To borrow an old campaign slogan from former Nashville Mayor Karl Dean, Nashville is rising.
And by that, we specifically mean its debt.
Nashville’s debt continues to climb, so much so it’s at its highest point in 10 years, according to The Tennessean.
The paper cited a new report that shows city officials spent one out of every $10 of taxpayer money to pay off debt the last fiscal year.
The current path, the paper went on to say, quoting experts, is unsustainable.
As Metro Council member Steve Glover told The Tennessee Star last month, Nashville is broke and can’t afford to hand out more incentives for corporations, like the one proposed for Amazon.com
But incentives aren’t the only thing plaguing the city’s finances, according to The Tennessean.
“As debt payments climb they can crowd out salaries for teachers, police and other government workers — particularly when the mayor and council decline to raise property taxes, as they did last spring,” The Tennessean said.
“Some of the rising burden can be traced to a decision by city officials during the Great Recession to delay debt payments. Since then, the borrowing has continued.”
Chris Coviello, lead Nashville analyst at Moody’s Investors Service, told the paper the city should cut expenses, raise revenue, or find some way to fund their debt service obligations.
“Metro has $3.6 billion of outstanding general obligation debt, a tab that has funded school repairs, community centers, parks, sidewalks and other infrastructure,” the paper reported.
“That figure doesn’t include water and sewer infrastructure or some big-ticket items such as the $623 million Music City Center or the $91 million First Tennessee Park, home of the minor-league baseball Nashville Sounds. Those have dedicated streams of revenue outside of tax collections, although Metro is ultimately on the hook.”
But Nashville’s debt has climbed since 2011. Metro leaders refinanced debt. They made interest-only payments for two years. According to The Tennessean, that is like making only the minimum payment on a credit card.
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