Nashville's mayor is suspending a major contract associated with the proposed Nashville convention center. The price of a PR contract has mushroomed to more than six times the original budget.
Mayor Karl Dean sent a letter to the head of Metro's development agency Wednesday afternoon. In it, he ordered the agency to suspend all activity with the public relations firm McNeely Pigott & Fox.
Council members had expressed concern after the NewsChannel5 investigation revealed the public relations contract was not supposed to exceed $75,000. Metro has paid McNeely Pigott & Fox more than $458,000.
The Metro Development and Housing Agency paid the firm at rates as high as $285 an hour for things like writing speeches.
NewsChannel5 Investigates found nearly $10,000 in expenses for monitoring local blogs, posting on internet forums, twittering and facebook.
"There's nothing wrong here - everything is fine as I said it's less than three percent of what we've spent to date, that percentage will come down as the project moves forward," said Phil Ryan, MDHA.
The Mayor's letter to MDHA stated: "I do not believe that having an open ended contract with a vendor is a fiscally responsible approach to managing this project."
He added, "The development of Music City Center is too large of a project and too important to our city's future economic development to allow negative perceptions or potential mistakes in its financial management."
Mayor Dean appeared on NewsChannel 5+ OpenLine and said he wanted to review spending exposed in our investigation.
"The buck stops with me and I saw these reports and I thought this was a time to take a time out," said Dean. "Lets take a time out and make sure everything is done right and lets move on from there."
Dean said he wants his Finance Department to review all bills submitted by the PR firm and for the price tag to be reviewed. In addition, when work resumes, he wants all future bills to be reviewed by that same department.
He said he was not aware communication costs had gotten so high.
"I'm going to ask him actually to be much more involved in all areas of contracts with the convention center," said Dean.
Mayor Dean said he has confidence in the firm and in MDHA which oversees the convention center project. He said the suspension of this contract was temporary.
The Metro Council has not given final approval to the convention center project, but the council has voted to allow MDHA to start buying land for the project.
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