FINANCE CONTROL BOARD, August 16, 2004
Conversations between Alan LeBovidge and members of the Springfield City Council
Morning Session: Present: Alan LeBovidge, Domenic Sarno, J. Wesley Miller, DoR press aid Tim Connolly, Vera O’Connor, members of the press
(J. Wesley Miller presents AL and others with a written critique of the MassMutual report and copies of two Methodist hymns: Integrity: Fortitude and Integrity: Courage, then leaves the room.)
No councilor is present to speak with AL until 10:16 when Rose-Marie Mazza Moriarity arrives. DS introduces her as vice-chair of the Council.
AL: The City Council should have a place at the table. It’s worthwhile to hear what they have to say. Our role is financial, not running the schools or the DPW.
DS: Other councilors are to arrive at 11:00.
RM: I wrote out my recommendations since writing is often easier for me since I have three young children.
AL: The questions the legislature is asking is “Can the City turn around financially? What are the problems? What will fix them? How long will it take?”
RM: We don’t want a receiver. Our new mayor could have tackled our problems; even during the campaign, Charlie Ryan knew things would have to be done differently. The Ryan administration is committed to change. Its cry for help from MassMutual and others was a way for Springfield to take ownership of solutions. I like MassMutual’s recommendations. Streamlining of services is important. We need to look in-house, then outside. Public safety is important in all neighborhoods; people are afraid that the firefighters or the ambulance may not get to them on time. Public safety needs more bodies.
AL: Public safety is an issue, numbers. Is the Police Department good, do certain things need to be changed?
RM: Both. The Chief’s hands are tied by union contracts allowing officers who have gotten promotions to select what shift they work, leaving some shifts understaffed. Community police is important; when we had it, people were more confident. Community police meant that the same officers were in a neighborhood on a regular basis; it was changed due to budget cuts.
DS: I get calls at home over the week-end. Community police did preventive work, heading off trouble, the “broken window” theory.
AL: Union mandates?
RM: Seniority gives officers the opportunity to work their preferred shifts. Manpower voids had been covered by cadets, but because academies have not been funded, we’re running out of people to work the less popular shifts.
DS: We have flex hours in the police department. Bad things happen during the second and third shifts which is where we are short.
RM: Firefighters are down from four-man crews to three-man crews although new housing development continues, adding to the potential workload.
AL: A 25% reduction.
RM: Sometimes if firefighters are needed, 2 trucks (6 ffs) are called whereas, 1 truck with four ffs could have done the job.
AL: Someplace there is a hole ($20million) in the budget. We must cut costs or raise revenue to close the gap. What would you do?
RM: It takes money to implement the MassMutual recommendations. I think we should go from issuing weekly paychecks to issuing bi-weekly paychecks; this will cut in half the time spent preparing payroll.
AL: Realistically, is there much in the way of cutting that can be done?
RM: Springfield couldn’t have cut $20million to make ends meet. What is our debt really? Remove the wage freeze, health insurance?
AL: Give me other areas.
RM: Health care, BUT we don’t want to harm our beneficiaries, especially retirees who have sustained increases of $100/month recently.
AL: A universal problem, the monster eating the world is health care cost. What is your view of the revenue source? What’s your sense of the real estate market, values? Are we collecting 100% of value?
RM: Values are going up. People are frustrated; they are paying more and getting less police and fire protection, street sweeping. Why does the assessor’s budget expend 100% of taxes when it is clear that 100% won’t be collected?
AL: Every community collects less than 100%. We have to face that we have deferred, but not eliminated liabilities (e.g. the wage freeze). Even if you defer from today, you’ll eventually hit the wall.
RM: We’ve done that for so long and have been lax in collection.
AL: Even if we do that, you only collect those back taxes once, then you have to live with flattened revenues in the future. What about trash fees or a parking fine hike?
RM: Parking fees have been done. I have a hard time with a trash fee; fees don’t disappear or go down once they have been instituted. I still might support one with a sunset provision after, say, three years.
AL: A school busing fee? What is your view?
RM: The problem comes in that this is an unfunded state mandate. We are a racially diverse city by and large, and our schools could be balanced without busing.
DS: Springfield schools are attended by children of whom 80% qualify for a free lunch. We’re rich in pride, but poor. Bonded indebtedness....(?) As for a trash fee: people expect the basics.
AL: I’m just trying to look at what other communities have done, e.g. Lowell, Lawrence, new Bedford. If you had to pick a couple of your [written] recommendations what would you do?
(Angelo Puppolo arrives.)
RM: The golf course restructuring has been done; they are now making money. The Retirement Board has been located in City Hall and only recently started paying rent and will soon be moving to the DPW building where they will pay $22,000 in rent. Mayor Ryan has been looking at other leases.
AL: Enforcing the codes with fines?
RM: The code enforcement department was short-staffed for years. Now staff has been added and unpaid fines will be attached to property tax indebtedness
Angelo Puppolo: We could amend the ordinance to go after past arrearages if you’ll fund a position.
RM: We now have a 30-day waiting period; it should be two weeks.
AL: What about paying high school kids to do inspections during vacations?
RM: People know when things get cleaned up. When it’s not done, frustration grows. Development is on-going.
AL: Any city has to provide safety and attractiveness to keep and attract residents. It’s a shame you need negative reinforcement. Springfield is 33 square miles in area. Other towns have instituted payment in lieu of taxes for not-for-profits...
RM: I’d be willing to talk about this. We need Baystate Medical Center.
AL: This is not a be all and end all. There is no silver bullet, but we need some sizeable bullets. You need an annual addition of $20 million forever.
(Tim Rooke arrives.)
RM: Restructuring the bond debt. We bonded when rates were high and should renegotiate.
AL: Let’s fix things before starting a costly new on-going program. For instance, building a bridge is a one-time project whereas a new entitlement program goes on forever.
DS introduces Tim Rooke and Angelo Puppolo.
AL: I’m here to listen. I’m more interested in ideas to fix things.
AP: Thanks for coming. I have some procedural questions. I’d like more notice of meetings. I read about it in the paper. For instance the City Council posts its agenda on Wednesday before its Monday meeting. There is also no provision for public input; I would like to see a ½ hour of public speak-out, even if statements are limited to topics on the control board’s agenda. As for this month’s budget: this is the last 1/12 budget? What is the City Council’s mechanism to have input? Public comments? Written comments?
AL: The Finance Control Board is different from the City Council. We don’t put out agendas. The tour last week was not a public meeting; in our minds, it was just an informational tour. If one person could come, everyone could come, and we would have had to hire a train. For us, it was a get-acquainted tour. Public meetings are open to all.
AP: The Finance Control Board must follow the Open Meeting Law.
AL: Public input can come in a separate meeting set just for listening. The committee meetings are set to do certain things.
AP: I hope that votes are not set before the meeting. I seek more give and take with the public before votes are taken that will effect them.
AL: The first two meetings were organizational. Input can be sought before votes.
RM: What about the advisory board named by Eric Kriss?
AL: Diversity and participation are important. We are open to suggestions as to names for the advisory board.
RM: Neighborhood groups have an interest in what is going on. For instance, the Library Study Committee was comprised of one representative from each neighborhood organization. As staff is hired, please consider Springfield residents. It is hard to recommend somebody for a job that isn’t posted.
AL: Posting is a good idea. Potential staff members need financial acumen, the ability to run the numbers. These are temporary jobs. You are right in saying that you do have to spend wisely to make money in the long run.
I think it is important to keep the City Council involved in financial matters. I would like the City Council to act as it did formerly, knowing that the Financial Control Board has veto power. DS and CVR will fairly represent City Council opinions. We have a job to do, and we have to move on things and report to the Secretary of Administration and Finance on whether this problem can be solved. We have to be able to tell him, “We think there is a plan in place to turn this around.”
AP: As long as there is an opportunity to have input, it’s OK.
AL: If we have an open discussion and DS or CVR don’t represent you accurately, I know we’ll hear about it. In terms of public safety (police and fire), we want rehiring if possible. I’ve talked to the Mayor about this. The state trust fund is a one-time thing. The important question to ask is “What can we sustain? How will it work out in ’06 or ’07?” The Mayor will have a recommendation.
DS: The City Council will be looking at the police.
AP: We need to bring in some fines as well.
Tim Rooke: Congratulations to your staff. You will need to make a report to the Secretary of A & F by September 1? You’ll probably come to the same conclusion we’ve come to: we need a formula change; the school bus mandating, repayment of the $30-60 million the state owes us. We’ve been paying, but the law says the state is to pay. I’m sure there are others. There is $14million in unused school building bonds sitting in a reserve account at the School Building Assistance Commission, bonds approved, but not sold. This money could be reassigned. This has been discussed with the Mayor. We overspent on school projects in the amount of about $20million; why doesn’t the school side pick this up?
AL: Massachusetts law says it’s this way. Any legislation can be changed, though.
TR: The Quinn Bill....
AL: These things may be valid, but they’re beyond our scope. The Quinn Bill is a legislative issue, not our issue. What about a trash fee? A school busing fee? IT revisions? The City is understaffed.
TR: Most steps we’ve taken came from the DoR report. I don’t think fee increases will solve this crisis. I think you’ll come to the conclusion that we need more money from Boston.
AL: Additional aid is a year-to-year thing. Maybe we’ll have to decide that there is nothing to be done. What’s your biggest cost? Personnel is 80% or so of your cost.
TR: The City side has reduced, but if the school side is cut, that doesn’t help the City.
AL: Our obligation on the school side has to do with efficiency.
RM: I hope you have informal conversations such as this with the School Committee.
AL: We will.
DS: Once you make your analysis....
AL: Everyone has to pitch in to solve the problem; all must agree. We want to make sure you are doing everything you unreasonably can. If we could fix it in 2 weeks and be out of here, we would.
TR: The more you review everything the better.
AL: Busing: is it necessary for Springfield? I’d like to talk to some experts. We might need to go to the legislature and the SJC to effect this. Is it needed? If not, what steps are needed to change? Those are big ticket numbers, but we don’t have the power to fix it. The Quinn Bill is way beyond what we can do. Maybe I’ll just call people one-on-one to get feedback. The City Council was elected by the people. (“What do you think, Tim?”) If you don’t have your finger on the pulse, they’d throw you out of office.
AL: I’ll ask to have the deadline pushed back. This is a multi-year project. We wouldn’t be doing our job if the bottom falls out in 2008. What are one-time fixes? What are multi-year fixes? I’ll feel good when we get all the information.
TR: We found out there was lots of money out there ($850,000 from the school department).
AL: Outstanding fines? That’s low-hanging fruit whether you outsource or do it yourself.
TR: Workers Comp needs to be more efficient.
AL: Everybody’s could be more efficient. Where would you be if you were #1 in the state? Citizens have a right to that.
TR: In the police, neither police officers not residents feel safe. I’d like to see $4million for police. I’ll support you 1000%.
AL: If people feel unsafe, it’s the death knell for the City. Every officer must be on the street. I’m glad we talked. Work on the 1/12 budget; see what you can do.
AP: This was very positive.
AL: I’m looking forward to working with you. The three steps in the budget process will be that the Mayor draws up the budget, the City Council reviews it, and then the Finance Control Board takes a look at it.
TR: MassMutual report has some great conclusions, but to implement it, we need bodies and money.
AL: This is a great use for the $52million seed money.
(End of morning session)
Afternoon Session, August 16, 2004
(The meeting was in progress)
Present: Alan LeBovidge, DoR press aid Tim Connolly, Jose Tosado, Bill Foley, Judy Matt
JT makes a pitch for more state money for schools, cites Step Up Springfield.
AL: Where do you redeploy money in the school system? Why does interest on school construction and school busing come from the general fund?
We talked this morning about the need for police and fire, about how people have to feel safe and that the citizens are for Springfield.
My commute is 2 hours to get out here from my home near the New Hampshire border, compared to the 1½ hours it can take me to get to work [in Boston]. It takes Phil Puccia only a hour and a half to get here from North Andover. Springfield has a lot of potential for growth.
The MassMutual report won’t bring in $20million. We have to answer to the Secretary of A & F as to whether Springfield’s problems can be solved. The wage freeze is a deferral which grows by $2.1million annually. What do we do today so that, at the end of some time frame, the problem is solved?
BF: Many of us felt this wasn’t necessary. Certain areas were being investigated; the Mayor wasn’t going ahead with increases, savings in three areas: 2000 retirees and spouses who qualify for social security to cover 80% of their health care, a 25/75 split [for health care co-pays?] which has been increased resulting in some savings, a trash pick-up fee (but what would happen when some refuse to pay?).
Most mayors were successful in convincing the State that Springfield takes care of all the problems not met by the suburbs, such as deinstitutionalization, homelessness, the poverty issue. (We have 25,000 people below the poverty level.) Mayors I’ve served under [names them] have been successful in getting money from the state. I’m not sure how much we can turn around like Boston or Worcester. We’ve had luck with Baystate Medical Center, Mercy Hospital and telecommunications, but I don’t know if there is a home run here. Code enforcement and the City Clerk have raised fees. We’ve always survived, but this is a poor town.
AL: As a worst case example, what if no one is going to help you from the outside. What would you do then? On the assumption you wouldn’t get more?
BF: If they’re not going to help us, they’re not going to mandate us. The superintendent should be able to control more of the dollars. If you are asking us to turn it around ourselves, I don’t have an answer for you. Let the suburbs take their fair share of the problems: gangs, deinstitutionalized people. Someone has the obligation to help us. I don’t see us being able to do that without help.
AL: If there were no busing and no school building interest coming from the general fund, I don’t know if anyone is coming to your defense.
JT: Statewide DYS placements cost us service dollars, but we are not reimbursed. Springfield is inundated with specialty-type programs.
AL: In the crudest terms, with no outside support, you’d say, “Send those kids back”? Are you guys happy with the level of service per dollar from police, fire, the highway department?
BF: The Mayor made a mistake by hiring cops with no long-term funding in place. The traditional size of our force is 390 patrolmen. I’m satisfied with work done by the police and fire departments. As for the DPW, we’re an old city, always way behind in fixing the pipes. We can raise $150million on our own. It’s important for you to emphasize to Eric Kriss and Governor Romney that the urban experience is different form the suburban experience. We lost lottery money.
If we’re taking care of the poor, educating these children who speak many foreign languages, our additional aid it too low. It is not fair; we never turn people away. We operate 4 or 5 home care shelters, and we get more people daily. If people would share the burden with us, we wouldn’t be in trouble.
AL: It is the same story with Worcester, new Bedford, Fall River, Lawrence. What can we do here? Come up with a plan that shows a trend of comeback. Hopefully, we think we can come up with a plan. This morning I suggested a trash fee, a school busing feel. At some point it is the residents’ problem.
BF: I thought we could have done it on our own. Under Plan A, Mayor Ryan thought this was the best approach.
AL: Tell me the top three things you could have done.
BF: 1) Increase the co-pay, 2) shift to plan B, 3) make some departments self-sufficient 4) trash fees would raise $3million. Not all together would raise $20million and delay of salary increases. Mayors have been successful in convincing the legislature that we deserve special attention. In 1989, our situation was worse than it is today. I don’t think we’re starting from rock bottom.
JT: We’ve all worked together on the Council on this. We get a good bang for our buck from the police and fire; they do a fantastic job. The police commission has been taking on the whole issue of sick time. We are in a crisis level here in terms of safety. We are hiring a minority for each non-minority hired. I am also concerned about the lack of racial and gender diversity on the Finance Control Board; the executive director is also a white man with an issue of gender and racial bias in his background. Springfield is very diverse. I hope that diversity is seen as a value.
AL: Diversity is great; I believe and understand that. For Phil, I went for the best person I could find; he wasn’t convicted of anything. We needed to hit the ground running. We’re not making a lot of money on this.
All of us want the City to succeed. We don’t want the City to go into receivership. Even if you use the whole state trust fund, it is a loan, not a grant. We need an analysis that results in pay-back of this loan.
JT: If you can get us onto sound financial ground, that’s what we want. I had thought the control board would use City expertise to carry forward the resources of the board.
AL: You’re operating on a thin, shallow basis in the Assessor’s office and Mary T.’s office. Who will collect back taxes and fines with no staff? I don’t see the bodies to get in there and do the work. You’re walking a thin line of productivity. I’d love to hire all staff from Springfield. It does take Phil a certain start-up time; give us a month. I’m counting on you guys to have constructive, real input into the process.
JT: We want to work with you, because this is our City. Diversity needs to be seen as important.
(Russ Denver and Jeff Guifreda from the Chamber of Commerce enter and introduce themselves. Judy Matt introduces herself and gives her card to AL.)
AL: I have no control over the legislature. I figure we have to do it ourselves.