2019 Budget Breakdown

Why I didn’t vote for a property tax increase.

It was a challenging week on Metro Council, with mixed opinions on the various proposed budgets (the most substitute budgets filed by the Council in Metro’s history) and a wide variety of needs and wants to balance and consider. Several of my constituents are disappointed because I did not vote for what they believed was a much-needed, 15.8% property tax increase. While it saddens me to disappoint any constituent, and I understand their concerns, I also know that the majority of my constituents agree with my decision to vote no.

There are more people over age 70 living in District 34 than anywhere else in Nashville, and I heard from a lot of them last week. A senior residing in a modest ranch home on our district’s typically large lots is paying around $4,000 in property taxes at the current rate. The Vercher substitute budget would have increased their annual taxes $630. Some will say, that’s a small price to pay for all the benefits within the budget, but I have to think closely about the impact on the people I represent and be mindful that in other areas of Nashville with exponentially appreciating home values, a sharply rising and regressive property tax is an even greater burden, contributing to the gentrification of core neighborhoods and pushing more people to reside on the periphery of Davidson County and beyond.

I also heard from several constituents asking me to raise their taxes. I appreciate these constituents’ willingness to increase their personal tax burden for the collective good of our schools. While this was a clear vote for my head, this was a difficult vote for my heart because I know that our Metro teachers and employees feel under valued and under appreciated with just a 3% cost of living adjustment (COLA) in the mayor’s budget, when they were already due 3% last year. Chair Vercher’s budget delivered a 4% COLA and one pay “step” increase for MNPS employees, but just a 3% COLA for general Metro employees. The Council eagerly awaits the MNPS pay study and the School Board’s work in this area, as it is clear that teachers have long been dissatisfied with the current pay structure.

Numerous departments and constituencies had items in the Vercher substitute budget that they wanted, that were good things, but those goods have to be balanced against the larger budgetary and economic impacts. For example, the Vercher budget added 20 new positions to the Metro Nashville Police Department (MNPD), which sounds beneficial, until you realize that there are currently over 80 MNPD positions un-filled. Personally, I wanted another urban forestry position in the Codes Department. I know from my work on tree-related policy that we are far behind peer cities and this position is much needed. This was a budget request that I personally coordinated. Chair Vercher kindly added it to her substitute budget, but as passionate as I am about tree-policy work, that still did not convince me to vote for this budget.

There’s no one solution to Metro’s budget woes. I agree that we will likely need a slight tax rate adjustment to get back on track after the last three mayors abdicated their responsibility to adjust the rate to keep revenue, spending and debt obligations in balance. That said, I disagree that a rate adjustment of the magnitude proposed, a $0.498 cent increase per $100 of assessed value, a 15.8% rate increase, is appropriate at this time. A rate adjustment should not be so significant that Metro Government is disincentivized from addressing systemic/structural problems and making the heavier, more complicated policy lifts. Before we consider raising property taxes, which have the greatest impact on lower-income individuals, we must:

  1. address the revenue capture in the “downtown” tourism zone (TDZ).
  2. advance a referendum within the next two years for a fundamentals-first transportation plan with dedicated funding for sidewalks, greenways, bikeways, & a truly excellent bus system.
  3. be pro-active and intentional about implementing business improvement districts (BID) in our suburban centers to supplement funding for the specific operational and capital needs of those areas.
  4. elevate ethics in procurement.
  5. reform tax increment financing (TIF).
  6. better address the impact and lessen the use of incentives and abatements for preferred real estate developers and corporations.

These are just some of the structural, policy changes we need to make, and I do not believe we should raise the property taxes of individual citizens so significantly until Metro Government gets our proverbial house in order. (For more details on the list above, please see the “Getting Our House in Order” blog post). There are so many awesome folks in Metro Government doing solid work for our citizens. I am grateful to them, and saddened that the rocky leadership in the Mayor’s Office, and the doubts and concerns that creates, continues to influence the willingness of taxpayers to invest more money in the Bank of Metro.

However they feel about mayoral leadership over this term, the majority of the Council agrees that Metro Government’s budgeting process is broken. Despite our thick budget books and 55 departmental budget hearings, much of our large departments’ budgets remain opaque. It is only through years of intentional engagement that council members begin to notice patterns in legislative and budget related discussions and start making specific requests for organizational charts and financial reports. In so doing, members of our various committee’s come to better understand the inner workings and budgetary needs of the departments to better deliver the services that citizens need and want. This requires an inordinate amount of time and effort, and questions of the council members are often met with skepticism and concerns of micro-management.

Given the constraints the Council has, I am grateful to Councilman Mendes for his budget work, to Councilman Glover for trying to provide a budget with a lower tax increase to honor the COLA, and to Budget & Finance Committee Chair Vercher for all her hard work. For one person to have to revise and compile a massive budget in virtual isolation with small inputs for changes and additions from other council members via staff, when the mayor has a massive finance department and months and months at his disposal to prepare his budget, is ridiculous. Our mayor-dominant system does not serve our citizens well. The Council does not, but can and should, make better use of its committee system to divide the work needed for comprehensive departmental oversight, meeting policy goals, and delivering a budget that reflects the collective will of our body and the citizens we represent.

When a budget fails by one vote, it’s very easy for those who are disappointed to direct their ire at any one particular Council member. Nashvillians who are mad at the Council for not passing the substitute budget with the tax increase, should remember also that the mayor lobbied against it and likely would have vetoed it. If you want better budgeting and fiscal stewardship, elect a better mayor and elect council members with the independence to vote against unsound deals. For good or bad, with our “strong-mayor” form of government, Nashville is where it is at any particular time largely due to the deals and choices made inside the Mayor’s Office.

In service to you, I research, read, and listen to a variety of opinions and sources before all votes, especially one of this magnitude. I stand by my budget vote and am accountable for it and every vote that I have made in my service on the Council. I welcome you to contact me with your questions and concerns at angie.henderson@nashville.gov or call me at 615-260-5530. I am always happy to discuss your Metro government with you.

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Getting Our House in Order

I’ve been mixing my metaphors lately: houses, gambling, cleaning, stores, trains. “We’re off track.” “We need to clean house.” One day last week, I was thinking perhaps I should make an effort to dial down the use of metaphors in my remarks about Metro when a constituent said to me that it appeared to him that Metro had misplaced priorities and was putting a lot of energy into branding and marketing and less into fundamentals of governance.

“Indeed,” I said. “Recent mayors have put a lot of energy into highlighting programs & proclamations, but it would behoove the city if they would spend less time touting the admirable variety of merchandise in the display windows and more time paying attention to all the essential products being stolen out of the back of the store!” (A store metaphor, right off the top of my head–apparently, I’m a metaphor addict.)

My blog post about my budget vote was too loooong. I could already feel people falling asleep as I was typing it. One of the central points I was trying to make was that Metro needs to address several key, structural and policy issues before asking individual taxpayers to contribute more in property tax. I briefly listed several areas that need attention, and lest you think I did not expound upon them sufficiently in my other post, I decided to flesh them out a bit more here.

  1. Address the revenue capture in the tourism development zone (TDZ). Structured to provide dedicated tax revenue for operations and debt service on the new convention center, this zone is too large, extending well past downtown. It’s so large that the Convention Center Authority (CCA) is running a $100 million revenue surplus and using that surplus to fund parking garages in private development, like the recent $38 million contributed to the 5th & Broadway project. As negotiated by Metro, the CCA directed $10 million to the general fund this year. They may be able to provide more, but we also need to consider whether the boundaries of the TDZ need to be redrawn via legislation at the State. Learn more about the TDZ here: https://www.tennessean.com/story/news/2018/07/01/nashville-music-city-center-tennessee-tourism-lower-broadway-tax-revenue/737803002/
  2. Advance a referendum ASAP within the next two years for a fundamentals-first transportation plan with dedicated funding for sidewalks, greenways, bikeways & a truly excellent bus system. This will open up at least $48 million in the annual operational budget. Mayor Barry’s gamble in 2017, when she didn’t adjust the tax rate (historically always a mayor-lead effort) so she could tout the “lowest tax rate ever” for the benefit of marketing her high-cost, low-return, debt-laden transit plan (which failed via referendum 2 to 1) is coming due. We cannot wait five years to advance a better more modest plan that will make a positive difference for more people.
  3. Be pro-active and intentional about implementing business improvement districts (BID) in our suburban centers to supplement funding for the specific operational and capital needs of those areas. In a sprawled city/county consolidated government like Nashville, BIDs allow these established business hubs, many with legacy chambers of commerce, to enhance infrastructure and services on their own, tailored terms. This is an important financial and community building tool that Nashville is so far only using in three areas. Learn more about BIDs here: https://www.pps.org/article/bid-2
  4. Elevate ethics in procurement. Nashville has had several messy, major procurements this term first for the potential redevelopment of the park land that was home to the former Greer Stadium and most recently for the purchase and management of our on-street parking system, a plan most on Council oppose. In response to the Collier Engineering scandal, Mayor Briley hired a 100K position in the Mayor’s Office to address ethics in procurement. Fine, but at the same time, we should probably stop doing business with the corrupt contractors that sparked this work, no? Why is our city still doing business with a firm that we have verifiable proof stole money from taxpayers? Tolerance of grifters only begets more grifters.
  5. Reform tax increment financing (TIF). TIF can be an important tool when used as intended to catalyze development in depressed and blighted areas, but TIF was still being doled out for prime downtown real estate projects in 2017. Nashville’s real estate market is burning hot, and fires don’t need gasoline poured on them. (Metaphor alert) This needs to stop, and I appreciate Councilman Cooper and Councilman Mendes’ work to address this. Learn more about TIF in Nashville here: https://www.nashville.gov/document/ID/2ee32fe9-1022-4eff-8462-1ae457b923fc/Final-Report-May-7-2019
  6. Address incentives and abatements for preferred developers and corporations. For per-job type incentives, we’re still paying half a million to Dell every year in our budget, apparently because no one in the Mayor’s Office or on the Council thought to put a reasonable time limit on that incentive when it passed in 1999. This year, I amended the Amazon per-job incentive bill, which I didn’t vote for, to cap them after 7 years. I opposed $15 million in infrastructure incentives for the Nashville Yards development, the $20 million un-itemized bucket in our capital spending plan for the River North development, and the 10-acre give away for a private, mixed-use development that was part of the soccer deal. Private development should pay for itself, full stop. Hopefully abatements are an incentive of the past, but the Omni Hotel is still abated to the tune of around $2 million per year, and the Bridgestone Americas downtown tower is receiving a 100 percent property tax abatement for 20 years, just to name a few. These decisions have accrued to the detriment of our general fund, basic services, and schools.

Metro Government needs to get our house in order, and I’m determined to help clean things up. If we address the issues listed above, we’ll be back on the right track. (I know, I know, cleaning house AND train tracks, but I told you at the start I was having a metaphor problem, so it was bound to show up in the conclusion.)

P.S. Please note that these blogs are far from research papers. Is there more to be said, more facts to be shared? Sure. But there’s only so much time in the day to serve my constituents, complete two major policy efforts (trees! sidewalks!), and campaign to continue to representing District 34. If you like what you read here, there’s also a contribution page on this website, and I’d be grateful for your support to continue serving on the city council. Next financial deadline is June 30th. Thanks very much!

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  • Written by angie henderson