Why Nashville needs to raise property taxes | Plazas

David Plazas | The Tennessean

Show Caption Hide Caption Is Nashville in a new urban crisis? Since January journalists David Plazas and George Walker IV have examined how pro-growth policies have prepared Nashville for prosperity, but it has been paired with growing inequality in their "Costs of Growth and Change in Nashville" series.

Sure, the city is booming, but only the privileged are reaping the benefits.

Metro has an obligation to the least among us.

An increase will correct past leaders' mistakes.

David Plazas is the opinion and engagement director for The Tennessean.

This question keeps popping up: How is it that Nashville prospers but Metro government struggles to make its budget?

I heard it again Tuesday while attending the board meeting of Nashville Organized for Action and Hope, the influential interfaith coalition with a focus on affordable housing, equity and social justice.

The gathering took place at Gordon Memorial United Methodist Church in North Nashville.

NOAH members debated whether to support a proposed 50-cent property tax increase as Metro Council debates Nashville’s budget this month.

That would generate $150 million over three years to make up a budget shortfall and cover promised raises to public servants like teachers, firefighters and police; honor Metro Nashville Public Schools’ total budget request; and replenish reserves.

COUNTERPOINT: Nashville should not raise property taxes; haven't taxpayers paid enough? | Opinion

► Read More: Teachers, unions push property tax hike as Nashvillians sound off on budget woes

At-large Metro Councilman Bob Mendes has championed what he calls a “correction,” because Metro historically has adjusted its property tax rate after the quadrennial reappraisal of properties countywide.

Documentary: How new Nashville is swallowing old Nashville For the past 11 months, photographer George Walker IV, and Opinion Engagement Editor David Plazas — with support and guidance from The Tennessean team — have told the story about the growing gap between prosperity and inequality in this booming city.

After the 2017 reappraisal, the tax rate dropped dramatically from $4.516 per $100 of property value to $3.155.

That’s because the county cannot by law collect more from property owners than it did in the previous four years. Since property values rose by an average of 37 percent, the math forced the drop.

Growth couldn't help in boom times

Former Mayor Megan Barry could have set the rate higher, but she did not. Incidentally, former Mayor Karl Dean did not adjust the rate either in 2009 or 2013.

Barry’s decision allowed Metro to boast about having a historically low tax rate.

► Special series: Costs of Growth and Change in Nashville

Meanwhile, revenue forecasts were off because they did not anticipate factors like:

An enrollment drop costing public schools $7.5 million

Mass successful reappraisal appeals by commercial property owners

Economic growth alone could not carry Metro in times of prosperity.

Mayor David Briley, who recently won a special election to fulfill Barry’s term through 2019, has proposed a “belt-tightening” budget that includes selling surplus public land, outsourcing parking and making deep cuts to the budget.

(The Mayor's office responded to this column Thursday that the proposed budget is larger than the budget last year by 1 percent. That is true. The budget proposal, however, does not support 3-percent cost of living raises that public employees were promised by the last mayoral administration. In addition, MNPS Director Shawn Joseph said in May that by funding only $5 million of a $44.7 million public schools request, the proposal "represents a $17 million cut from current funding level.")

He campaigned on a promise not to raise taxes, but that vow has consequences, which fall deeply on the people who are struggling the most.

At the NOAH meeting, someone warned that the money for the Barnes Affordable Housing Trust Fund would disappear come July 1.

The fund is named for the Rev. Bill Barnes, a stalwart champion of affordable housing who died Aug. 21.

► Read More: Honor Bill Barnes by championing affordable housing

Barry had promised $10 million for the fund annually. Under Briley’s budget, that money is contingent upon the sale of two properties.

That might save the Barnes fund next year, but what about after that?

By this time, Nashville should have made more headway on affordable housing; the effective dismantling of the Barnes fund would send a terrible message.

Nashville: A tale of 2 cities

People who cannot afford Nashville’s boom are continuing to be displaced.

Consider:

At the same time, Nashville is thriving.

The market is hot, unemployment is at a record low, the population is swelling, and companies are relocating here.

AllianceBernstein is bringing 1,000 new six-figure salary jobs to Nashville. The NFL Draft is coming in 2019. A World Cup soccer team might play a game here in 2026.

► Read More: Nashville and 2026 World Cup: 'I feel good about it, but ... the work is not done'

Nashville is a rich city with a budget crisis and a moral crisis about how to serve the least among us.

On Tuesday, NOAH agreed to endorse the 50-cent tax increase.

I agree with that posture.

That could cost me an extra $51 a month — on top of last year’s property tax increase.

However, I believe citizens need to honor that social contract with our community that benefits all, not just the privileged.

Our leaders made poor decisions that brought us to this point, which is why Mayor Briley and the Metro Council need to place us on firmer ground.

A tax increase will be painful and unpopular, but it will be the right thing to do.

David Plazas is the opinion and engagement director for the USA TODAY NETWORK - Tennessee and The Tennessean. Call him at 615-259-8063, email him at dplazas@tennessean.com or tweet to him at @davidplazas.