opinion of Bredesen, King—who says he has almost always supported Republicans—says nice things about Bredesen. "He (Bredesen) has the perception of stimulating a strong belief among the people of Nashville that certain things ought be done and that they can be done, and there is a lot to be said about motivating people," he says. King says that in the past, he generally supports Republican candidates, unless "there is a strong or prevailing reason not to do otherwise." But when asked whether he will vote for Bredesen or Hilleary, King dodges the question. "You can ask," he says, "but I don't believe I will respond to that."

Despite such anecdotal information, Bredesen tries to give no hint of overconfidence when it comes to the election. "If I don't win, then at least I will have had a great 18 months," he says. However, Bredesen is not so circumspect about his confidence in his ability to be the next governor. Showing a touch of the arrogance that has been his strength as an executive and, at times, his folly as a politician, he says, "I just know that I can do a much better job than the current governor and his administration are doing. I just know I can. I certainly don't have any anxiety about that."
 

September 19, 2002 * Vol. 12, No. 38
© 2002 Metro Pulse