Monday, June 4, 2018

What's on the Council Agenda for 6/5/2018: public hearing on the budget, addressing Metro pension mismanagement, the Donelson Transit-Oriented Redevelopment Plan, stopping the fairground giveaway.

By Rod Williams - The Metro Council will meet Tuesday, June 5, 2018 at 6:30 PM in the Council chamber at the Metro Courthouse. Here is a copy of the Council agenda and the staff analysis for those who want to watch the Council meeting and follow along.  Below is a summary of what is on the agenda and what I perceive to be the most important.

Nominations to the Industrial Development Board:  Nomination are made from the floor for seats

on the board and then at the next meeting the council elects members from among those nominated. I believe there are four seats to be filled. This is not generally something the public cares much about but these seats are highly sought after and among business interest this is of considerable interest. This Board controls a lot of money. It develops property then leases it to businesses. This is one of ways the Council bribes companies to locate in Nashville by giving sweetheart deals to favored companies. Another way of looking at it is that this is a tool to incentivize companies to locate in Nashville.  Since the property remains the property of Metro Government and thus exempt from property taxes, companies awarded these deals do not have to pay property taxes but instead pay "payment in lieu of taxes" or PILOT, which is often much less than they would pay in taxes. Also, the IDB may do the same for developers of affordable housing.

Confirmation  of mayoral appointments to boards and commission: There are a total of  eleven appointments to be confirmed. Normally this is a routine matter and the council rarely rejects a mayoral appointment. 

Public Hearing on the operating budget and the capital improvements budget: Bill BL2018-1184 is the operating budget and Bill BL2018-1196 is the capital improvements budget.
The current Fiscal Year 2018 budget is for  $2.21 billion. The mayor’s proposed budget for Fiscal Year 2019 represents an overall increase of $20.4 million. This year's budget does not call for a tax increase.

At the budget hearings expect person after person to call for more spending for schools, parks, libraries, sidewalks, General Hospital, and other pet projects. Unfortunately, Nashville's conservatives  are not very active and seem not to care a great deal about local government.  They only get motivated about once ever eight years or so to oppose a proposed tax increase.  While liberals are active day in and day out and are at every budget hearing asking for more spending, conservatives are not to be seen calling for less spending except in the years of a proposed tax increase. It is not surprising that liberals always win.

This public hearing would be a great opportunity for people to voice concern about our massively expensive sidewalk program that builds very few sidewalk, our continued funding of the unnecessary General Hospital and the scam of excessive police and firemen overtime pay and the giveaway of ten prime acres of fairground property.

This year expect to hear from a lot of metro employees upset that the budget does not include funding for their promised cost of living pay increase and from school advocates upset that the schools requested budget was not fully funded.

One thing to note about this budget is that it anticipates insufficient money held in reserves.  The budget is broken into six separate funds such as the General Services General District General Fund and the School Debt Service Fund and four others. Metro has a policy that the city should maintain a balance of at least 5% reserves in each of these funds.  This is simple prudence and sound money management.  This budget does not do that. The Urban Services District Debt Services Fund would drop to as low as 2.3%.  Metro is like a household that is one unexpected auto repair bill from missing a mortgage payment or getting the light cut off. With the pension liability of the city and retiree health cost liability as well as debt obligations,  if we have a natural disaster or lose an existing sports franchise or if Trump's promised trade war causes an economic downturn, Metro could face some very hard choices. For a more detailed explanation of what is in the budget see the staff analysis. To become an expert on the Metro budget, see Citizens' Guide to the Metro Budget.

The capital improvements budget is not really a budget. It appropriates no money. It is a planning documents that prioritizes capital spending projects and list the source of the funding. Before something can be funded by the Council, it has to be in the Capital Improvements Budget. A lot of items in the CIB will never be funded. How many of those listed as a high priority get funded depends on  how much money  the Council puts into debt service to finance projects. Putting something in the CIB does not necessarily mean it gets build, but if it is not in the budget it certainly doesn't.

Resolutions:  There are 29 resolutions on the agenda. All resolutions are on the "consent agenda" initially but if there are any negative votes in committee they are taken off of consent.  Also any council member may ask to have an item taken off of consent or to have his abstention or dissenting vote recorded. All items on consent are passed by a single vote instead of being voted on individually.

There are several resolution to accept grant money.  Some of them require a local match and some do not.  There are a couple resolutions to settle law suits out of court.  None of the resolutions on the agenda are particularly controversial or of particular interest. Here is one of interest.
Resolution RS2018-1180  proposes three amendments to the Metro Charter. If approved by the Council they would go before the public to be voted on in a referendum. The first concerns the line of succession in the event of a vacancy in the office of mayor. The second changes the way we elect someone to fill a vacancy in the office of vice mayor or district council member by speeding up the process and the third would establish  the positions of President Pro Tempore and Deputy President Pro Tempore of the Metro Council within the Charter. Currently, these positions exist only as designations within the Council’s Rules of Procedure. I don't have strong feeling pro or con about any of these.
Resolution RS2018-1243 by Robert Swope and Steve Glover is an attempt to do something about Metro's money mismanagement. It ask the "Investment Committee
of the Metropolitan Employee Benefit Board, the Metropolitan Finance Department, and the Metropolitan Office of the Treasurer to review contracts pertaining to the management of Metro’s pension fund and to explore other options for pension fund management that would lower management fees and other expenses related to the pension fund. This should include exploring whether Metro’s pension fund could be managed by the Tennessee Consolidated Retirement System.

In the "whereas" clauses this resolution reveals the fact that the "pension fund, as of June 30, 2017, had assets of nearly $3 billion," and "investment expenses associated with Metro’s pension fund totaled over $39 million." I suggest those who care about the financial well being or our city to read this resolution. 

Resolution RS2018-1245  is "resolution supporting and encouraging economic equality for women." It repeats the often made deceptive claim that women are underpaid compared to men because women earn only 79% of what men do. It ignores that women make different choices. When other variables are held constant, there is no pay gap. For more on this see The ‘Wage Gap’ Myth That Won’t Die - WSJ,  or The Gender Pay Gap is a Complete Myth - CBS News. This is a meaningless resolution and accomplishes nothing, so it may not be worth wasting council time trying to debunk the myth, but it is galling that the Council continues to support such nonsense. I wish someone would challenge this resolution but I don't expect it.  If I were in the Council, I may not would take to the floor to argue the issue but I would at least be recorded as abstaining.
Bills on Introduction and First Reading: There are 48 bills on first reading. Bills on First Reading are normally considered as a group and are seldom discussed. First reading is a formality that allows the bill to be considered. Unless a bill is ridiculously atrocious it should be passed on first reading. Bills are not assigned to committee or analyzed by council staff until after they have passed first reading. I have not carefully reviewed the bills on first reading, but will before second reading. There is one bill on First Reading that is very significant. Bill BL2018-1205  would save the fairgrounds by prohibiting the giveaway of the tea acres that is slated to be given to the developers of the planned soccer stadium. This is a good bill. I don't think anyone would try to kill it on first reading but they may.

Bills on Second Reading: There are 13 bills on Second Reading. Here are the bill of significance:
Substitute BL2018-1139 approving the Donelson Transit-Oriented Redevelopment Plan. There is a new authority given to cities to plan, facilitate and guide develop around transit stops to encourage a certain kind of development around those stops and to give cities the authority to issue Tax Increment Financing bonds for improvements in the designated area. This would be the first time this authority has been used. This designation would apply to the Donelson stop on The Nashville Star line. There is a lot of detail in the staff analysis for those who want to know more. I have no problem with this concept.  Previous I had expressed a concern is that this might confer the power of eminent domain to MDHA for use in this area.  I have since spoken to the sponsor and have been assured this is not the case. With that assurance, I support this bill.
 Bill BL2018-1157  establishes a 50 foot floodway buffer along the Cumberland River and
A House on a cliff on the Tennessee River
prohibits variances.
The floodway is the river channel and adjacent low lying areas that would be underwater in a 100 year flood. No new construction could occur in this area and no existing building could be expanded. Suppose within the fifty foot buffer, the property sit on a high cliff a hundred foot drop to the river. Should that property not be allowed to be developed?  That property could have less impact on the river than a property miles away.  Also, building in the area adjacent to a 100 year floodway does not add to the potential for flooding if displacement is applied. Displacement means that if any capacity for the land to hold water is decreased on one part of a parcel, then more capacity must be added elsewhere. As an example, if a home is build and near the front of the property, the lot is build up by adding so many cubic yards of dirt to a low area, then the same amount of earth would have to be removed elsewhere.
This would also appear to be a  "taking" property. If someone has a right to develop their property and that right is taken from them,  that is a "taking" even if the owner retains legal title. If property is taken the owner should be compensated and it should only be taken for a public purpose. The public purpose may be to reduce flood risk. That may be a valid public purpose, but the owner should be compensated if his land is now worth less because it cannot be developed. Also, there is a proposed development of a boat-oriented development along the Cumberland with canals and boat docks. This type of development could not occur if this rule was in place and if there were no variances permitted.
Bill BL2018-1185 sets the tax levy which does not change the current tax levy so does not raise taxes.

Bill BL2018-1186   is essentially an extension of an existing tax relief program that has been in existence for many years. This is a good bill. It allows elderly homeowners to stay in their home and not be forced out because of increased property taxes.
Bills on Third Reading. There are  11 of them. Most are rezoning bills and of little interest.

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