The Newport City Council, facing its biggest economic threat in the last 25 years, due to the Corona Virus disaster, decided to do the best they can by borrowing from the city’s future. Not only are jobs being lost but the city’s near future is being severely undermined by the slow down in the U.S. and world economy.
Fortunately, Newport, like hundreds of cities around the country, have built-in savings accounts that can help cities and counties recover – with emphasis on the term “help.” Those accounts can’t do it all. Cities with special investment districts called Urban Renewal Districts, have been stockpiling money for years reflecting the growth of cities through a special taxing arrangement. It’s highly complicated, but suffice it to say, the money’s there. But again, it’s not a band-aid that can cover the whole loss. But it counts.
The result will likely be that a lot of major projects the city has been touting the last five years will only be partially constructed with some projects being totally put back on the shelf. City Manager Spencer Nebel and his department heads will be re-assessing the “art of the possible” over the next few months and the final details will be reflected in the city’s new budget for the 2020-21 fiscal year which is coming up July 1st.
This highly complex dance with city finance will no doubt have some twists and turns as we explore our way through the next couple of years. Financial assistance from the federal government will no doubt play a major roll, as it is already playing out in the evening news broadcasts. The reason we hear on TV that billions of dollars are going “over there,” and that trillions of dollars here are “going somewhere else” are all funded through the U.S. Federal Reserve which controls the printing of American currency. The more we print, the more money we have. That’s why every Congressman who walks out of a hearing room with a bill that has money behind it can help move the country forward – even if, hours earlier, there wasn’t any money for it. It pays to be the world’s #1 currency. But controls on inflation always looms behind the curtain.
But getting back to the City Council, City Manager Spencer Nebel showed everyone that he truly cares about the city’s business and commercial services because he convinced the council to approve his request that property tax revenues that have increased in several areas of the city’s commercial centers be re-directed to sustaining the survival of Newport’s Bayfront and South Beach business communities rather than stockpiling those funds for future projects – in short – keeping what we have until times get better.