Wednesday, July 9, 2014

Former Council Members Chumney and Stout-Mitchell Offer Plan to Resolve City Impasse

Proposal involves tax increase, across-the-board budget cuts, and consultation with state officials.

Posted By on Wed, Jul 9, 2014 at 4:39 PM

Chumney (l); Stout-Mitchell
  • Chumney (l); Stout-Mitchell
Two former members of the Memphis City Council — Carol Chumney and TaJuan Stout-Mitchell — have offered a proposal to resolve the current impasse over benefit reductions which has resulted in widespread protests and civic dislocations, including "Blue Flu" absences by substantial numbers of police and Mayor A C Wharton's response in canceling the unique features of the city's sick-leave policy previously extended to members of the M.P.D.

Chumney and Stout-Mitchell have made this four-point proposal for "all parties" to consider::

1. 10 percent across the board cuts for each city department [the city’s current general fund operating budget is approximately $600 million—this would generate approximately $60 million dollars];
2. A modest property tax increase of 17- 25 percent [estimated to generate $17 to $25 million dollars- the current city property tax rate is $3.11—the increase would cost a middle income homeowner less than $100 a year on their property tax bill];
3. Negotiating permission from the state officials to approve an additional two years for the city to replenish the unfunded pension liability from the five year deadline.
4. A review of commercial tax freeze incentives for further tax-savings (which the state comptroller has flagged in his correspondence with city officials).

Here is the two former Council members' press release in its entirety:

TWO FORMER MEMPHIS CITY COUNCIL WOMEN CALL ON ALL PARTIES IN MEMPHIS BUDGET CRISIS TO COME BACK TO THE TABLE
In Response to City Council’s Request They Announce Their Own Budget Proposal

Carol Chumney and Tajuan Stout Mitchell, former Memphis city councilwomen, jointly call upon all parties in the Memphis Budget Crisis to come back to the table.

The city is presently experiencing a budget crisis, after the Mayor and City Council adopted a budget for the fiscal year 2015, that makes substantial cuts in current and retired employee health insurance benefits. The cuts are the result of an admonition by the Tennessee state comptroller that the city has to bring its large unfunded pension liability shortfall (estimated to range from $450 to $700 million dollars) current within five years, or risk the state taking over.

The city is experiencing a crisis of sorts since the adoption of the budget last week, with nearly 25 percent of the Memphis police force calling in sick over the past few days.

At a rally yesterday by the families of city workers, Chumney and Stout-Mitchell called upon all parties in the Memphis budget crisis to come back to the table, including the Mayor, Memphis City Council, city employee leaders, and the state officials (including the comptroller and Sen.
Mark Norris).

Some members of the Memphis City Council have asked for proposals from the citizens to solve the budget problems. Chumney and Stout-Mitchell are proposing the following:

1. 10 percent across the board cuts for each city department [the city’s current general fund operating budget is approximately $600 million—this would generate approximately $60 million dollars];

2. A modest property tax increase of 17- 25 percent [estimated to generate $17 to $25 million dollars- the current city property tax rate is $3.11—the increase would cost a middle income homeowner less than $100 a year on their property tax bill];

3. Negotiating permission from the state officials to approve an additional two years for the city to replenish the unfunded pension liability from the five year deadline.

4. A review of commercial tax freeze incentives for further tax-savings (which the state comptroller has flagged in his correspondence with city officials);

As a Memphis City Council member, Chumney advocated for and secured the elimination of the 12 year pension for city elected and appointed officials. She gave up a safe City Council seat,and opportunity for a city pension, when she ran for Mayor of Memphis in 2007, coming in a close second to then 16 year incumbent Mayor W.W. Herenton. As an attorney with her own law office, she understand the challenges many of those in the private sector face due to the recession.

Stout-Mitchell served in the city administration in both Herenton and Wharton’s administrations, heading up Intergovernmental Relations in 2008.

Both Chumney and Mitchell ask that the city officials spell out their five year plan to resolve the city’s budget crisis, and not “kick the can” down the road until after the city’s 2015 municipal elections. The current city mayor, A.C Wharton, served two terms as the county’s mayor (having been elected in 2002). After Herenton resigned in 2009, Wharton won a special election as Memphis Mayor, and reelection in 2011.

Chumney and Mitchell say “We need a long-term fix for the city budget problems, and to keep in mind that the economy may fully recover in the years ahead which would allow for a restoration of the cuts, or reduction in taxes.”

“Moreover, the City Council reduced property taxes in the past few years, and the proposed property tax increase primarily restores those reductions in order to fund the pension liability over the next five years.”
“We believe both cuts and the modest increase are appropriate under the circumstances, will ensure public safety is not compromised, and will prevent a windfall should the Memphis economy pick up steam in the next few years.”

Chumney adds, “if our public safety workers are not paid reasonable wages and benefits, then it opens the door to corruption within the departmental ranks. We ask these men and women to risk their lives for us, and this proposed budget should enable the city to both move forward on a sound financial footing and honor its promises to these workers and their families.”

Chumney and Mitchell say “While we do not have access to all of the financial data, that the mayor and councilmembers have, as former public officials, we are putting this proposal forward in hopes that it will encourage the parties to come back to the table, and discuss a reasonable five year solution. “

To see the full press release in its original PDF form, click on this link.

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