Monday, September 28, 2009

The Rest of the Story-What some people conveniently forget to say.

This past Sunday, a number of items appeared in the Cincinnati Enquirer that warrant a response because of the misleading nature of the statements. It is unfortunate that the techniques, values, and ethics of national attack politics have now arrived in Cincinnati.

One of the items was an ad that attacked Council members Harris, Thomas, Cole, Crowley, and me on a variety of subjects. A well-known restaurateur sponsored and signed the ad. It is unfortunate that neither he nor his staff took the time to check their facts.

The recession has severely impacted the City of Cincinnati. The Mayor and Council closed a $28 million General Fund deficit this year and will have to close a $40 million General Fund deficit for 2010. It is important to note that the deficit is in the General Fund because the cause is reduced income tax and other revenues into the General Fund. Simply saying City Council approved this or that expenditure, even if true, may not be relevant because the source of funding could be the Capital Budget or Enterprise Funds or state or federal grants.

As for the issues used to attack Council members Harris, Thomas, Cole, Crowley and myself in the ad, I will take each one and provide... "The rest of the story..."

1. "...decided it was more important to spend $5 million to replace windows at City Hall, than to keep the people safe..." Enquirer ad, 9-27-09 p C5
Response: The city executed Energy Services Performance contracts with Ameresco and Honeywell on June 29, 2009. The contracts allow for the installation of nearly $5.6 million worth of energy efficiency upgrades to City Hall, the Convention Center, Centennial 2, various police and fire stations, and other buildings maintained by City Facility Management. A total of 40 buildings are affected. These lighting, heating and air conditioning, building automation, and building envelope upgrades will reduce the City's energy use by 3,290,539 kWh, generate 45, 817 kWh of renewable energy, and reduce greenhouse gas emissions by 3,413 metric tons each year. The majority of the work will be self-funded with guaranteed energy savings (a minimum of $450,000 annually) and energy rebates...$351,675 of Energy Efficiency Conservation Block Grant funds (aka stimulus funds) will be used for gap financing to make the first-round projects work. $239,380.77 is from the General Fund, but is not from tax receipts. It is money repaid to the city by Duke Energy for overcharging the city. FYI Memo from the City Manager to Mayor and Members of Council 6-30-09.

2. "...Over-the Rhine was the most violent neighborhood..." Enquirer ad, 9-27-09 p C5
Response: Violent crime in Over-the-Rhine for Jan-May 2009 was 36% lower than the same period in 2005. The study that resulted in O-T-R being called the most violent neighborhood in the US used data that was outdated and did not use as its basis the entire 110 square blocks of Over-the-Rhine. It only used a ten block area in the northwest sector of Over-the-Rhine and in the West End. The study's methodology is highly questionable and intellectually suspect. Repeating its flawed conclusions does a tremendous disservice to the residents and businesses there and to the organizations and individuals who have invested over $84 million in the community. Visit UrbanCincy.com

3. "...to lay off 138 police officers unless every officer accepted a pay cut." Enquirer ad, 9-27-09 p C5
Response: One element needed to close the $28 million deficit in the city's 2009 General Fund was city employees agreeing to take cost savings days. When originally proposed by the City Manager, every employee paid out of the General Fund would take 6 cost savings days. The unions had to agree to this for those employees in the city's bargaining units. The City Manager and Chief Streicher were instructed to make sure that any police cost savings days would not impact street strength. In a memo dated, August 5, 2009 they specifically stated the layoffs would not impact street strength. Ultimately, the 138 police officers were not laid off because the union agreed to accept a salary reduction of $1,151.69 per officer, which averages out to approximately 4.6 cost savings days per officer. FYI Memo from the City Manager to the Mayor and Members of Council, 8-5-09

3. "...these same council members voted against taking pay cuts themselves." Enquirer ad, 9-27-09 p C5
Response: Cincinnati City Council members have not increased their salaries since 2006 even though by law, the members are entitled to the increase. Due to inflation over this same period of time, council salaries have remained static, but the purchasing power has declined. In 2006 council did not take a 3% increase. In 2007 council did not take a 3% increase. In 2008 council did not take a 7.7% increase. And, in 2009 council did not take a 7.7% increase. As for council members taking cost savings days, individual members of council are writing checks to the city for the equivalent of between five and six cost savings days.

"So instead of providing funding for public safety, he (sic Thomas) and his colleagues chose to:
4.
... hire a tree trimmer..." Enquirer ad, 9-27-09 p C5

Response This position is for a Tree Maintenance Worker paid a salary of $37,026. The Park Department needed this position to insure the safety of residents and employees. The responsibilities include pruning and removing hazardous trees along park roadways, around picnic areas, and playsets. The person will use an aerial lift truck or rope and saddle. It is paid out of the General Fund. Source: Report from the City Manager to Mayor and Members of Council, "Second Quarter 2009 General Fund Hire Authorizations," 9-2-09

5.
...and a climate control coordinator..." Enquirer ad, 9-27-09 p C5

Response: All general fund funding for the Climate Protection Coordinator was eliminated as part of the mid-year budget correction. The position is now part-time and is funded entirely through an Energy Efficiency Conservation Block grant (aka stimulus dollars) from the federal government.


6
....and to spend $3 million on recycling containers..." Enquirer ad, 9-27-09 p C5
Response: Council has not voted to spend $3 million on recycling containers. In May 2008, council asked the administration to review the recycling program and recommend how we could increase the rate of recycling, share to a greater extent in any revenue from sale of recyclables, and increase the amount of money the city saved by avoiding landfill tipping fees. The original motion was extensive, and also directed that workers received a living wage for sorting recyclables.

The Office of Environmental Quality worked diligently and developed a plan that achieved the objectives of council.It would increase the amount recycled by 300% and create 20 new jobs at sorting facilities and 36 new jobs at recycling manufacturing facilities. It also would decrease greenhouse gas emissions.

The city currently spends $2.3 million for its recycling program.

So...where did the $3 million figure come from?

Well, to improve participation rates the administration recommended a program that includes a Recycle Bank and the use of 64 gallon wheeled carts. The program also moved the city into the modern age of RFID's (Radio frequency identification devices, known to most people as barcodes) to allow for tracking of participants so they could receive rewards for recycling.

The cost of purchasing and providing 64 gallon wheeled carts to all households in four family or smaller units and all single family homes is $3.5 million. The administration proposed to finance the purchase with a lease that covered the cost of the $3.5 million and would have required annual payments of approximately $462,000 a year (Option1). The savings projections previously referenced include the cost of the lease. Source: Report from the City Manager to the Mayor and Members of Council, "Recycling Program Enhancements/Cost Savings," 8-3-2009


7. ...and $1.5 million on sidewalks..." Enquirer ad, 9-27-09 p C5

Response: This reference is a true mystery. I can only assume the sponsor of the ad was referencing an ordinance to pay for sidewalk repairs. The amount was under $700,000. The amount is recouped through sidewalk assessments to property owners whose property abuts the sidewalk.

It is unfortunate when a respected member of the community is mislead into making public statements that are factually untrue. It is understandable, however, because public finance and the city's budget are complicated -more complicated than the books of most restaurants. In the future, one can only hope that he will take a little more time to do his due diligence.

Friday, September 11, 2009

Deficits, Lay offs and Recessions

Beginning in June of this year, the global economic crisis hit home in
the City of Cincinnati. The Administration informed City Council that
due to lower than expected tax revenue, we were faced with a 2009
deficit of $20 million. Recognizing the devastating effect such a
deficit could have on the citizens of Cincinnati, Councilmembers Cole,
Qualls, Thomas, Harris, and Vice-Mayor Crowley, presented a plan that
made substantive cuts while protecting critical City services. Had we
not passed this plan, 902 City Employees would have received layoff
notices, including 302 police officers and 230 firefighters.

It is important to note that no one wanted to layoff any City
employee, especially in the area of Public Safety. But it is also
important to note that since 2000, Cincinnati Police and Fire staff
levels have risen approximately 6%, while General Fund staffing levels
for all other departments have been cut by 29.9%. Over the same time
period, public safety department budgets rose 37.1% (33.8% for Police
and 43.3% for Fire), while non-safety General Fund department budgets
fell 10% overall. Public Services fell 18.9%; Economic Development
-25.1%; Finance -29.9%; and Community Development -6.7%.

On July 17, when faced with a deficit that grew to $28 million, the
City Manager announced layoffs would be necessary in 2009. He did,
however, emphasize that layoffs could be avoided this year if the
unions agreed to cost-savings days and to forgo cost of living
increases for 2009 that were awarded by an arbitrator. To close the
gap, General Fund departments made reductions in their budgets ranging
from 2.7% to 11.2%, with eleven departments –taking cuts of 5% or
more.

Mayor Mallory, supported by Councilmembers Cole, Crowley, Harris,
Thomas, and Qualls undertook negotiations with the city’s labor unions
and the Administration to find substantive cuts and reasonable
concessions from the unions.

These negotiations were successful and were reflected in the plan passed by a majority of City Council on September 4.

While we are all grateful for solving this recent crisis, we know that next year will be worse. Cincinnati does not exist in a bubble. This is a global recession, not a local one. Other cities are facing very similar budget problems.

• Philadelphia - Laid off 3,000 workers, reducing garbage collection
to once every other week.
• Atlanta - Four rounds of layoffs, increase in property taxes, and
mandatory furloughs for all city workers (including police, fire, and
others).
• Miami - Deep pay cuts (ranging from 6% to 15%) and pension benefit
reductions or the elimination of 191 sworn police officers, 305
general union employees, 5 firefighters, and 110 nonunion workers.

The plan that the council majority passed on September 4th is responsible, possible, and
reflective of the times. We did not demand layoffs and we did not make
the quality of life unbearable for our citizens. We asked the unions to meet us halfway. And we are glad the CODE and the FOP agreed. It is unfortunate that AFSCME did not do so.