Economic Conditions - Nashville, TN, U.S., Global

[Hushpuppy321]

4 hours ago, markhollin said:

Metro Council on Tuesday night is set to debate legislation that would charge real estate developers more money to build in Nashville — a proposal that the council's own lawyer believes is illegal.

Four council members are sponsoring  a bill that would require a $5,000 fee per new commercial building, and a fee of $1,500 for each residential unit. Sixty percent of the revenue would support Metro Nashville Public Schools, with the other 40% funding roads, sidewalks, bikeways, water and sewer facilities and other infrastructure. The legislation is scheduled for a period of public comment and debate at the council's May 5 meeting.

Here is the proposed bill:

https://www.nashville.gov/Metro-Clerk/Legislative/Ordinances/Details/39cf11cd-f82b-4be0-8081-e8ff8e493caa/2019-2023/BL2020-276.aspx

More behind the NBJ paywall here:

https://www.bizjournals.com/nashville/news/2020/05/05/common-sense-illegal-or-both-council-debates-new.html?iana=hpmvp_nsh_news_headline

If adopted wouldn’t this discourage future residential development?  The flat $5000 for commercial isn’t enough to dissuade building.

[DDIG]

51 minutes ago, Hushpuppy321 said:

If adopted wouldn’t this discourage future residential development?  The flat $5000 for commercial isn’t enough to dissuade building.

That's what I'm saying. $5,000 for a commercial development. Sure, that's barely a drop in the bucket. $400,000 for 266 apartments? Uh that's absurd and would definitely deter that type of project when Nashville needs housing inventory.  Completely out of whack.

Edited May 6, 2020 by DDIG

[UTgrad09]

I would think residential units have more impact on services than commercial buildings, no?

[PruneTracy]

9 hours ago, UTgrad09 said:

I would think residential units have more impact on services than commercial buildings, no?

Considering that most of the money would go to MNPS, it certainly seems so.

[smeagolsfree]

I think it will all pretty much be a mute point as the state will probably not let Metro do it anyway and they are only pithing in the wind. They have as much as come out and said that.

[Bos2Nash]

16 hours ago, DDIG said:

Lol so a commercial tower of any size would be a flat $5,000 and a 283 unit apartment building would be $433,000 or so.  That's  all absurd.

Actually no. Apartment buildings actually follow the commercial building code and are considered commercial properties, so apartments would be $5,000. The residential component comes into play for tall-skinnies, townhomes, single family residences.  I'm not entirely sure how this would effect a condo development, but what it may  introduce is a lot of apartment proposals and converting to condos later on.

From a plumbing side, Office Towers have a significant impact on the public utilities just like residential. Lots of water for flushing toilets and running sinks. Electrical and mechanical they are almost more so impactful because lights are always on and many office buildings have consolidated mechanicals that run at almost all times. Buildings account for something in the range of 40% of all environmental impacts on the environment so the impact is not only on the city, but also the community as a whole.

All of this is mute if this is the Impact Fees that was already shot down at the state level

Edited May 6, 2020 by Bos2Nash

[DDIG]

31 minutes ago, Bos2Nash said:

Actually no. Apartment buildings actually follow the commercial building code and are considered commercial properties, so apartments would be $5,000. The residential component comes into play for tall-skinnies, townhomes, single family residences.  I'm not entirely sure how this would effect a condo development, but what it may  introduce is a lot of apartment proposals and converting to condos later on.

From a plumbing side, Office Towers have a significant impact on the public utilities just like residential. Lots of water for flushing toilets and running sinks. Electrical and mechanical they are almost more so impactful because lights are always on and many office buildings have consolidated mechanicals that run at almost all times. Buildings account for something in the range of 40% of all environmental impacts on the environment so the impact is not only on the city, but also the community as a whole.

All of this is mute if this is the Impact Fees that was already shot down at the state level

Ah. Ok. That makes a lot more sense. NBJ has it wrong in their article then.

And, yes, if the State has not shot it down previously, good chance they supersede specifically if this were to pass.

Edited May 6, 2020 by DDIG

[LA_TN]

Regardless, that fee will be passed on to the buyer/renter

[Nash_12South]

Nashville begins reopening Monday, May 11.

50% capacity at restaurants and retail.

Edited May 7, 2020 by Nash_12South

[Rockatansky]

On 5/5/2020 at 4:42 PM, SoundScan said:

Ahh yes, that's the Bay Area model, and the results are exactly as you would suspect: less new housing and more expensive existing housing. Some areas have government impact fees as high $30,000 per unit.

Nashville's suburban counties (Rutherford & Williamson among them) have impact fees and it doesn't seem to have slowed them down any.

[Hushpuppy321]

On 5/6/2020 at 10:54 AM, smeagolsfree said:

I think it will all pretty much be a mute point as the state will probably not let Metro do it anyway and they are only pithing in the wind. They have as much as come out and said that.

I’m curious as to how the State can override Metro Government if they determine this type of Tax Increase is needed?  I know States have a lot of authority but I thought Real Property Tax was mostly in the Municipal Domain.

[smeagolsfree]

I am thinking that Metro can appeal any decision based on the same way they are appealing the Voucher plan the State just appealed under Article XI Section 9 of the State constitution. I am not a lawyer, but this looks to be pretty obvious, but there is a lot of legal mumbo jumbo, which is sort of why I understand why it was said Kill all the lawyers, in a Shakespeare Play, because most people can't understand what they are saying except another lawyer. Its a conspiracy to make you get another lawyer.

The Legislature shall have the right to vest such powers in the Courts of Justice, with regard to private and local affairs, as may be expedient. The General Assembly shall have no power to pass a special, local or private act having the effect of removing the incumbent from any municipal or county office or abridging the term or altering the salary prior to the end of the term for which such public officer was selected, and any act of the General Assembly private or local in form or effect applicable to a particular county or municipality either in its governmental or its proprietary capacity shall be void and of no effect unless the act by its terms either requires the approval of a two-thirds vote of the local legislative body of the municipality or county, or requires approval in an election by a majority of those voting in said election in the municipality or county affected. Any municipality may by ordinance submit to its qualified voters in a general or special election the question: “Shall this municipality adopt home rule?” In the event of an affirmative vote by a majority of the qualified voters voting thereon, and until the repeal thereof by the same procedure, such municipality shall be a home rule municipality, and the General Assembly shall act with respect to such home rule municipality only by laws which are general in terms and effect. Any municipality after adopting home rule may continue to operate under its existing charter, or amend the same, or adopt and thereafter amend a new charter to provide for its governmental and proprietary powers, duties and functions, and for the form, structure, personnel and organization of its government, provided that no charter provision except with respect to compensation of municipal personnel shall be effective if inconsistent with any general act of the General Assembly and provided further that the power of taxation of such municipality shall not be enlarged or increased except by general act of the General Assembly. The General Assembly shall by general law provide the exclusive methods by which municipalities may be created, merged, consolidated and dissolved and by which municipal boundaries may be altered. A charter or amendment may be proposed by ordinance of any home rule municipality, by a charter commission provided for by act of the General Assembly and elected by the qualified voters of a home rule municipality voting thereon or, in the absence of such act of the General Assembly, by a charter commission of seven (7) members, chosen at large not more often than once in two (2) years, in a municipal election pursuant to petition for such election signed by qualified voters of a home rule municipality not less in number than ten (10%) percent of those voting in the then most recent general municipal election. It shall be the duty of the legislative body of such municipality to publish any proposal so made and to submit the same to its qualified voters at the first general state election which shall be held at least sixty (60) days after such publication and such proposal shall become effective sixty (60) days after approval by a majority of the qualified voters voting thereon. The General Assembly shall not authorize any municipality to tax incomes, estates, or inheritances, or to impose any other tax not authorized by Sections 28 or 29 of Article II of this Constitution. Nothing herein shall be construed as invalidating the provisions of any municipal charter in existence at the time of the adoption of this amendment. The General Assembly may provide for the consolidation of any or all of the governmental and corporate functions now or hereafter vested in municipal corporations with the governmental and corporate functions now or hereafter vested in the counties in which such municipal corporations are located; provided, such consolidations shall not become effective until submitted to the qualified voters residing within the municipal corporation and in the county outside thereof, and approved by a majority of those voting within the municipal corporation and by a majority of those voting in the county outside the municipal corporation.

[markhollin]

Nashville-area home sales fell by 17% in April, as Covid-19 slowed the economy and raised uncertainty about what’s still to come.

According to new data from the Greater Nashville Realtors, 2,887 closings were reported last month, down from 3,479 closings in April 2019.

“What’s important to keep in mind is the reduction in total sales, the Greater Nashville area is doing much better than other markets which have seen sales plummet during this time,” Greater Nashville Realtors President Kristy Hairston said in a news release. “Locally, consumers are still buying and selling homes, which is evident in 3,050 pending closings for May, which is promising.” 

More at NBJ here:

https://www.bizjournals.com/nashville/news/2020/05/07/nashville-home-sales-hit-hard-by-covid-19.html?iana=hpmvp_nsh_news_headline

[Nash_12South]

I spoke to a couple of managers of local restaurants/bars about the reopening. One, primarily a restaurant, is planning on reopening very cautiously. The other, primarily a bar, is trying work out how to serve mainly food to get back in the game and was saying just meeting the requirements for reopening (special thermometers, masks, gloves) was a challenge. He noted that some of his staff were making more now with unemployment than before and were reluctant to return "too quickly". 

[DDIG]

1 minute ago, Nash_12South said:

I spoke to a couple of managers of local restaurants/bars about the reopening. One, primarily a restaurant, is planning on reopening very cautiously. The other, primarily a bar, is trying work out how to serve mainly food to get back in the game and was saying just meeting the requirements for reopening (special thermometers, masks, gloves) was a challenge. He noted that some of his staff were making more now with unemployment than before and were reluctant to return "too quickly". 

With the extra $600 weekly federal unemployment a ton of these employees are likely making more on unemployment right now.

[Armacing]

4 minutes ago, DDIG said:

With the extra $600 weekly federal unemployment a ton of these employees are likely making more on unemployment right now.

Not to mention the length of unemployment benefits has been doubled.  An hourly employee at a restaurant could conceivably receive a much higher income for staying home from work for half a year rather than returning to the disease-ravaged wastelands of the local strip mall.  Former employees will be fighting over the privilege to be dismissed due to coronavirus before this whole episode is over.

[Nash_12South]

2 minutes ago, Armacing said:

Not to mention the length of unemployment benefits has been doubled.  An hourly employee at a restaurant could conceivably receive a much higher income for staying home from work for half a year rather than returning to the disease-ravaged wastelands of the local strip mall.  Former employees will be fighting over the privilege to be dismissed due to coronavirus before this whole episode is over.

If the business owner has met the new safety guidelines, and the layed off are offered their old job back, and refuse, technically they have quit and don't continue to get the benefits.  I could be mistaken, but that was how it was explained to me. 

[smeagolsfree]

7 minutes ago, Nash_12South said:

If the business owner has met the new safety guidelines, and the layed off are offered their old job back, and refuse, technically they have quit and don't continue to get the benefits.  I could be mistaken, but that was how it was explained to me. 

That is true as it is called job abandonment. When that happens they are not eligible for unemployment.  Been on both sides of the coin on that one. As an employer and as a mad employee.

[markhollin]

In regards to the proposed bill to charge commercial and residential developers a new fee to build in Nashville:

That vote has been rescheduled for June 2, to allow time to make a few tweaks to the legislation.

One of the main changes could be adding an effective date that could be months in the future — in an attempt to put more time on the clock for lawmakers to change the state-level law.

As much as anything, council members said they wanted to approve such an "impact fee" to send a message to state legislators and also local voters, especially on the heels of Mayor John Cooper proposing a budget that leans on a mix of spending cuts and a 32% property tax hike.

"I 100% agree, we’ve got to show the intentions of finding alternative sources [of revenue]. I hear from constituents every day that they’re looking for alternative options. Even if the state pre-empts us, at least we’re showing our intentions to move forward," said Councilman Thom Druffel.

More behind the NBJ paywall here:

https://www.bizjournals.com/nashville/news/2020/05/08/development-fee-vote-postponed-to-june-with-tweaks.html?iana=hpmvp_nsh_news_headline

[smeagolsfree]

Maybe they could call it a development fee instead of an impact fee, or build in other fees to the permitting process to make up for the totals they are talking about.

Five thousand dollars is a drop in the bucket for the commercial developers and fifteen hundred is easily built into the cost of a residential development. All they have to do is increase the cost of a building permit fee.

[Armacing]

16 hours ago, smeagolsfree said:

That is true as it is called job abandonment. When that happens they are not eligible for unemployment.  Been on both sides of the coin on that one. As an employer and as a mad employee.

That's what I'm saying.  They will want the business owner to declare them "laid off due to coronavirus".  They will be mad at the owner for calling them back because it represents a pay-cut for the employee and it puts them in harm's way.

[smeagolsfree]

But it is the way the law looks at it and until the law is changed there is not a lot they can do to change it. Unfortunately the laws protect the employer instead of the employee in most states and especially in the south. Those are the harsh facts and reality of the way things are.

[Armacing]

5 hours ago, smeagolsfree said:

But it is the way the law looks at it and until the law is changed there is not a lot they can do to change it. Unfortunately the laws protect the employer instead of the employee in most states and especially in the south. Those are the harsh facts and reality of the way things are.

Oh, I agree with you about that 100%.  I'm just musing on the bizarro world we currently live in where employees would rather be laid off than come into work and draw a paycheck.  Strange times - and getting stranger...

[Nash_12South]

Rivergate Mall opens Monday, The Mall at Green Hills, Wednesday. Limited open store options as of today. 12 South was about as busy as any weekend minus open stores. A little surprised. It may not be the best thing to reopen, but a lot of people are ready. More emphasis on masks is needed,  saw very few outside of businesses today. 

Edited May 9, 2020 by Nash_12South

[BnaBreaker]

5 hours ago, Nash_12South said:

Rivergate Mall opens Monday, The Mall at Green Hills, Wednesday. Limited open store options as of today. 12 South was about as busy as any weekend minus open stores. A little surprised. It may not be the best thing to reopen, but a lot of people are ready. More emphasis on masks is needed,  saw very few outside of businesses today. 

If businesses are going to reopen in a limited capacity then that's one thing, but if a significant portion of the population can't even be bothered to wear a mask for a couple hours to benefit their friends and neighbors, and are going to now essentially operate as if all is well and it all just magically disappeared, then this is about to get way, way worse, I'm afraid.  

Edited May 10, 2020 by BnaBreaker