Here we go again
The shadowy “4GoodGovernment” group is back messing with Metro again. Its effort last fall to trigger a referendum fell short when a court ruled that its petition language was fatally flawed. Now they are trying again. If it gets enough signatures, the new petition would force a special referendum election this May or June. It would severely limit the Metro government’s ability to function. You can google “4GoodGovernment” to find the petition language. This Tennessee Lookout story is a good explainer.
The people who put the petition together have no legitimate argument for their position on taxes. The petition would radically redefine how Metro works in a dangerous and random way. I hope it fails due to a lack of signatures and we don’t have to deal with yet another election and more lawsuits.
I want to be clear that I don’t have any quarrel with well-intentioned people who might sign the petition. People are entitled to their opinions. But for the architects behind the petition, it’s different. I don’t think there is a genuine interest in making Nashville a better place for everyone.
Saying that there is “no legitimate argument” for their position on taxes is a strong statement. It’s warranted here. I’m sure that “both sides-ism” is going to make us talk more about their position than I would prefer. But make no mistake — there is strong overlap between the Trump-to-the-end thinking that can’t accept election reality and the people who built this petition. Facts don’t matter. Reality gets turned on its head. It’s messy to have to tell people “you have no legitimate argument.” I don’t say it to be disrespectful. I say it because they have no legitimate argument and I won’t pretend there is.
The petition, if passed, would radically redefine how Metro works. The petition would limit Metro to no more than a 3% property tax rate increase per year. This is out of step with the “good old days.” It’s out of step with today. It bears no reasonable relationship to anything Metro has ever done. It makes no sense.
Here’s a post from three years ago that talks about how property tax rates have worked over the history of Metro. That post has a link to a chart with Metro’s property tax rates from 1963 to 2018. Through that time, Metro raised the property tax rate eight times, for an average of 12.5% per rate increase.
The current combined property tax rate is $4.221. Over the last 30 years, the property rate was HIGHER than this for 23 of those years. While Metro mismanaged the rate to be much too low for much too long and self-inflicted its budget problems, objectively, today’s property tax rate is not high compared to Metro’s history or to peer cities. Metro has a long history of maintaining the same rate for multiple years and then adjusting it by more than 3% to fit the needs of the growing city. The proposed 3% cap would radically change how Metro operates.
The petition, if passed, also would inject unhealthy randomness into how Nashville budgets in FY2022 and FY2023. Specifically, I don’t think the people who drafted the petition understand how their language fits in with the mandatory every-four-year property value reappraisal in Nashville.
About the reappraisal process…this happens every four years and is required to be revenue neutral. You can look back at FY2017 and FY2018 on that chart I linked to for an example of how this works. In FY2017, the tax rate was $4.516. Then the mandatory reappraisal concluded that property values in Nashville increased a lot in the four years since the prior reappraisal. I am wanting to remember that the increase was something like 35-40% over four years. Because Metro isn’t allowed to make extra money from a reappraisal and must be “revenue neutral,” the tax rate was forced down to $3.155 for FY2018. The people who wrote the petition seem oblivious to this process.
I’ll spare you the math, but if the current reappraisal process that will wrap up very soon were to conclude that there is no increase in property values over the last four years, then the petition language forcing the rate back to $3.155 would require cutting about $341 million from Metro’s operating budget in FY2022 — which starts in less than five months on July 1, 2021!!! However, if the current reappraisal were to show a 10% increase in overall property values in the county, passing the petition would force $246 million in cuts. As a final example, if the reappraisal were to show a 34% increase in overall property values, then passing the petition would not force any cuts at all. It’s bizarre to me that this was drafted so that the amount of budget cuts would be driven by how the reappraisal process goes. This just shows that the people who wrote the petition fundamentally don’t understand how Metro’s budget works.
Another way to think about their lack of understanding is to talk about if there is enough “fat” in the Metro government to cut $100 million or $200 million or more. I looked at some of the spending that I’ve heard the people behind the petition complain about over time. If you completely got rid of the entire budget for: the Mayor’s Office, the Council office, the Community Oversight Board, the Historical Commission, Barnes Fund, all economic development spending, all spending on social services and non-profits, the Human Relations Commission, Nashville General Hospital, property tax relief spending, the Metro Action Commission, and the Metro Arts Commission, you would have slashed about $107 million from the budget. The point is that these people are picking giant numbers that sound great at first blush. But forcing cuts of this size would be outrageous and completely undermine Metro’s ability to provide basic services. Except for the fact that they apparently have enough money to mail the petition to 100,000 voters, this wouldn’t be worth a moment’s consideration.
We live in a world now where almost everything is viewed through a partisan lens, which leads in turn to “both sides-ism” where fair-minded people want to give new ideas a chance, and I know that many well-intentioned Nashvillians will be attracted initially by the “let’s cut taxes” slogans. In the end, I hope that most of us see this petition as a danger to the city’s future and reject it.
(There are five other proposed referendum items in the petition. Some are similarly bad for Nashville. If this petition ends up on a ballot, I’ll post about them as well.)