It’s likely that not too many people noticed when, on Monday afternoon, the Metro Council’s budget and finance committee unanimously approved a debt restructuring plan critical to Mayor Karl Dean’s $1.52 billion budget for the next fiscal year. Given the zaniness of a news cycle and public consciousness dominated by perhaps the worst flood in Nashville — and much of the state’s — history, it was easy to miss.
As the council begins a budget hearing and review process expected to last until the end of June, the question that weighs perhaps most heavily in the immediate is how the city’s departments will pay for the public infrastructure ravaged by the flood.
Metro officials are non-committal on a total dollar figure for repairing all the roads, bridges, water and sewage treatment equipment, greenways, computer systems and everything else hit during and after the deluge. They expect to have a damage assessment by the end of this week.
Meanwhile, finance director Richard Riebeling is preparing for talks with representatives from the three major Wall Street ratings agencies this week. With the recent refinancing of some of the city’s debt to cover revenue shortfalls, and the city’s sale of bonds to finance construction of the $633 million convention center last month, the market would like to know that the city is not falling to pieces.
It is not. Nor is its budget.
According to Riebeling, Metro government will likely pay something close to 12.5 percent of the cost of repairs, once all is said and done. The Federal Emergency Management Agency is expected to cover 75 percent, and the state and local governments split what remains down the middle. Metro also has flood insurance, although Riebeling wasn’t certain how much to expect from that pool of money.
Riebeling also said the general government shouldn’t have to borrow money for repairs. The city’s charter requires him to set aside 4 percent of the general fund as a reserve to be used over the course of the year for equipment purchases, ongoing maintenance and modest repairs. That fund stands at about $23 million now, he said, adding the city would tap it first, so long as it receives Metro Council approval to do so.
Individual departments will be required to find ways to pay for repairs out of their own budgets, he said. Metro Water Services, which manages both drinking water and the sewer system, runs on a budget of more than $200 million a year. Much of that comes from customer fees, and the department can issue its own bonds.
Sonia Harvat, a spokeswoman for Metro Water, told The City Paper a repair assessment at this point is like a “moving target.”
“When you think of the homes in Bellevue and the devastation you’ve seen there, our water treatment plant received that same kind of devastation,” she said, referring to the K.R. Harrington water treatment plant, which remains offline after being submerged in floodwaters.
One of the city’s three sewage treatment plants is still offline, Harvat said, and the department on Tuesday drained its 9 million gallon clear well — the first storage place for clean, finished water that comes out of the plant. It was compromised by dirty floodwaters and needs to be disinfected.
Metro Public Works began its cleanup effort in full on Monday, picking up debris from various neighborhoods and digging into the grueling process of repairing some 450 Metro roads and bridges that sustained damage both major and minor. That department has also declined to speculate on cleanup and repair costs.
Regardless, Riebeling said he doesn’t expect the city’s bond rating to be affected by the flooding and subsequent cleanup costs.