MEMPHIS, September 1, 2026 - The City of Memphis Chief Financial Officer asked the Council's Budget Committee to amend the FY2027 debt service fund operating budget to appropriate an amount not to exceed $2,600,000 for an arbitrage rebate payment to the Internal Revenue Service.

The item is not on the published committee agenda for September 1. It was added.

He opened by thanking the Council and the committee vice chairwoman for allowing it to be added at the last minute. He said the city received the arbitrage calculation late on August 27, 2026, and that he wanted time to do a review. He then gave the reason for the urgency plainly: the payment was actually due on August 31, 2026, but the city has a ten-day grace period, which is why he was asking for same night minutes.

What arbitrage rebate is

He explained it for the room. When the city borrows money for capital projects, it invests the proceeds until it spends them. If the earnings on those investments exceed what the Internal Revenue Code allows, the city has to rebate the excess back to the Internal Revenue Service.

That is what the payment covers, in connection with the bond issues identified in the resolution.

Two numbers

The resolution authorizes not more than $2,600,000. The calculated obligation is $2,578,689.52.

He explained the gap himself before anyone asked. When the resolution was written he was not certain the item would get same night minutes, so he built in leeway in case additional interest accrued. He said that if the Council passes it with same night minutes, the payment will be only $2,578,689.52.

Councilwoman Yolanda Cooper-Sutton pressed on the two figures, saying that is a different number, and located the exact amount in a chart in the middle of the first page of the resolution. She confirmed with him that the city will pay $2,578,689.52, asked where the remaining dollars go, and was told the difference is not going anywhere. She confirmed the ten-day grace period was the reason for the same night minutes request.

The difference between the authorization and the calculated payment is $21,310.48.

No other member entered the queue. The committee approved it with a favorable recommendation and same night minutes.

What happens next

The resolution went to the floor as add-on item 22 with same night minutes and took effect on September 1, 2026. The Chief Financial Officer said the payment will be $2,578,689.52. No reporting back to the Council was required on the record.

Your city. Your money. Your receipts.