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Joyce Clark Unfiltered

For "the rest of the story"

As we prepare to enter 2014 it’s a good time to look at the major issues Glendale will face. Here is Glendale’s Top Ten for 2014:

  1. The winner for the coming year is Glendale’s financial future. The City Manager and Executive Finance Director will offer a series of options, some critical, some not, to right the situation. Will the city council grow a backbone and adopt some stringent measures that are sure to be unpopular with the general public?
  2. Will IceArizona be able to deliver on its promise of enhanced arena revenues to recompense Glendale for its annual $15 million dollar management fee? The $15 million annual fee coupled with another $12 million in arena construction debt repayment contributes to Glendale’s heavy financial burden.
  3. The Camelback Ranch area has never delivered on its promise to perform. When the recession hit all development came to a screeching halt. Will the city create n incentive strategy for development of the surrounding area? Its annual $13 million dollar debt construction repayment is yet another major financial burden.
  4. Will the Attorney General’s office investigation into former City Manager Ed Beasley and deals cut with former financial consultant Art Lynch and former HR Director Alma Carmicle result in charges being filed?
  5. What impacts will the arrival of the first of 144 F-35 aircraft have on Luke Air Force Base, Glendale and the surrounding West Valley area?
  6. Will the Arizona Cardinals continue to seek its dream of a bubble tent practice facility on Glendale’s Youth Sports fields? What about their desire for Glendale’s long-promised parking garage as a means of fulfilling its parking requirements as vacant land diminishes at Westgate?
  7. Will the new City Manager Brenda Fischer continue to fire employees as her solution to any future irregularities? Will a new round of internal warfare erupt between police and fire over the severely constrained city revenue pot of money as her empathy toward fire (her husband is/was a firefighter in Henderson, Nevada) becomes more evident?
  8. With November, 2014 city election for councilmembers in the Cholla, Barrel and Ocotillo districts bring new faces and new agendas and another shake up in the fragile council coalitions?
  9. Will the temporary city sales tax increase become permanent as a solution to Glendale’s financial mess? How will citizens react to the broken promise of its sunset in 2017? Will citizens see increases in all kinds of local taxes while experiencing a decrease in the level of services provided?
  10. How will the city find the money to pay for its hosting of the Super Bowl in 2015? A figure of $1.7 million dollars is unrealistic and doesn’t equal the amount spent by Glendale on its last Super Bowl hosting gig.

Lastly there is the unknown. There is always a new, unforeseen crisis. What will it/they be for Glendale in 2014? Councilmembers will continue to combat and to abuse one another and all of us. The City Manager will continue to offer policies to strengthen her power and there is no one on council to guard against it. Departments such as police and fire will vie for shrinking resources. New players and power brokers will emerge. All that can be said with any degree of certainty is that it won’t be a dull year. Thank goodness there will be plenty of fodder for upcoming blogs!

© Joyce Clark, 2013

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This will be my last posting until after Christmas Day. With less than a week before Christmas family and friends, last minute shopping and baking consume my time. Here goes. This council is often disappointing because of their lack of substantive engagement. Their December 17, 2013 council workshop had a myriad of issues, some of them quite important.

When it came to the presentation on the Monthly Arena Reports we learned some new or corroborating information. The figures that are used by the city are figures provided by IceArizona.  Mr. Duensing, Executive Director of Financial Services, stated that the expected annual arena revenue for this fiscal year will be $6,791,540 and the expected deficiency will be $7.1M. He indicated that as of November 30, 2013 (covers period from Aug. 5 to Nov. 30, 2013) the amount of revenue accruing to the city is $1,168,880. This means the enhanced IceArizona revenues to cover the $9M unbudgeted will be short by approximately $2M by June 30, 2014 (end of current Fiscal Year). I find it amazing that his forecasted estimate of annual revenue is so precise, down to the penny. Nevertheless, it portends that the city will be short a boat load of arena revenue this year.

The city budgeted $6 million dollars for arena management of the $15 million dollar total fee and expected IceArizona’s enhanced revenues to cover the $9 million dollars unbudgeted. Looks like that ain’t gonna happen.  Mr. Duensing also answered a question posed in one of my latest blogs regarding the Supplemental Ticket surcharge of $1.50 per qualified ticket. He said we won’t see this total until the end of this fiscal year per the agreement. Fine but why isn’t a monthly amount being offered to the city in the monthly reports? After all, it’s their specific line item. I’ve been told that an escrow account has been established. It would be nice if the city received confirmation that X amount of dollars is being deposited monthly into that account. After all, it is an interest bearing account and the entire amount, including interest, could very well end up going to the city.

It also raises the question of the definition of what is a qualified ticket. Here is the agreement’s definition: “Qualified Ticket” means a Ticket to a Fee Activity for which (i) the Team Owner, with respect to Hockey Events; (ii) The Arena Manager or sponsor or promoter, with respect to Team Revenue Events, City Revenue Events and other Fee Activities that are not Events; or (iii) the City, with respect to City Sponsored Events, receives valuable consideration (whether in money, services, foods or other value). Any Ticket for which (i) the Team Owner, with respect to Hockey Events; (ii) the Arena Manager or the sponsor or promoter with respect to Team Revenue Events, City Revenue Events and other Fee Activities that are not Events; or (iii) the City with respect to city Sponsored Events, (a) receives no value, or (b) receives money (but not any other services, goods or other value) for such Ticket in an amount less than 25% of the retail priced stated on the face of such Ticket, shall not be a “Qualified Ticket”; provided, however, that, if the aggregate number of Tickets described in the immediately preceding clauses (a) and (b) that are distributed by the Team Owner for a given Hockey Event (other than a Hockey-Related Event) exceeds 1,750 then the Tickets described in the immediately preceding clauses (a) and (b) distributed by the Team Owner for such Hockey Event that exceed 1,750 shall be deemed “Qualified Tickets” for such Hockey Event, unless the City and the Team Owner mutually agree otherwise.”

I suspect the city has one interpretation of this paragraph in mind and IceArizona has another. I’ve learned that arena employee tickets purchased at a discount were counted as qualified tickets in previous years. Apparently now they are not by IceArizona.  Is it because the discount is greater than 25%? What other categories of purchased tickets are no longer considered as qualified by IceArizona? Is IceArizona discounting a large number of tickets? If so, as a result, how much surcharge money is the city not receiving?

Apparently there is some sort of agreement that the number of complimentary tickets to be given away would average no more than 1,000 per game. It appears that IceArizona has far surpassed that average and in one case gave out 3,500 complimentary tickets for one game. The rationale for capping the number of complimentary tickets per game is that it frees up a greater number of qualified tickets to earn the city surcharge. I am hopeful that a Fiscal Year- end audit commissioned by the city will clear up many of these questions.

What was council’s reaction to the dismaying news that arena revenues will experience an approximate $7M deficit? Not a word. Not one single question asking how the projected deficit would be covered. Instead there was a chorus of “thank yous” to staff for bringing this information forward and making it publicly available.

The other substantive issue on council agenda was the Five Year Forecast. As presented by Mr. Duensing the bottom line is that the city faces everything from a minimal deficit of approximately $250,000 next Fiscal Year up to a substantial deficit of $30 million dollars within 5 years. He asked council to approve staff’s development of a short term plan and a long term plan to deal with these expected deficits.  He received council approval to do so along with a chorus of confidence from councilmembers that the deficit can be overcome. Mayor Weiers said it best by asking everything be placed on the table and he hopes council has the courage to make some very difficult decisions. Every citizen of Glendale hopes council has that courage. What better Christmas present could there be?

© Joyce Clark, 2013

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My blog produced a raft of emails indicating that I wasn’t very clear in my recitation of arena numbers. Here’s an attempt to clarify:

We will not know about parking revenues until January 31, 2014 because that number is due quarterly per the arena management agreement and will reflect October-November-December (4th quarter of Fiscal Year 2013-14) parking surcharges.

However, there is a line item on these monthly reports that troubles me. In none of the monthly reports does it indicate that IceArizona is depositing Supplemental Ticket surcharge revenue ($1.50 per ticket) into an escrow account.  It is an escrow account designed to supplement revenues to the city (If needed) to try to make the city whole for $9 million dollars. You see, this Fiscal Year 2013-14, the city council budgeted $6 million for arena management (keep in mind nothing is budgeted for FY 2014-15 because the budget has not been set or approved  by council and will not be until June 2014). Since the city only budgeted $6 million dollars of the $15 million dollars needed to pay IceArizona the arena management fee, the idea behind the surcharges and fees was to earn an additional $9 million dollars for the city. That would hopefully make the city whole for the $15 million dollars a year to IceArizona. If the $9 million wasn’t generated the Supplemental Ticket surcharge of $1.50 per ticket was to be given to the city to cover the short fall.  Here is the exact verbage:

Supplemental Surcharge

“9.1.3 Supplemental Surcharge. In addition, throughout the Term, a Supplemental Surcharge of $1.50 per Qualified Ticket (“Supplemental Surcharge”) shall be imposed by the Arena Manager for all Hockey and non-Hockey Events. The Supplemental Surcharge shall be deposited by Arena Manager into one or more an escrow accounts in the name of Arena Manager and the City, and shall be the property of each Party to the extent each is entitled to such monies under this Agreement as determined by Arena Manager and the City jointly (the Supplemental Surcharge Escrow Account”): provided that such deposits shall be held in accordance with and subject to audit pursuant to the procedures described on Exhibit “N” attached hereto (the “Supplemental Surcharge Procedures”). City shall have the right to draw upon the Supplemental Escrow Account within 60 days following the last day of each Fiscal Year, to the extent City received less than $9,000,000 in total revenue from operations at the Arena pursuant to this Agreement during the immediately preceding Fiscal Year (the “Deficit Amount”), as further described in the Supplemental Surcharge Procedures and in an amount not to exceed the total funds available in the Supplemental Surcharge Escrow Account at the end of such Fiscal Year. The funds remaining in the Supplemental Surcharge Escrow Account following payment of the Deficit Amount, if any, to City shall belong to Arena Manager free and clear of all claims of City and shall be disbursed to Arena Manager such that said escrow account is reset to a zero balance following the reconciliation pursuant to the Supplemental Surcharge Procedures at the beginning of each Fiscal Year. The Supplemental Surcharge amounts imposed by the Arena Manager which are the property of Arena Manager pursuant to this Section 9.1.3 are pledged to the City, as more fully described in the Supplemental Surcharge Procedures, to the extent of the City’s interest, with the City claiming no interest in the balance of such account. The Supplemental Surcharge Escrow Account shall be held in one or more (FDIC insured) accounts of the Arena Manager and the City jointly, at one or more Third Party financial institutions agreed to by the City and the Arena Manager. To the extent of any inconsistency between this Section 9.1.3 and the terms of the Supplemental Surcharge Procedures, the terms of this Section 9.1.3 shall control.”

Where are the Supplemental Ticket Surcharge numbers per month? There should be $8,206 for October; $101,644 for November; and $96,758 for December for a total of $206, 608 to date. So, where’s the money? Why no accounting in the monthly report? Why is there no indication that these funds have been deposited in an interest bearing escrow account? Could this be considered a breach of contract?

According to the Monthly Arena Revenues & Expenditures, Arena Lease and Safety & Security Agreements, a public document that will be used by staff in its presentation at the December 17, 2013 city council workshop on this issue, here are the monthly ticket surcharge revenues that are to be paid to the city. These are public figures provided by the city based on figures  provided by IceArizona. Here is the link: http://www.glendaleaz.com/Clerk/agendasandminutes/Workshops/Agendas/121713-W05.pdf .

Month ending Sept 30, 2013:

Ticket surcharge Hockey ($3 per ticket)     $16,413 total revenue surcharge for 1 hockey game.

Divide $16,413 by $3 and attendance for this one game was 5,471.

Month ending October 31, 2013:

Ticket surcharge Hockey ($3 per ticket)    $203,289 total revenue surcharge for 7 hockey games.

Divide $203,289 by $3 and attendance total for all 7 games was 67,756.

Divide 67,756 by 7 games and average attendance per game was 9,679.

Month ending November 30, 2013:

Ticket surcharge Hockey ($3 per ticket)    $193,517 total revenue surcharge for 5 hockey games.

Divide $193,517 by $3 and attendance total for all 5 games was  64,505.

Divide 64,505 by 5 games and average attendance per game was 12,901.

Oops. I just checked the Coyotes website and it lists SIX games in November. Whose mistake is it? If it’s the city’s incompetence perhaps City Manager Fischer should fire someone else in the Finance Department. If it’s IceArizona’s mistake was it deliberate?

We’ve all heard the rumors about Anthony LeBlanc handing out 2,000 complementary tickets per game. Whether it’s true or not has no bearing on ticket revenues because they would be free tickets there would be no ticket surcharge. You attendance gurus out there better check your attendance figures because these are the numbers that come from IceArizona. After all, IceArizona wouldn’t low ball the numbers to the city only to exaggerate them for the media, would they? Nah-h-h-h-h.

By the way I ran into Mr. LeBlanc at a Coyotes game and had a few minute to quiz him on the numbers of the Coyotes deal. Mr. LeBlanc quite clearly stated to me that they needed attendance of 15,500 per game to “make it.” His number, not mine.

© Joyce Clark, 2013

FAIR USE NOTICE
This site contains copyrighted material the use of which has. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those not always been specifically authorized by the copyright owner. We are making such material available in our efforts to advance understanding of environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a ‘fair use’ of any such copyrighted material as provided for in section 107 of the US Copyright Law who have expressed a prior interest in receiving the included information for research and educational purposes. For more information go to :http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use’, you must obtain permission from the copyright owner.

The Glendale City Council workshop scheduled for Tuesday, December 17, 2013 will finally force this council to declare its financial intentions for the future. It is a jam packed agenda but there are several items that are especially important to each and every citizen in Glendale. One is a presentation of Monthly Arena Reports and the other is the Five Year Financial Forecast.

The Monthly Arena Reports were a request of Councilmember Alvarez. We know her motive and that is to show how much the city is bleeding from the current management agreement. Staff will prepare and post online each monthly arena report. The December 31, 2013 report is to be public by January 31, 2014.

Unfortunately based upon the material offered at workshop the city does appear to be bleeding as a result, in part, of the latest arena management agreement. Here is what each of the monthly arena reports will include:

Revenues to the city

  • Sales tax collected inside the arena
  • Base rent ($500,000 annually)
  • Ticket surcharge for hockey events ($3 per ticket)
  • Ticket surcharge for non-hockey events ($5 per ticket)
  • Supplemental surcharge ($1 per ticket)
  • Parking revenue for hockey events ($10 per car)
  • Parking revenue for non-hockey events ($15 per car)
  • Naming rights (20% to city)
  • Naming rights for indoor stage (100% to city)
  • City sponsored events (revenues minus expenses)
  • Safety & Security Fee ($174,122 a year)
  • Hourly security costs for police
  • Hourly security costs for fire
  • Interest income placed in an escrow account

Expenses to be paid by the city

  • Arena capital improvements ($500,000 annually for now)
  • Quarterly management fee ($3,750,000 per quarter; $15M annually)

What does all of this mean? The sales tax collection, ticket surcharges and public safety revenues are not new revenues.  The only new revenues, courtesy of IceArizona, are the rent of half a million a year, naming rights and parking revenue. IceArizona has paid $219,702 to date of its annual rent. There is no new contract on naming rights as the current contract has not yet expired. As for parking revenue we will not see the first revenue number until January 31, 2014. It will be an interesting number for IceArizona keeps the first $20,000 (that’s 2,000 cars at $10 each) per game in parking revenue. Tom Duensing, Executive Director of Financial Services, in a recent article forecast(http://www.azcentral.com/community/glendale/articles/20131213glendale-fiscal-forecast-grim.html) that the Coyotes deal will cost the city an estimated $8.1 million next year, after the city receives its revenue associated with the deal. That’s one Christmas present denied.

The second major agenda item, the Five Year Forecast, is even worse. What it boils down to is that Glendale is spending more than it takes in. The annual amount that the city is short in revenue averages $14M a year until 2017 when the temporary sales tax increase disappears. Then the average deficit balloons to $30M a year. Do you smell the temporary sales tax increase becoming permanent? If it occurs it is a major promise broken and will have consequences the next time the city asks Glendale voters to approve anything.

While operating expenses continue not to be controlled as effectively as they could be there are other obligations that put in the city in trouble. The city’s debt service (of about $30M a year) is 17% of its operating budget. It is way too high and according to Moody’s it should be in the 10% to 12% range. Add the city’s contractual obligations (of about $25M a year) at 13% of its operating budget. Fully 30% of the city’s operating budget is used to pay debt service and contractual obligations. Add to that figure, personnel costs of over 50%. There isn’t enough money to cover all of this. No Christmas present here either.

Also of note is the projected expense for the Super Bowl of $1.7 million dollars with expected revenue of $200,000. It appears that this expense is greatly underestimated. In 2008 the city’s expenses were over $2 million dollars with a loss of about $1 million dollars. In 7 years every expense has gone up, not down and the expectation was, until now, that it could easily cost the city $4 million to host. The city has only factored in the $1.7 million it must pay to the Host Committee. It has not accounted for any additional costs including staff time.

Staff will be asking council to provide direction for the upcoming FY 14-15 council budget workshops. Their choices are: fix the deficit for the coming fiscal year or fix the deficit long term. If they wish to send a strong, positive signal they will embrace a long term fix. If they are still in hopeful mode they will choose to solve the ongoing problem short term and like chicken little, put it off as long as possible. Which way will they go?

© Joyce Clark, 2013

FAIR USE NOTICE
This site contains copyrighted material the use of which has. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those not always been specifically authorized by the copyright owner. We are making such material available in our efforts to advance understanding of environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a ‘fair use’ of any such copyrighted material as provided for in section 107 of the US Copyright Law who have expressed a prior interest in receiving the included information for research and educational purposes. For more information go to :http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use’, you must obtain permission from the copyright owner.

On the December 3, 2013 city council workshop there were 6 topics. This was not one of council’s short, one-hour, “whizz bang, thank you ma’am” kind of meetings. It seems whenever there is discussion related personally to council the discussion is intense and prolonged.

Let’s take a look at each one. First up was the issue of 2 hour downtown parking. Someone had complained to Mayor Weiers and so it surfaced as a Council Item of Special Interest. Since the parking restriction was not being enforced there was a question of keeping the signage up. Councilmembers Martinez, Knaack and Sherwood felt there was no problem but supported Weiers, Hugh and Chavira in their request to survey the downtown merchants about the issue. So there will be a second installment on this issue after the survey is completed.

Next item was the city suite policy and its use. This item was requested for discussion by Vice Mayor Knaack who explained that she wanted to disabuse the public of the notion that council had free and unfettered access to the city suites at Jobing.com arena and Camelback Ranch. This notion is widely held when the public sees Mayor Weiers and Councilmember Sherwood often and regularly in the city Jobing.com arena suite. The policy as I remember it allowed for 2 uses: for non-profit use and for city business use (economic development). Apparently there is now a third use allowing for city council city business.  Council finished by directing staff to make more use of the suites as a reward to city volunteers. A good idea. Sources have said that Interim Assistant City Manager Frisoni was able to rent the Jobing.com arena suite in the past for her daughter’s birthday party. If that did occur it most certainly violated stated city policy. Hmmmm…

The third item was allowing citizens to donate a greater amount monthly to the From the Heart Donation program — another Mayor Weiers topic. After much discussion council gave direction to increase the donation option from $1 a month to $2 a month on citizen utility bills. The thinking was that it would double the amount received monthly for the program. Maybe, maybe not. When the price is increased on anything the number of purchasers usually decreases. Let’s see how this works out.

Undoubtedly the hottest topic was the discussion of council budgets. Vice Mayor Knaack requested this item and made the point that she did not think the use of council funds (read your taxpayer dollars) should be given from councilmember budgets to non-profits.  Martinez and Sherwood agreed but it raised Councilmember Alvarez’ blood pressure by at least 100 points. She had been silent on all previous items and did not wake up until this topic came forward. Then she was off and running!

She made sure she cited every past transgression from Knaack benefiting from the city’s VIP (Visual Improvement Program) for businesses to the city’s decision to enter into the $15 million dollar a year management agreement with IceArizona to the absence of recreation programming for kids. She made sure she recited every past sin. She made clear she would not go along with any prohibition council might create regarding council budget donations to non-profits. Hugh and Chavira stood fast with her.

Councilmember Martinez, joined by Vice Mayor Knaack, once again asked that councilmembers reduce their discretionary and infrastructure budgets so that the funds could go back into the General Fund. There is no doubt that Martinez, Knaack and former Vice Mayor Steve Frate believed strongly in doing so. Here is the past history on council budget reductions;

  • Barrel district (Knaack)      reduction of $26,571 and district improvements of $197
  • Sahuaro district (Frate)      reduction of $24,729 and district improvements of $4,965
  • Cholla district (Martinez)    reduction of $23,796 and district improvements of $2,998
  • Cactus district (Lieberman) reduction of $2,563 and district improvements of $500
  • Yucca district (Clark)          reduction of $1,188 and district improvements of $15,445
  • Ocotillo district (Alvarez)    reduction of $0 and district improvements of $9,545 

Donations to non-profit/school districts:

  • Ocotillo district (Alvarez)              $22,134
  • Cactus district (Hugh)                  $11,849
  • Yucca district (Chavira)                $  8,000
  • Cholla district (Martinez)              $  1,000
  • Barrel district (Knaack)                $     609
  • Sahuaro (Sherwood)                    $     419

You can see from the figures above there are two competing philosophies regarding the spending of council budgets. There being no consensus on anything related to how they spend your taxpayer dollars there was no direction given and things will stay just as they are.

The next item was a topic generated by Councilmember Sherwood. Currently all councilmembers can offer a Council Item of Special Interest without having to get 3 other councilmembers to agree to the topic. Sherwood wanted to go back in time and reuse the policy that required 3 other councilmembers to support any Item of Special Interest. As he said, “It was better to have staff work with ‘real’ issues” and he summarily dismissed the value of any Item of Special Interest brought forward by a councilmember. His suggestion went over like a lead balloon and he received no council support for his latest idea.

The last item was city generated and was a presentation on the proposed financial policy on transfers. After the presentation by Tom Duensing, the new Director of Financial Services, he was thanked profusely (especially by Chavira who has become quite adept at thanking everybody for everything) but there was nary a question. The longest part of this item was the presentation by Duensing.

On another unrelated issue, lately there has been a fire storm of public discussion on the siting of billboards in the Arrowhead area adjacent to the Loop 101. I bring this up not to take a position on the issue but because of something I read recently. A Cholla citizen reacting to the billboards said, “How ghetto could that be, to put up signs like that?” This is not an aberration but the typical attitude exhibited by Arrowhead folk. So, billboards are ghetto-izing? It’s OK for billboards to be placed in the rest of Glendale along with pawn shops, loan stores, massive apartment complexes and liquor stores? I’m surprised that Arrowhead has not ceded from the city. It must be embarrassing for Arrowhead people to have to say they live in Glendale with all of its ghettos.

© Joyce Clark, 2013

FAIR USE NOTICE
This site contains copyrighted material the use of which has. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those not always been specifically authorized by the copyright owner. We are making such material available in our efforts to advance understanding of environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a ‘fair use’ of any such copyrighted material as provided for in section 107 of the US Copyright Law who have expressed a prior interest in receiving the included information for research and educational purposes. For more information go to :http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use’, you must obtain permission from the copyright owner.

On the November 26, 2013 City Council meeting agenda was Item 23, an ordinance revising employee unclassified and classified positions as well as a revision of Human Resources Policies 201, 513 and 514. It was an item that council tabled and directed to be brought to a workshop — as well they should have.

As Councilmember Martinez stated there had been no review or discussion of this item prior to its appearance as an ordinance that night. City Manager Brenda Fischer took full responsibility for not bringing it to council prior to the vote. She should have. This ordinance, if approved, will be a blatant and naked accrual of more power to the City Manager and a diminishment of employee rights. Instead of former City Manager Ed Beasley’s “iron fist” we now have current City Manager Brenda Fischer’s “velvet glove.”

If I were a city employee I would be concerned. Currently the “at-will” employees are:

  •  City Manager                        1
  •  City Clerk                             1
  •  City Attorney                        1
  •  City Judge                            1
  •  Assistant City Judges             5 estimated

Under the proposal add:

  • Assistant and Deputy City Manager level positions
  • All department Director/Assistant Department Director level positions
  • All employees, exempt and non-exempt, assigned to positions in the legal department (includes City Attorney’s office and Prosecutor’s office);                            
  •  assigned to positions in the City Clerk’s office;                                        
  •  assigned to positions in the Mayor’s and City Council offices;
  •  and all classified employees in their introductory or probationary period of employment.

Under the current system reflected in the FY 2013 budget there are approximately 9 positions (estimate of number of assistant city judges is 5) that are unclassified and are considered as at-will. Under the proposed “velvet glove” system the number grows to approximately 120 positions. That number does not include “all classified employees in their introductory or probationary period of employment.” My math can be shaky but it appears to be a 1,000% increase planned in the number of at-will employees and that does not include probationary employees.

What are the differences between classified and unclassified employees? The major distinction is that unclassified employees have no right of appeal or right of grievance should they be fired. There does not have to be a “cause” to terminate. Consider them to be contract employees. There is no permanence or stability associated with the job. They are salaried employees who earn no overtime pay. There is no annual merit or “step” increase. Rather increases are based upon performance and productivity.

Retirement “vesting” and benefits can be different between the two systems. Unclassified employees can usually vest in retirement immediately while there is a waiting period for classified employees.

A classified job offers an individual job security and stability. Security at work has been demonstrated to improve and to enhance the individual’s performance. In the private sector companies that offer permanent jobs understand the need of promoting higher levels of job satisfaction to improve workforce performance. A classified employee will generally receive more employment benefits and bonuses like health insurance, pay raises and holiday pay.

There is no right or wrong position on these job classifications. Younger, more mobile workers seem to prefer at will employment while older persons are more comfortable with the security of job stability.

However, this new proposal raises a myriad of questions and concerns:

What about the issue of subjectivity? What if a department head has an assistant department head that does terrific work but their personalities clash? There exists the potential for abuse.

What about public safety? Do department heads and assistant department heads in police and fire become unclassified? If so the estimated number of 120 will grow substantially.

What about those employees currently in their introductory or probationary phases? Did those that already accepted employment from the city choose stability or mobility? If it was stability did they unwittingly forego another opportunity at another city assuming that once they passed their current probation they would have a stable job? In this new proposal once they finish probation after January 2, 2014 do they become at-will, unclassified? If so, over time, every employee will become unclassified. The proposed ordinance specifically states, “Legislative note: The expansion of the unclassified service to include employees hired and or promoted on or after January 2, 2014.”

The ordinance also states, “Unclassified employees are entitled to all regular benefits and leaves unless otherwise provided in the human resources policies and procedures.” How long will it be until unclassified employees see revisions to HR policies and procedures?

Then there is the description of classified service within the ordinance, “The objective of this service is to provide public and management services covered by a fair and nonpolitical system of personnel management for the City of Glendale.” Those seem to be desired outcomes in municipal government. So why the proposed change? It goes on to say, “The unclassified service is made up of employees in positions where administrative necessity dictates that the position be more responsive and accountable to city policy.” Is the unclassified system inherently more subjective and political? Yes.

The City Charter under Article III, Section 3, (3) states the City Manager has the authority to “appoint, and when deemed necessary for the good of the service, lay-off, suspend, transfer, demote or remove all department heads, officers and employees of the City subject to such merit system regulations as the Council may adopt.” However, only classified employees are subject to the merit system and even if the City Manager wished to get rid of a classified person there are protections in place that must demonstrate cause. The council may make all the adjustments it wants to the merit system but they will only apply to classified employees whose numbers in this proposed scenario seem to diminish over time.

Another sentence has been added in this section, “The City Manager delegates the Human Resources & Risk Management Executive Director as the decision making authority with regard to the entire recruitment and selection process.” It is worded carefully for it appears that the HR Director can select candidates for positions but the ultimate hiring and firing will be done by the City Manager.

Why was this proposed? I’ve been told by sources that it was adopted by the City Manager after she had to appear before the Personnel Board in the matter of the Don Bolton termination. A different source suggested Mayor Weiers’ love of all legislative practices and procedures (this model is used by the state legislature) drove this initiative. Weiers has tried to have several state legislative practices adopted but what works at the state level does not always work well at a local level.

What justification is offered by either the City Manager and/or the HR Executive Director for a major change in personnel classification? None — apparently.  In the City Council Report under Purpose and Recommended Action the proposed action is described but its purpose is not.

Why the reluctance to offer the purpose of such a major change? We are certain to hear that this proposed system offers flexibility in a changed work environment. Sounds like double-speak, doesn’t it? Make no mistake. This scheme centralizes power in the City Manager’s office. As elected officials leave so, too, will their staff under this proposed system. It can get really expensive in short order.

It was extremely prudent of council to table this proposal for future discussion at a workshop. The questions are many:

* Why is this major policy change necessary? And do not accept the answer of flexibility.

* Exactly how many employees out of the 1,000 plus will become subject to this policy?

* Will it apply to all new employees throughout the organization after January 2, 2014? From that date forward, once they have finished probation, will they be unclassified?

* How does such a policy change affect future budgets? What is the anticipated cost of moving to such a system? Add 20% to any staff estimate, if they provide one.

* Will department heads and assistant department heads in public safety become unclassified? If not, why not?

* Is the City Auditor and her department employees unclassified? If not, why not?

* Who will have the ultimate authority for hiring and firing unclassified employees?

* And most importantly — What practices will be implemented immediately and prior to a council vote to prevent any potential abuses including that created by subjectivity?

 

© Joyce Clark, 2013

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What exactly is in Representative Trent Franks’ bill, H.R. 1410? In the world of Congress it is short and sweet. Here is a link to the text of the bill: http://www.keepingthepromiseaz.com/.

H.R. 1410 specifically cites the 2002 voter approved state Gaming Compact which expires in 2027.The bill states that there was a promise to Arizona voters that there would be no new casinos in the state, especially within the Phoenix metropolitan area, other than those specifically granted within the Compact. It requires that there be no new casinos in Maricopa and Pima Counties. This stipulation covers the period from April 9, 2013 to January 1, 2027. That’s it. Nothing more. Nothing less.

This bill enjoys bipartisan support not only among the Arizona delegation but in Congress as well. It has passed the House of Representatives and has moved to the Senate. Its fate is unknown. It will be voted up or down or ignored in this session. If no action occurs it dies and will have to be reintroduced in the next session of Congress. If the midterm elections prove to be wildly successful for the Republicans there is a good chance for its successful passage.

The Tohono O’odham (TO) and their supporters are positively hyperventilating over this bill. If passed the TO simply cannot build in Glendale – certainly not until 2027 when the Gaming Compact is up for renewal by voters.

What many fail to realize is that the proposed casino is not in the hands of Glendale. We all await a decision from the U.S. 9th Circuit Court followed by a final clarifying decision by the U.S. Department of the Interior. Then there is the Supreme Court decision on the case of Michigan vs. Bay City on the issue of Tribal sovereign immunity. Don’t for a second believe that these decisions won’t be appealed – for they will. We are still years away from a final outcome.

Why all the posturing by the TO and their supporters right now? Could it be because the Gila River Indian Community and their sister tribes have ramped up their profile of late by advertising on TV and underwriting a letter of support by Mayor Weiers? They must be chagrinned to see the Gila River Indian Community award a grant to Glendale that is 10 times larger than the $40,000+ they awarded a month ago.

The drama will continue with both sides posturing and vying for the hearts and minds of Glendale residents. Yet the ultimate decision rests elsewhere.

© Joyce Clark, 2013

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The City Council meeting of November 26, 2013 had a raucous start, much like council meetings of old. The notion of putting citizen comments at the start of every meeting may come back to bite this council as they experienced their first hour long marathon of citizen commentary. I am not including the public commentary on the night of the Coyotes’ vote as that was to be expected. No, this time it was the opening salvo of a regular, assumed-to-be ho hum council meeting. It was anything but not just because of citizen commentary but because of all of the very serious issues that were up for a vote (more about those issues over the course of the next few blogs).

A majority of council did not comment about citizen commentary at the start of every meeting. Councilmember Sherwood did and made clear that he does not like it. It’s almost as if he considers citizen comments to be irrelevant and just an irritation that prevents him from performing what he considers to be the real business of council. His sentiment was arrogant to say the least. Then Councilmember Alvarez, who is wedded to citizen comments first, just had to rebut Sherwood’s remarks by saying, “When we were elected we were (sic) committed to be here.” How ironic as this is the councilmember who holds the record for her non-attendance at scads of meetings. She even has had the temerity when calling in to council meetings to hang up before the meeting’s conclusion and thus missed those all important citizen comments.

It looks like the Keeping the Promise anti casino group has seared the nerves of the casino supporters with their running of a TV ad and underwriting the costs of an anti casino letter penned by Mayor Weiers. They had their usual suspects…er, supporters out in force to speak on the TO’s behalf before the council. The usual mouthpieces have decided to become visible once again…Ken Jones and Arthur Thruston to name but two. Due to their advanced age they needed time to rest and recharge before becoming public gadflies again. Can you believe that Ken Jones was advocating for yet another public vote? This time his target is the casino. You’d think he would have learned that one needs to be careful what one wishes for. His last effort fizzled out like water dousing a fire. He also opined that the people of Glendale do not need Keeping the Promise running our city and buying city officials. Oh really? Guess he figures it’s okay when the Tohono O’odham appear as if they are buying city officials like Alvarez. He never took the time to complain about Alvarez and her antics with the Tohono O’odham.

Thruston, bless his heart, simply relies on picking and choosing his facts. Those that he doesn’t like, he ignores. He trots down to the podium with a handful of newspaper clippings and pontificates on issues culled from the newspapers (and of course, their, ahem, totally unbiased reportage). He fancies himself as a raconteur in the vein of a modern day Will Rodgers who once said, “you know everybody is ignorant, only on different subjects.”                       

What engendered all of the citizen commentary was Item 12 of the Consent Resolution agenda accepting a grant of over $400,000 from the Gila River Tribe for the purchase of a fire truck. Yet, there was no comment from the citizens when council voted to accept a Tohono O’odham grant of $40,000+ to fund the Glendale Youth Project on October 22, 2013 – a scant month ago. In fact, Alvarez voted to accept that grant voicing praise and voted to reject tonight’s grant. Could her bias be showing? What’s changed? The acceptance of a grant from an anti casino Tribe. That’s the only difference. What was even more astounding were the citizen accusations that Mayor Weiers and Councilmember Martinez are shilling for the casino opposition.  When Councilmember Alvarez engages in the same activity it’s not considered shilling. Strange, isn’t it? There’s an old saying, “People who live in glass houses shouldn’t throw stones.” Alvarez would be well served to rein in her troops or she may find her glass two story home (second story improvement not recorded nor additional property tax paid) shattered in all of the cross fire. It’s merely an observation.

Another action of note is Councilmember Sherwood’s reversal of position on the casino. When he ran last year he was opposed to the casino. He even met and collaborated with now Mayor Weiers, I and candidate Gary Hirsch, all of whom shared the same anti casino position. The anti casino Tribes even did an independent political mailing expressing their support for Sherwood because he ran on a platform of opposition to the casino. Now, inexplicitly or perhaps not so inexplicitly, he has reversed his stance. He, along with Councilmembers Hugh and Chavira, wrote to the Department of the Interior saying don’t pay attention to Glendale’s opposition to a Tohono O’odham casino. Why has the champion of Westgate abandoned it? Remember all of his talk about the necessity of the Coyotes as an anchor for Westgate because the team would attract traffic to Westgate and keep it viable?  Does he really believe that the casino will help Westgate? Nah. Rumor has it that he was contacted by the pro casino forces right after his election and they may have assured him that if he moved to the dark side they would assist in bank rolling his next election. Was that just too good a deal for Sherwood to pass up? You decide.

So, who is keeping the promise to Glendale’s residents? The promise that a casino does not belong in Glendale, will cost our taxpayers for the supporting infrastructure and will destroy a pledge made by all of the tribes (including the Tohono O’odham) when seeking voter support for the 2002 voter approved Gaming Compact. It’s no longer Sherwood. If he could change his position on this issue so readily, how can we believe what his stance is on other issues? It appears that his guiding principle has become one of pragmatism but what has happened to one’s word being one’s bond?

© Joyce Clark, 2013

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The Tuesday, November 19, 2013 Glendale city council workshop is jam packed and includes a Development Impact Fee update, the Fire Department Budget deficit, special project recommendations and the Ballpark Boulevard extension.

Since the Arizona Legislature changed the way all cities in the state can impose, collect and spend Development Impact Fees Glendale, like many other cities, has developed a new Impact Fee structure. Impact Fees are charged to new developments and the developers typically add these fees into the price of a home, apartment, office, commercial or industrial building. Tischler Bise is the consultant hired to prepare the study on Impact Fees. I would like to know the cost of the study for I assure you, as thorough as it is, it was not cheap.

The consultants divide Glendale into three zones. The East Zone runs the entire length of Glendale, north to south and from 43rd Avenue to 75th Avenue. It is a very large zone and is approximately 42 square miles.  The Loop 101 zone is the smallest running from Northern Avenue to Camelback Road, 75th Avenue to 115 Avenue. It is a very small zone and is approximately 13 square miles. The West Zone is all land within Glendale’s annexation boundaries and is approximately 36 square miles. Although very thorough the consultants provide no rationale for the establishment of the Zones that are essential to the study.

There is concern with the disparity of size of the zones for they comprise a “nexus.” By that is meant that development impact fees are collected and spent within each zone. With the Loop 101 Zone being the smallest there will be less opportunity to collect/spend fees to provide the same quantity and quality of infrastructure as enjoyed by the East Zone. As an equitable issue all land south of Northern Avenue from 43rd Avenue to 115th Avenue should form the Loop 101 Zone. That would remove approx. 12 square miles from the East Zone making it approx. 30 square miles and increasing the Loop 101 Zone to 25 square miles. The West Zone would remain static at 36 square miles.

The balance of the study is impressive. Their facts and figures are well grounded and formulas are used to determine what the new fee structure for state mandated infrastructure should be. Although the Development Impact Fee structure is no longer what Glendale and every other city used previously there is no choice but to work within the new state-mandated regulations. We will not see the kind of Impact Fees that helped to make Glendale what it is today but it is important that we make the best use of them possible. With the exception of the determination of the zone configuration this is exactly what this study does.

The second item of discussion is the fire department’s deficit. There is but one question to ask. Is the fire department being managed effectively by current Fire Chief Burdick? In juxtaposition the Police Department led by Chief Deborah Black is not facing this kind of deficit. What kind of deficit? How about $1,674,887 minus one-time savings netting a deficit of $1,328,070? In addition the on-going, annual deficit of over $800,000  goes to pay for overtime due to the department’s philosophy of “constant staffing.” It’s time for a study to demonstrate which brings more value to citizens – constant staffing which entails an enormous amount of overtime at time and a half pay or the hiring of more personnel eliminating the need for the constant staffing regimen and its requisite overtime pay.

That item will be followed by a presentation and discussion of recommendations that resulted from the half million dollar external audit.  The City Auditor’s and City Attorney’s roles will be part of that discussion as well as the Trust Fund Citizen Boards and departmental internal premiums for risk management.

The last item of discussion will be what to do about Ballpark Boulevard. The city in an agreement with the two baseball teams agreed to extend Ballpark Boulevard north to 99th Avenue and Maryland Avenue. The current, approved concept will cost the city $18 million to acquire land for right-of-way and construction. Mayor Weiers asked that two alternatives be considered that would come in between $6 and $8 million. Both of these alternatives would run adjacent to the city’s airport on either its west or east side. The only problem with the alternatives is that they will not replace the contractually mandated concept of connecting to 99th and Maryland. That will still have to be done. So the question is…does the city construct a stop gap measure costing $6 to $8 million now knowing that down the road it still must spend $18 million per its contract with the City of Phoenix and both baseball teams? The city has no money right now and without any demonstrated urgency it is something that can wait. Neither Phoenix nor the teams are demanding immediate action.

This is not going to be one of the council’s typical one hour or less meetings. The issues are complex and I would hope that council “has done its homework” and is prepared to ask meaningful and relevant questions on all of these complex issues…but then again, it could be wishful thinking.

© Joyce Clark, 2013

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Two recent news stories can have you scratching your head and saying, “What the heck?” Just when you think Glendale has its act together it trips over itself and acts either incomprehensibly or incompetently.

It appears the NFL is still miffed with Glendale. I don’t buy it. Glendale successfully hosted one Super Bowl and is using the same model, only updated, to host the next one. Supposedly the NFL is in a stew about three issues: parking, Glendale hoteliers’ refusal to join the NFL’s room bloc and lack of Glendale leadership.

What about parking? Glendale provided the necessary parking at the last Super Bowl and will do so again. It has the requisite parking lined up already. It’s a non-issue.

What about the room bloc? Glendale cannot tell private businesses what to do and what to charge for room rates. Perhaps if the NFL sweetened the pot a bit for Glendale’s hotels there would be incentive for joining the room bloc.

What about Glendale’s leadership? It appears that the current city council has sent numerous signals that they are on board and willing to take whatever action necessary to make the Super Bowl a success. It is a smoke and mirrors issue apparently being jinned by two entities: the Arizona Host Committee and the Bidwills. On nearly all levels of Glendale must communicate with the NFL executives through one or both of those entities. Remember the kid’s game of post office? By the time the original message went through several people the final message was nothing like the original. Glendale’s message is filtered by two, not-so-friendly entities.

The Host Committee has got to be walking around with a bag full of guilt knowing that all events but two are sited outside of Glendale and that Glendale will get the bill for the Super Bowl and probably lose money again. They have been very reluctant to assist Glendale in legislatively crafting a mechanism to make Glendale whole. Apparently Glendale’s losses are not a concern.

The Bidwills apparently are not giving the NFL kudos about Glendale because they are angry about NFL Super Bowl unrelated issues. They are angry that they didn’t get their way about putting up a training tent on Glendale’s Youth Sports Fields adjacent to the stadium and they are angry (perhaps in this case justified) that their partnership with SMG to bid on managing Jobing.com was ignored. Glendale did handle that badly by accepting bids and then letting them hang out there in limbo while it brazenly accepted IceArizona’s deal to manage the arena. The entire situation was strange to say the least. Another issue may be one of the lack of a parking garage. The Bidwills know that Glendale cannot afford to build one at this time. Soooo….the Bidwill’s land on both sides of stadium already has approved zoning (including the right to build a parking garage or two) as Sportsmen’s Park, East and West. If the Bidwills want a garage so badly why don’t they take out an incredibly low interest loan from the NFL and build one on their land??

It’s time that the Host Committee and the Bidwills stopped stewing and accepted the fact that Glendale is the host city. To make this event successful it’s time they lifted Glendale up rather than attempting to stomp it into the ground. They say publicly that they want Glendale to be a full participating member of the team but behind the scenes Glendale is virtually ignored. When another successful Super Bowl is over it will be in great measure because of Glendale’s efforts to insure its success.

Glendale is showing that its methods of operation haven’t changed much, if at all, under new City Manager leadership. It appears that Glendale missed the FEMA deadline for submitting paperwork regarding its flood prone areas in the city. A special council meeting had to be scheduled last Tuesday despite the fact that Weiers, Sherwood and Chavira were attending the National League of Cities convention in Seattle. They participated telephonically, something the Surprise city council just voted to abandon as a practice.

It was only discovered after several citizens called the city to complain that they were denied coverage. Don’t believe the disclaimer that it’s not a big deal because most of Glendale’s flood plain is in its river beds. There is also substantial land along Grand Avenue that has historically flooded and is in the flood plain. How could this fall through the cracks?

And the City Manager’s remedy? Expect another firing of some employee becoming the latest “fall guy” in the string of recent firings. Glendale hasn’t changed under new leadership. It still fudges on transparency. It refused to publicize its investigative report generated from the half million dollar external audit until the Arizona Republic made a Freedom of Information Request. It continues to follow the philosophy of omission; leaving out the negative, in an effort to spin any issue positively. Sometimes Glendale, you just have to say that you screwed up.

© Joyce Clark, 2013

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