By Rosetta Miller Perry
One doesn’t have to be a billionaire or a stock market wizard to recognize strange fiscal policies and decisions, and Nashville’s city government continues to do things that are at best questionable, and at worse ill-advised. The latest was the announcement Thursday by Mayor John Cooper that the Metro finance office and his office would be filing Metro Council resolutions to authorize the refinancing of $629 million in general obligation bonds. The plan was approved by the state’s comptroller earlier in the week. These were both officially set to be filed last Friday.
The Mayor maintains it will save Davidson County taxpayers over $44 million over the next 20 years. “Hardworking Nashville families have to manage their budgets responsibly, and we must do the same thing in Metro government,” Mayor Cooper said. “Just as any resident would look for the best available terms on a mortgage or car loan, my job is to make sure Nashville’s taxpayers get the best deal possible.”
A second refinancing resolution that his office filed was to authorize the refinancing of $650 million of commercial paper, short-term debit into long-term, low-interest general obligation bonds. Increasingly, debt service costs have become a larger share of Nashville’s overall operating budget. This refinancing plan would supposedly help the Metro government prioritize other city needs, including schools and emergency response. It will also create an opportunity for neighborhood infrastructure investment.
Cooper’s office and those in support of those moves claim Nashville’s government would have restored access to commercial paper, offering flexibility and the ability to resume previously authorized capital spending. Such projects could include non-emergency repairs to sidewalks and roads, as well as planned projects for schools, libraries, bikeways and community centers.
Meanwhile, non-essential capital spending remains frozen due to COVID-19’s impact on the city’s revenue. That freeze will stay in place until both these resolutions are complete. The Mayor plans to advance the next annual capital spending plan for Nashville in early 2021. His office maintains it will address deferred maintenance needs and an initial round of projects in Nashville’s Transportation Plan.
The Tribune is quite skeptical about all this refinancing, or the benefit of these moves. For one, there’s been no discussion or specifics cited anywhere by Cooper or his supporters regarding the interest that must be paid due to these actions, or how doing them specifically helps get the city’s finances back on track. We’re also still wondering what’s the justification for the Sports Authority floating $225 million in bonds to pay for a soccer stadium sitting on public land, which is now largely private thanks to the actions of past Mayors.
Bottom line is Nashville has lots of people hurting, with jobs disappearing and housing costs soaring. A better use of a bond issue would be to affix it to proposals for affordable housing, as opposed to inserting halfway measures into a deal more designed to satisfy the needs of soccer fans and private individuals. The group that is behind the stadium deal has offered assurances that they will include affordable housing and also a number of good jobs in the mix, but neither of those is their primary goal.
Like any sports owners, their number one priorities are a winning team and maximum profits. That’s not evil or inherently wrong, but it doesn’t do anything to solve this city’s budgetary problems, nor help those most in need of good jobs and homes they can manage to pay rent or mortgages for through their income.
We sincerely hope all these refinancing deals, this billion-dollar plus transportation program, and stadium bond deal are going to do what the Mayor say they will, though at one time he was opposed to the soccer deal. But now he’s on board with it, and the city’s supposed economic boom rolls on for the benefit of developers and upper class, high income residents, while everyone else is left to scrape and fend, and try to survive.