Indiana State Budget
I spent most of June on vacation and so I have not been posting in June. My family just got back from a 19 day trip to Europe late last night…
Both the Democrats and Republicans in the Indiana legislature have completely failed in their primary duty this year; to pass a two year state budget. It was so bad that legislators were called into a special session since they completely failed to pass a budget during the regular session.
This disaster is the fault of both Republicans and Democrats; however, I stand with Mitch Daniels and the Republicans and support their budget rather than the budget proposed by Democrats.
I have read everything I could find on this year’s budget standoff and it looks to me like there were three major differences between the two parties:
1. Mitch Daniels and the Republicans wanted to keep a rainy day fund in place with a minimum of one billion dollars while the Democrats wanted to spend more of the rainy day fund. One billion dollars is really a pitiful rainy day fund since it amounts to less than one months of Indiana’s operating expenses and I certainly stand with the Republicans on this one.
2. School funding. The Democrats want to spend more money on education. I have two kids in the public school system and I think we need a strong education system; however, we cannot afford to increase education spending at this time. The Republicans and MItch Daniels have supported little to no increases in K-12 school funding.
3. The Democrats support the archaic school funding formula that has been used for a long time in Indiana. This formula benefits schools that are in urban areas and schools that are actually shrinking. The current school funding formula is absurd and should be abolished. The Republicans want to change the formula so that school funding is more evenly distributed. I would like to see the Republicans go even further; I think the state should give a set amount per student; period. Right now NACS gets the lowest amount per pupil in the state. I think that the state should pay a flat amount per student per year.
It is truly pathetic that our state could not get a budget passed without a special session.
Mike Sylvester
Mayoral Announcement on Renaissance Square
You can read the full press release here if you desire, but let’s take a look at a couple of quotes from the release:
“We explored all the options,” observed Henry. “Our space needs demand action. 200 East Berry Street represents a unique and inclusive solution, a one-of-a-kind opportunity that will allow us to bring together all city departments and make the best use of our resources. The time is right. The price is right. And the long-term benefits for both the city and county are outstanding.”
The price is right? Hmmm…
The economics of the opportunity make it a highly desirable deal with all financial projections supporting it. The building will be purchased for $7.3 million from Renaissance Square, LLC. Renovations and furnishings will add approximately $7.2 million to the budget for a total cost of $14.5 million. The purchase funds will come from County Economic Development Income Tax dollars.
By any chance did we offer less than $7.3 million? Was this the same crack-staff that negotiated the Harrison Square deal? And using CEDIT dollars for this? Is that really the best course of action here?
The administration is using a potential $500k/year in cost savings to justify the purchase but even if you believe those numbers would it not be even better to pay less than $7.3 million? It’s not like the building has been a real hot commodity…
Quick Thought
Maybe the Harrison Square “catalyst” will ultimately be found in driving the size of local government so large that it can occupy all the vacant downtown office space…
The Renaissance Square Fix is in Bubba - Again…
It looks like the mayor is hell bent on wasting millions of taxpayer dollars on Renaissance Square. From a local paper’s editorial:
City Controller Pat Roller said the administration will be introducing a proposal to Fort Wayne City Council on Tuesday. In addition to the city departments now in the City-County Building, city police would also move into Renaissance Square.
Roller said, “It’s the economics of the deal” that make moving the city to the building a better option now. She said under the previous plan the city would have had to reimburse the county for space at the City-County Building as well as make payments for the purchase of Renaissance Square.
“This way we just have to pay debt service, and then we own the building after 20 years,” Roller said. She also said the purchase price has gone down. The average of two appraisals on the building is $7.3 million.
So let me make sure I get this straight. Instead of renegotiating our lease with the County we’re going to buy and renovate a different building. We’re also going to pull the police station out of the Renaissance Pointe neighborhood which will most certainly hasten it’s demise. We’re also not going to use any of our $20 million surplus to buy the building - instead we’re going to finance it over 20 years and pay an enormous amount of interest. And to top it all off we are going to grossly overpay for said building.
Any appraiser that says that building is worth $7.3 million is either incompetent or on the take if you ask me. The county’s appraisal came in just over $1 million and the deputy mayor himself said that the $7 million figure was a non-starter. So what’s changed? That building has been empty for years with no private tenants. In this market it is essentially worthless - by that I mean it is worth whatever the scrap value is or perhaps 2x that.
In fact, the county assessor has assessed the value at $1.1 million for the last 6 years. But now we’re to believe it’s worth $7 million? Personally I don’t think the city should move from the current city-county building, and I definitely don’t think the police should move from their current headquarters. But even if they did want to consolidate they shouldn’t pay more than a couple million for a building and they should pay cash. Now is not the time for the city to be taking on unnecessary burdens of debt.
And what’s the rush anyway? Do they think somebody else is going to buy the building? Why not wait until they see the city’s finances over the next couple of years before taking on any major projects like this? The best thing for citizens to do at this point is to contact your local council member (citycouncil@cityoffortwayne.org) and let them know that you don’t support the city spending tens of millions of dollars when our current financial situation is so uncertain.
Woodlan Junior-Senior High Moves to Fort Wayne?
Tonights News-Sentinel has an article about Fort Wayne being a finalist in the All-America City competition this week in Florida. One paragraph states that Sheena Tracy and Cheyenne Hale will be presenting Fort Wayne’s “engagement of youth” activities by talking about a program, “Thinking Errors” which the article says is at Woodlan Junior-Senior High School. When I last looked, this high school is in the East Allen County School system and is not located in Fort Wayne.
I guess that our schools in Fort Wayne, including FWCS plus our non-public schools, are not involved in any youth engagement activities. ( This is one of the three areas that a city has to be active in to qualify for the award).
So what does this say about Fort Wayne? Doesn’t our city government know that we do not have unigov in Allen County? There are youth engaging activities in our city- but they do not involve any governmental funtions and I guess therefore out mayor has no pride in them. That’s the “not-invented-here” syndrome in action!
As Expected California Begs for a Bailout
As I wrote previously, California is completely broke and staring down the barrel of a $24 billion budget shortfall. Here’s what I thought about the state asking for a bailout:
At some point they are going to have to realize that the size of their government is unsustainable. They must make severe cuts and build their cash reserves back up. You cannot mortgage yourself into prosperity
[...]
Of course that is unless Uncle Sam decides to bail them out which I’m sure is what they’re hoping for. I don’t know about you but I don’t want my tax dollars going to help a bunch of delusional and irresponsible legislators.
Well, it sure didn’t take long did it?
Top state officials have gone hat in hand to the administration, armed with dire warnings of a fast-approaching “fiscal meltdown” caused by a budget shortfall.
[...]
With an economy larger than Canada’s or Brazil’s, the state is too big to fail, California officials urge.
[...]
But federal officials are worried that a bailout of California would set off a cascade of demands from other states.
Here it comes. Another massive bailout for people who certainly don’t deserve it. The federal government should not subsidize California’s largesses. They are in the position they are in because they refuse to deal with reality and they have no concept of money or basic economics. Of course neither did the major banks and we bailed their sorry asses out.
Which is more likely?
- California legislators show they have half-a-brain and balance their budget through appropriate spending cuts
- Uncle Sam bails them out
I hope I’m wrong but if I were a gambling man I know where I’d put my money…
Councilman Tim Pape Jumps The Shark
I realize councilman Pape is probably getting more upset by the day watching his government-utopia dream fall by the wayside - The Harrison, Renaissance Pointe, Public Safety Academy, etc. Nobody likes to hear “I told you so” but his rhetoric against accountability is ridiculous. Here was his reaction to the city council asking for an updated report on the Harrison Square project’s expenditures:
Councilman Tim Pape, D-5th, said he was concerned with opponents to the project simply using this as another chance to criticize it. Pape, one of the more vocal supporters of Harrison Square on council, said he understands the project deserves public scrutiny, but said council members could have received all this information on their own had they simply asked.
Surely he’s not suggesting that council should be privy to the information but the public shouldn’t?
Pape said opponents have hammered on Harrison Square by saying they are looking out for the public good, but they have offered little scrutiny of any other project, such as the redevelopment of Southtown Mall. He said continued criticism discourages private developers who might be interested in investing in the city.
This one actually made me laugh out loud. Does councilman Pape not see the difference in the level of expenditure between Southtown and Harrison Square. Should HS not receive more oversight due to the larger investment? Really? And as for discouraging private investors, why would they be discouraged? The precedent has been set - they can come in, promise the world, deliver nothing and people like Pape will continue to support them no matter how much money they loot from the taxpayers. Doesn’t sound like much to be discouraged about to me.
“I hope the electorate sees what’s happening and votes these people out.”
Yes, I too hope the public sees that the majority of council would like to have $60+ million worth of expenditures accounted for. I guess Pape thinks a slap on the back and “Heckuva job Brownie” will suffice but the rest of us might want a tad more. In fact, where is the report from the city audit department? If they aren’t going to audit a project of this size then what good are they? Something to keep in mind come city budget cut time.
If anyone deserves to be voted out it’s those that have turned a blind eye towards the city’s negligence in enforcing their own contractual agreements…
How are we doing on $235,000 funding of Stadium Maint.Fund
With 35 home games out of the scheduled 70 for the Tin Caps at Parkview Field for the 2009 season, an update of the attendance is in order to see if addition taxpayer money may be required to meet the city responsibility to the annual addition to the Stadium Maintenance Fund.
Note that attendee’s not to be included in the total are all free or reduced fee ticketed youths. Announced free tickets to date include 9500 school kids on the Wednesday games before the end of the school year. There are others, but the quantity has not been given - this includes tickets to media, visiting team officials, discounted tickets for fund-raisers, employees, game day performance personnel, and any ticket used by Major League or Minor League Baseball personnel.
April - 8 games total attendance = 35,846 Of this 4500 were free student attendees on 4/22/09.
So net April attendance was 31,346 for a 3,918 per game average.
May - 17 games total attendance = 78,570 Of this total 5000 were free student attendees on 5/6/09
So net May attendance was 73,570 for a 4,327 per game average.
And then, YTD total = 114,416 less the 9500 free ones = 104,916 for 25 games - for a 4,197 average
June up to 6/13/09 10 games total attendance = 48,579 - average for first 10 games in May = 4858/gm
And for the first 35 games in 2009 (one half of the 70 game home season) - total attendance = 162,995 less the 9,500 is a net of 153,495 or an average of 4386 per game
Assuming these averages will hold for the last 35 games, this will result in a total of 70 times 4,386 = 307,020 attendees for the season. This will result in Hardball paying, at $1.00 per attendee over 275,000, of $32,020 to the city. Per the Stadium License Agreement, all of this goes into the Stadium Maintenance Fund. With the one half of the “naming rights” payment of $300,000($150,000) for 2009 this fund will have a total of $182,020 in it. Per the Stadium License Agreement, the city will annually pay $325,000 into this fund. (In addition, the city has agreed to pay for all utilities for the stadium).
This means that the Tin Caps will have to have OVER 80,000 total fans attend the remaining 35 games for the $1.00 per attendee overage to just pay the $325,000 into the maintenance fund - or they will have to average 1,371 MORE per game in the second half than they did for the first!
THAT MEANS AN AVERAGE OF 6,757 for the last 35 games - just to break even! Only 4 games of the first 35 exceeded that average and I have not yet found out if the Girl Scouts last Friday night received discounted tickets so that total may be one less, since those tickets may not count.
And even more will be required to pay fror the natural gas, electricity, water and sewage costs at one attendee per dollar available.
Oh, and by the way, the Stadium License Agreement specifies that the only concession income that the city gets is 10 % of the profit at CITY SPONSORED EVENTS!
It’s a great ballpark, but the sales-job our city council got before approval, is very, very suspect!! As has been expressed by a few of our present council, most - if not all - of the net income from downtown baseball is going to Atlanta, Georgia!!!
California - Broke as a Joke
Just when I thought it couldn’t get worse than the clowns that make up our state legislature, I read up on the nonsense going on in California and realize that we have it pretty good. California is near bankrupt. They are facing a $24 BILLION budget deficit this year and if they don’t pass a budget that shores up their financial position they will be dead broke in less than 50 days.
At that point the entire government will cease to operate. I imagine that the governor will shut down everything but non-essential services before that happens to make sure the most basic services (police, fire, etc) still have the money to operate. Part of the problem is that California requires a 2/3 vote of the legislature to pass a budget so minority members can typically stonewall the whole process. But I don’t think that’s the biggest problem right now.
Believe it or not, legislators whose state is already the highest taxed in the country are actually considering raising taxes to make up the shortfall. Property values have plummeted by 50% in many parts of the state and unemployment is in double digits and they are going to raise taxes? Unbelievable.
At some point they are going to have to realize that the size of their government is unsustainable. They must make severe cuts and build their cash reserves back up. You cannot mortgage yourself into prosperity - although the majority of Californians tried during the housing bubble. There really is no other option for California government as nobody is going to give them a loan without the interest rate being so high as to make it not affordable - the equivalent of continuously taking “loans” from the corner check cashing store.
Of course that is unless Uncle Sam decides to bail them out which I’m sure is what they’re hoping for. I don’t know about you but I don’t want my tax dollars going to help a bunch of delusional and irresponsible legislators. I think the best option is for the state to fully and completely legalize marijuana…
Spokane To Imitate Fort Wayne’s Six Sigma “Success”
Spokane, Washington has decided to incorporate common sense
lean six sigma processes into local government. Their model is none other than local government right here in Fort Wayne:
For those skeptical that Lean Six Sigma can work for city government, advocates love to point to Fort Wayne, Indiana.
When Graham Richard became Fort Wayne’s mayor in 2000, the city was wary of this “Six Sigma” thing he kept talking about. But soon he was the toast of national efficiency experts, an author of a book on the subject and featured in US Mayor magazine.
Over the past decade, 300 Fort Wayne employees were given Lean Six Sigma training.
“We saw savings of over $10 million specifically attributed to the Lean Six Sigma processes,” former Fort Wayne finance director Ryan Chasey says. “Keep in mind that our Six Sigma efforts were not fully geared toward cost-saving, they were also geared toward service improvement.”
Of course to this day I have never seen a detailed analysis showing the so-called $10 million in savings. And this type of hand-waving savings isn’t just indicative of what goes on here - it’s endemic in the entire six sigma initiative. I believe quality initiatives have their place in mass manufacturing environments but that’s not local government. I do not believe anything Fort Wayne has done via Six Sigma processes couldn’t have been accomplished through common sense and competent management.
If nothing else, the people of Spokane got to read part of my view on Fort Wayne’s Six Sigma initiatives. From the article:
Meanwhile, Fort Wayne aerospace scientist Jeff Pruitt, who also blogs at fortwaynepolitics.com, says Spokane’s program should have more accountability than Fort Wayne’s.
“I see [Lean Six Sigma] as a path to give money to more consultants to waste taxpayer money,” Pruitt says “There needs to be some up-front outline of what the program intends to accomplish.”
I think the High Performance Looting Government Network was a prime example of this…
