The MATA board of commissioners voted unanimously this week to approve construction of a nine-acre, $15.7 million terminal on Airways and to lease a majority of the facility to Greyhound bus lines.
The South Intermodal Terminal will be home to Greyhound's Memphis operations and a small MATA customer service center, as well as a stop on about five local bus routes.
The project is connected tangentially with the ongoing federal probe of Willie Herenton. In 2004, Herenton's real estate firm bought an option to buy Greyhound's downtown property on Union Avenue for $10,000. Two years later, after Greyhound decided to vacate the site for the new publicly funded facility, the option was sold for $91,000.
Will Hudson, head of MATA, said the public transit authority approached Greyhound in the early 1990s about partnering on a facility. "We started working on Central Station and the North End terminal," Hudson said. "We were working with Greyhound and they chose not to go in after a long debate."
In 2000, discussions began again because MATA identified Whitehaven as a good area for one of its transit centers, and Greyhound wanted a location closer to Memphis International Airport.
Greyhound will pay $2.5 million toward the cost of constructing the terminal, and because it will be renting 76 percent of the building, will pay 76 percent of the facility's ongoing operating costs. MATA also is getting $10.3 million in federal money, $2 million from the state, and almost $1 million from the city to fund the rest of the construction.
MATA's contract with Greyhound extends for 40 years with an option for one four-year extension. Greyhound's rent will be $10 a year. In addition to Greyhound and MATA, the facility also includes space for retail and the Memphis Police Department.
MATA staff said December's meeting was the result of a $1 million state grant that must be spent by February 2010.
Though Greyhound signed the lease last month, MATA officials and board members were quick to say they don't know anything about Greyhound's Union Avenue property.
"We don't know what they're going to do," Hudson said. "The only connection they have with us is that they agreed to move their operations out there."
Board member Karl Birkholz said he had been questioned by the FBI twice. "I've gotten more questions about this than anything I've addressed now going on 18 years," Birkholz said. "What they do with that property, I don't give a — I imagine they're going to sell it."
After construction begins, the South Intermodal Terminal will take about 15 months to complete.