Memphis may kick-start pre-K fund with donation

Memphis may give an initial $3 million boost to a proposed fund for countywide, needs-based prekindergarten, Chief Operations Officer Doug McGowen said Tuesday.

Although the city will contribute up to $6 million to the pre-K fund per year starting in fiscal year 2022, the sources outlined in Friday's announcement won't cover the entire commitment, McGowen said. So, to make up the shortfalls, the city could use $3 million in unrestricted fund balance — which is like reserves but without a dedicated purpose.

Until 2027, the city would contribute $6 million yearly to the pre-K fund using that "seed" money, a penny of the property tax rate ($1.2 million annually), and the new property taxes from expiring tax abatements, McGowen said. Beginning in 2027, enough tax abatements would have expired to fully cover the contribution to the pre-K fund.

The city can afford to make the investment thanks to a more efficiently run government, McGowen said. The city will save $1 million annually just from reforming the way it responds to false police and fire alarms and from holding property owners accountable through a new city tax sale, he added.

"That's just two examples," he said. "That's $1 million already."

But the $6 million in city funding is only part of the plan to save the 1,000 pre-K seats endangered by the end of a $7.9 million federal preschool grant in May 2019. McGowen said he's hopeful Shelby County government, Shelby County Schools and nonprofits will supply the remaining $10.6 million needed to make up the funding and expand to 8,500 seats, the county's goal as part of a larger $40 million plan for county education. The county is also looking at dedicating its portion of the property taxes freed by expiring tax incentives to pre-K, said council member Kemp Conrad, who initially proposed finding city pre-K funding. Conrad said he hopes the city's investment will drive more private investment to get the city to that $40 million mark.

The council began the process Tuesday to approve two ordinances, one creating the fund and the other establishing funding. Those are scheduled for a final vote April 24.

"The one thing this shows the citizens of Memphis is, we are working toward attacking poverty," said council Chairman Berlin Boyd.

Boyd said funding pre-K was especially significant this year, the 50th anniversary of the assassination of Dr. Martin Luther King Jr., and that pre-K could "redefine" Memphis.

"Our education system will really play a key role in where we go in our future," Boyd said.

Responding to concerns that Memphis is shouldering more than its fair share of the burden for pre-K, McGowen said Memphis will cover about 72 percent of the funding for countywide pre-K, and about 70 percent of pre-K students will be in the city limits.

"It was the fairest way I could do it," McGowen said.

Reach Ryan Poe at poe@commercialappeal.com and on Twitter at @ryanpoe.