Mayor John Cooper filed his proposed budget for the 2021 fiscal year earlier this week, which includes raising Nashville’s property tax by nearly 32 percent to “help the city recover” from the obvious financial impact of the March tornado and COVID-19 shutdown. The $2.447 billion budget has a rate increase of 32 percent, bringing the property tax rate to $4.15.
Several restaurant owners feel that in light of recent developments, most independent restaurants couldn’t survive this third financial blow, since businesses are already struggling due to those same coronavirus and tornado effects.
In response to the proposed hikes, Peg Leg Porker pitmaster and proprietor Carey Bringle penned an impassioned letter to the mayor — which he then posted to Facebook on Wednesday. “Even though I was closed, I paid my sales tax of over $40,000 in March and another $21,000 in April. I paid my property tax bill of $55,000 even though I can’t have customers in my restaurant and can’t run my business because of your shut down. Since you have shut us down, I have personally paid the city over $110,000 and now you want more. I am sorry Mayor Cooper, I am not buying it. Enough is enough. Right now I am just struggling to survive, “ says Bringle. See his full post below:
Clearly the letter resonated with many, as dozens of other Nashville restaurateurs shared and commented on the post in support. Some emphasized the impact would be less significant on those renting space versus owning.
Other owners say that while they have great respect for Mayor Cooper and are thankful for this leadership over the last few months, the timing of this proposal is all wrong. “This is a critical time when independent restaurants can’t survive under the burden of any additional expenses. We hope he will listen to our concerns and make adjustments to reduce the impact on small business, “ says Caroline Galzin of Nicky’s Coal Fired. Craig Schoen (of Peninsula, who rents their space in East Nashville) said that while he largely agrees with much of what the mayor has done up to this point, the timing of his announcement was pretty terrible. “People should not be penalized for making good business decisions and for basically creating a neighborhood,” he said. Daniel Bockman (Tempered Cafe and South Side Kitchen & Pub) says he understands the city’s need for more revenue, but that adding pressure to small business right now is ridiculous. “We need support right nor, not hindrance,” says Bockman.
Other restaurant owners echoed Bringle’s sentiment. Howard Greenstone, Founder of Red Pebbles Hospitality and Manny Hatz (Fat Kat Slim’s) said they were both already fighting property taxes before the mayor’s proposed hike. Greenstone owns restaurants around the country and says percentage of property tax to rent in Nashville is far higher than anywhere else. Nick Guidry, who owns Pelican & Pig with wife Audra, says, “For Peg Leg alone having to front an additional $25-30k is absolutely ludicrous. For businesses that don’t even own their properties to have to front an additional 32 percent (how did that go up from an already crazy 20 percent) increase, with no rent, tax, utility, debt, relief from the government level is a slap in the face. We’re basically being told none of us matter to this city.”
After also seeing his property taxes go up exponentially over the last eight years, Barista Parlor’s Andy Mumma says there has to be a better way. “Why don’t we legalize weed and get millions of new tax dollars that way? I’m just not sure, especially in this time, that taxing us (small businesses) more is the best solution. Nashville has always been small business friendly and that’s what had created a city of culture, good food and drinks, and a place people want to actually come visit. Let’s try and find a way to preserve that AND balance the budget.”
Louisa Green of Headquarters Coffee Shop says for many who signed triple net leases (an agreement where the lessee is responsible for the ongoing expenses of the property, including real estate taxes, building insurance, and maintenance, in addition to paying rent and utilities) in the last decade will be left in a really vulnerable spot, because the businesses will be on the hook for the tax increase. Terrell Raley (Amaranth Hospitality Group) also notes triple net leases, saying that the proposal is just another pile-on item for renters. “Downtown, our restaurant (Liberty Common) has $11/sq ft in landlord pass-through (taxes, insurance, operating expenses) alone, in addition to high rent and overhead. We will have to rely on our landlord being a good guy to make it though to Quarter 2 of next year. This is not a position any business owner wants to be in,” he says.