NASHVILLE, Tenn. (WTVF) — The coronavirus has shut down much of Nashville's economy.
Hotels are nearly empty and businesses are closed. It will have a dramatic impact on our already tight budget.
Metro Councilman-at-large Bob Mendes, who chairs the Budget and Finance Committee, said the economic slowdown will leave a large hole in this year's budget and it will also impact next year's budget.
Nearly 20% of Nashville's budget comes from sales tax revenue, and right now no one is sure how long businesses will remain closed due to the virus.
Mendes said this situation is different from a recession where the economy slows down over months.
"The economy is the patient on the table and the surgeons have stopped the heart and we don't have cash flowing. Everybody is trying to hold onto cash. With no money flowing through the economy, it makes it really hard. That's why we are going to see unemployment spike," Mendes said.
Mendes said some downtown hotels reported selling just 10 to 15 rooms in past nights.
The Music City Center and Gaylord Opryland have seen major conventions cancel.
Mendes is worried about the growing budget hole in this year's budget and the impact on next year's.
"We may have to borrow against next year to pay for this year. So, at this point I'm really viewing both fiscal years together," Mendes said.
In recent years Mendes supported raising property taxes to fund Nashville's budget.
He said while no one knows the final numbers from this crisis, he sees no way around a property tax increase.
"I think the math is going to indicate that's the only way to go," Mendes said.
Councilman-at-large Steve Glover has consistently opposed a property tax increase.
He said he wants to see more financial numbers.
"Right now, there are just too many unknowns. There's just no way that we can predict," Glover said.
NewsChannel 5 asked, "Where do you stand right now on a property tax increase?"
Glover responded, "Right now I'm nowhere. I think if we say right now we need to do a property tax increase, I think right now is the wrong time."
Both Mendes and Glover said the tornado alone would have been a big budget hit.
But they emphasize city services are still flowing and Nashville will overcome this.
"As apocalyptic as this seems, it's not actually the apocalypse," Mendes said.
"We may argue about things, but we come together and we work as a team and I love seeing that right now," Glover said.
