>> female announcer: This is a

production of WKNO, Memphis.

Production funding for "Behind

the Headlines" is made possible

in part by..

>> Barnes: As we come to the end

of 2012, a look back at the

biggest stories of the year

tonight on "Behind the

Headlines."

>> (instrumental music)

♪♪♪

>> Barnes: I'm Eric Barnes,

publisher of the Memphis Daily

News.

Thanks for joining us.

Joined tonight to look back at

the biggest stories of the year

with Bill Dries form the Memphis

Daily News.

Andy Meek also of the Memphis

Daily News.

Eleanor Boudreau, WKNO-FM

and Jackson Baker from the

Memphis Flyer.

Thank you all for being here.

We start.

No big surprise, the biggest

story of the year was the

schools in all its forms.

I guess I'll start with you,

Bill, to kind of hit.

And there's so many big mile

stones that continue to go on.

But let's start with you in

terms of a review of all that

did happen in this past year.

>> Dries: Well, there was a lot

that happened.

There's still a lot more to come

in terms of the school's merger.

And it's broader than the

school's merger.

It's the rise of municipal

school districts and the

question about whether those

districts will arise or not.

Basically this year we had some

decisions that were made.

The Transition Planning

Commission delivered it's report

of 172 recommendations for what

the merged school system should

look like starting in August of

2013.

That was delivered to the school

board.

The school board is still to act

on a number of those decisions

In fact, they have not taken

final action on any of those

recommendations in terms of

putting them in a budget for

next school year as we speak on

this show today.

>> Barnes: Yeah and that

includes those recommendations.

Everything from, you know,

nuanced issues of curriculum to

closing 21 schools.

You know, redoing the bus

contracts, the janitorial

services.

You know, trying to save $100

million in doing things

differently that would involved

a tremendous number of difficult

decisions.

And even then, you know, funding

is a big question mark.

So we've been talking about this

for, you know, the whole year as

these things have been going on.

The other thing we have is the

superintendant decision.

And we've got a double headed

situation right now.

Let's go back to an interview we

did in August with David Pickler

formally of the county school

board, now of the unified school

board, when he was talking about

what next with the

superintendant.

>> Dries: Do you think that the

full board can vote on a plan

whether it's the TPC plan or

some plan that mixes in other

parts?

Can you all get a vote by the

end of August?

>> Pickler: Oh, I think that's

highly unlikely.

We need to.

We need to begin that process.

We need to have already selected

a superintendant quite frankly.

And it appears that Tuesday

night we're at least going to

approve a process for

determining with the selection

process it's going to be like

for that superintendant.

And that report is not expected

until the end of September.

>> Barnes: And so we have,

Eleanor, I mean, a process that

has frustrated a lot of people.

That you have the two

superintendants.

They've now decided, you know,

they've recently decided that

they're about to sign a

contract, I should say, with the

search to find the

superintendant.

A lot of people saying-Why don't

we just hire John Aitken from

the former Shelby County

Schools?

No one really saying that Kriner

Cash is going to continue.

And frustration-What's your take

on that?

>> Boudreau: Yeah, well one

thing that school board did do

this year is they decided not to

renew Cash's contract.

So I think it's pretty clear

that he's not going to be the

pick because of that move.

But they still have yet to, you

know, sort of set-up a really

definitive process for how

they're going to get to their

next superintendant.

And I think, you know, Aitken is

definitely going to be

considered but whether or not

he'll be chosen depends on who

the other candidates are and

what the process is which we

don't really know yet.

>> Barnes: And Jackson, your

take?

I mean, the biggest parts to the

biggest story of the year?

Maybe the ruling.

I mean, the ruling by Hardy Mays

and the ongoing decisions he has

to make.

>> Baker: There's no question

that because that put everything

in limbo.

And given that August '13

eventually will get here and

there will be a school year

beginning then and there will be

a unified system that never,

never, never proclamations you

hear from some of the suburban

mayors.

Some of the, may end up and

their proclamations may end up

rethinking whether they can live

with this unified system.

Mentioned John Aitken.

If he had been hired at a time

when there was mood to hiring,

back in the spring actually,

they might have eased their way

towards their making their peace

with such prospect.

I think frankly his prospect for

being names superintendant are

in decline now.

I think that was the time to

have done that.

We're going with this search

process.

However, the more continues,

then the less likely someone

local will beat him.

>> Dries: They're scheduled to

make the decision in February.

That's when the vote is

scheduled to happen on a

superintendant and a contract of

being negotiated.

Let's remember that the

Transition Planning Commission

and a number of political

leaders, not the least of which

was Shelby County Mayor Mark

Luttrell, thought that the

school board should make this

decision on a superintendant no

later than the end of the fall

which is right about where we

are now as we do this program.

>> Barnes: Right, and you've

already got-I'm sorry Jackson.

But you've already got, you

know, reports of, you know,

frustration from the board

saying that it is administrators

under the superintendants who

are slowing down some of this

process, some of these

decisions, the 172

recommendations.

And again, the critics saying-

Look, if you've got this

difficult situation in any

circumstance, but when you've

got two superintendants, it's

not clear that either of them

will be there.

This is not the way to make

these hard decision.

>> Baker: And that February date

will be inclined to float.

>> Barnes: I mean, based on

history, we would say otherwise.

>> Dries: I think if it floats

much that the criticism is

really going to ramp up.

I think there's a good

possibility that by February,

the political pressure could be

on the school board to jump the

process that they have in place

now for coming up with a merger

plan and go to some other

alternative method that is

quicker that the bottom of line

of which will be to give parents

the reassurances they need about

the next school year.

>> Barnes: And even with all

that going on, we also had new

approaches to dealing with

failing schools and Tennessee

statewide.

And the state decided to set up

an Achievement School District.

Some 70-something schools that

are on the failing list, many of

those, the vast majority of them

in Memphis.

I was able to sit down with

Chris Barbeck who is the head of

that achievement school

district.

And he talked a little bit about

the responsibility and approach

that they'll have to taking over

those schools.

>> Barbeck: There will be six

schools that we're working in

next year.

Three of those will be in

Frasier.

There's also two charter schools

that we work in other parts of

Memphis.

And then we'll also have a

school.

So the schools that we'll be

running as achievement schools

are all focused in Frasier.

And the charters-There's one

charter working in Binghampton

and then another charter working

in North Memphis.

>> Barnes: So that has gotten

underway.

But even there, there's still

some uncertainties.

You know, how quickly that whole

process will grow.

As he said, some ultimately nine

schools are getting taken over

by the achievement school

district in the Memphis area,

moved in to kind of a charter

school model.

What more do we know now, Bill?

>> Dries: We know that we'll

have a school system in which we

have roughly half run directly

by the ASD, the other half run

by charter school operations.

And that has really impacted the

move to merger as well because

there's definitely more

competition among the public

schools with the ASD schools and

the charter schools in the mix.

>> Barnes: Right, right.

Last thoughts on the school

situation?

I mean, we look ahead.

We've got, Jackson, a couple

rulings coming up probably in

the first part of the year from

Hardy Mays.

Your thoughts on that?

>> Baker: If he decides that the

final portion of Norris-Todd

which is what allows the special

school districts in Shelby

County only, if he allows that

to go down the way that he ruled

in the subsequent legislation.

Then again, I think that some of

the suburbs are going to rethink

their desperate need for

independence.

I think you could have a

somewhat larger unified district

than we're thinking of.

>> Barnes: And that's where you

get in to the kind of paths to

autonomy, the idea that the

suburban schools could be

charter schools like the failing

schools, like all the charter

schools and that sort of thing.

And that's another story as we

move on.

But from this part year, the

rise of charter schools has been

pretty remarkable.

I think, you know, when the

state took the cap off those-no

more limits on the number of

charter schools in the state.

If you remember back, there was

some resistance from the city

and the county and the school

boards and kind of slowed down

some of the applications but I

think next year, you'll see the

flood gates open.

And potentially, the Willie

Herenton schools working with

the juvenile courts.

Is that right?

>> Dries: Right, that's planned

for next school year to open up

a north side high school as

well.

And let's not forget the

Governor will probably be at

least backing, if not

introducing, a bill to permit

school vouchers.

>> Barnes: Yeah, your thoughts

on the Herenton?

>> Baker: Well, I'm going to

come in a little different

direction.

I'm going to go ahead and spin

the prediction I was going to

save for the end of the show.

The ever-busy Mark Norris who

does what he can every year for

the suburbs, he will be

producing legislation that will

greatly enlarge and change the

nature of the charter school

process because, you know, that

Nashville school that was

ordered by the state to accept a

charter school.

I think you're going to find

that as another door to open for

his kind of legislation.

That's the next move that

suburbs will make.

>> Barnes: I think you're right.

And I think as we go, we think

looking ahead to next year, I

think the rise of charter

schools is going to be

remarkable.

And that's probably a multi-year

thing.

And it's exactly on that front,

Up 'til now, we in Memphis have

thought of charter schools

because we've seen them as, you

know, entities that step in.

And failing schools be it

through the ASD or just invited

in.

And they've done some remarkable

things.

And some have bottomed out.

I mean, charter schools aren't a

perfect solution but overtime,

like the school in Nashville,

you'll get companies coming to

Memphis that are more schools of

choice.

They're not just about helping

kids who are in failing schools.

They're about competing with

private schools.

They're about competing with the

optional schools.

And that will really change the

face of not just the suburban

areas but I think the city, as

well.

So that's my prediction such as

it is for next year.

We move on to another big story

this year.

As always, Jackson, there were

numerous elections.

Too many, as I always say,

because there were constant

elections and you can't keep

track of them.

But your thoughts looking back

on some of the big moments in

election history in 2012?

>> Baker: Well I want you to

know that next year is our off-

year.

We're going to have about three

special elections.

There were two different

tendencies going in different

directions in the election

process as concerns us.

Statewide, the Democratic Party

was virtually rendered null and

void.

They ended up redistricting

which was under the control of

the Republicans who were

dominate in the legislature

already.

Really accentuated that process.

There are now seven Democrats in

the state senate, 33-member

state senate.

They actually had an election a

couple of weeks ago for

Democratic leader.

Jim Kyle of Memphis was

reelected senate Democratic

leader of a vote of 4 to 3.

When you think about it, they

probably conducted that election

on a phone booth.

And in the house it's not much

better.

24 members out of 99.

So the Republicans have a super

majority in both houses.

The election established them as

the one party that really

governs in Tennessee.

Locally, however, things were

different.

Shelby County not only of course

went for Obama.

Of course, the nation is going

in a different direction than

the state.

But Shelby County is going in

the same direction as the

nation.

Two Democrats who were thought

to be in danger back in August

running for county seats,

Cheyenne Johnson the Assessor

and Ed Stanton, the general

sessions clerk, were thought to

be in danger because of the

municipal elections were going

on then.

They won which indicates that

the Democratic Party still has a

niche here in Shelby County

which will endure.

>> Barnes: Well, and one thing

that's interesting about that

and I want to come back to the

state situation you described.

But let's stay local for a

second.

You do still have on a local

level this kind of mix and match

and these greyer areas of who's

Republican and who's Democratic.

I mean, we talked before about

Mike Ritz, the head of the

County Commission.

A Republican who has fought this

suburbs', you know, desire to

separate who is by some accounts

is, you've joked, a rhino.

You've repeated that people have

said that about him.

>> Baker: That's what his fellow

Republicans call him.

>> Dries: And he lives in

Germantown.

>> Barnes: I mean, what do we

make of that?

Is that a good thing maybe that

there aren't these kind of

clear-cut lines between left and

right, Republican-Democrat?

>> Baker: Well, I think it is a

good thing because there was a

time at least when the county

commission, even though they had

partisan elections, was

partisan-free on most issues.

Now basically, the division on

the County Commission is not

Republican-Democratic.

It's urban-suburban.

And Ritz who lives in

Germantown, nevertheless, the

majority of his constituents

live in the city of Memphis.

And he has adopted their point

of view.

He has become a leader on that

County Commission of a sort we

haven't seen in a while.

He's led on the IP issue.

He's the one that kept that IP

issue within bounds frankly with

the pressure he put on.

I look for him to be making a

similar moves with regard to how

we handle TIFs in the future.

>> Barnes: TIFs, the tax income

financing which is where they

steer money from various

districts in to redevelopment.

They've used it downtown to

great extent and so on.

>> Baker: And so it's not really

a partisan thing.

But Ritz, by the way, when Mike

Carpenter was on the commission,

he was one of those that agreed

that Mike Carpenter was a rhino

Republican.

Now, he's the one that has that

label.

>> Meek: Jackson made the point

about looking at Cheyenne and

bucking the trend of somebody.

I've just always wondered.

You know, you get down to the

local levels.

Is there a Democratic way to be

a property assessor?

Is there a Republican way?

Some of that seems to really not

matter in this.

That may explain some of the

dichotomy Jackson noticed.

>> Dries: I think there was

something else at work and that

was that neither Cheyenne

Johnson nor Ed Stanton conceded

the Republican vote to their

challengers.

They campaigned in Republican

areas.

They frankly worked harder than

their Republican challengers did

precisely because they knew

there was going to be a big turn

out in the mostly Republican

suburbs.

And they won.

>> Barnes: I think also along

those lines and talking about

what does it mean to be

Republican or Democratic at a

very local level.

I mean, Mark Luttrell who was

very involved in the Transition

Planning Committee conversations

and pushing as we just said for,

you know, whole leverage back.

You know, we don't want to give

the school system a blank check

until we know they're going to

put a good school system in

place.

But there's still this big gap.

And he was very clear in a an

interview we did with him and

interviews he did with other

people.

He said-"I'm not afraid to raise

taxes.

I didn't sign a no tax pledge.

I would never sign a no tax

pledge."

And that's not the kind of thing

you hear.

But he said-"I just want it to

be an effective school system

and if we're going to spend that

money, we're going to spend it,

you know, effectively."

Eleanor?

>> Boudreau: Yeah, I think that

the divisions when it comes to

schools that are the most

meaningful are the city and

county line.

It's not strictly Republican or

Democrat.

I think that's where you see,

you know, Republicans like Mark

Luttrell, the County Mayor, and

Mike Ritz on the Shelby County

Commission have had opposite

opinions on different issues

with schools.

Well, Mike Ritz represents a

district that is majority in the

city of Memphis.

And Mark Luttrell is the County

Mayor.

So even though they're both

Republicans, a lot of those

issues split city to county.

They're not really party issues.

>> Barnes: Right, and let me do

one more thing.

You mentioned the state.

Just one last minute, Jackson.

We look ahead.

We talked about the super

majorities in the Republicans.

They've got the governor.

They've got, you know, the

house.

They've got the senate.

Big majorities.

But looking ahead, you know,

that's when sometimes

legislatures-and it happened to

the Democrats years ago-when

they over reach and when the

divisions among.

And a lot of people would say,

up in the state capital, a lot

of the time the division is not

Republican-Democrat.

It's actually urban and rural.

What's your take on how this

sessions going to go?

The voucher bill is going to

come up probably, school's

voucher.

There's going to be a gun bill.

Your sense of how that plays out

with these big super majorities?

>> Baker: I don't know if

there's going to be much

division on Republican ranks on

the voucher bill.

The governor had a task force.

I saw Brian Kelsey the other

day.

He thinks he feels confident

that the governor would allow

him to bring an administration

bill.

He already has a bill on the

hopper.

The controversy is going to come

again on the gun issue because

there was a huge controversy

last year in which you had the

business Republicans on the one

side, the NRA Republicans tea

party types on the other.

That is not going to go away

because even though the governor

has said he thinks some kind of

bill will pass, some compromise,

it's hard to see what that

compromise is going to be.

I don't think FedEx is still

going to be crazy about having

guns locked in cars in parking

lots.

So the business community, I

think, is still going to look at

that.

And, you know, as one of the

Republicans who is on the other

side of the issue said-"Listen,

if business says you can't bring

a yo-yo on their property, you

can't bring a yo-yo on the

property, much less a gun."

>> Barnes: Right, right.

You mentioned FedEx.

And that segues in to another,

you know, area looking back at

the last year.

The country came officially out

of the recession, Bill, but, you

know, still a tough year,

without a doubt.

And changes at FedEx-Let's start

there.

Changes at IP.

Changes at some of the big

corporate players.

But let's start with the FedEx

experiences last year.

>> Dries: Well, FedEx and Fred

Smith as founder and CEO began

2012 very optimistic about the

prospects for recovery from the

recession.

They were seeing economic growth

in the form of economies joining

the global economy, mainly

China.

That changed dramatically during

the year.

And as a result, we end the year

with FedEx about to hand out

some buy-out packets to probably

several thousand employees

within the United States which

is part of FedEx Express really

paying the price for this shift

in slow down in the global

economy that we've seen in the

last year.

Very real results locally on

that.

>> Barnes: Lets move to a couple

of other business stories from

this past year, Andy.

One is a recent story.

International Paper is going to

stay in Memphis.

Tell us a little bit about that.

>> Meek: Well, they've acquired

a competitor.

They are growing and need more

space frankly.

You know, when the economy's

bad, that's especially a time

when incentives become more

paramount to these kinds of

moves.

It was originally looking like

they were going to try for an

extraordinarily long tax freeze

amount that, you know, gave a

lot of people pause.

That since has been dialed back

this week.

The good news is they're going

to stay here.

They're applying for tax

incentives to help make that

happen.

So, you know, it's a win.

>> Barnes: When you talk about

the tax incentives, there's a

number of business.

There are many businesses and I

won't hit all of them.

But that's been more of a topic

of debate, in particular after

Electrolux which I think came

through in probably 2010, 2011.

But broke ground this summer,

started hiring it's first

people.

Huge amount of tax incentives,

you know, involved with that.

Mitsubishi is moving towards

it's plant opening downtown.

Or another one that got a great

deal of tax incentives was

Pinnacle Airlines back-what?

A year and a half ago, Bill?

I can't quite remember when.

When it first got it's

incentives to move Downtown.

A lot of fan fare.

And then this year Pinnacle

ended up in Bankruptcy.

>> Dries: Right, Pinnacle filed

for bankruptcy reorganization in

April.

And the company has had to

rethink it's organization plan

or its reorganization plan

several times because of what's

been happening in the airline

industry in general.

Pinnacle is a regional air

carrier.

Delta Airlines on the other hand

has renegotiated its contract

with airline pilots to the

extent that they can drop the

50-seat and under jets that they

have been flying which Pinnacle

has a lot of in their fleets.

That agreement caused Pinnacle

basically to say we have to

rework our reorganization plan

and go back to our employees and

negotiate wage concessions.

>> Barnes: Yeah and another big

story of the year for, you know,

in the business community but

also affecting families and

everyone is Delta cutting back

dramatically the number of

flights out of Memphis, the

number of direct flights out of

here.

And a lot of concern about where

Delta is going.

But also some amount of hope

that for people who really have

always wanted Southwest to come

in to Memphis in a big way,

Southwest has said that they'll

probably be here.

You had another comment, Andy.

>> Meek: It was about Pinnacle.

There's an expectation that as a

result of the bankruptcy, they

were going to scale down their

real estate in a big dramatic

way.

So if the worst does happen in

Memphis, people are looking at

that in different ways.

Well, they have had this halo

effect in really reinvigorated

the tower that they're in now.

It just causes you to look at

incentives in a whole light

because you might say-"Well, was

that a bad investment if they

leave?"

Well, maybe not if you look at

it in a different way.

>> Baker: The whole Pinnacle

affair if a reminder of just how

transitory some of the feel-good

stories are because a year ago,

we were celebrating Pinnacle

moving downtown.

Kind of like University if

Memphis going in to the Big

Eight.

That's another one.

Big East.

>> Barnes: And that's a business

story in its way because there's

a big economic impact with these

sports teams.

And yeah, I mean, the big story

would have been a month ago if

we had done this show.

We would have said-"Oh, you

know, the University of Memphis

finally going in to one of the

big elite conferences and all

that that brings in terms of

tournament and recognition, the

money coming in with traveling."

Oh, by the way, there's no Big

East.

(laughter)

>> Barnes: Another story along

those lines was business

ownership, local ownership in

part of the Memphis Grizzlies.

You want to touch on that, Andy?

I mean, it was a big year for

that really,

>> Meek: Yes it was.

A young technology company guy

from California who stepped up

and really wanted to buy the

team and has excited a lot of

people.

You mentioned the local

ownership.

A lot of big names involved-

Duncan Williams, Autozone,

Justin Timberlake, Peyton

Manning.

I mean, the list goes on.

They did not do that with the

expectation of making a lot of

money.

The sense you hear from all of

them is this really high-minded.

We wanted to make an investment

in keeping a big civic asset

that everybody loves here in

town.

And that story is continuing.

The Grizzlies this week have

hired ESPN's John Hollinger.

Excited a lot of people to bring

kind of a Moneyball-esque

analytics sort of laser focus to

the team and player evaluation

and things like that.

>> Barnes: And they've been at

the top of the standings for

much of the last month.

>> Meek: I'm told Robert watches

every game either on his iPad or

his laptop.

He travels a lot.

Robert Pera, the new owner.

So, very engaged.

>> Barnes: We'll go around.

We've got just a couple of

minutes left.

Thoughts about looking ahead?

The biggest stories of next

year.

Clearly, I mean, they're going

to involve the schools so may be

it's the biggest stories other

than the schools.

I'm going to start with you,

Eleanor.

>> Boudreau: Well, I mean, the

schools are going to be merged

August of 2013.

When I think about next year,

that's what I think about.

>> Barnes: I mean, you want to

make a prediction on the court

rulings to come or no?

You may not want to.

>> Boudreau: No, I really don't

want to.

But thank you for the offer.

I appreciate it.

>> Barnes: Bill, looking ahead,

big stories for next year?

>> Dries: I think the impact of

vouchers coming.

I think the atmosphere for

changing education and a broader

sense state-wide which will have

a big impact here is going to be

the real story of 2012.

The pace for change is going to

become more aggressive and the

line that separates public from

private education is going to

continue to blur.

>> Barnes: I agree.

I think that's the biggest story

for the next five years.

>> Meek: Economy, no question.

At the time of this taping, the

fiscal cliff still is not

solved.

It's going to impact people just

in a tremendous way no matter

what happens.

The last recessions officially

ended according to the press

release July 2009.

Things are pretty precarious

right now.

>> Barnes: Jackson, looking

ahead?

>> Baker: The diminishing brand

of Tennessee Democrats has a

hope.

That's Craig Fitzhugh of nearby

Ripley.

A state representative who

survived a very stiff from

Republicans in this year's

elections.

And he's indicated he may run

for governor.

He's a very solid guy.

He may lead something of a

renaissance.

>> Barnes: And with just one

last minute, I would go back to

something Andy said.

I mean looking ahead, the real

estate economy this past year

seems by all accounts nationally

and in Memphis, has bottomed

out.

That's a big driver of local

economic growth from mortgages

to construction and so on.

That will be something really to

watch next year.

I'm not going to make a

prediction on that because

housing is too fickle.

And we don't know about the

fiscal cliff.

I mean, that could have a huge

impact on jobs, spending by

businesses like FedEx, spending

taxes for small businesses and

large businesses.

So that really is probably the

way that plays out is going to

actually.

I'm sure people are sick of

hearing about it but it's going

to have a big impact locally.

Thank you all for being here.

Thank you for joining us.

Join us again next week, first

show of the new year.

Thanks again.

Goodnight.

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