How much is enough for a rainy day?

Frank CagleFrank Talk

When Victor Ashe came into office as mayor in 1988 the city’s rainy day fund was $5 million and the city had to borrow money to meet payroll. When Knoxville’s next mayor takes office the city till will contain an $85 million fund balance.


When Ashe left office the budget was at $136 million. Since then, during the two terms of Bill Haslam and Madeline Rogero the city budget has increased $100 million. The budget at the end of Haslam’s terms was at $164 million. The budget for Rogero’s final year is likely $236 million

When Ashe left office the rainy day fund was at $18 million. Haslam built the rainy day fund to $65 million his last year and Rogero has boosted it to $85 million at the end of her two terms.

It seems to me the paltry $5 million in 1988 was ridiculously low, and possibly the $18 million is also low. But should the city have $85 million in the rainy day fund? For Haslam and Rogero to build up the reserve fund Haslam raised taxes by 35 cents, and Rogero followed closely at 34 cents.

(Ashe proposed, campaigned for and passed a referendum to raise the sales tax a penny, a process not likely to happen again given the current state of our politics.)

Haslam and Rogero have been good stewards of the taxpayers’ money, and the city budget is very healthy indeed. But should the next mayor, of those currently running, suggest cutting taxes?

Or will the healthy budget leave room to build a downtown baseball stadium or finance some other major project?

(By the way. Haslam’s last budget as governor just finished up with a $650 million surplus. The state’s rainy day fund at the end of Haslam’s tenure is over $1 billion.) )

Who is this guy? Since Bill Hagerty has been picked by President Trump as your next U.S. Senator, you might wonder just who this guy is.

Well, he’s a Nashville native and a Vandy grad who has spent most of his working life as a venture capitalist. His public service has consisted mostly of raising money for political candidates from John McCain to Mitt Romney to Donald Trump. He worked with Mitt Romney doing venture capital projects and was Romney’s national finance chair when Romney ran for president. He also raised money for McCain when McCain ran for the post.

Gov. Bill Haslam made Hagerty his economic development commissioner. Hagerty’s connections with the state Republican hierarchy, in addition to working with Haslam, include hiring Will Alexander, the son of U.S. Sen. Lamar Alexander, as his chief of staff at ECD. And he carried him along when they both went to the private sector. Hagerty is “running” for Alexander’s seat.

Reportedly there was some tension between Hagerty and Haslam when Haslam eased him out of ECD in 2014 in order to give Haslam’s friend Randy Boyd some state experience before his ill-fated run for governor in 2018. Hagerty was often mentioned as a gubernatorial candidate at the time as well, but somebody decided it was Boyd’s turn. But Haslam and Hagerty have since had warm things to say about each other. You can expect Haslam to endorse Hagerty for the senate as soon as Hagerty gets free of his current job as Ambassador to Japan.

Hagerty finally backed a winner as a fund-raising chair for Donald Trump. Trump made him ambassador to Japan and has endorsed him as our next senator.

Nashville trauma surgeon Manny Sethi had already announced his candidacy and shows no sign of throwing in the towel. He said last week that the regular people do not know how the GOP Establishment operates behind closed doors. Well, duh. I think they do, it’s just that there isn’t anything they can do about it.

But what are Hagerty’s positions on the issues? It doesn’t really matter, does it?

TV blackout: DirecTV customers are still without ABC Channel Six since negotiations between DirecTV and Nexstar broke down. Channel Six went off the air for East Tennessee DirecTV customers July 3 in a dispute with the satellite provider. Nexstar owns 120 television stations nationwide, including Knoxville.

Frank Cagle is a retired newspaperman and the former managing editor of the Knoxville News Sentinel.

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