Month: January 2017

Quick update before Council meeting tonight

Tonight, there is a meeting of the Council Public Safety Committee and its Minority Caucus in response to the Driving While Black report issued in October 2016 by Gideon’s Army.

This meeting is the result of a resolution and an ordinance that I have co-sponsored with Erica Gilmore. The resolution asks for MNPD to let the Council know whether the data in the report is accurate, and whether there is any additional information that the public needs to understand the data in context. The ordinance asks for annual reporting of data similar to what is in the report.

Today, Chief Anderson has provided lengthy materials in response to the report. You can see his letter to the Council, his letter to the public, and some additional statistics for context. I thank Chief Anderson for providing this information.

Chief Anderson’s materials explore the idea that, even though we have community-based policing in Nashville (i.e., do your policing where victims report crime) and minorities are involved in the criminal justice process at higher rates than non-minorities, there is no evidence of a causal link between the two. He explains that any racial disparities in outcomes are a reflection of our broader society.

I appreciate Chief Anderson acknowledging that his department has been “…reluctant to publish parts of this information.” He says (and I agree) that “…for there to be any meaningful improvement in [this situation] there must be candid, maybe painful, conversations across Nashville.”

The reason I proposed the current legislation was to encourage all of us to fully confront any differences between how people of different races experience the criminal justice process in Nashville. Even when the data is “unsettling” as described by Chief Anderson, it is better for Nashville to be unsettled and be talking.

I would like to see my legislation passed as a statement that Nashville and MNPD together believe the right thing to do is to disclose and confront unsettling statistics.

Context for the Upcoming Supplemental Hospital Appropriation

On December 29, 2016, the Hospital Authority voted to request a supplemental appropriation from Metro for Nashville General Hospital. I expect this request to come before the Council on February 7, 2016.

Before the request for a supplemental appropriation gets discussed broadly in the community, I would like to spend a few minutes providing context for the hospital’s finances. My main point is that the hospital’s finances have been challenging for a long time and we should NOT be surprised that they need a supplemental appropriation to get through the year.

I’ll write more about this after the appropriation request is formally made to the Council. For now, I just want to compare a few key financial statistics for NES (which is in good shape financially) and the hospital. By putting these numbers side-by-side, I am not trying to embarrass the hospital. In fact, I think it is amazing that they can keep plugging away with these finances. It is a testament to how much they believe in their important mission that they can make these numbers work.

First, by comparing the amount of bills you owe at any time to your total expenses for the year, you can get a quick snapshot of how you’re doing financially. For example, if you are 6 months behind on the mortgage and a year behind on your credit cards, you are in worse shape than if you are current on your bills.  Businesses often try to stay around 60 days outstanding on their bills.  In the chart below, you will see that as of June 30, 2016, NES’s current bills were just under 60 days of expenses for the full year.  At the same date, the hospital’s current bills were almost a 100 days of expenses.

For the hospital to have gotten down to 60 days outstanding on its current bills as of June 30, 2016, it would have needed an additional $10 million appropriated to it for the current fiscal year.

Second, we have all heard the rule of thumb that families should maintain an “emergency fund” of 3 or 4 months of expenses. And, without that, your family is at financial risk due to the unpredictable circumstances of life.

Let’s look at how NES and the hospital do with this. As of June 30, 2016, NES had enough cash on hand to pay approximately 100 days of expenses — that’s a healthy, appropriate reserve. The hospital had under 4 days of cash available on June 30, 2016.

For the hospital to have had even a modest 1 month of cash in the bank as of June 30, 2016, it would have needed an additional $7 million appropriated to it for the current fiscal year (in addition to the $10 million I mentioned above to bring the days of bills due down to 60 days).

My last financial point is there is absolutely nothing new about this situation.  I took a quick look at Metro’s audited financials for 2005 and 2010. By my math, as of June 30 of each of those years, the hospital had less than 1 day of cash available to it. In fact, in 2010, the hospital had $97 million of expenses and ended the fiscal year with $11,094 in cash.  (I didn’t forget zeros — it was 11 grand!)

In the coming weeks as we discuss a supplemental appropriation for the hospital, there may be some of the usual voices saying “shut it down.” That’s the wrong answer. I think the right answer is to look at what it will take to properly pay down the bills, and properly fund its bank account to help the hospital weather the inherent unpredictability of the healthcare industry.

You can read my previous posts about Nashville General Hospital here and here.

NOTE: All of the dollar amounts in the charts are from pages B-27, 31 and 34 of Metro’s FY2016 audited financials. The percentages and “approx days” calculations are mine.