Tag: budget

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Slowdown Coming

Photo: Georgios Kollidas | Dreamstime.com

With pressure building for potential tax increases in Memphis city government, the outlook for additional aid from state government took a hit Monday, as the State Funding Board acknowledged weaker-than-expected revenues and set a deliberately slow growth rate.

The board, composed of the state’s three constitutional officers and the state finance commissioner, set a growth rate in general fund revenue of 1 percent to 2 percent and total tax growth at 1.25 percent to 2.15 percent for fiscal 2025-26. That is on the heels of an estimated total growth rate projection for fiscal 2024-25 of -1.68 percent to -1.34 percent. 

Economic growth has ground down considerably in Tennessee after a double-digit revenue windfall of two years ago. Among other factors, the state is facing a $1.9 billion business tax reduction stemming from legislative approval of Governor Bill Lee’s proposal to eliminate the property portion of the state’s franchise and excise taxes. That move followed additional tax breaks for businesses the previous year. The Department of Revenue has processed nearly $900 million in rebates this year, and more are expected.

On the eve of the oncoming 2025 legislative session, the weak budget outlook could affect lawmakers’ decisions, leaving in the lurch not only localities’ requests for aid but funding requests from state agencies totaling over $4.2 billion. The revenue forecast isn’t expected to come close to matching that figure, even with anticipated federal funds covering some of the costs.

• Two Memphians are finalists to succeed soon-to-be-retiring state Court of Appeals Judge Arnold Goldin of Memphis: Shelby County Circuit Judge Valerie Smith and interim Memphis Chancellor Jim Newsom. A third candidate is Jackson Chancellor Steve Maroney, a former chair of the Madison County Republican Party.

Smith was a member of a three-judge chancery court panel that dismissed a lawsuit challenging the legality of the state’s school voucher program. The decision was later reversed by the Court of Appeals. 

Newsom was named in 2015 to a Chancery Court position by former Governor Bill Haslam but was defeated for re-election in 2016 by current Chancellor JoeDae Jenkins. He was reappointed interim chancellor this past summer by Governor Lee to assume the duties of Chancellor Jim Kyle, who has been disabled by illness.

• The three gun-safety measures approved resoundingly by Memphis voters earlier this month via ballot referenda have predictably come under legal challenge. The Tennessee Firearms Association has filed a lawsuit in Shelby County Circuit Court seeking to block city government from activating the measures. 

In a sense, the gun-lobby group’s suit is pointless, in that backers of the referenda conceded that voter approval of the measures was conditional on the will and pleasure of state government, which had made clear that state policy at this point would disallow the implementation of the three measures.

State House Speaker Cameron Sexton had angrily opposed the referenda as antithetical to state law and threatened to retaliate by cutting Memphis off from various state-shared revenues if the measures were enacted.

The measures, certified for the ballot by the city council, would re-institute a requirement locally for gun-carry permits, ban the sale of assault weapons, and enable the local judiciary to impose red-flag laws allowing confiscation of weapons from individuals certified as risks to public safety.

Mindful of Sexton’s attitude, backed by Governor Lee, the Shelby County Election Commission originally acted to remove the referendum measures from the November ballot, but they were approved for the ballot by Chancellor Melanie Taylor Jefferson.

• It begins to look as though the beleaguered Shelby County Clerk Wanda Halbert will survive various ouster attempts and will survive in office until the election of 2026, when she will be term-limited.

Her latest reprieve came from Circuit Court Judge Felicia Corbin-Johnson, who disallowed an ouster petition from attorney Robert Meyers, ruling that such an action had to be pursued by Shelby County Attorney Marlinee Iverson, who had recused herself.

Judge Corbin-Johnson had previously disallowed an ouster attempt from Hamilton County District Attorney Coty Wamp, who was acting as a special prosecutor. 

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State Budget Flags On Business Tax Breaks

State Capitol (Photo: Tennessee State Government)

Tennessee’s State Funding Board approved conservative growth rates Thursday as revenue flags in the wake of a major business tax reduction.

The board, which is made up of the state’s three constitutional officers and finance commissioner, set a growth rate in general fund revenue of 1 percent to 2 percent and total tax growth at 1.25 percent to 2.15 percent for fiscal 2025-26.

With this year’s overall budget at $52.8 billion, the board maintained the total growth rate projection for fiscal 2024-25 at negative-1.68 percent to negative-1.34 percent. The board was forced to roll back projections at mid-year because of weak revenue.

Economic experts told the board earlier this month that the economy is in good shape but that growth is slowing after double-digit revenue two years ago. The state also is facing a $1.9 billion business tax reduction over several years after lawmakers approved a request by Gov. Bill Lee to eliminate the property portion of the state’s franchise and excise taxes. That came on the heels of a business tax break the previous year.

Tennessee lawmakers still at odds over business tax cut as session enters final days

The Department of Revenue has processed nearly $900 million in rebates this year, and more are expected.

Tennessee’s growth rate usually lies between 3.5 percent to 5 percent, but staff expected revenue to slow down and built in a cushion over the past two years, Budget Director David Thurman said.

In recent budget hearings, state departments and agencies requested more than $4.2 billion in funding increases for fiscal 2025-26 to deal with inflation and improvements in state services. But the revenue forecast isn’t expected to come close to matching that figure, even with federal funds covering some of the costs.

The weak budget outlook could affect lawmakers’ decisions on providing funds to flood-ravage counties in East Tennessee and the governor’s proposed private-school voucher program, which was not approved this year but has $144 million in unused funds in the budget.

Tennessee Lookout is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Tennessee Lookout maintains editorial independence. Contact Editor Holly McCall for questions: info@tennesseelookout.com. Follow Tennessee Lookout on Facebook and X.

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Business Budgeting 101

Photo: Firmbee.com | Unsplash

Does your business use a budget? Having a budget may seem like a no-brainer, but you’d be surprised how many businesses don’t use one. Without a budget, it’s difficult to have a clear understanding of your financials and overall performance. If your business has struggled with budgeting and isn’t sure where to begin, you’re not alone. Make today the start of your budgeting journey with these simple steps.

Decide Your Budgeting Tool

To start a budget, all you really need to do is get it on paper, literally. Drafting a budget on a piece of paper is a great start if that’s what’s comfortable to you. Most beginners opt for a tool such as Excel to house their budget. Excel is a solid tool with templates and formulas that make it relatively easy to track and update expenses.

As you get more experienced with your budget, you may want to consider more robust budgeting tools, like Jirav, that offer a deeper analysis of your financial metrics and advanced reporting capabilities. The same applies if your business has rapidly grown or has plans for expanding — you may find that a simple spreadsheet is no longer sufficient and could be holding your business back.

Align Your Budget With Your Goals

Budget numbers shouldn’t be pulled out of thin air. They should always be a reflection of your business’s upcoming goals and priorities for a set time frame, such as quarterly or yearly. Whether you’re aiming to upgrade certain systems or want to add head count to a few teams, your budget should account for the top areas you want to invest in.

It’s also crucial to get other departments involved, depending on the size of your business. Each team will most likely have their own budget to follow, so it’s important to make sure everyone’s plans align with the overall vision and direction of the company.

Don’t Let Your Budget Become Stale

A great way to start your initial budget is by reporting on your financials from the previous year and using that as the basis. Be cautious though: Many businesses fall into a rut of using their previous year’s financials as the baseline of their budget each year without looking for ways to improve it. Once you’ve gotten more comfortable with budgeting, it’s recommended to further analyze the trends you see in your budget and explore new reporting metrics to optimize its impact on your business.

There are countless insights in a budget for businesses to tap into to shape their strategy. If an area is severely overspending, that may signify deeper performance issues or inefficiencies that need to be addressed. The reverse may be true for areas that underspend. Eventually, you may choose to set up your budget to track revenue by a team or employee and use that data to determine how to allocate future funds. No matter where you decide to focus your attention within your budget, it should be reviewed and adjusted every year to meet the changing needs of your business.

One of the most challenging aspects of budgeting is simply getting started. Whether you opt to use a basic program like Excel, a robust software option, or even the back of a napkin, a budget is only useful if you put effort into it. 

Gene Gard, CFA, CFP, CFT-I, is a Partner and Private Wealth Manager with Creative Planning. Creative Planning is one of the nation’s largest Registered Investment Advisory firms providing comprehensive wealth management services to ensure all elements of a client’s financial life are working together, including investments, taxes, estate planning, and risk management. For more information or to request a free, no-obligation consultation, visit CreativePlanning.com.

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Five Financial Tips for Young Adults

Photo: Cut in A Moment | Unsplash

It can be difficult to know how to start building a solid financial future. With all the responsibilities of early adulthood you may be tempted to put financial planning on the back burner. However, the sooner you start planning, the better off you’ll be in the long run. The following tips can help you get started.

1. Create a budget.

Identify how much money you spend each month and compare that to your monthly income, considering two types of expenses: fixed and discretionary.

Fixed expenses are those you pay each month, including rent/mortgage, minimum credit card payments, car payments, insurance, utility bills, and cell phone.

Discretionary expenses are costs you choose to take on that may not be essential, including eating out, movie and concert tickets, streaming TV subscriptions, gifts, and vacations.

Once you’ve added up your fixed and discretionary expenses, compare the total to the income you bring in. If you’re spending less than you earn, congratulations! You’re one step closer to a stronger financial foundation. If you find you’re spending more than you’re earning, you may need to trim some discretionary expenses to bring you back to level footing.

Look at the discretionary expenses. Where can you lower your spending? Maybe you can cut back from eating out four times per week to one or two times per week. Perhaps you don’t need all your streaming services. Or maybe you choose to take your next vacation closer to home rather than paying for a plane ticket.

The key is to establish a budget that allows you to pay your fixed expenses and discretionary expenses while living within your means and taking care of obligations.

2. Pay off debt.

Regardless of the type of debt (student loan, credit card, auto loan, etc.), the sooner you pay it off, the sooner you’ll achieve financial security. While there are times when it’s necessary to take on debt, there are other times where outstanding debts can spiral out of control. Two effective strategies for paying off debt include:

• The snowball method — This involves paying off your smallest debt balance as quickly as possible, then moving on to the next-smallest debt. This approach can help you gain a sense of accomplishment as you knock out one loan after another.

• The avalanche method — You begin paying on the loan with the highest interest rate first. Once that is paid off, you move to the loan with the next-highest interest rate. This allows you to pick up speed because each payment saves you more money than the one before.

3. Build an emergency fund.

An emergency savings account can enable you to keep up on your necessary expenses, pay down debt, and continue your lifestyle for a period of time. A rule of thumb is to have three to six months’ worth of living expenses saved. An emergency fund can protect you from taking on additional debts to meet your needs

4. Save for retirement.

The sooner you start saving, the better your chances of achieving or maintaining the lifestyle you want. The easiest way to start is by contributing to your employer-sponsored retirement plan at a rate that maximizes your employer matching contributions while still being sustainable.

Don’t have access to an employer-sponsored plan? Consider an individual retirement account (IRA). There are two main types of IRAs: traditional and Roth.

• Traditional IRA — Contributions are made on a pre-tax basis, which reduces your taxable income in the year you contribute. Money invested in a traditional IRA is free to grow tax-deferred until retirement. Distributions are taxed as ordinary income and may be subject to a 10 percent early withdrawal penalty if taken before reaching age 59½.

• Roth IRA — Contributions are made with after-tax funds, providing no tax benefits during the year in which you contribute. Contributions can be withdrawn after five years with no taxes or penalties (earnings are subject to tax and a potential 10 percent penalty if withdrawn before you reach age 59½).

5. Avoid lifestyle inflation.

As your income increases over time, it may be tempting to increase your spending. This tendency is sometimes referred to as “lifestyle creep,” and if not managed, it can get in the way of your financial goals. When your income increases, consider increasing your savings first.

Gene Gard, CFA, CFP, CFT-I, is a Partner and Private Wealth Manager with Creative Planning. Creative Planning is one of the nation’s largest Registered Investment Advisory firms providing comprehensive wealth management services to ensure all elements of a client’s financial life are working together, including investments, taxes, estate planning, and risk management. For more information or to request a free, no-obligation consultation, visit CreativePlanning.com.

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New Spending Ideas for the New Year

Photo: Kelly Sikkema | Unsplash

A new year is upon us, and that means many are setting (and forgetting) new year’s resolutions. New beginnings are a common time to think about spending, saving, and budgeting. In this space, we’ll talk through a few concepts that might be useful as you consider your relationship with your money in the coming year.

One of the trickiest things to define when mapping out a plan is what kind of spending to actually worry about. Spontaneous purchases on Amazon or a fancy bottle of wine at a restaurant is more of a luxury than a necessity if you’re looking to cut costs. But what about grocery spending? Doctor visits? School tuition? Your mortgage?

Probably the best way to look at it is to consider only things you want to change. If you’re happy in your house and committed to staying, then there is not much to do about your property taxes. They are of course an item that must be considered as part of cash flow planning, but there is not much reason to spend mental energy on them.

There is a potential big blind spot, however, which is the savings that can be had even in “non-negotiable” categories. For example, many people believe you should spend as much as possible on tires, since they are an important safety component when it comes to driving. Even if you consider safety non-negotiable, you might find through research that certain less expensive tires are just as safe as the top tier. Even if you remain committed to the most reputable and well-known tire brands, you likely will find that you can achieve substantial savings by shopping around. The knee-jerk reaction to spend as much as you can on safety-adjacent stuff might be just as influenced by marketing as any actual incremental security.

Another source of unnecessary spending is the desire to be spontaneous. While spontaneity has a role for all of us, there is no place for it financially if you’re aggressively trying to work your spending down. Things like dining out, buying clothes, and weekend getaways are easy to stumble into, and the costs can add up quickly. Planning just one nice restaurant meal each week could not only help control the budget but also give you something to look forward to in advance — and that anticipation can greatly increase the enjoyment per dollar spent.

In the end, the most important spending principle is to be honest with yourself. Every dollar we spend is because in the moment we have convinced ourselves it’s a good idea, but that justification can be ephemeral. If you use a transaction aggregator like Mint, it can be instructive to go back over your transactions weeks or months later and see what you value after the fact and what you don’t. Even better is to look at your Amazon purchase history, which is never purged. Which items you’ve bought do you still use? Which did you never use? Which items make you wish you could go back in time and unorder them? An honest relationship with your past spending is one of the best ways to develop better decision-making about the future.

If you are happy with your spending, you have nothing to worry about, but most of us have some work to do in this realm. Like we always say, we cannot control markets, but we can control spending, and your spending habits likely have the most outsized impact of anything on the path to your secure financial future. Hopefully, these tips can help you develop a mindset that serves you as you make decisions about your money.

Gene Gard, CFA, CFP, CFT-I, is Chief Investment Officer at Telarray, a Memphis-based wealth management firm that helps families navigate investment, tax, estate, and retirement decisions. Ask him your questions or schedule an objective, no-pressure portfolio review at letstalk@telarrayadvisors.com. Sign up for the next free online seminar on the Events tab at telarrayadvisors.com.

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Memphis-Shelby County Schools Seeks Feedback for Next School Year’s Budget

A recent Memphis-Shelby County Schools survey that seeks input about how to prioritize budget spending aligns with many of the priorities Superintendent Joris Ray outlined during his recent state-of-the-district address. (Courtesy: Chalkbeat)

This story was originally published by Chalkbeat. Sign up for their newsletters at ckbe.at/newsletters.

Mar 16, 3:56 p.m. CDT

As Tennessee’s largest school district prepares its spending plan for next school year, Memphis-Shelby County Schools officials are seeking feedback from families and community stakeholders.

From facilities improvements and digital learning resources to social-emotional support and wraparound services like health care for students, the district survey seeks input about how to prioritize budget spending. 

District spending aside, the survey also asks for input on other issues, such as whether Shelby County has enough pre-kindergarten classrooms and if K-2 teachers and parents have enough support to teach children how to read. It also seeks to gauge community awareness of various services the district provides, including tutoring, the summer learning academy, and its new social-emotional learning curriculum.

Sign up for monthly text updates on the Memphis-Shelby County school board

Chalkbeat wants to make it easier for busy Memphians to stay informed of important school board happenings every month.

To sign up to receive monthly text message updates on MSCS board meetings, text SCHOOL to 901-565-5550 or type your phone number into the box below. https://app.groundsource.co/surveys/textsms/19015655550/school/?font=arial&button=000000

Many of the questions asked in the survey are in tandem with the priorities Superintendent Joris Ray outlined in his recent state of the district address, including retaining and recruiting high-quality educators, boosting early literacy, and reducing the student-adult ratio at the K-2 level.

The survey comes a week before the school board will host a series of community meetings to discuss the upcoming budget, ESSER spending, and the district’s renewed literacy commitment. Under its second grade retention rule that it will implement at the end of this year, all students must be able to read before entering third grade. The meetings are scheduled for: 

  • Monday, March 21, 5:30 p.m., A. Maceo Walker Middle School, 1900 Raines Road, hosted by board members Miska Clay Bibbs and Joyce Dorse Coleman.
  • Monday, March 21, 5:30 p.m., Richland Elementary School, 5440 Rich Road, hosted by board members Kevin Woods, Sheleah Harris, and Billy Orgel.
  • Wednesday, March 23, 5:30 p.m., Snowden School, 1870 N. Parkway, hosted by board Chair Michelle McKissack and board members Stephanie Love and Althea Greene.

The district will also live-stream the meetings and make them available online at voiceofscs.com and scsk12.org/board.

Samantha West is a reporter for Chalkbeat Tennessee, where she covers K-12 education in Memphis. Connect with Samantha at swest@chalkbeat.org.

Chalkbeat is a nonprofit news site covering educational change in public schools.

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Governor Lee Proposes $1 Billion Boost for Tennessee Education

Credit: state of Tennessee

Tennessee Governor Bill Lee wants to add $1 billion to Tennessee’s nearly $6 billion education budget. Lee announced the proposed increase Monday night during his annual State of the State address, where he shared his 2022-23 priorities and the highlights of his proposed budget. The proposed budget for fiscal year 2023 is $52.6 billion, with 41 cents out of every dollar spent on education.

Some top lines for K-12 education include:

  • $32 million for charter school facility funding. 
  • $125 million to increase teacher salaries.
  • $200 million to relocate public schools in flood plains, including schools in Shelby County. 
  • $550 million in career and technical education grants. 
  • $750 million toward additional education investments.

The money for the proposed raise for teachers received some of the loudest applause of the night. 

“Historically, funds put into the salary pool don’t always make it to deserving teachers, and when we say teachers are getting a raise, there should be no bureaucratic workaround to prevent that,” Lee said. “So in our updated funding formula, we will ensure that a teacher raise is a teacher raise.” 

The infusion of money for teacher salaries and education is part of Lee’s plan to overhaul Tennessee education funding. The Education Law Center gave the Volunteer State an F for its funding level in its Making the Grade 2020 report. 

Last year, Lee ordered a review of the Basic Education Program, a funding formula with 46 components that determine how much money the state sends to districts for textbooks, technology, and other needs. Under the proposed student-centered funding formula, districts and charter schools would get additional education investments to assist students who are managing issues such as  learning disabilities and the challenges of living in poverty, and that should translate to more help for teachers in the classroom, said Education Commissioner Penny Schwinn.

“Some of the things we’ve heard the most about are things like counselors and nurses and supports for students who need those supports and ensuring our teachers can focus on the academic instruction,” Schwinn said in an interview before Lee’s speech. Schwinn added that teachers have been asking for additional support for high-needs students.

“It’s time to do right by them, and I think this is a good first step,” she added. 

Pointing to a 2020 report by the Tennessee Advisory Commission on Intergovernmental Relations, some education advocates say that Tennessee schools need an additional $1.7 billion of state money, so even with the billion-dollar-boost proposed Monday night, Tennessee education would still be underfunded.

Other organizations praised the governor’s announcement.

“The priorities laid out in the State of the State, including an additional $1 billion investment in education, an increase in teacher pay, and dedication to expanding career and technical opportunities for students, if adhered to, will make the 2022 legislative session a success for Tennessee’s students and their futures,” Adam Lister, president and CEO of Tennesseans for Student Success, a middle Tennessee-based nonprofit organization, said in a statement. 

“Governor Lee’s call for the General Assembly to overhaul and improve the way the state funds education is a transformational moment,” Lister added.

Lee also weighed in on the culture wars in the classroom in the wake of anti-critical race theory laws and national debates about when and how to teach children about or protect them from learning the harsh realities of U.S. history. 

Lee highlighted recently introduced legislation to ban some books from Tennessee libraries. He announced a state partnership with Hillsdale College, a conservative Christian college in Hillsdale, Michigan, to expand civics education in Tennessee that promotes “informed patriotism.” He also announced that the state would give $6 million to create the Institute of American Civics at the University of Tennessee, a center that would combat what he described as “anti-American thought” in higher education. 

 A replay of the governor’s speech is on his YouTube channel. 

Chalkbeat is a nonprofit news site covering educational change in public schools.

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New Year, New Budget

Invest in 2022. (Photo: Visual Stories || Micheile | Unsplash)

This time of year is always busy with new beginnings and new ideas. Resolutions sometimes stick but always give a good chance to think about the future. Here are three ideas for 2022 to help keep your finances running smoothly.

Watch out for cash.

With 2021’s inflation uptick and the low interest rates in bank accounts and CDs, there’s almost never been a worse time to hold cash. A cash position is losing 5-6 percent of purchasing power every year at this rate, so stashing cash isn’t as defensive as it might seem. While the stock market might seem due for a correction (and in fact one might be right around the corner), putting money in a diversified portfolio is still the best way to fight inflation and hopefully achieve some real returns.

If you have a specific need for cash soon, like an upcoming down payment or college expense, it can make sense to hold cash. However, if you’re holding cash just because you’re hesitant about uncertainty with no specific spending needs in the near future, you probably should consider putting that money to work. Big cash positions are eroded by inflation and can’t enjoy the long-term power of compounding.

Be skeptical.
I enjoy a good conspiracy theory, but I work hard to differentiate what might be possible from what might be probable. In the last year, I’ve seen an unprecedented number of people make major life decisions (financial and otherwise) on what I might charitably call questionable theories. Keep in mind that the modern information industry is extremely good at getting us hooked on information that connects with our biases and fears. Increasingly, the selective presentation of facts can appeal to our worst instincts.

Yes, our national discourse and politics seem unusually polarized right now. However, there are countless things that are going very right in our world. Markets move up and down and politicians come and go, and staying the course in a diversified portfolio is the best way to navigate toward a secure financial future.

Think about spending.
Markets are uncertain and always seem the most uncertain now. In retrospect, everything has always worked out okay in the past, but will this time be different? As investment professionals, we spend a lot of time and effort building the best portfolios we can for our investors, but we don’t know the future, either.

If you’re concerned about the future, the one thing you have absolute control over is to spend less. If you’re really concerned about the future, spend a lot less! This has two powerful effects. For one, less spending allows you to more quickly build up savings and investments, which give a margin of safety for future needs. Building a fulfilling life with less spending means in the worst case you can be more resilient to a job loss, unexpected health event, or other financial shock. In the best case, it means you can retire or downshift your career sooner than you planned. Investments are just one small part of a successful financial plan, and spending discipline can have a much more dramatic effect on your future than any other factor.

Gene Gard is Chief Investment Officer at Telarray, a Memphis-based wealth management firm that helps families navigate investment, tax, estate, and retirement decisions. Ask him your question at
ggard@telarrayadvisors.com or sign up for the next free online seminar on the Events tab at telarrayadvisors.com.

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Coalition Pushes for “Moral Budget”

Credit: Moral Budget Coalition

A coalition of Memphis nonprofit organizations want city and county leaders to keep current tax rates and spend the excess funds on a raft of community investments in what they call a “moral budget.”

Memphis City Council members delayed the final vote on Memphis Mayor Jim Strickland’s proposed $716 million budget Tuesday, awaiting word from federal leaders on how they can spend money from the American Rescue Plan (ARP). 

With only one regular council meeting left before the July 1st deadline for a new budget, little is likely to change. This is especially true of large items, like setting the city’s tax rate, which is a cornerstone of all civic budget-making.

However, that’s exactly what the Moral Budget Coalition is still pushing for. The group is comprised of many groups, including Stand for Children Tennessee, Memphis Interfaith Coalition for Action and Hope (MICAH), Memphis Tenants Union, Memphis Music Initiative, My Sistah’s House, BLDG Memphis, Homeless Organizing For Power & Equality, Memphis Restaurant Workers United, Memphis For All, Decarcerate Memphis, Collective Blueprint, and Whole Child Strategies. 

During budget season this year, the coalition presented a new voice to the money conversation at Memphis City Hall. It requested something new from lawmakers, but something familiar with many in last summer’s Black Lives Matter movement: investment in the community versus the same old thing.  

“As we watched the current budget cycle, there was a growing sense that we are caught in an ill-fated loop that never leads to progress and prosperity for our community,” reads the proposal from the Moral Budget Coalition. “Current budget proposals and discussions only played at the edges of any kind of forward movement. 

“The Coalition for a Moral Budget felt the need to come together and propose a set of budget amendments that would be a bold statement for where we wanted Memphis and Shelby County to head in the future.”

Instead of tax cuts this year, the group wants city and county leaders to keep current rates intact. This would yield $40 million in additional taxes for the city and $100 million for the county, the group said. 

We know that the city council and county commission can get this done for our people and communities before the budget deadline with the same urgency and deliberate speed brought to bear for the business community.

Moral Budget Coalition

With the additional funds, the groups asked leaders to invest in Youth Education Success Fund for education, the Memphis Area Transit Authority (MATA) for transportation, mental health services for youth and adults, the Opportunity Youth Workforce Fund, debt relief for renters, the Memphis Affordable Housing Trust Fund, services for the homeless, housing help for the transgender and gender non-conforming community, weatherization efforts, expansion of broadband, raises for city and county workers, healthcare, art, and more.  

“While this may be viewed as late in the budget process, we have seen our local mayors and legislative bodies move mountains to offer tens of millions of dollars in tax incentives to projects within a couple of weeks because time (and the business community) demanded,” reads the proposal. “Since our proposed moral budget does not affect the current budget and supports new revenue to fund the proposed investments, we know that the city council and county commission can get this done for our people and communities before the budget deadline with the same urgency and deliberate speed brought to bear for the business community.”

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Harris Proposes $1.4 Billion Budget Without Tax Hike

Shelby County Mayor Lee Harris. (Courtesy Shelby County Government).

One year after presenting a budget proposal that ended up being submitted to seemingly endless wrangling by the Shelby County Commission, County Mayor Lee Harris on Wednesday presented a budget proposal that almost certainly will be more gracefully received as the county’s legislative body prepares to begin its own deliberations.

Last year, facing a possible deficit, Harris proposed an increase in the county wheel tax that was not approved. His budget proposal for 2021-22, the third of his tenure, amounting to $1.4 billion in expenditures, contains no such proposed increase.

As Harris put it on Wednesday, April 21st, his proposal “contains no property tax increases, no cuts, gives a 1.5 percent pay raise to all our employees, and raises the minimum hourly wage for Shelby County government workers to $15.29 per hour.”

On Thursday, the Mayor’s office released a transcript that follows very closely the outlines of his remarks to the commission. It follows below. And, while his proposal seemed to be well received, the commission — both as individual members and as a body — will assuredly make an effort to put their own stamp on it before the beginning of the fiscal year in July. 

As Commissioner Reginald Milton said, serving notice, “This is more of a clarity issue. And I think that’s important we do this. The agenda item here says ‘Discussion of the 2022 budget presentation.’ That is incorrect. It is the 2022 proposed budget presentation. And as a legislative body it is important that we realize our role.  The mayor does not present a budget, he presents a  proposal, and we, as an elected body, will look it over and we will add and subtract from it as we see necessary as well. … We are part of this process. No budget is approved without this body’s inclusion. That’s why we were elected — to ensure that each of our districts are represented in the budget and their concerns are heard. With that said, Mr. Mayor, I am extremely impressed with what you said.”

The mayor promised the commissioners a printed copy of the budget before the commission’s next scheduled public meeting on May 5th, and, in response to their requests on Wednesday, he said he would also prepare an electronic version to be put online.

Meanwhile, here is how the mayor explained his budget proposal:

I’m pleased to say that the $1.4 billion proposed budget contains no property tax increases, no cuts, gives a 1.5 percent pay raise to all our employees and raises the minimum hourly wage for Shelby County Government workers to $15.29 per hour. 

Further, we have found a way to make strategic investments in education, public health, public safety and to make a substantial $19 million contribution to our rainy-day fund.

This budget follows a year like no other in our lifetimes.

We have all lived through one of the most difficult periods in Shelby County history. At the beginning of March 2020, there were virtually no confirmed cases of the novel coronavirus in the entire United States. Almost overnight, this infectious and deadly pathogen spread across the country and invaded our community.

This past year has brought pain to Shelby County. More than 92,000 residents contracted COVID-19. Our unemployment rate peaked at 14.8 percent in July 2020 before retreating to 6.8 percent as of February 2021. Thanks to federal CARES funding, and a lot of work, we are able to blunt some of the negative economic effects of the pandemic.

But, there is still pain throughout our community. Therefore, I don’t believe this is the time to raise taxes. Too many in our county are still on the road to recovery. What’s more, our property tax rate is already one of the highest in the state.

Even without a tax increase, we will invest in education.

The budget continues to build on the historic and unprecedented work we began when we came into office and devoted more than $8 million to early childhood education. This year, like last year, we have allotted $8.5 million to Pre-K and early Pre-K. Over the last three years of my time in office, we have allocated more than $25 million in new dollars to Pre-K education.

Because of that historic investment, every child, regardless of income, has access to Pre-K. This is important.

The academic research and education professionals tell us that a sound education in the earliest years of life is the foundation that each child needs to build a life of success. And if our children succeed, so will our community.

This budget includes the full $427 million for schools in addition to $30 million in school construction funding for this year.

When it comes to public health, this budget ensures that we can continue the COVID response throughout the rest of this year. Although some of the worst aspects of COVID may have receded, we expect we will have to continue the course for just a while longer.

We plan to continue to fund the COVID response unit until this virus is defeated. We will need to maintain the full complement of personnel and assets that form the backbone of the COVID response unit and this budget proposal does that.

Also, in our ongoing commitment to public safety, our current plan invests $32 million over six years in the Shelby County Fire Department. The investment allows the department to hire 41 firefighters and purchase a variety of safety equipment and new technologies. This massive investment in public safety means that the fire department will be in a position to reduce the emergency response time for underserved areas in Shelby County.

There are two new fire stations planned, one is near South Cordova and another in Southeast Shelby County. The construction and equipment costs of $10 million are included in this budget proposal.

This week’s budget presentation only begins the process.

The budget will be reviewed by the County Commission. The other elected officials might request more funding. There could be additions or subtractions.

But for now, we are focused on a road to recovery. This proposed budget is Shelby County’s roadmap to take us into our 203rd year.