The myth that “belt tightening” could fix the budget

A year ago, many of us argued that Metro’s property tax revenue was out of step with the city’s historical practices and that this was the leading cause of Metro’s budget problems. Links to my posts from last year are here.

The counter-narrative from the Mayor’s office and a slim majority of the Council was that the city could “tighten its belt” on expenses to solve the budget problems.

The Mayor’s budget for the current FY19 — which the Council ended up approving last June — called for Metro departments to cut $11.5 million in expenses through the course of this year. You can see that at p. 18 of last year’s budget presentation:

and at page 5 of this year’s presentation:

For the Council, this amount of belt tightening wasn’t enough and a “Blue Ribbon Commission” was created to find more cuts. After working on this project since last fall, the Blue Ribbon Commission has suggested that another approximately $19 million of expenses should be trimmed from the Metro and MNPS budgets. See page 32 of this year’s presentation.

I have confirmed that the Mayor’s proposed budget accepts and adopts all of the Blue Ribbon Commission’s recommendations about cutting expenses for the upcoming FY20.

The upshot is that even after slashing $11.5 million in expenses in FY19, and planning to cut another $19 million in FY20, the budget is still a mess and has to rely on $41.5 million of one-time non-recurring revenue to make ends meet.

Last year, the numbers didn’t lie. There was no reasonable way to cut enough expenses to pay all the bills of a growing city. The Mayor wanted to give it a try anyway. But, now that we know chopping $30 million in expenses does not fix the city’s budget, I hope we can get focused on the revenue side instead.

Bob Mendes

Bob Mendes represents all of Nashville as a Council-At-Large member of Nashville’s Metro Council. He is Chair of the Council’s Charter Revision Committee, a member of the Metropolitan Audit Committee, and a member of the Council’s Budget & Finance Committee, Rules & Confirmations Committee, and Ad Hoc Affordable Housing Committee. Bob also practices business law at Waypoint Law PLLC. Bob’s complete bio is here. You can follow Bob @mendesbob.