A city with soul: Director of Finance Brian Collins addresses the future of Memphis

Brian Collins serves as the Director of Finance for the City of Memphis, a position he has held since 2012. After years as a Chicago trial attorney, Collins made a home and career in Memphis, working for First Horizon and teaching in the University of Memphis MBA program. He earned his bachelor’s degree from DePaul University, JD from Loyola University, and MBA from Ohio State.

The beginning of 2014 saw the opening of an Electrolux manufacturing plant, a major new employer in Memphis. From an economic development standpoint, what is Memphis doing to distinguish itself from other cities in the region?

I have a lot of faith in EDGE (Economic Development Growth Engine). EDGE President and CEO Reid Dulberger and our EDGE board do an excellent job of screening, trying to attract, and putting really terrific deals on the table. But the competition is pretty ferocious and we find ourselves in a tough spot. We are at the southwest corner of our state with Mississippi to our south and Arkansas across [the Mississippi River]. Those communities in North Mississippi in particular have a whole different mechanism for attracting business because they can use income tax revenues. Of course Tennessee is one of the few states that does not have an income tax. And based on the vote we had last week, it doesn’t seem like we will in our lifetime.

I think we have issues with trying to compete with our neighbors for economic development. I think eventually there is going to be a lot of congestion and growth in North Mississippi. The land that is available is going to be further and further from the Memphis core, which is the main attractor for the region. North Mississippi would have nothing if it wasn’t for Memphis, which of course is the problem: Memphis is providing the infrastructure, the airport, the city, the urban environment, the basketball teams. When you read the websites of our suburban ring of competitors, half of what they sell themselves on is our assets: “Come to North Mississippi and enjoy all that Memphis has to offer.” All without being in Memphis, without paying a nickel for it.

I think that vis a vis other big cities around the country, we still have the lowest overall tax burden of most big cities. We rely heavily on the most regressive types of tax streams. We have a high poverty level, we have regressive taxes, and these things tend to feed on one another. We’ve just got to overcome that. We’re not going to give up. Memphis is a great place. It’s got a great heart, a great soul. Unfortunately we lag behind the state and the nation in terms of unemployment. It’s part of the underlying issues of poverty and literacy that we have to solve.

On that note, Memphis has its own agenda, but faces the particular challenge of being situated in a decidedly conservative state. How are you working with or even against the state to accomplish what needs to be done?

I believe we have a very good relationship with Nashville. The Treasurer, the Comptroller, all of the financial folks in Nashville, have been very supportive of Mayor Wharton and the policies and things we’re trying to do. For instance, they have watched with great interest and I think have been approving of the strides that we’ve made to reform our retiree healthcare. We have proposals on the table to reform our pension system. I think both of those reform pushes have been on the leading edge of the type of reforms that they are looking for.

So despite the fact that Nashville and the state government is decidedly Republican while Memphis is a Democratic town, I think that the belief that your financial house must be in order before you can succeed is a shared value. Over the last five to six years the Mayor has been in office, the size of government has shrunk. I think if you took the labels off and looked at the last five or six Comprehensive Annual Finance Reports (CAFR), you would think, “Wow, the Republicans have taken control of Memphis.”

At the same time, we have a very different demographic than the rest of the state. Our biggest issues are overwhelmingly poverty and literacy. What we’re trying to do is take a holistic approach and say “everything is connected, everything is circular.” We have to win on the economic front, we have to create jobs in Memphis. You can’t just legislate away poverty. You can train people, you can educate them, but you’ve got to give them a job too.

Pensions were a big part of the news cycle this year. How is the city handling the so-called pension crisis?

We are working very hard to get our unfunded liabilities under control. We are managing our debt as well as we possibly can. When you look at some of the pension numbers, we are doing better than average, but we’re still going after it with a passion because that’s not good enough. Last fiscal year to this fiscal year we are more than doubling the amount that we are paying to get that unfunded liability under control.

It’s not popular to do the kind of things the administration is doing. To Mayor Wharton’s credit, he is doing things you wouldn’t expect and that won’t make him as popular as he might otherwise have been. These are tough decisions to make. I am convinced that in the years ahead as we see these problems receding in the rearview mirror and we see that we have an unrestricted fund balance that gives us flexibility to deal with these issues, we can finally stop talking about finances and be more proactive about attacking the real problems in our city.

It’s all about trying as hard as we can to build a better future for the young people of Memphis. We’ve got to make our streets safer, we’ve got to create hope for these kids. We have to support the Shelby County school system and make sure that all of our children get a high quality education. But at the end of the day when they get out of high school, we also have to make sure they have a junior college system and colleges. And there have to be jobs.

One of the saddest things is when a young person, especially young African American men and women, do fabulously well and then they end up in Atlanta, Chicago, and New York. Not only are we not providing middle class jobs for so many of our young people, we’re also losing our best and our brightest. Memphis needs to home grow their next Finance Director. We’ve got to create opportunities.

I’d love to hear your perspective on the Unified School District.

I think it’s off to a good start. I am a fan of [Shelby County Schools Superintendent] Dorsey Hopson. It is hard to be in the same room with him and not come away feeling that we have someone there who is going to refuse to let those kids down. So I am very excited and have a lot of respect for him.

Memphis has an opportunity to be a laboratory and a leader. The [bad news] is we have so many under-performing schools. The good news is we’re doing something about it. The special school district that’s run by the state is coming in with some very talented and very dedicated people. I have met some of those folks and have been so impressed by their dedication and fervent belief in their mission.

The education system here was stagnant but the pot has been considerably stirred up. I believe that good things will come of that. I’m optimistic about our future.

Feature Photo: cc/(Jeremy Sorrells)