RESOLUTION NO. RS2017-616
A resolution adopting a policy requiring a limitation on the amount of debt service funds appropriated for the amortization of general service bonds and urban service bonds in the annual operating budget of Metropolitan Government in relation to the total expenditures of the annual operating budget for all purposes.
WHEREAS, Article 6 of the Charter of The Metropolitan Government of Nashville and Davidson County (the “Charter”) sets forth the provisions for the adoption of the annual budget and other financial duties, including the requirement that the Metropolitan County Council (the “Council”) shall adopt a balanced budget (Section 6.03) and the Council shall adopt the annual budget not later than June 30 of each year which will become effective on July 1 and in the event the Council fails to adopt a budget it shall be conclusively presumed to have adopted the budget as submitted by the Mayor; and
WHEREAS, the Council as its next order of business after the adoption of the operating budget shall be the adoption of an annual tax on real and personal property and merchants’ ad valorem in the General Services District (GSD) and a School tax, which together with an annual tax on real and personal property and merchants’ ad valorem in the Urban Services District (USD) determined by the Council, which mandatorily shall be adopted by resolution of the Urban Council, that is sufficient together with other anticipated revenues, fund balances, and applicable reserves to equal the total amount appropriate for each of the several funds (Section 6.07); and
WHEREAS, Article 7 of the Charter further provides that there shall be debt service funds for the amortization of general bonds and urban bonds respectfully and that the property tax levies shall assure sufficient funds to adequately fund such debt service funds to meet the interest and redemption charges for payment of the bonds redeemed in that fiscal year (Section 7.20); and
WHEREAS, the Council recognizes the requirement and the necessity of providing adequate funds annually to timely repay the debt created by the issuance of all bonds, and assuring the maintenance of a good bond rating with the national rating services to benefit from lower interest charges; however, it is mindful that, although the necessary infrastructure needs should be met, basic government services should be first addressed sufficiently and that debt payments should be limited to an amount that does not unduly burden the taxpayers of Metropolitan Government; and
WHEREAS, it is fitting and proper for the Council to adopt a policy that would place a sufficient but reasonable cap upon the percentage of revenues devoted to this one area similar to the policy adopted by the Council that established a minimum amount of unappropriated fund balances to assure funds would be available for emergencies and needs not anticipated in the annual budget.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE METROPOLITAN GOVERNMENT OF NASHVILLE AND DAVIDSON COUNTY:
Section 1. The Metropolitan County Council hereby adopts a policy that requires that in any annual budget adopted by the Council, the total GSD, including Schools, and USD debt service appropriated expenditures shall not exceed ten percent (10%) of the total fiscal year appropriated expenditures.
Section 2. The Council may suspend this policy to provide additional debt service funds when bonds or other capital borrowings are needed to provide funds to overcome a natural disaster or in the event of other public emergencies by two-thirds (2/3) vote of the entire membership of the Council.
Section 3. This resolution shall take effect from and after its adoption, the welfare of The Metropolitan Government of Nashville and Davidson County requiring it.
Sponsored by: Steve Glover
|Referred to:||Budget & Finance Committee|
|Introduced:||March 21, 2017|
|Deferred to April 18, 2017:||March 21, 2017|
|Next Consideration:||April 18, 2017|
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