Saturday, February 8, 2014

Metro's debt load is bigger than ever. It is time to stop borrowing money. Just say NO!

Councilman Charlie Tygerd has warned about it in very specific terms and a handful of councilmen such as Josh Stites and Emily Evans have expressed concern from time to time, but Metro's debt continues to rise.

A few months ago the Council defeated an effort to finance part of Metro's employee pension liability but last council meeting, the council voted to authorize borrowing to purchase lap top computers. With the $623 million Music City Center, the $17 million east bank Riverfront Park development,$65 million Sulphur Dell ball park, the $32 million ice hockey facility in Antioch and other projects, Metro has taken on an unprecedented level of debt. With proposals to build a new $40 million Riverfront Park expansion and amphitheater, a $15 million pedestrian bridge across the Gulch, a $175 million-plus AMP bus rapid transit line, there appears to be no end in sight.

I am not opposed to all of the above mentioned projects. Any of the above already build or funded or any of the proposed projects may have merit individually.  I am not one who opposes everything. During my service in the Council in the 80's, I voted for the Convention Center and River Front Park. As a citizen of Nashville, I supported Music City Center. I believe Nashville has more going for it than most cities and I believe the Center will pay for itself.  I initially did not oppose the Sulphur Dell deal and believed the financial package looked like it would not cost the city. It appeared the new revenue would pay for the bonds.  It was not until the developer refused to guarantee he would follow through on his commitment, that I turned against the project.

The cumulative impact of the above projects are troubling. When we issue general obligation bonds, we are pledging the full faith and credit of the city.  Our property tax rate must be sufficient to cover our debts. If debt service takes more and more of the city revenue, that leaves less and less for police and fire and education and maintenance. Unfortunately, I have little confidence in our Council to slow the rate of debt accumulation.  One of the least meritorious projects recently funded, in my view, was the $32 million Antioch ice hockey facility, yet all of the Council, including the handful of conservatives, people like Robert Duvall, Duane Dominy, Josh Stites, Charlie Tygerd and any one else you can name- all of them, voted for it.  Other than refusing to borrow to finance city pension, I do not know of a single time the current or immediate previous Council said no to borrowing money.

It is time to say no. We are already in danger of having our bond rating downgraded.  If there is another downturn in the economy or if the convention business falls off or if we loose our minor league baseball franchise, we could be in serious trouble. In my view the city needs to put  all proposed new capital spending projects on hold. Wait a while and see how the revenue is flowing. Try to pay off some debt before we take on new debt.  I would immediately  pull the plug on the Amp, and defer the riverfront amphitheater and the pedestrian bridge.

I fear that if the next Mayor we elect is someone like Megan Berry, we will continue the policy of greater and greater debt and I do not think that policy is sustainable. There will be a day or reckoning if we continue down this path.  I don't know what it would take to get a Council that would say "no" to new spending.  The "conservatives" on the Council, for the most part, vote just like the progressives. We need to elect a mayor who will be fiscally responsible. 

Below is a recent Nashville Scene article that addressed this issue:  Metro's debt load is bigger than ever before — something critics say can't be sustained. 

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