Memphis Tomorrow is Butt Ass bad. And the local community is ignorant to that fact. Evidently, ignorance is why the City Council agreed to fund the controversial Tom Lee Park development with $10M, while at the same time, the Downtown Memphis Commission (DMC) owes the City of Memphis $10M. Nothing else can explain the action.
DMC, in many ways, is a component part of the overall Memphis Tomorrow “Government Efficiency” program. The “government efficiency” program effectively:
Botches taxpayer funded community betterment initiatives
Supports excessive corporate/real estate tax incentives for the small few using bogus accounting
Piles up cash reserves in quasi-governmental organizations like DMC and EDGE through fee revenue earned for administering excessive corporate/real estate incentives.
The above is a losing formula; even for local corporations. But for almost 20 years, Memphis Tomorrow has invested the community in ecosystem decline, enabled by ignorance, that occurs with the aid of a non -investigative press, lacking governmental oversight and new, absent public university thought leadership.
Consequently, local officials believe that Memphis Tomorrow’s Government Efficiency program is “visionary”. Meanwhile, as local government struggles to have adequate cash reserves, this blog will focus on the excess cash reserves of DMC and EDGE using each of their 2019 audited financial reports.
DMC and EDGE Cash
Without consideration of DMC and EDGE expenses and based on their cash reserves, it is recommended that local government invoice DMC and EDGE $15M each, payable upon receipt. See the following analysis:
Downtown Memphis Commission (DMC) – As of June 30, 2019, the DMC had $33M in designated and undesignated cash/liquid assets (pg. 19) with $9.2M in annual expenses (pg. 14). With $33M in cash/liquid assets as of June 2019, DMC owes the City of Memphis approximately $10M based on a review of accrued interest of $5.1M (pg. 13) and principal debt of $5.1M (pg. 30) for the Peabody Place Garage. A note on page 30 states:
“No principal or interest is payable on this note to the City of Memphis, for the construction of the Peabody Place Garage, until its maturity on July 24, 2034. At June 30, 2019 and 2018, the accrued interest payable is $5,149,656 and $4,891,096, respectively, and is included in Long-Term Liabilities in the accompanying Combined Statement of Financial Position.”
But why no principal or interest payments to the City of Memphis? At any rate, this would have been a great opportunity for local government to align a DMC City debt with the financing of the Downtown Tom Lee Riverfront project. At the same time, based on a helpful exchange during public comment at County Commission on July 13, it does not appear governmental processes are in place to review the audited financial statements of quasi-governmental bodies.
Meanwhile, the DMC has a steady revenue stream of approximately $2M for parking management (pg. 10) per year, to service the remaining parking garage debt, outside of the City of Memphis debt, of $4.3M and $2.2M through 2024 and 2032 respectively.
Solution: Local Government should invoice DMC for $15M, payable in full, upon receipt. Under this invoicing strategy, DMC will have approximately $10M in designated funds and $7M in undesignated funds to support $9.2M in annual operations which includes the support of a $2M parking management revenue stream.
Economic Development Growth Engine (EDGE) – As of June 30, 2019, EDGE has cash/liquid assets that total $24,462,782. Only $1,774 of those assets are restricted (pg. 16). Their annual operating and non-operating expenses total $8.4M (pg. 13).
Further, grants from the EDGE entity, Depot Redevelopment Corporation (DRC), of $834K and $315K to the Greater Memphis Alliance for Competitive Workforce and Municipal Chambers of Commerce respectively occurred in 2019. These grants fall outside of the narrow purpose local government established for the DRC, in countywide workforce and municipal chamber grant subsidies. The purpose of the DRC, which is not countywide workforce or chamber grants, is stated in the report as follows:
“The primary purpose of the DRC is to secure from the United States the land, building, and equipment of the Memphis Defense Depot (closed as a military base in 1997); enter into agreements to acquire, construct, improve, lease, operate and dispose of property; and to promote the redevelopment of the Memphis Depot for the citizens of the City and County” (pg 18).
Of course, if local legislators fail to conduct oversight and review audited financial reports, as a matter of process, material violations to the taxpayer, in a majority Black community in need, are likely to continue.
Solution: Local government should invoice EDGE for $15M, payable in full, upon receipt. EDGE will have $10M in cash reserves to fund ongoing operations.
Conclusion
Again, Memphis Tomorrow is Butt Ass bad. Butt, Butt, Butt !!!. Expectations for community leadership have been lowered to the floor, leaving taxpayers in a majority Black community in need holding the bag.
The elitist Memphis Tomorrow mindset is one of entitlement. They feel entitled to effectively carjack the taxpayer and small business, often disguised through planning, pageantry and new relabeled initiative rollouts.
Folks can protest police all they want, while legislators pass symbolic “racism is a pandemic” measures. But there will be no social justice until there is a meaningful measure of taxpayer justice. And that will only come when Memphis Tomorrow pays the taxpayer back $1.5B.
Finally, $30M, in arguably, excess cash/liquid assets was found with just DMC and EDGE. At last look, the Memphis Health Education Facility Board had $5M in cash/liquid assets. What else is out there ???