Mayor Freddie O'Connell Delivers 62nd State of Metro Address, Files His Recommended Fiscal Year 2026 Budget

Today, in the Grand Reading Room of the Nashville Public Library, a place built by community partnership and will, Mayor Freddie O'Connell delivered the 62nd Annual State of Metro Address celebrating Nashville's strong forward momentum, unique sense of belonging, and the benefits of a reliable, resilient local government. Mayor O'Connell presented a recommended operating budget for fiscal year 2026 built on a common-sense approach to governing that prioritizes quality schools, reliable services, and safe neighborhoods for Nashvillians.

"The State of Metro today is where many cities would like to be; school performance is up; we're delivering better delivering city services; crime is down; people want to be here, and we're working even harder to make it easier for them to stay," said Mayor O'Connell. "With the 2026 budget, we're continuing to invest in us by focusing on delivering the fundamentals that touch the lives of our residents every day, on continuing what works, and responding to the biggest needs and concerns of Nashvillians, including housing affordability."

The mayor's recommended budget is built with financial stability in mind, as the city weathers significant inflation, national market volatility, the threat of cancelled federal grants, and the phase-out of COVID-era funding. The $3.8 billion recommended budget includes a combined property tax rate of 2.814, a rate lower than the 3.254 rate of 2021-2025. The new combined property tax rate of 2.814 is the lowest for Nashville in decades, the lowest rate among the largest cities in Tennessee, and one of the lowest in the country.

"It's complicated talking about appraisals, equalization, and the impact on tax, especially because two things are true at once: The median home in Davidson County is now 45% more valuable than it was when last appraised, and that means when we set the new tax rate, many of us will have increased costs, even as we're setting the lowest overall property tax rate in Nashville since 1972," O'Connell added.

Schools

To support quality schools for a growing community, Metro Public Schools make up 37.2% of the total budget for FY2026. The mayor's recommended budget for schools is 13% greater than FY2025 to continue building on Metro Schools' success.

The budget bridges the end of federal emergency funding by dedicating $64.5 million to continue these services through Metro's annual operating budget. College and career readiness support, mental health support, Community Achieves, the scholars portfolio, and safety ambassadors are several of the programs supported through this funding.

The additional investment in schools will continue support for Metro Schools teachers and grow services like exceptional education for children with disabilities, English learners student support, annual textbook funding, the classroom associate program, and safety and security in the schools.

In addition, starting in FY2026, Metro will also support schools through the Metro Public Health Department by investing $15 million so there is a nurse in every school, and Metro Nashville Police Department (MNPD) will add 23 new School Resource Officers, $3.2 million, to enhance safety in the school system.

Investment in Metro Nashville Schools is paying off for Metro students and families. In 2024, Metro Schools had the highest graduation rate on record. In addition, of the 100 largest urban districts, Metro Schools ranked fourth in math and ninth in reading for post-pandemic recovery and was one of five districts to show up in the top 10 lists for both subject areas - and the only district to make both lists two years in a row. We are continuing to lay the foundation in FY2026 for Metro Nashville Public Schools (MNPS) to grow and plan for the future of Metro - our children.

Services

During his campaign for mayor, Mayor O'Connell promised to operate a Metro government that does the little things well and prioritizes things that improve quality of life. In this recommended budget, $138 million goes to support services that touch the lives of Nashvillians daily.

Housing

Nashville now has a full accounting of our investment in affordable housing and a holistic strategy to guide future funding. This budget is the first to implement elements of the Unified Housing Strategy. The first-year implementation represents a total commitment of $45 million including, but not limited to:

• $16 million for the Barnes Fund
• $2.4 million to support rapid rehousing vouchers for people experiencing homelessness (previously supported through federal recovery dollars)
• $2.2 million for the operation of Permanent Supportive Housing (PSH) for people experiencing homelessness and a study to recommend an ongoing PSH strategy. By quickly moving people and families into stable housing, we can reduce long-term shelter stays, medical and emergency services costs
• $1.7 million for anti-displacement work to make needed home repairs for older adults

The budget also reflects $17 million in new and recurring tax abatements through the Metropolitan Development and Housing Agency (MDHA) PILOT (Payment In Lieu Of Taxes) program, a financial incentive designed to encourage new construction and substantial rehabilitation of affordable housing, and it dedicates $2.4 million in rescue plan funding for eviction right to counsel.

The Mayor's Office will add a housing coordinator to align the work across various departments, agencies, and the public and private sectors, and as part of the strategic work identified through the Imagine Nashville study.

Choose How You Move Implementation

The voter approved Choose How You Move transit improvement program is in motion and will strengthen and expand with the FY2026 operating budget, but largely be paid for by the previously-approved funding mechanisms.

Residents will see increased frequency and reliability on several routes, a new low-income fare program, the expansion of WeGo Link which provides first and last mile service, and expansion of WeGo Access, a service for riders with disabilities (which will be available on weekends for the first time). The budget includes investments in security, including funding for a new transit-focused division of MNPD, which will include 29 officers to provide security onboard transit vehicles and in transit centers.

Additional Services

Additional foundational services provided by Metro Nashville include our parks, libraries, health department, and Waste Services.

The mayor's recommended FY2026 budget includes an additional investment of $2.8 million and 30 additional staff to continue the creation of a separate, standalone Department of Waste Services to manage our solid waste.

The Parks department includes additional funding of $6.7 million. Providing a safe experience is a primary goal for enjoying our beautiful Metro parks. The investment will add security in our parks and community centers as well as additional alarm panels.
The budget also funds health and wellness programs like Nashville Strong Babies, HIV/STI prevention and treatment, vaccinations, mobile health programs, mental health support, and nighttime codes inspectors.

Safety

One of the highest calls of government is to keep people safe and answer the call when help is needed. The budget invests an additional $49.6 million in our first responders.

The Nashville Fire Department (NFD) will receive an additional $15.3 million in FY2026, improving fire response times, enhancing training and education, improving community safety programs, providing better equipment and technology, and enhancing EMS. Primary increases include the following:

• $2.5 million for a new truck company of 18 personnel to respond to demand in fast growing Antioch and the south Nashville area.
• $2.3 million for additional personnel to support staffing improvements due to significant increases in calls for truck companies, rescues, and engines assigned to hazardous material and rapid task force response.
• $1.5 million to add a new EMS Unit of 12 employees to improve emergency response and patient care.
• $2 million for 13 additional staff in the Fire Marshal's Office to address the increasing demand for fire inspections and to ensure building safety
• $731,900 to expand the highly successful REACH (Responders Engaged and Committed to Help) program which pairs mental health co-responders with fire and EMS teams.

The Metro Nashville Police Department (MNPD) will receive an additional investment of $24.7 million in FY2026, including $3.5 million from new Choose How You Move revenues to support the new transit division in MNPD. In addition to transit and additional School Resources Officers for MNPS, MNPD's budget includes 36 new officers to establish a permanent flex unit (D-Detail). MNPD's recently added D-Detail works as a force multiplier by helping precincts across the city, going where they are most needed. Since launching on February 1, D-Detail officers have been the primary response unit on more than 1,800 calls and overall police response times countywide are down an average of 10.3 minutes in 2025.

The Department of Emergency Communications, which oversees Metro's 911 Call Center, will receive $1.2 million and six additional staff. The budget dedicates $637,000 and adds six staff at the Office of Family Safety, which supports people experiencing violence in the home. The budget also includes increased funding of $9.1 million to support the Courts, Clerks, District Attorney, Public Defender, Justice Integration Services, and CJP, including funding to provide General Sessions Court Judges with greater access to a suspect's out of county and out of state criminal history through NCIC.

Safety takes many forms and requires many partners, and the Fiscal Year 2026 will also see the further implementation of the Office of Youth Safety and a Director of Violence Prevention housed in the Mayor's Office to unite, amplify, and complement work underway in Metro and by community partners to promote safety and well-being while reducing interactions with the criminal justice system.

Fiscal Stability in the Years Ahead

"This has been a challenging budget to prepare because there are so many financial variables," O'Connell said. "Our national economic outlook is murky, we're phasing out hundreds of millions of dollars of one-time federal COVID relief funding, and we've lost a reliable partner at the federal level. This budget is built from a 2025 budget in which we asked each department to reduce spending. It's a basic, common-sense budget and I believe wholeheartedly in the core services it allows us to continue."

The recommended budget reflects a focus on smart financial management. Metro's fund balance policy has earned a strong AA+ bond rating with S&P, cutting borrowing costs and saving about $9.6 million on the latest bond issuance. The policy also helps bring in revenue, like in FY2024, when Metro earned $36.9 million in interest.

"Our financial position is even stronger this year with a $74.9 million budget sustainability reserve," said Director of Finance Jenneen Reed. "This reserve acts like a rainy-day fund that helps Metro withstand unforeseen downturns, unexpected expenses, and drops in revenue and can be used to balance the budget in future years."

The mayor's recommended budget now moves to the Metro Council for consideration. Fiscal Year 2026 will begin on July 1, 2025, and will run through June 30, 2026.

"This budget demonstrates our commitment to maintaining Nashville's positive momentum by investing in schools we need, services we trust, and safety we deserve -- while minimizing the impact to taxpayers," O'Connell said. "If we get all of this right: the way we move, how Metro works, and coming together to celebrate the place we live and welcome others who've discovered it, Nashville will become an ever-easier place to stay."