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Joyce Clark Unfiltered

For "the rest of the story"

May 13

1

There is no money to find

Posted by Joyce Clark on May 1, 2013
Posted in City of Glendale • Glendale finances  | Tagged With: , , , , , | 4 Comments

convention 2On Friday, April 26, 2013 the Glendale City Council had another special budget workshop. This time their agenda was to revisit the issues of police and fire requests for additional personnel and healthcare premium increases for employees and retirees.

Ms. Sherry Schurhammer once again presented the proposed budget and the cuts recommended for 2015 and 2018. Staff’s recommendation was to deny the police and fire requests for additional personnel and to accept the increased healthcare premiums. Her major take-away is that the city has a structural deficit and acceptance of this budget as proposed was the first step toward eliminating it.

Fire Chief Burdick came back with a revised request for an additional 8 positions and two  fire truck leases. Police Chief Black upped the police ante to 31 positions plus 6 non-sworn positions. Together these two departments requested a new ongoing expense for the General Fund of $5.5 million and a new one time expense of $1.2 million for the General Fund.

For most of the session there was a united front of 4 councilmembers willing to grant the police and fire departments their requests. They were Councilmembers Alvarez, Chavira, Sherwood and Vice Mayor Knaack. Later one of them will break from this pack and change the council consensus and direction to staff-but that’s for later in this blog. Let’s begin with the four’s reasoning for granting the police and fire wish list.

Norma Alvarez

Norma Alvarez

At least Councilmember Alvarez is consistent. She began with remarks like, “a business should be paying for their own” and “ they’ve (businesses) taken a lot.” Make no mistake. She was alluding to the city owned arena. She also suggested that we “forget festivals” and pointed out that Glendale Glitters will cost the city $759,000 to produce this coming year. She even suggested that the funding for Public Safety be taken out of the Enterprise Funds (water, sewer and sanitation). She made sure that everyone knew that “the past is what brought us here” and she’s “not gonna forget the past.” She became confused when talking about crime being up in Glendale. It depends on what kind of crime. Glendale’s overall crime rate is down but certain categories such as theft have gone up.  Apparently the bottom line was that she had received a complaint from a citizen (certainly not vast hoards of people) that a “suspicious activity” call was not answered for an hour. Obviously calls are prioritized. If there is imminent danger to life or a crime is in progress it receives the highest priority, a Number 1 and is answered within 4 or 5 minutes. A call such as she described would receive a priority of 3 or 4 and would be answered eventually when an officer was available. Apparently that is not good enough for her.  It was vintage Alvarez. She blamed others, protected her agenda in the guise of protecting the taxpayer and exhibited her usual amount of confusion.

Chavira photo

Sammy Chavira

We finally saw the true Councilmember Chavira as he stood in support of Alvarez’ desire for more police and fire personnel. He worried about “call degradation.” Bet he couldn’t define it for you. He literally blessed fire and police personnel. Solicitudes were oozing from every pore. He was clearly upset that the police department had asked for more personnel and funding than had the fire department.  Then he spoke the magic word, “parity.” Just to remind you, he is a Phoenix firefighter and is going to push his brother Glendale firefighters’ agenda. He and his brother firefighters positively bristled at the mere possibility that police could end up with “more” than they would. So he suggested that the police personnel request be reduced to 20 personnel thereby reducing the ongoing request to $4 million. Make no mistake. His agenda is to further the desires of the Glendale Fire Department. They own him. Not just because he’s a brother firefighter but because the fire union poured upwards of $50,000 into his campaign. That’s a lot of chump change that Sammy will be paying back for a very long time. What Chavira did was not helpful. He widened minor disagreements between fire and police into the size of the Grand Canyon. It has now surfaced like an unwanted boil on your backside.

Martinez photo

Manny Martinez

Councilmember Sherwood offered some well thought out questions and clearly supported the police and fire requests. He, at the end of the session, still felt that if the city paid less back on a loan it has with the Enterprise Funds, the city could pay the additional costs of these requests. Councilmember Martinez stuck to his guns and simply made the point that it was not appropriate to grant these requests and that they “were not in a popularity contest.” He also said it was not productive to continually go back to the past and to point fingers. Councilmember Hugh was silent until the end of the session.

Knaack

Yvonne Knaack

Vice Mayor Knaack made it clear she was in public safety’s corner when she said the defeat of Proposition 457 (would have allowed the removal of sales tax increase) was due to Public Safety’s efforts.  She said that voters defeated it because public’s perception was that its defeat would preserve Public Safety. I know that is the message that police and fire were using in their campaign to defeat Prop 457. All that I can say is that at the very least, Councilmember Martinez and I made it very clear, often and quite publicly, that its defeat would prevent the city from making draconian cuts to this year’s budget and buy the city time to make more temperate cuts over the next five years. We both repeatedly referred to the city’s structural deficit. We did not say it would save fire and police jobs. We said it would save the city from having to make major personnel cuts to any department but that cuts would still be needed.

The issue of the proportionality of public safety sales tax was initiated by Vice Mayor Knaack. The voter approved tax calls for proportionally 1/3 to fire and 2/3 to police.  This will surface again but I think council will find that changing the proportionality of the tax is far more complicated than they know. She also publicly acknowledged that the arena management fee could very well be higher than the $6M in this budget.

Perhaps the surprise of the session was comments made by the Fire Chief. He said $1.2M to $1.3M was needed to insure “constant staffing” within the department. One would think that would be his first priority within his department budget. He also indicated that he would have “no problem shutting down a truck” to cover his department’s overtime. He virtually threatened council with his observation that they will have to make policy decisions regarding fire next year. He followed that by saying he would close a fire station if fire was not adequately funded. The nut is the definition of “adequately.”

Weiers

Jerry Weiers

Mayor Weiers also offered some rather interesting remarks. He noted “the angst between the fire and police departments.” He also said that the previous council should have stayed with the 1.2% sales tax increase across the board rather than the 7/10s in place now.  He then called for council to express their final positions so that consensus could be achieved and direction given to staff. It broke Alvarez-Chavira-Sherwood-Knaack in favor of increased revenues to police and fire. Weiers-Hugh-Martinez were opposed and wanted to accept the staff recommendation. It appeared that fire and police had won the day but wait…

Bowers

Dick Bowers

Interim City Manager Dick Bowers responded with “there is no money to find” and the proposed budget as presented is a “sound and reasonable approach.” He indicated that if council gave direction to accede to police and fire requests, cuts to all other departments would be “surgical.” It was then requested that council identify which departments they would like to see eliminated to meet the police and fire financial requests. Council then spent 5 or 10 minutes reading the material related to departments other than fire, police or enterprise departments. It was embarrassing painful to watch but  reality set in when they realized how much would have to be cut. Vice Mayor Knaack finally broke and changed her direction in support of the staff recommendation. Chavira made one stab to try to get her back into the fold and she responded with, “I have the right to change my mind.” It was a tough decision to make but she did the right thing.

Two important lessons surfaced from this workshop. A majority of this council has not accepted that there is a structural budget deficit and expenses are outstripping revenues; and fire has bared its teeth with dire promises to delivery service if their demands are not met in the next year’s budget. Mayor Weiers, Councilmembers Martinez and Hugh are to be commended for holding the line and accepting that budgetary expenses must be pared and pared now.

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Apr 13

17

City council plays the same song…over…and over…and over

Posted by Joyce Clark on April 17, 2013
Posted in City Council Actions • City of Glendale • Glendale finances  | Tagged With: , , , | 2 Comments

cit mtg 2Congratulations are in order to city staff. At the City Council workshop of April 16, 2013 working in an atmosphere where the current city council is loathe to make any budget cuts that are associated with layoffs and in fact wants to add additional police and fire positions is difficult, to say the very least. The cuts that this council will not accept remain necessary even as they collectively stick their heads in the sand.

Staff, knowing that cuts to the budget will not be accepted, took the obverse approach and has offered this council revenue enhancement. It seems that raising property taxes and collecting additional revenue from the Enterprise Funds for services provided by the General Fund may be the answer. This is not the final solution, however. As Ms. Schurhammer stated today, budget cuts, albeit more modest ones, are still needed and the sooner the better. As she and the rest of staff have said repeatedly the city’s budget has a structural deficit. In other words, more is spent than is taken in.

Knaack

Yvonne Knaack

It was noted that Vice Mayor Knaack, a member in good standing for many years, of the “gang of four” (voting bloc of the former mayor), now repudiates the former mayor’s imperative to keep the city’s property tax rate low. She actually had the temerity to say that she never supported the former mayor’s desire to keep property taxes artificially low. Too bad she never spoke out publicly or demonstrated her beliefs in a vote.

Chavira photo

Sam Chavira

Councilmember Chavira once again, embarrassingly and obviously, carried fire’s water bucket in an attempt to get this council to support granting the 15 fire fighter positions (at a cost of $1.5M every year) coveted by the fire department. If one didn’t know his agenda all one had to do was watch his performance in feeding positive questions to the Fire Chief to immediately figure it out. Every once in a while he would throw the police department a bone by including them in the discussion but his sole objective was to advance the cause of his brother firefighters. Mr. Bowers, Interim City Manager, made it very clear that the staff recommendation is to deny any supplemental requests this year including those of fire and police. His reasoning was straight forward and quite clear, “The city simply does not have the money.” This time, at least for now, council listened and it appears that these supplementals will not be granted. This council is not quite done with this subject. I suspect they will look for other means to grant, at the very least, fire’s supplemental.

Sherwood

Gary Sherwood

Councilmember Sherwood once again raised the question as to whether a figure of $6M was adequate for the arena costs. He became a little confused in attempting to get the figure of annual revenue the arena generated (not all of Westgate…and the western world…thank you) out. Well, we, dear readers, already know what that figure is from a previous blog where I conveyed the average numbers reported by the NHL as the manager of the arena. Ta Da! That revenue figure averages $6 to $7 million annually. No one else on council seemed interested in a workshop on arena costs and revenues so it died as a future topic.

musicCouncilmember Alvarez appears to have only two songs in her repertoire. One is the siren song to support the Tohono O’odham in its quest to plant a casino in Glendale less than a quarter mile away from Westgate. Again she called for a public forum (read free favorable publicity for the Tohono O’odham) before council. Again, she was rejected by a majority of the council. Does she not understand that the city is a party to state and Tribal interest litigation against the casino?

Norma Alvarez

Norma Alvarez

Her other one-note song is blaming others for her belief in the city’s continual waste of money. Please note it is a waste of money to her if it is not being spent to increase the salaries of its low wage employees. Her public definition of low wage employees is anyone making under $130,000. My goodness…reminds me of Obama’s definition of the rich ($250K annually, for tax purposes)!  Today’s rant on city waste was twofold: the absolute waste of the city’s involvement in Camelback Ranch and the car dealership coming finally to Bell Road with the city’s incentive to forgive a portion of sales tax for a specified amount of time. She refuses to understand that the dollar a year rental of Camelback Ranch for the teams is in exchange for their picking up the tab for operating and maintaining the facility year round (saving the city a cost of easily a million dollars a year). Instead of taking the time to truly understand the issue we hear her accusations of the city being too busy thinking of the glory of sports and not realizing that sports bring the city nothing. What she fails to realize that as part of this new council she bears the same baggage as the rest of them. On her watch the dealership will come in. Therefore on her watch the dealership will receive the sales tax incentive.

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Apr 13

3

Gimme more

Posted by Joyce Clark on April 3, 2013
Posted in City Council Actions • City of Glendale • Glendale elected officials • Glendale finances  | Tagged With: , , , , , | 5 Comments

convention 2Wow! It’s difficult to summarize the 2 1/2 hour, April 2, 2013, Glendale city council workshop into about 1,500 words – but here goes. First up was the city’s Intergovernmental Director, Brent Stoddard, reporting on HB 2657 before the state legislature.  In a nutshell, cities can support 7 provisions of the bill but 3 provisions are in dispute with the state.  The legislature wants the state Department of Revenue (DOR) to collect all sales taxes from all cities in the state. Currently Glendale and 17 others collect their sales taxes, report and remit the state’s portion to the state. Guess the state doesn’t trust those cities. The cities have countered with a proposal to offer a one-stop portal through a third party that would be managed by the DOR. I guess the state doesn’t trust cities to audit businesses either and want to take over that function exclusively as well. The cities have proposed the creation of uniform auditing standards; and the ability to request of and notify the DOR so that a city could still perform the audit. Lastly, the issue of dreaded construction sales tax issue was discussed. It appears that both sides, the state and the cities, are miles apart on this one. No resolution to be had as of this date. Stay tuned for the next chapter on this issue.

Chavira photo

Sam Chavira

Next up was the Police department presentation by Interim Chief Black. Our fearless leader of and advocate for all things Public Safety Councilmember Chavira asked, if the department was adequately staffed to protect residents and keep officers safe. After winnowing through all of the rhetoric, Chief Black reluctantly said, yes by saying, “we are meeting the needs of the community as best we can with the allocated funding.” How’s that for threading the needle?

Chief Black and her department are to be commended for their innovation and creativity. As a result of their reorganization efforts patrol staffing will go from 166 to 182 officers, increasing an officer’s pro-active patrol time from a low of 11 minutes to about 16 minutes per hour. That is phenomenal considering Glendale’s current financial position.  Their adoption of a new CAD system this fall will include an automated vehicle locator on all patrol cars enabling the dispatcher to send the closest available unit. This new system will create fuel cost savings and reduce response times.

Norma Alvarez

Norma Alvarez

Naturally, Councilmember Alvarez admitted that she didn’t understand all the numbers and “stuff.” Based upon her Ouija board, she KNOWS that the city’s residents are not well protected, especially in south Glendale, the area in which she lives and which she represents. The heck with the entire city. She went on to say that she didn’t want Chief Black to be a good employee and to work within the city’s fiscal constraints. Alvarez also said “we have to put more officers out there” and we can take dollars from programs that are a luxury. It will be interesting to see what she defines as a luxury.

There was a lot of discussion about the 8 police zones into which the city is currently configured. It seems no one on council could wrap their heads around this concept. What was not communicated is that all zones are not created equally, at least in size. Their dimensions are based on the number of calls for service as well as what makes sense geographically for patrol and response times. The more calls for service in an area, the smaller the zone gets.

Knaack

Yvonne Knaack

Vice Mayor Knaack then said the level of police staffing was “unacceptable.” By whose or what definition?  I guess the fact that our police department in July, 2012, was re-accredited by the Commission on Accreditation for Law Enforcement (CALEA) once again and for the first time was awarded the Gold Standard doesn’t mean anything and can be ignored. Really? When pressed by Knaack, Chief Black indicated it would be nice to be at fully authorized strength by adding another 31 officers. Bingo. Yet the police department has $7M as contingency in their public safety sales tax fund. I, like Vice Mayor Knaack, remember distinctly that one of the purposes of this public safety sales tax was to hire more officers.

Fire Chief Burdick’s presentation was interesting for what he said but also for what he did not say. The fire department still holds to a 4 person staffing model on all of its engine and ladder trucks and one is a firefighter/paramedic on each truck. Four men on a truck to answer fire calls is necessary to meet OSHA’s 2-in-2-out law. That mandate makes sense. That means for a working fire, while 2 firefighters are in a building, there are 2 on the outside to make rescue if necessary. Perfectly logical for working fire service calls. True, the number of working fires has increased by 26% due to automatic aid. Are all of those working fires in Glendale? Probably not.

The vast majority of calls are medical (estimate is that they are at least 80% of all calls for service) requiring either advanced life support or basic life support. Why doesn’t the city have smaller vehicles staffed with paramedics?  When a fire unit is dispatched it is told what kind of call to which it is going to respond. Smaller vehicles used for medical calls would be more fuel efficient and cost less to operate and maintain and would not require 4 man units. Or perhaps a medical transport vehicle with 2 Glendale paramedics on board should be sent. There has to be a better, more cost efficient way to respond to medical calls than sending a very big and very expensive fire truck.

Weiers

Jerry Weiers

Mayor Weiers did ask about automatic aid and what was the ratio of calls between Phoenix and Glendale and Peoria and Glendale.  Bravo. Not surprisingly, Chief Burdick didn’t have that information and said he would provide it. This is typical of staff when there is a question that they would rather not answer publicly.  Usually it’s because the answer doesn’t advance their cause. Weiers did bring up another suggestion, the use of an LPN in answering medical calls. The LPN could write prescriptions and make a determination if medical transport was needed.  That idea met with a great deal of resistance by Chief Burdick despite his admission that it is a model being used in Mesa. It could very well be an idea whose time has come. Using a truck that gets 5 miles to the gallon with 4 firefighters/paramedic is no longer cost effective at a time when the majority of calls for service are medical.

Chief Burdick, after this annoying interruption with questions of fact, was then asked by Councilmember Chavira if the department was adequately staffed and if firefighters were safe. Once again, cutting through the rhetoric, his answer was, yes today, quickly followed by a need to address excessive call volume. Whose? Those of Glendale residents? Phoenix residents? Peoria residents? We don’t know because that information was not provided.

Vice Mayor Knaack cut to chase and asked what he needed. Immediately the chief responded with another 15 firefighters and another truck ($650,000 price tag but would pay $65K a year in a lease back). Bingo.

greed 1The councilmembers’ questions certainly fed both departments’ agendas of “gimme more.” And why wouldn’t they? Look at some facts. In the last election cycle both unions, police and fire, supported Weiers, Sherwood, Hugh and Chavira. Vice Mayor Knaack and Councilmember Martinez received the same healthy union support in their last reelection bid in 2010. The police union was a minor player in both elections not having the same political war chest or available personnel as the fire union. The fire union, on the other hand, made sure there were cash contributions by individual, non-Glendale, firefighters to their campaigns, paid for printing and mailing campaign literature and paid for and put up campaign signs for these very same people now deciding to beef up these departments-because staffing levels are “unacceptable.” There is nothing illegal about any of these actions. It’s Politics 101 but it doesn’t serve, you, the taxpayer very well. Perhaps the parks and recreation people or the finance people need a union to level the playing field.

Sherwood

Gary Sherwood

Under Council Items of Special Interest, Councilmember Sherwood called for starting a search for a permanent City Attorney. What was truly mind-boggling was Councilmember Alvarez’ request that the City submit grant applications to the Tohono O’odham tribe for Public Safety dollars. What about we are still in litigation with the TO doesn’t she understand? When one is in a legally adversarial position with another, one does not ask for handouts from his adversary. She also thinks the city is mean and nasty because it owns the web page for the West Valley Resort and the TO has to pay the city annually for the right to use it. It is true. Congratulations to the city for pulling such a wonderfully, snarky yet brilliant move.

Council then adjourned into Executive session. Topics up for discussion: external audit, arena RFP, compensation for departing City Attorney and compensation for the new Interim City Manager. I suspect we will find out the results in a day or two.

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Apr 13

2

Heard around the water cooler

Posted by Joyce Clark on April 2, 2013
Posted in Blogs • City Council Actions • City of Glendale • Glendale elected officials • Glendale finances • Jobing.com arena  | Tagged With: , , , , | 2 Comments

cit mtg 2On the evening of April 1, 2013, the City made a public presentation of the state of its budget to the public. If you include myself and the councilmember representing our area there were a total of 5 people in attendance. That’s right. Three citizens and us. How embarrassing for the councilmember. Oh, but that’s OK. His only constituency these days is the fire fighters union.

staff multiplied jpgIn terms of city staff, it would be safe to say the citizens were outnumbered at least 3 to 1. There was at least 20-25 staff in attendance. Every director of every department was on hand to answer the flood of citizen questions (not), in addition to 2 of Glendale’s cable channel 11 TV crew filming the non-event. It almost begs the question as to why doesn’t the city ask the general public to RSVP? If a minimum number of citizens respond, the meeting is held. If only 2 or 3 respond, the meeting could be cancelled. After all if the public meeting had been cancelled, it would have only required calls to 3 people.

These staff members are salaried and not paid time and a half for extra duties such as attending this meeting.  These salaried personnel, if they so choose, can compensate themselves for the time by coming in to work a little later or taking a longer lunch break. It is an option available to them should they choose to use it. Many of them do not and put in more than a standard 40 hour work week.

Ms. Schurhammer, Executive Director of Finances, made a 15 minute presentation on the city’s budget. She concentrated on the city’s total Operating Budget by Fund and Department and the General Fund Budget by Department.  She pointed out that 34% of the city’s entire budget and 63% of the city’s General Fund budget goes to Public Safety. There was virtually a silent scream from all non-public safety staff asking how much more does Public Safety need? We’ll get to that in a minute.

Back in December, 2012, both the Fire and Police departments had their respective budgets balanced and were prepared for a vote of approval from the sitting council at that meeting. However, Vice Mayor Frate made a motion shark 2that their budgets be tabled and brought up again when a permanent City Manager was hired. The vote was 6-1 with me being the lone, dissenting vote. That action left their budget departments” doors open just a crack. Now, sensing an opportunity, they are smashing open those doors with a fire truck and tactical vehicle. They sense blood in the water and this new council (led on this issue by Councilmember Chavira, a Phoenix firefighter) is willing to give them everything and anything they want. Chavira will take care of his brothers in Glendale and we can only guess that Phoenix Councilmember Danny Valenzuela (a Glendale firefighter) will take care of his brothers in Phoenix.  Sweet, isn’t it? It has a nice, quid pro quo ring to it, doesn’t it? Note that the city does not have a permanent City Manager. Yet he will have to deal with the largesse that this council dispenses.

cit mtg 1After Ms. Schurhammer’s presentation, Ms. Julie Watters of the city’s Media and Communications Department, led the meeting by asking if there were any public comments. Mind you, a citizen could not ASK a direct question, only comment. If anyone had a question, they were directed to talk to that specific department director after the meeting. This is a tried and true practice that Glendale has practiced for years and which I have hated for just as long. For you see, if the question is a difficult or uncomfortable one, the answer is made only to the citizen seeking the answer after the meeting. After all, the city wouldn’t want all those citizens hearing that awkward answer to that difficult question. Would it? It’s a divide and conquer strategy that I believe is unfair to the citizens of our community.

cooler 3What were the water cooler musings? Several sources echoed one another. Much of it, dear reader, is old news for I have blogged about it previously. Nevertheless, here goes:

  • The Coyotes will be sold this month by the NHL.
  • The idea of 4 separate arena management contracts (you remember…hockey, entertainment, education and cleaning) still has legs and is not dead.
  • The general consensus is the Coyotes will be leaving Glendale as the city and the new team owner will not be able to come to mutually satisfactory terms on the arena lease management contract.
  • Or the other theory is that the team will stay in Glendale briefly (2-5 years) and then relocate.
  • This new council has no will to make the necessary and needed cuts over the next 4 years and likely will not sunset the temporary sales tax increase in 2017.

super bowlAll departments will struggle to come up with adequate funding to support the hosting of the 2015 Super Bowl in Glendale. Further diminishment of citizen services may be the only way to fund the costs.

 

 

 

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Apr 13

1

Who will be the gorilla?

Posted by Joyce Clark on April 1, 2013
Posted in City of Glendale • Glendale finances  | Tagged With: , , , | 1 Comment

budget 3The Glendale City Council typically meets in workshop session every two weeks on a Tuesday afternoon at 1:30PM. It is also televised on Glendale’s Channel 11, which only works if you have Cox cable service and live in Glendale. It is also available online at www.glendaleaz.com.

coins 1This is the busiest time of year for any city council as it decides where to allocate resources (revenues) for the coming year. Money in local government is power and each department fights to retain or grow its part of the pie(chart). It will be interesting to see who the gorillas are this year.

What can we expect this Tuesday? Several important items are up for discussion, some of which will be discussed inman money open session and some of which will be discussed in the non-public, executive session. First up in the open session will be the periodic legislative update. There should be discussion (I would hope) on the state’s attempt to take away cities’ construction sales tax. This issue is huge and if the state prevails, look for every city (including Glendale) to try to find ways to mitigate this loss which could be substantial.

firefighterNext up will be Council Items of Special Interest on the Police and Fire budgets. Making it to a workshopPoliceman agenda is interesting in and of itself. Last week Councilmember Chavira called for such a discussion and his suggestion met with deafening silence by the rest of Council. Yet here we are, a week later, and it has made its way to a workshop. Even more curious, at the previous council’s January 8, 2013 meeting, it was scheduled to vote approval to take actions to balance both department budgets. Instead a motion was made and approved by a majority of council (I was not one) to place all actions on hold until the appointment of a permanent city manager. There is no permanent city manager…yet…but like an unruly stepchild, the issue is before the new council. Hmmmm…

Then there are the six items listed on the council’s executive session agenda. Three of them are hot topics. One is consultation with the newly hired external auditor with a price tag of $200,000; another is that council is to give the contractCity Manager and City Attorney direction regarding arena management (don’t forget Beacon Sports’ fee of $100,000) and the Coyotes; and the last of the trio is to resolve the compensation package for the former City Attorney and I assume, the Acting City Attorney as well. The first two items deal with contracts and the third with personnel. All, unfortunately, are legitimate topics of private discussion.

It would be extraordinary if council resolved the Coyotes issue in Esession but, the NHL will first sell the team to whomever and then the council will decide if the Coyotes stay or go when it makes its decision about the arena management contract. Don’t expect any news on the Coyotes issue from Glendale today or anytime in the very near future.

On Monday, April 1, the city will host its first of two community meetings on the city budget. I plan to go and learn the “media line” that will be used to sell it to the community this year.

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Mar 13

27

Budget Class…day one

Posted by Joyce Clark on March 27, 2013
Posted in City Council Actions • City of Glendale • Glendale elected officials • Glendale finances  | Tagged With: , , , , | 2 Comments

man moneyThere were several take-aways from the March 27, 2013 Glendale City Council budget workshop. Perhaps the most important was the Executive Director of Finance, Ms. Sherry Schurhammer’s quote of the day, “we have an ongoing operational deficit.” I’m not sure what about that statement some councilmembers refuse to understand. It’s really quite simple. The city spends more money than it takes in.  It’s almost as if members of this council expect manna from heaven or a sugar daddy to appear as a means of solving the city’s financial problems. Let’s hope this council grows a backbone and accepts that cost of service cuts are needed. The latest proposal from staff shows major cuts of $8M not now but in Fiscal Year 2014-15 and another round of cuts in Fiscal Year 2016-17. Quite clearly putting off the necessary cuts merely compounds the deficit and makes the future cuts to citizen services and quality of life more drastic and more painful.

Coyotes logoAnother interesting take away is the fact that staff is using $6M as a placeholder for an arena lease management fee. At least there was acknowledgement that this figure is merely a place holder. The final fee could be higher, lower or stay the same.  Or is that a place holder for the Phoenix Monarch Group, the good friends of Councilmembers Alvarez and Chavira? There remains a residual “blame the Coyotes” mentality. The first slide up presented by staff showed the city with a $3.4M deficit if it had had to pay the $17M arena lease management fee this year. I think that deficit blame deserves to be placed elsewhere. How about the $2.5M to repay the Water & Sewer Funds, and also used to make the Risk Management Fund and the Workman’s Compensation Fund whole? Or how about the $2.2M of newly created expenses: a $200K audit, a $100K Beacon contract, $1.2M additional to the Fire Department; an additional $370K in legal fees, an additional $370K in water costs in the Parks & Recreation Department or the unknown amount in salary and benefits for the newly hired Interim City Manager? These big ticket items come to nearly $5M in new costs that were unbudgeted when the current budget was approved and they will have to be absorbed this year.

hidden agendaAnother take away is there is certainly no doubt about at least one councilmember’s agenda. CM Chavira is “carrying the water for Public Safety.” It was obvious that his friends from inside those departments, especially Fire (don’t forget he’s a Phoenix firefighter), had prepared a series of questions for him to ask.  He read them quite nicely. Later when he was asked if he had more questions and apparently had used all of his prepared questions, he seemed to be at a loss for words. Chances are they will have prepared a new set of questions for him to read at the April 2, 2013 council workshop on Public Safety.

PolicemanWhile Interim Police Chief Black answered his questions directly and provided a realistic assessment based upon the city’s current fiscal condition, we didn’t see the same level of cooperation from Fire Chief Burdick. There definitely is a further agenda occurring on the Fire side. We heard the first salvo today when the Chief said calls for service had grown. Well, Glendale’s population has not grown per Mr. Craig Johnson, Director of Water Services, when he said new water hookups are flat. Those people leaving Glendale are replaced by others moving in but not in large enough numbers to create an explosion of growth in Glendale. The city is already planning for the fact that as Glendale’s population remains static, it will lose some of its state shared revenue to other, growing NW and W Valley cities.

Red Firetruck with Ladder ClipartSo where are the increased calls for fire/emergency service coming from? Have you heard of Automatic Aid? It’s a regional and cooperative program among most Valley Fire departments. If there is a call for fire service in Phoenix, Avondale, etc., and their nearest truck is busy on another call, the nearest adjoining city department will respond. I would certainly want to know the number of calls for fire service Glendale responds to outside the city versus the number of calls for service within the city. The increase in calls for fire service may well be attributable to population growth in cities surrounding Glendale.  If that is the case and the increase in calls is the result of an increased need to respond to Automatic Aid calls that is not a Glendale driven problem. We are not mandated to grow service or pay for it in Glendale to accommodate surrounding cities. While Automatic Aid is great in fostering regional cooperation in cases of extreme regional emergencies and for creating cost efficiencies in the use of specialized services such as water or mountain rescue, I am not convinced that it works in the best interest of a city with a stable population base whose resources are being used by surrounding cities with burgeoning populations.

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Mar 13

25

What are they up to now?

Posted by Joyce Clark on March 25, 2013
Posted in Blogs • City Council Actions • City of Glendale • Glendale elected officials • Glendale finances  | Tagged With: , , , , | No Comments yet, please leave one

External Audit coming…

auditAt the Tuesday, March 26, 2013 City Council meeting an agenda item will be a vote of approval to hire Haralson, Miller, Pitt, Feldman & McAnally (HMPM), P.I.C., a law firm, to perform the special external audit this council has been craving. It doesn’t come cheap. The cost of this contract is $200,000. HMPM will subcontract out some of the work to Butler, FFG, and ESI. It is not clear from the staff report what would be the scope or responsibility of any of these firms. It is also not clear what their specialties are.

The costs per hour range from a high of $400.00 per hour for a principal to $100.00 per hour for a paralegal/law clerk.  Simple math shows that the number of hours billable for this contract range from 500 hours (about 12 ½ weeks) to 2,000 hours (about 50 weeks). This exercise could be completed in 3 months to a year. I think we can expect it to be completed this summer.

This is not a budgeted item and is not included in the current Fiscal Year 2012-13 adopted budget. That means that the money will have to be allocated from somewhere in the budget. Look for the payment of this contract to come from the $17M set aside for an arena lease management agreement. By the time this council’s agenda is met we won’t see much of the $17M left to pay anyone to manage the arena.

Bowers

Dick Bowers
Courtesy of
Linked In

A new Acting City Manager…

Expect at this same council meeting the hiring of Mr. Richard Bowers, former Scottsdale City Manager, as Glendale’s Interim City Manager until the search and hiring of a permanent city manager is completed.

A new Acting City Attorney…

Expect the council to approve Mr. Nick Depiazza, current Chief Deputy City Attorney, as the Interim City Attorney, until a permanent City Attorney is found and hired.

Budget meetings slated for this coming week…

On Wednesday, March 27, 2013 and Thursday, March 28, 2013, council will participate in two budget workshopsbudget 3 starting at 9am each day. This year’s budget workshop book is a hefty 284 pages of reading guaranteed to entertain and delight. Just crank up your printer, go to the Glendale website, find the agendas under the City Clerk’s page and you can print your very own copy just as I did. If you know where to look you will be able to spot the shifts in policy based upon where this council allocates available resources.

coins 1Still looming is how this council will address the loss of $22M in revenue currently being earned by the sales tax increase slated to sunset in 2017. The general feeling among council is that the city will have recovered by then and will easily absorb the $22M loss in sales tax revenue. There appears to be no will to be fiscally prudent and continue with cuts in anticipation of that loss of revenue. If they do not have the will to make gradual cuts each year for the next four years, they will be forced by circumstance to make draconian cuts in 2017. It’s very simple; karma catches up to you every time.

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Mar 13

22

Goldwater Institute: You may do what it says but not what it does

Posted by Joyce Clark on March 22, 2013
Posted in Blogs • City of Glendale • Glendale finances • Jobing.com arena  | Tagged With: , , , , | 5 Comments

GoldwaterBuilding

Courtesy of
Goldwater Institute

On March 14, 2013 the Center for Media and Democracy in conjunction with Arizona Working Families issued A Reporter’s Guide to the Goldwater Institute: What Citizens, Policymakers and Reporters Should Know. It can be found at this site:  http://www.prwatch.org/news/2013/03/12021/reporters-guide-goldwater-institute.

While I was serving on Glendale’s city council there were several lawsuits filed by the Goldwater Institute (GWI) against the city. The first dated back to June of 2009 and contended that the city was refusing to release documents relating to its negotiations with various entities wishing to purchase the Coyotes and to secure a lease management agreement. GWI felt every scrap of paper should be a public document. The final agreement was that the city would release all documents it felt would not harm its negotiating position and if that should be the case, a judge, in camera, would review them and make a final decision.

Then about two years later, in March of 2011, Goldwater having reviewed more than 1,000 of the city’s documents as a result of the previous court decision, filed suit to subvert the Hulsizer deal to buy the Coyotes. It contended that the city was offering a subsidy in violation of Arizona’s Gift Clause statute. There was never a decision in this case as the city and Hulsizer could not finalize a deal.

When this report was issued I was eager to read its findings. I suspect that the practices of GWI are not so different from other public policy non-profits whether they are liberal or conservative. These types of non-profits are often shielded by federal government regulations making it difficult to obtain a complete and accurate picture of their financial dealings.

I find that to be ironic. The same organization that sued the City of Glendale for a lack of transparency is habitually not so transparent itself. It seems they don’t mind letting the public know about some, not all, of their sources of funding but they certainly don’t want you to know too much about how they get their money or spend it.

Another irony is GWI’s persistent attack on only one sport venue in the state – Glendale’s Jobing.com Arena and its use by the Coyotes. Lord knows, there have been sweetheart deals aplenty with other sports venues. Yet Goldwater never raised an eyebrow. I have often wondered if the close relationship of some board members with the baseball industry was a motivator. Perhaps, in the minds of some, there are too many sports teams all competing for the same public discretionary dollar. Taking out a major sports team could benefit the remaining teams. When a team is weak, as the Coyotes have been for multiple years, that makes it a perfect target for elimination.

Briefly the findings of this report do highlight some questionable practices:

  •  The Goldwater Institute is a member of the American Legislative Exchange Council (ALEC). ALEC is funded by corporations and its sole purpose is to craft and advocate for bills favorable to big business interests exclusively. The relationship between these two organizations appears to be very, very close. Often the very issues that GWI is advocating for coincidentally happen to be part of ALEC’s agenda.
Darcy Olsen 2

Darcy Olsen
Courtesy of
Goldwater Institute

Clint-Bolick

Clint Bolick
Courtesy of
Goldwater Institute

  • Despite a very modest growth in GWI’s income it substantially raised its top executive’s salaries disproportionately to that growth in revenue. Darcy Olson’s Executive Director salary jumped from $180,000 to $268,000 by 2011; Clink Bolick’s Director of Litigation salary went from $126,000 in 2007 to $300,000 by 2011.

 

  • Up to $1.9M has been approved as a loan by the GWI board to one of its board members, Norman McClelland, a GWI founder and past president, for his private, for-profit company, Shamrock Farm Co Investing.
  • Goldwater claimed to the IRS in 2010 that it spent $0 on grassroots or direct lobbying. Yet is has two registered lobbyists, Starlee Rhoades, Vice President, and Lucy Caldwell, Communications Director. Gallagher & Kennedy, a Public Affairs firm, is representing GWI as an active lobbyist this year.
  • GWI does not publicly disclose its largest donors, although most public policy non-profits do.  A majority of GWI’s funding comes from and  its largest donors happen to be out-of-state foundations with specialized agendas.
Barry Goldwater

Barry Goldwater

Barry Goldwater  became the Institute’s namesake. Recently Susan Goldwater expressed public concerns in the media about the GWI by saying, “(W)hat he didn’t like was seeing it turn into a special interest, big-business lobbying group.” I suspect Barry Goldwater is rolling in his grave as he sees what the Institute has morphed into.

Perhaps this “big-business lobbying group” should add as an agenda item how it can advance the cause of big-business sports teams and their venues. After all, according to GWI, all big-business is good business.

 

 

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Mar 13

19

An addendum to “Saving grace”

Posted by Joyce Clark on March 19, 2013
Posted in Blogs • City of Glendale • Glendale elected officials • Glendale finances • Jobing.com arena  | Tagged With: , , , , , | 2 Comments

savingsIn my posting the other day, “Saving grace,” I talked about the $17M allocated and reserved in Glendale’s Fiscal Year 2013-14 Budget for Jobing.com Arena’s lease management agreement. I suggested that saving that $17M would be prudent by placing it in the city’s Unappropriated Contingency Fund. It should not be spent at this time. Then should there be a lease management agreement the first year’s funding would be available or if not used in that manner, it would fatten the city’s bottom line, an attractive strategy for lowering interest rates on the city’s bond indebtedness.

Well, apparently everyone – from city staff to the council – is already placing dibs on that money as evidenced by the March 19, 2013 City Council workshop.  Ms. Sherrybargaining 3 Schurhammer, Executive Director of Finance, offered many ways to spend it. Some of the expenditures include:

  1. Paying for the special, outside audit mandated by the new council.
  2. Paying for the consultant (read Beacon Sports and its special ties to the Reinsdorfs) to write and manage the RFP for the arena.
  3. Miscellaneous city department overages or unexpected expenses.
  4. Repaying loans made from the water and sewer funds.
  5. Paying for fund transfers to and from the Risk Management Trust Fund and the Workers’ Compensation Trust Fund.

Add to that staff wish list Mayor Weiers’ recent comment about raising employees’ salaries. Also add Councilmember Chavira’s plaintive call for a Special Council Workshop to consider the issue of Public Safety employees’ compensation and Councilmember Alvarez’ desire to restore or increase funding for youth and the poor.

If everyone’s desires are fulfilled, you can say good-bye to that $17M at the end of budget workshop discussions. Then where will the funding come from if (are you listening, God?) there ever is a successful contract for the arena and its management.

tax increaseI also heard the first tentative feelers being thrown out there publicly about Glendale’s property tax rates and the fact that revenues from that source continue to drop. Don’t be surprised if there is discussion (and possibly) adoption of higher property tax rates in Glendale.

 

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Mar 13

18

Saving grace

Posted by Joyce Clark on March 18, 2013
Posted in Blogs • City of Glendale • Glendale finances  | Tagged With: , , | 1 Comment

budget 3In a few weeks the Glendale City Council will begin a series of workshops to craft the Fiscal Year 2013-2014 budget. The temptation will be the unexpended $17M allocated for the Coyotes lease management agreement in the FY 2012-2013 budget and what to do with it. The temptation will be spend it now. I believe that is the worst move that this council could make.

On the March 19, 2013 City Council workshop one agenda item is The Fiscal Year 2012-2013 Financial Report Update and Fiscal Year 2013-2014 Revenue Projection.  The good news is that the temporary sales tax increase generated approximately $22M for Fiscal Year 2012-13. An insightful comment from the staff report states, “An analysis of spending habits in the community for these four months (Sept. to Dec. 2012) shows that the increase in the sales tax rate had no obvious impact on the spending pattern in the community.” All of those doomsday proclamations of “no one will shop in Glendale anymore” were flat out wrong. Shoppers, it seems, didn’t want to spend the extra money for gas to go further away or they simply did not want to leave their usual venues and venture outside their comfort zones.

Forget the Coyotes for a moment. The reason for the sales tax increase, ratified by the voters, remains the fact that the city spends more than it takes in. The Fiscal Year 2012-13 General Fund Budget is $155.3 million. Of that amount approximately $22 million (15%) comes from the increase in the sales tax rate that occurs each year over the next four years. What happens when the extra $22 million annual revenue from increased sales tax  is gone as it sunsets in 2017? That is the question.

There is a solution that began implementation in FY 2012-13 and that is a $5 million reduction in expendituresbudget cuts 1 each year from FY 2013 to FY 2017. If that course of action continues when the extra $22 million is gone in FY 2017 the city will not have to make any more draconian cuts. It will have a balanced budget whose expenditures are covered by existing revenues without having to dip into its contingency fund. The Glendale staff reports also states, ” Since the news sales tax rates are set to sunset in 2017, a long-term look at the city’s operational expenses must occur in order to plan for the eventual reduction of sales tax collections. The current financial position necessitates that the plan incorporate a phased approach and the FY 2013-14 budget will be a critical component of this plan.” In other words, get the job done and cut the city’s spending.

For the past six years during the worst of the recession, Glendale’s expenditures rose as its employee base grew and operating and maintenance costs also grew. Simply put, its expenditures have not met revenues. In the last two years, the city publicly acknowledged the problem and began laying off employees because quite simply, personnel costs represent about 70% of the General Funds’ expenses. That is the major expense and will require major cuts.

A city primarily produces one thing and one thing only – service to its residents. Yes, it produces one commodity as well, water, but that cost is borne by the people that use and pay for it. Service costs are built on two items: 1. buildings and equipment with their operating expenses and maintenance; and 2. employee wages and benefits. In the past several years, the former council purposefully began reducing personnel (wages and benefits) and  non-personnel expenses (operating and maintenance). The city has reached the point where non-personnel costs have been decimated and the only way to continue to cut them further is to reduce service areas or levels meaning that further personnel reductions will be necessary.

san_wrkr[1]Whether it is libraries, public safety or trash collection, they are all services offered to residents. The cost to provide services continues to outstrip the revenue the city takes in. The city must rein in the cost of services to have any hope of creating a balanced budget in FY 2017 when it loses the extra $22 million in annual revenue. The 2012 city council committed to the plan of cutting $5 million from the budget every year until 2017. To date the new council has been reluctant to follow through.

In an effort to avoid the pain of making another $5 million in cuts this coming fiscal year and each year for the next few years, this new council may consider the $17 million in this year’s budget as “found” money and spend every dime of it. Not a good idea. If they choose that course they are not solving the underlying problem of not enough revenue to cover costs. They are merely delaying the problem and compounding it. Saving the city’s money is not a foolhardy strategy but rather it is a grace to be nurtured and preserved.

savingsThe most prudent course of action is to place that $17 million in the city’s “rainy day” (unappropriated contingency) fund and to make the necessary $5 million in cuts this year. Increasing the city’s contingency fund is a signal that the bond market considers favorably and offers the city the opportunity to decrease interest rates even further on its current debt service load of $86 million (FY 2012-13). The debt service load is the annual amount paid in principle and interest on the city’s total debt.

Another reason to place the $17 million in contingency is that there may be another deal to keep the Coyotes in Glendale. Any deal will require a certain unknown amount as the annual lease manager fee. Having that money in reserve resolves the issue of where the fee is to come from.

A simplistic analogy is that you have a $1000 monthly mortgage payment but your income is only $900 a month. What do you do? I guess you could run up more debt on a credit card but that only delays and compounds your problem.  The best way to face the problem is to cut your monthly expenses.

Will this council do what you would do? Will it responsibility continue to cut its expenses over the next four years or will it spend “found” money now to avoid pain of making further, necessary cuts and delay the problem only to face a bigger problem in FY 2017?

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