The contentious battle over a proposed living-wage ordinance for Nashville has taken a dramatic turn because of a Metro Law Department opinion saying that the Metro Council lacks the authority to do much of what the ordinance would accomplish.

The bill as originally introduced would set a minimum wage of $9.78 for Metro employees and would apply that minimum to work performed under certain contracts with the city, as well as to some employees of firms receiving economic development subsidies from Metro. In response to a request for a legal opinion by three members of Metro Council, Metro attorneys concluded that several critical elements of the proposed ordinance would run afoul of the city’s charter and certain provisions of state law. Council backers of a living wage seem prepared to limit the bill’s scope to comport with the Law Department’s review. At the same time, organizers of the grass-roots living-wage campaign are wary of the opinion, unconvinced that it is necessarily the final word on the subject. Organizer Daynise Couch questions the timing of the opinion and says that the campaign is consulting with attorneys about how to challenge or refute it. But even if living-wage advocates conclude that the Law Department’s assessment is flawed, they face an uphill political battle to keep the full proposal alive.

The legal opinion rejects the legitimacy of a living-wage ordinance on three main grounds. First, it points to a procedure outlined in the Metro Charter whereby salary grades and ranges for city employees are determined within the confines of a Metro “pay plan,” ultimately approved by the Metro Council. Deputy Law Director Sue Cain, who drafted the legal opinion, wrote that the Council couldn’t enact a living-wage ordinance because it entails setting wages in a manner inconsistent with the charter. For a couple of other key Metro agencies—the Hospital Authority and the Sports Authority—the power to determine compensation comes from state statute; for those departments, the opinion concludes that a living-wage ordinance is contrary to state law.

As a general matter, the Council cannot use its legislative power to alter or overturn a provision of Metro’s guiding document; that requires the more involved process associated with passing a charter amendment. Cain’s argument rests on the unstated and debatable assumption that setting a wage floor for city employees is an inextricable aspect of creating a pay plan. An alternative view is that a pay plan refers to the process of classifying and compensating jobs in relation to one another; as such, it could be argued that a minimum-wage level (such as might be specified in a living-wage ordinance) need not meaningfully interfere with that process.

Second, the opinion holds that Metro can’t impose a living wage on contractors who do business with the city because a city has “only those powers that are expressly granted or are necessarily implied by its charter or by state statute.” A city government can do many things on its own, but actions falling under the legal category of “police powers” require an explicit grant of authority from the state, and the U.S. Supreme Court ruled in the 1930s that minimum-wage laws are an exercise of police power. No Tennessee state statute or Metro charter provision grants Nashville the power to set a local minimum wage, so the Law Department concludes a living-wage requirement for contractors would be invalid. But there is is some ambiguity here: It is not clear that a living-wage requirement for contractors and a broadly imposed local minimum wage are legally equivalent. There are no cases in Tennessee on either this narrow question or the broader ability of local governments to set wage rates.

The opinion veers into what could be considered questionable territory with an assertion that a living wage imposed on contractors would illegally restrict competition and violate the competitive bidding requirement of the city’s charter. The logic here builds on a 1903 case in which the Tennessee Supreme Court threw out a Nashville ordinance requiring that all city printing bear union labels. That provision plausibly would have restricted competition because certain printers—those without unions—would be ineligible to bid. But a living-wage ordinance merely sets a contract condition that any and all potential bidders can elect (or not elect) to meet. It involves no more of a restriction on competition than any of a number of routinely applied terms or conditions that impact cost, such as how fast work needs to be completed or what kinds of materials have to be used.

Lastly, the legal opinion addresses the feature of the ordinance that mandates a living wage for businesses receiving economic development subsidies. Making a property-rights argument, Cain wrote that a living wage imposed on existing economic incentive agreements would violate due process and contract clause protections. This piece of the opinion is persuasive—a new law cannot modify existing contractual responsibilities without compensation. (For their part, living-wage supporters say it was never their intention to apply the ordinance to existing subsidy arrangements.)

But the opinion does entertain the possibility that a living-wage measure covering agreements for future economic development subsidies could pass legal muster.

Where does this leave the proposed living wage? Although Metro Law Director Karl Dean describes the legal opinion as “not a close call,” there are legitimate grounds for skepticism about some of its core arguments. But mere skepticism does not translate into political viability. Living-wage supporters and Council backers will huddle later this week to plan strategy going forward. Council member Don Majors, the ordinance’s lead sponsor, indicates that he intends to proceed with a substitute measure that would, at a minimum, preserve the living-wage mandate for future recipients of economic development (the one element more or less left standing by the legal opinion). Meanwhile, living-wage campaign organizers are pondering whether a challenge to the legal opinion might be feasible.

But supporters are concerned that whatever the substantive merits of the legal opinion, its forceful dismissal of the legality of the ordinance will send Council members into retreat and unravel the fragile majority that has persisted up until this point. One idea supporters are toying with is a non-binding Council resolution instead of, or along with, an ordinance. This could be a way to legislate the principle of a living wage now, paving the way for creating an enforceable living wage later, perhaps through the charter amendment process.

In the meantime, the legal developments and their potential to derail the living-wage movement presumably delighted Mayor Bill Purcell and his friends in the alliance of business interests (calling themselves the Coalition to Keep Nashville Working) who fiercely oppose the very concept of a mandatory wage aimed at lifting low-wage workers into the lofty realm of basic economic independence. In a breathtaking display of intransigence last week, the coalition’s Francis Guess declared that the group remains “strongly opposed to anything referred to as a living wage.” Poverty, on the other hand, is apparently not objectionable.