Transcript of Mayor Madeline Rogero's State of the City Address

Proposed Budget for City of Knoxville's Fiscal Year 2015-2016

April 29, 2015
Lakeshore Park

Good afternoon. Thank you for joining me today in Knoxville, at this very special place. Lakeshore is a phenomenal asset, not only to the neighborhood and the 2nd District, but for our entire city and the region.

This is very special land and it has served a very special purpose from its beginnings in 1886. As you know, mental health policy changed from institutionalization to community-based care, which ultimately led to the closure of this facility.

As a city, we have had the opportunity to gradually transition this beautiful setting for use as a public park. However, we cannot celebrate this transition without pausing to think about the people whose conditions brought them to Lakeshore.

We must not forget that society has a moral obligation to continue to address their needs.

Upon completion of the restoration of the Administration Building, we intend to honor and memorialize the history of Lakeshore, the staff who worked here and the people they served.

Our transition over the past year has included substantial public input as we revised the long-term master plan for this park. As Councilman Grieve stated, this is a public-private partnership with public funds that are leveraging very significant private funding.

The transition has proceeded deliberatively due to the dedication and generosity of the Lakeshore Park board. I also want to thank Knox Youth Sports and Councilman Grieve.

Recognitions

I am honored that Bishop Stika joined us today for the Invocation. He lives and works just down the street and walks his dog at this park.

Thanks to the Knoxville Community Band for sharing your talents, and to the Knoxville Police Department Honor Guard for presentation of the colors.

We were honored to have veterans and active reserves lead the pledge of allegiance.

I want to introduce them because they each have a special connection to our city:

JD Burrell, Sergeant, Knoxville Police Department
Marine, Bronze Star recipient from the first Gulf War

Boyce Evans, Purchasing Agent, City of Knoxville
Lt. Colonel, US Army, Infantry Officer, 20+ years of service in various combat units throughout the world

Matt Perkinson, Captain, Knoxville Fire Department, Fire Station 18, Hazmat Truck
Master Sergeant with the Tennessee Air National Guard, served overseas in both Baghdad, Iraq and Bahrain

Hector Sanchez, Assistant District Attorney, DA's Office; nephew of my executive assistant Terry Alexander
Sergeant, US Marine Corps, Combined Security Transition Command, Afghanistan 2005-09

Haynes Smith, retired; father of Terry Alexander
Sergeant, US Army, Infantry, Bronze Star recipient for combat in World War II, New Guinea, South Pacific

Stephanie Welch, VP of Operations for Community Schools, Great Schools Partnership
Major, US Army Reserves, Executive Officer, 7239th Medical Support Unit

Also Councilmen Dan Brown and Finbarr Saunders are Vietnam War veterans.

Would all veterans and active military or reserves please stand so we can honor you? To all of you, thank you for your service to our country.

Let's also again recognize Zachery Coffey for the anthem. I first heard him sing at President Obama's visit to Pellissippi State earlier this year. And I am pleased to have his grandmother, Linda Coffey, also joining me at my table.

Mayor Tim Burchett, I appreciate your friendship and our ability to work so well together.

I am so happy that Kelly Burchett (Mayor Burchett's better half) joined us today at my table; as well as Bob Booker (former state representative, former administrative assistant to Mayor Testerman, former Council member, and renowned historian); Eddie Mannis (business owner, board member, arts patron, founder of Honor Air, and my first Chief Operating Officer); and my friend, Chief Justice of the Tennessee Supreme Court Sharon Lee. Thank you all for joining me.

To all the current and former elected officials who have already been recognized, let me also thank you for your presence and your public service.

I am especially grateful for our outstanding City Council. Council, you keep me on my toes and are incredibly effective at representing your constituents. Thanks so much for your support.

And a special thanks to Vice Mayor Nick Pavlis for your leadership role on Council and for the great job you do representing your district and constituents city-wide.

I also work every day with outstanding people.

I want to recognize my senior leadership team (and I ask them to stand when I call their names):

• Bill Lyons, Deputy to the Mayor and Chief Policy Officer;
• Christi Branscom, Deputy to the Mayor and Chief Operating Officer;
• Law Director Charles Swanson;
• Police Chief David Rausch;
• Fire Chief Stan Sharp;
• Finance Director Jim York; and
• Community Relations Director Tank Strickland.

I also want to thank all department directors and staff present for your outstanding work.

A very special recognition goes to my executive assistant Terry Alexander. Those of you who have called my office already know what a treasure she is.

Over the past two weeks, we have lost two special people in the life and history of our city.

Former Mayor Kyle Testerman passed away on April 11th. He was a City Councilman and served as Mayor for two terms. I am so grateful that Council honored him while he was still alive on February 2nd by renaming the Tyson Park Tennis Complex after him.

And Love Kitchen co-founder Ellen Turner passed away last Wednesday at the age of 87. She and her twin sister, Helen Ashe, founded Love Kitchen to provide clothing and meals to the homebound, homeless and unemployed. Ellen's big heart and great sense of humor endeared her to so many of us. She leaves a legacy of compassion and service.

State of the City

This is my fourth budget address. This event today continues a long tradition of coming together annually to review the state of the city and to chart a course and budget for the coming year.

The budget is much more than a financial document. It is our vision statement and our policy document. It shows very clearly how we will accomplish our goals and strategies to achieve our vision of becoming an even greater city.

Our first goal is always to be good stewards of your money - the taxes you pay to run this city.

Secondly, our goal is to deliver the excellent services you depend on and to provide for the safety of our community.

Thirdly, we wish to initiate and catalyze opportunities and investments that make Knoxville a great city in which to prosper today, and a more competitive city for the jobs and talents of tomorrow.

We have again enjoyed a year of progress on all of these goals, and I remain as enthusiastic as ever about Knoxville's momentum and direction.

So let's review some of these milestones and accomplishments.

The City of Knoxville is first and foremost a service organization, and I am lucky to have 1,600 dedicated women and men working with me every day to maintain and enhance the services and quality of life that City residents expect.

Here are just a few examples of their work (and I hesitate to mention just a few because there are so many good things happening):

• Our 311 Call Center answered nearly 200,000 phone calls from citizens, helping them access the full range of City and community services;
• The Police Department responded to more than 275,000 calls;
• The Fire Department responded to more than 20,000 calls for emergency service; and our HazMat Team became the first in the state to achieve designation as a State Certified Level 1 CBRNE Hazardous Materials Team. This is a big deal, and we are proud of them!
• The Public Service Department - cleared and picked up brush, mowed right of ways and parks, installed playground equipment and HVACs, repaired fire stations, set up and cleaned up after city special events, and planted more than 600 trees, just to name a few of their responsibilities.  And they, along with police, fire, and KAT, expertly executed our severe weather plan when snow and ice hit our streets.

Of course, a great city does more than provide basic services - it also supports a vibrant urban core, a thriving business sector, safe and connected neighborhoods, and a vision for a sustainable future.

Our Office of Redevelopment continued promoting reinvestment in downtown Knoxville and the center city. Our mantra is "From Disinvestment to Investment," and we focus from the urban core and outward along commercial corridors - north, south, east, and west. We strategically invest public dollars to maximize private sector investment.

The new public-private Walnut Street garage is nearing completion and will provide over 1,000 spaces for daytime employees, and free night and weekend parking spaces for downtown visitors.

Several looming redevelopment opportunities led us to bring in an Urban Land Institute panel of experts to study the former McClung Warehouses site on Jackson Avenue and the former State Supreme Court site on Henley Street, as well as the World's Fair Park, Civic Coliseum and Auditorium, and the Henley Street streetscape.

The ULI panel offered a range of recommendations, which we are considering as we move forward on downtown projects. We are also awaiting a feasibility and market study on the Civic Coliseum and Auditorium, which will help us determine next steps.

The University Commons development opened off Cumberland Avenue. This complicated project turned an abandoned industrial brownfield into a vertical urban retail center, with a parking deck tucked beneath the complex. We routed our free Vol Trolley from downtown to make a stop at University Commons, providing easy public transit access to shopping.

After years of public process and planning, the construction has begun on the Cumberland Avenue Corridor project, which will turn an ugly, congested, non-functioning street into a beautifully landscaped and pedestrian friendly area that will better serve the tens of thousands of people who live, learn, and work in that area.

On the South Waterfront, the former Baptist Hospital has been demolished and plans are moving ahead for $160 million residential, retail and office development. This is the largest investment in our South Waterfront in decades.

Just upriver, our new Suttree Landing Park and road network is under construction. Further east, near Island Home, construction has begun for new apartments and a riverwalk.

Also under construction is the new entrance and intersection alignment at Fort Dickerson Park, which will make that gorgeous park and its quarry more inviting and accessible.

To the east of downtown, we moved forward on designing the Magnolia Avenue Streetscapes Plan along a four-block area of Magnolia up to Bertrand Street, to make it more pedestrian friendly and attractive. This will establish a template for the streetscape that is planned to eventually run the length of Magnolia, all the way to Chilhowee Park.

We are already seeing private investment in the area, both from developers buying properties in the Magnolia Warehouse District and local business owners using City commercial facade grants to refurbish their buildings.

As you can see, dirt is moving all around us - and of course, we are being inconvenienced by road closings. But take heart - this is a sign of progress, and of strategic public investment that is catalyzing significant private investment in our city!

And please be sure to patronize the affected merchants.

The Knoxville Entrepreneur Center on Market Square produced several exciting programs like MediaWorks, an instructional and mentorship program specifically for digital media startups, and a second, very successful Startup Day that showcased innovative entrepreneurs.

Our regional and local economic development partnerships exceeded goals this year. The Innovation Valley reported a net increase of 3,273 new jobs in 2014, exceeding their goal of 2,300.

Some examples include:

• Fulton Bellows, the oldest manufacturer of seamless metal bellows, will invest $3 million and create 27 new jobs in by expanding operations at its existing Forks of the River facility.
• Hicks Plastics, a Michigan-based company, will open a new auto-parts manufacturing facility in Knoxville off Middlebrook Pike, investing $10.4 million and creating 202 new jobs in our city.
• Total Quality Logistics, a transportation services company, will invest $1 million to open a sales office in downtown Knoxville, creating at least 100 new jobs over the next five years.

Over the past year, we expanded our efforts to strengthen local neighborhoods. Some activities included:

• conducting a four-session "Fight the Blight" workshop that drew participants from nine neighborhoods;
• graduating the second class of the Building Strong Neighborhood Organizations Leadership Training Program, which included a dozen representatives from 10 different neighborhoods; and
• hosting a Neighborhoods Conference that drew some 700 participants including 100 young people - our future leaders

We completed the first phase of cleanup and restoration of Fountain City Lake, and we are working on a long-term management plan.

The Fountain City Lake is a good example of the importance of historic sites and properties to our local identity. Our historic buildings and public places give us a connection to our past, and shape our sense of ourselves as a City.

That is why last year we created a Historic Preservation Fund with an initial investment of $500,000, to help bridge financing gaps for the restoration of historic commercial and residential properties. We will soon announce the recipients of the first year's allocation of funds.

Similarly, I have recommended a new requirement for a delay in issuing demolition permits on qualified historic properties. This has passed MPC and will be on City Council's agenda May 12. The demolition delay ordinance will give more time for discussion and consideration before historic buildings are lost forever.

Knoxville has also continued its leadership on issues of sustainability and environmental stewardship. I was honored to serve on President Obama's State, Local, and Tribal Leaders Task Force on Climate Preparedness and Resilience which made recommendations on ways the federal government can help local communities prepare for the effects of climate change.

We continued to work with our Smarter Cities Partnership to make energy-efficiency improvements for low-income families with high utility bills. A major step in this initiative was KUB's creation of a "Round It Up" program, which will take effect in May.

Under the program, KUB bills will be rounded up to the next dollar, with the new revenue going to the Community Action Committee (CAC) to implement the energy efficiency upgrades. This is a voluntary program -- any KUB customer can opt out at any time. The good news is that, to date, less than 8% of KUB ratepayers have opted out. This could potentially generate $600,000 for the program. We are a compassionate city!

But wait …there's more good news just off the press. Along with our partners at KUB and CAC, I am very excited to tell you that TVA has just announced that they have awarded the Smarter Cities Partnership $7.12 million dollars to improve the energy efficiency of low-income homes in our community. Together with Round It Up, this funding will help hundreds of local families control energy costs and keep their homes comfortable and affordable.

This past year, we adopted a complete streets ordinance, with the encouragement of Bike Walk Knoxville, which institutionalizes our commitment to addressing alternative transportation modes like walking, biking, and public transit in all city street projects.

This was also a year marked by discussions in Knoxville and among mayors across the nation about the challenges facing young men and boys of color. In tandem with the national Cities United and My Brother's Keeper programs, we launched a local effort called Save Our Sons (SOS).

An SOS summit in November brought together more than 160 representatives of government, schools, churches, law enforcement, courts, agencies, and young men. We have now identified our initial strategies to expand opportunities and reduce violence-related deaths among this vulnerable population.

Finally, we took the second step of pension reform in order to support the long-term financial stability of the pension plan and the City. As you know, we are paying down an unfunded pension liability caused by the 2008 recession.

In 2012, during my first year in office, we proposed and voters passed a major reform of the pension system for all new employees starting in 2013 which will reduce our future obligations.

Last November, we proposed and city voters overwhelmingly approved five more changes to the pension system, which collectively limit the future risk to City taxpayers, added two citizens to the Pension Board, and will offer alternative pension options to City retirees without increasing costs to the plan.

The proposed budget

So as we begin this fiscal year, we are in strong financial shape, and we are cautiously optimistic. Our economy is steadily improving.

In fact, the Brookings Institution ranked metro Knoxville 99th among the world's 300 largest metro economies for its economic performance in 2014. Our employment growth rate was 2.4 percent, compared to 1.6 percent nationally.

We are well-managed financially. We have maintained the highest bond rating in the city's history and we have a solid fund balance that exceeds required guidelines for fiscal responsibility.

This strong fund balance allows us to make strategic investment decisions when opportunities arise that will leverage private investment and future growth.

The general fund budget I am presenting today reflects an estimated 2.93% increase in revenues from the prior year budget, for a total general fund budget of just over $206,376,000.

There is no tax increase in this budget. Our tax rate remains at $2.7257 per hundred dollars of assessed value. According to Finance Director Jim York, when adjusted for inflation and countywide reappraisals, this tax rate is actually lower than it was 10 years ago.

With these revenues, we will continue providing excellent public services and will continue to implement our goals of a Thriving Business Sector (with Job Creation and Retention); Strong, Safe, and Connected Neighborhoods; an Energized Downtown and Center City; and Living Green and Working Green.

As a service organization, our biggest asset is our employees. We aim to offer competitive salaries and benefits in order to recruit and retain the talent that we need. To ensure we stay competitive, I am recommending a 2.5% cost of living increase for employees.

Thriving Business Sector (Job creation and retention)

The proposed budget includes $400,000 for the regional Innovation Valley initiative, as well as continued funding for the Knoxville Chamber Partnership, which promotes economic development for the city.

The budget includes $50,000 to support the work of the Knoxville Entrepreneur Center and $30,000 for the Visit Knoxville Film Office to create an incentive program to attract film and TV production to Knoxville.

Arts and culture are the heart and soul of a community, but they are also an economic driver themselves, and a key strategy in economic development. From the wonderful Richard Jolley exhibit at KMA to the Symphony, the Opera and Rossini, Rhythm n' Blooms, WDVX Blue Plate Special, and now the incredible Big Ears Festival, we are increasingly a destination for those seeking entertainment and inspiration.

Operating grants totaling $375,000 will go to 23 arts and cultural groups. Last year I started a new Public Arts Fund with an initial investment of $250,000. I am again including $250,000 for public art.

Strong, Safe, and Connected Neighborhoods

As in the past, the largest portion of the budget is devoted to the operations of the Police and Fire Departments, including capital funding for new equipment for the Police Department, ongoing maintenance at various fire stations, and enhanced training facilities for police and fire.

It's also important that neighborhoods have quality infrastructure and are free from blight. This budget provides $300,000 to address chronic problem properties and another $200,000 for blighted property acquisition.

Included is $100,000 to continue the "demolition by neglect" program to protect historic properties, and I am again allocating $500,000 for Round 2 of the Historic Preservation Fund.

This budget includes the seventh contribution of $800,000 to assist KCDC in the redevelopment of the Walter P. Taylor homes project. This is part of a multi-year commitment and is already making a great impact in the quality of life in the Five Points area.

Stronger, safer neighborhoods are more than quality police and fire protection and bricks and mortar. Strengthening the social fabric and ensuring success for families and youth are essential as well.

• The budget provides $250,000 for Community Schools in center city neighborhoods. Community Schools is a strategy for using public schools after hours as a hub for organizing community resources to improve neighborhood health and safety and student academic success.

• A grant of $100,000 will go to the Boys and Girls Clubs of the Tennessee Valley for their capital campaign to expand recreational facilities at their Caswell Avenue campus.

• The city's Save Our Sons Initiative will receive $50,000 to implement strategies to increase opportunities and reduce violence-related deaths among boys and young men of color.

Community and social service agencies provide a wide range of services that are critical to the safety and stability of families and children in our city.

The budget includes $875,000 in agency grants, including capital funding of $250,000 for the development of a domestic violence shelter by Helen Ross McNabb Center, and $250,000 for ADA improvements at the Knoxville Area Urban League.

The Mayor's Roundtable on Homelessness continues to meet to implement the community's homelessness plan. In addition to federal funding, direct city funding to address homelessness is budgeted at $579,800.

Great neighborhoods also have access to parks, greenways, and recreational opportunities. This budget includes $200,000 for ball field and tennis court improvements throughout the City, and $2.1 million to fund the restoration of the Administration Building here at Lakeshore Park.

The budget again allocates $1 million for the development of greenway corridors, and includes funding to enhance the branding of the Urban Wilderness.

This budget advances the city's goal of "complete streets" that provide safe facilities for pedestrians, bicyclists, and public transit.

A total of $3.03 million is allocated to sidewalks and crosswalks, including $1.15 million to begin construction of sidewalk improvements in the I-640 at Old Broadway area.

Also funded is $1 million for bicycle infrastructure improvements to begin implementation of the new Knoxville Bicycle Facilities Plan.

The budget provides support for KAT, Knoxville's public transit system, in the amount of $10.25 million to operate buses, trolleys and para-transit service across the city, and funds year one of KAT's new service improvement plan, which will expand the hours of operation of certain routes.

The City has an ongoing program to pave and maintain streets on a regular rotation. The budget includes $5.8 million in direct city funding and an estimated $1 million from KUB for the paving program, as well as continued funding for alley-paving, roadway safety, bridge replacement, and traffic signal improvements.

An Energized Downtown and Center City

Downtown is "everybody's neighborhood," as it is the cultural and economic hub of our city and region. The budget allocates $50,000 for the Downtown Improvements fund, and $150,000 for streetscape improvements along South Central Avenue in the Old City.

Also, $150,000 is programed for a master developer for the redevelopment of Jackson Avenue between Broadway and Gay Street, as recommended by the ULI panel.

Allocations include $500,000 for commercial façade improvements and $500,000 to begin implementation of the Magnolia Avenue Streetscapes project when final design plans are completed.

The old State Supreme Court site downtown is a prime redevelopment opportunity, and the city will be in a better position to manage that redevelopment if we own the site. We are in negotiations with the state, and I anticipate bringing to City Council in June of this year a proposal to purchase the property.

Living Green and Working Green

The budget continues funding for the Office of Sustainability, which guides our comprehensive sustainability efforts across all city departments and activities.

Included in this budget is funding for the continuation of electric vehicle charging stations in public facilities, and it again funds $500,000 for match grants for an advanced traffic management system (ATMS). When implemented, the new system will enhance traffic flow and result in lower fuel consumption and pollution.

The Sustainability Office has a staff of two. I am funding an additional AmeriCorps position to help with these many projects, including their work with community partners to promote urban agriculture.

We have developed proposed revisions to our zoning ordinances that will allow and encourage a local food economy. These revisions will be before the Metropolitan Planning Commission in May and then will come to City Council for approval.

A Great City Aspires to be even Greater

These are some highlights of the budget that I am presenting to City Council. For more detail, please see the budget documents online at the city's website.

This is a practical, responsible, strategic budget that focuses on real needs in our city, provides the reliable public services that you expect, and responsibly addresses infrastructure replacement and maintenance.

But it goes further. It is also aspirational in that it proposes quality of life enhancements and drives quality redevelopment and private investment to make Knoxville an even greater city.

It will keep our momentum growing. I ask for your support for this budget.

I want to thank you for the opportunity to serve as your Mayor, and I thank you for being here today.