In November 1969 the City of Red Bank applied for a federal grant from the US Department of the Interior’s Land and Water Conservation Fund (LWCF). Administered by the Bureau of Outdoor Recreation (BOR) – a predecessor of the National Park Service – this program helps state and local project sponsors by providing 50% of the cost of developing public outdoor recreation opportunities. In exchange for the federal funds, project sponsors are required by federal law to maintain the project for public outdoor recreation in perpetuity.
In January 1970, Red Bank was approved for a federal grant of $70,175, which would be matched 1:1 from the city’s general fund. By summer 1972, the new 30-acre Morrison Springs Park was completed alongside a pre-existing public park with a pool. By then, the federal grant amount had risen to $73,675.92. The new park included ball parks with parking lots, trails, three picnic shelters, a group meeting pavilion, a concession stand with restrooms, and an amphitheater.
By 2011, the City needed to replace the old Red Bank Middle School at 3715 Dayton Boulevard, and chose to build the new one at the Morrison Springs Park. In a negotiated binding settlement with the NPS and its state-level partner agency, the Tennessee Department of Environment and Conservation (TDEC), Red Bank would be allowed to convert 14.63 acres of the park, in exchange for creating publicly accessible outdoor recreation opportunity at two 5-acre tracts on Stringer’s Ridge plus a 3-acre portion of the old middle school site.
Federal regulations require that replacement properties be acquired and developed for public outdoor recreation within 3 years (by January 2014). Red Bank did acquire the two parcels on Stringer’s Ridge in December 2010, and the old middle school site already was publicly owned. However, the City took no further action to develop any of the three sites for publicly accessible recreation.
Instead, during the three-year deadline period for developing replacement parks at Stringer’s Ridge and the old middle school site, the City of Red Bank chose to spend its money to expand and upgrade Norma Cagle Park, an action that had zero bearing on fulfilling the city’s land swap obligations.
By 2020, Red Bank still had not fulfilled its legal obligation, and in May 2020 was declared by the NPS to be out of compliance with the 2011 agreement. Further, the NPS rescinded that 2011 agreement as insufficient and no longer valid.
Federal law prohibits a project sponsor from simply paying back the original LWCF grant amount to escape legal liability from a conversion.
Even if reimbursement were allowed, the $73,675.92 federal grant in 1970 is equivalent to $518,395.55 in 2021 dollars.
The City remains required by federal law to replace the converted park with publicly accessible outdoor recreational land:
(1) of at least equal fair market value, and
(2) of reasonably equivalent usefulness and location, which meets recreation needs that are at least like in magnitude and impact to the user community.
Following the recission notice, the City attempted to hastily and quietly sell off the old middle school site, the one property with the best chance to fulfill the park replacement obligation. In August 2020, the City had the site appraised. Then in September 2020, the City issued a public Request for Proposals, seeking developers who would buy and develop the people’s property for predominantly private use and gain. By the January 5, 2021 deadline, three developers had submitted full proposals; none has yet been selected.
In summer 2021, Red Bank took one serious step toward meeting its park replacement obligation, by securing updated appraisals of the two most relevant sites, the converted 14.63 acres of Morrison Springs Park, and the old middle school site at 3715 Dayton Boulevard. The August 2021 results were:
Converted 14.63-acre site: $1,455,000
3715 Dayton Blvd 11.97-acre site: $3,770,000
Thus, Red Bank is required to permanently designate and protect land (in one or more parcels) worth at least $1.455 million, and that provides reasonably equivalent usefulness and location as the converted park. A specific stipulation of the NPS is that some form of active recreation must be provided by the city on such new protected land.
The NPS has ultimate authority to approve or reject proposed property substitutions. As the state partner with NPS in administering the LWCF grant program, TDEC has proximate responsibility and authority for assuring compliance and replacement of converted property. The full array of consequences for continued failure by the City of Red Bank to comply with its obligation are unclear. At a minimum, Red Bank will be unable to compete for future grants from TDEC and the NPS, and our red-flagged status could be a black mark against our city for certain other state and federal grant opportunities.