John Nephew
Maplewood City Council Policy & Politics
Thursday, August 26, 2010
Thursday, July 29, 2010
Why did the Accident Victim Cross the Road?
Our neighbors in North Saint Paul have passed a new ordinance charging "a $350 fee for non-residents who require emergency services in the city following a car accident," reports the Maplewood Review. On some of our border streets, will this mean whether or not you are billed the fee depends on if you were in the eastbound or westbound lane? (And if you have a choice of which side of the road to pull over to, should this influence your decision?)
In any case, expect to see more things like this in cities all over the state, as they try to hold down property taxes while recovering from the hit-and-run of past LGA/MVHC unallotments and trying to scramble out of the way of the semi-trailer of future state budget woes that is still barreling down the fiscal highway.
In any case, expect to see more things like this in cities all over the state, as they try to hold down property taxes while recovering from the hit-and-run of past LGA/MVHC unallotments and trying to scramble out of the way of the semi-trailer of future state budget woes that is still barreling down the fiscal highway.
Labels: finance, media, public safety
Wednesday, July 28, 2010
2010 Home Value Changes
Earlier this year, our city manager passed along a document from Ramsey County with statistics on the changes in single family home estimated market values in cities across the county, comparing 2010 to 2009.
For Maplewood, those changes are:
This graph provides an easy glance at the distribution of value changes:
For Maplewood, those changes are:
| -50% or LESS | 2 |
| -40% to-50% | 1 |
| -30% to -40% | 2 |
| -20% to -30% | 131 |
| -10% to -20% | 1,982 |
| 0% to -10% | 5,150 |
| 0 | 1,496 |
| 0% - 10% | 30 |
| 10% - 20% | 9 |
| 20% - 30% | 2 |
| 30% - 40% | 1 |
| 40% - 50% | 0 |
| 50% or More | 1 |
This graph provides an easy glance at the distribution of value changes:
Labels: finance
Tuesday, July 27, 2010
Gerten Pond
The 2009-2013 and 2010-2014 Capital Improvement Plans both include a project called "Gerten Pond Draining Improvements." The 2009-2013 plan anticipated the project in 2011-2012; the next CIP moved it back to 2012-2013. The project was described as follows:
I was pleased to see the recent eNewsletter from Congresswoman Betty McCollum report that our city's request for funding was included a bill approved by the the House Interior and Environment Appropriations Subcommittee, of which she is a member. Her newsletter reports,
A trunk drainage pipe collects upstream runoff and runs under Hwy 36 and outlets into Gerten Pond. This trunk drainage pipe backs up at times into surrounding commercial property and highway ditches between Gervais Ave and Hwy 36. An overall draining study should be conducted in order to identify deficiencies and then make the necessary improvements.In this year's draft CIP, the project no longer is a stand-alone item, but has been incorporated into the Highway 36/English interchange improvements.
I was pleased to see the recent eNewsletter from Congresswoman Betty McCollum report that our city's request for funding was included a bill approved by the the House Interior and Environment Appropriations Subcommittee, of which she is a member. Her newsletter reports,
City of Maplewood: Gerten Pond Improvements - $1,000,000. A major urban body of water, the Gerten Pond serves a large industrial and residential area in Maplewood, Minnesota. The requested funding will support improvements, drainage system revisions, and local environmental improvements to enhance the efficiency of storm water sewers.While the appropriations process has a long way to go and the outcome is not guaranteed, it's great news to have a chance at federal funding for this important project. Congratulations and thanks to Mayor Rossbach and City Manager Antonen, who brought this funding request to Washington earlier this year when they attended the National League of Cities conference, and of course thanks to Rep. McCollum as well.
Labels: finance, public works
Sunday, July 25, 2010
CIP Confusion and the Gladstone Savannah
I've been watching the replay of this past week's Parks Commission meeting, in which they voted against endorsing the proposed 2011-2015 Capital Improvement Plan. Unfortunately, there seems to be a persistent confusion through the meeting about how the CIP works.
For example, one concern was the proposed spending of Park Availability Charge funds on the Gladstone Savannah. A report to the City Council summarizing the Parks Commission concerns states, “The Parks and Recreation also made a motion to fund additional projects by cutting back on the Gladstone project and all non-Gladstone PAC fees be redirected to the unfunded projects identified.”
For years, the CIP has included seemingly imminent spending on the Gladstone Savannah. But very little if any has actually been spent. Here's how the project finances were described in the four most recent CIPs:
The reason is simple. The proposed Gladstone Savannah improvements have been and remain contingent upon there actually being development moving forward in the neighborhood. Every year it seems like that might finally happen (some approvals related to the latest effort are on our agenda for Monday), and so the related parks expenditures are included in the CIP for the next year. And so far, the development has failed to materialize. With no development, and no related PAC money, the Savannah improvements keep getting pushed off into the future. Each year the details change a little bit according to whatever is the current plan in the works (will it be assessed in part to a developer? will it include stormwater management features? etc.).
While respecting and agreeing with the intent of the Parks Commission, it appears that they are asking the city to do exactly what this CIP does in practice, just as the past CIPs have done. Without development in the neighborhood, there isn't money for the Savannah; but that doesn't mean there's any funding freed up for any of the other unfunded priorities in the park system. I don't see that there are any "non-Gladstone PAC fees" here to be redirected to other projects.
Moreover, note that the amount of projected funding coming from the Park Development Fund drops from $1.5 million in 2008-2012; to $1.3 million in 2010-2014; and now to $1.1 million in 2011-2015. So besides implicitly waiting for local PAC fees to be generated by development, just like past CIPs, this draft CIP proposes using $400,000 less from the Parks fund as well.
For example, one concern was the proposed spending of Park Availability Charge funds on the Gladstone Savannah. A report to the City Council summarizing the Parks Commission concerns states, “The Parks and Recreation also made a motion to fund additional projects by cutting back on the Gladstone project and all non-Gladstone PAC fees be redirected to the unfunded projects identified.”
For years, the CIP has included seemingly imminent spending on the Gladstone Savannah. But very little if any has actually been spent. Here's how the project finances were described in the four most recent CIPs:
- 2008-2012 CIP, p. 73: $900,000 to be spent in 2008; $100,000 in 2010; $500,000 in 2011; for $1.5 million total. All funds are identified as coming from the Park Development Fund.
- 2009-2013 CIP, p. 69: This page seems to be erroneous – it reports $900,000 spent in prior years (which I don't think is true); $100,000 in 2010; $500,000 in 2011. Again, all funds are listed as coming from the Park Development Fund, with a total of $1.5 million across the CIP years. I'm guessing that the intent was just to move all the same figures a year forward instead.
- 2010-2014 CIP, p. 65: This CIP listed prior year expenditures as $80,000 total. It also identifies a second funding sources: Special Assessment bonds (which were expected to be part of a redevelopment plan on the Tourist Cabins site) in addition to the Park Development Fund. Half of the prior year expenditures ($40,000 each) was to be allocated to each funding source. For 2010, we were supposedly going to spend $920,000 on the Savannah, half from the Park fund and half from Special Assessments. In 2012, $400,000 from park funds was identified; and again $400,000 in 2014. The grand total for the project in this CIP: $1.8 million.
- 2011-2015 Draft CIP, p. 61: The prior year expenditures have dropped to zero, but a third funding source — the Environmental Utility Fund (which is used for stormwater management) has been added. 2011 expenditures are listed as $1.2 million total: $200,000 from the EUF; $400,000 from Special Assessment bonds; $600,000 from the Park Development Fund. The future expenditures from the Park Development Fund are reduced to $250,000 in 2013 and $250,000 in 2015. As a result of those reductions (and the disappearing prior year expenditures), the grand total for the project in this CIP is lower, at $1.7 million.
The reason is simple. The proposed Gladstone Savannah improvements have been and remain contingent upon there actually being development moving forward in the neighborhood. Every year it seems like that might finally happen (some approvals related to the latest effort are on our agenda for Monday), and so the related parks expenditures are included in the CIP for the next year. And so far, the development has failed to materialize. With no development, and no related PAC money, the Savannah improvements keep getting pushed off into the future. Each year the details change a little bit according to whatever is the current plan in the works (will it be assessed in part to a developer? will it include stormwater management features? etc.).
While respecting and agreeing with the intent of the Parks Commission, it appears that they are asking the city to do exactly what this CIP does in practice, just as the past CIPs have done. Without development in the neighborhood, there isn't money for the Savannah; but that doesn't mean there's any funding freed up for any of the other unfunded priorities in the park system. I don't see that there are any "non-Gladstone PAC fees" here to be redirected to other projects.
Moreover, note that the amount of projected funding coming from the Park Development Fund drops from $1.5 million in 2008-2012; to $1.3 million in 2010-2014; and now to $1.1 million in 2011-2015. So besides implicitly waiting for local PAC fees to be generated by development, just like past CIPs, this draft CIP proposes using $400,000 less from the Parks fund as well.
Monday, July 19, 2010
Maplewood, pop. 37,755
The official population estimates for 2009 are in from the Met Council. Maplewood is estimated to have a population of 37,755 and 15,094 households, compared to 35,258 and 13,758 in the 2000 census. State law requires the Met Council to generate these estimates each year. Results from the 2010 census are expected in February or March of next year.
Labels: development, finance
Saturday, July 17, 2010
Home Foreclosure Scams
One side issue of the home foreclosure crisis in Minnesota has been a huge increase in loan modification scams. Reports of these scams to the Federal Trade Commission rocketed from just one in 2008 to nearly 8,000 the following year. Many people are aware that there are legitimate programs to help people who get behind on their mortgages or are "under water," and scam artists often prey on people by appearing to be legitimate.A coalition of businesses, nonprofits, and government have developed a campaign called "Look Before You Leap" to educate consumers, help them identify fraudulent offers, and connect them with legitimate loan modification and credit counseling resources.
The Star Tribune recently ran a story about the campaign and loan modification scams.
Labels: finance, media, public safety
Wednesday, July 14, 2010
A Problem for PACE
Last month I referenced the energy improvements financing program that was included in legislation passed this year. Such programs are often referred to as PACE, for "Property Assessed Clean Energy."
Unfortunately, these programs have encountered a snag: The Federal Housing Finance Agency, which oversees entities such as Fannie Mae, issued a statement on July 6 about the impact of such programs on mortgage lending. The problem, in brief, is that PACE programs dictate that the loans for energy improvements become senior liens on the real estate — meaning they have a higher priority than the mortgage lender in terms of being paid in case of a foreclosure. As you may have heard, a lot of mortgage lenders have been facing some difficulties in the past few years (to put it mildly), and FHFA is concerned that PACE programs increase the risk to lenders.
The result is a set of new restrictions on the entities that FHFA regulates. As one local official from Colorado quoted in The Wall Street Journal puts it, "They're basically saying they'll redline communities that move forward with PACE financing." One of the steps being required, for example, is "Adjusting loan-to-value ratios to reflect the maximum permissible PACE loan amount available to borrowers in PACE jurisdictions" — effectively meaning that if you buy a house in a city where PACE loans are available, you'll have to make a larger down payment to account for the possibility that you might take out such a loan.
As I understand it, Minnesota's PACE program is not yet set up. This new wrinkle may delay and alter its implementation, and may also hurt its appeal if the result is for loans not to be senior liens (which would mean more risk for the local governments implementing the program).
(h/t to City Mgr. Antonen for providing a copy of the FHFA statement and a link to the WSJ article to the City Council.)
Postscript: According to an AP article this evening, the California Attorney General is suing FHFA over its decision.
Unfortunately, these programs have encountered a snag: The Federal Housing Finance Agency, which oversees entities such as Fannie Mae, issued a statement on July 6 about the impact of such programs on mortgage lending. The problem, in brief, is that PACE programs dictate that the loans for energy improvements become senior liens on the real estate — meaning they have a higher priority than the mortgage lender in terms of being paid in case of a foreclosure. As you may have heard, a lot of mortgage lenders have been facing some difficulties in the past few years (to put it mildly), and FHFA is concerned that PACE programs increase the risk to lenders.
The result is a set of new restrictions on the entities that FHFA regulates. As one local official from Colorado quoted in The Wall Street Journal puts it, "They're basically saying they'll redline communities that move forward with PACE financing." One of the steps being required, for example, is "Adjusting loan-to-value ratios to reflect the maximum permissible PACE loan amount available to borrowers in PACE jurisdictions" — effectively meaning that if you buy a house in a city where PACE loans are available, you'll have to make a larger down payment to account for the possibility that you might take out such a loan.
As I understand it, Minnesota's PACE program is not yet set up. This new wrinkle may delay and alter its implementation, and may also hurt its appeal if the result is for loans not to be senior liens (which would mean more risk for the local governments implementing the program).
(h/t to City Mgr. Antonen for providing a copy of the FHFA statement and a link to the WSJ article to the City Council.)
Postscript: According to an AP article this evening, the California Attorney General is suing FHFA over its decision.
Labels: environment, finance
Saturday, June 19, 2010
Local Energy Improvements Financing Program
Part of the 2010 Jobs Bill passed by the legislature is the Local Energy Improvements Financing Program. City Manager Antonen recently shared an information sheet about this program with the City Council. In brief, the program will allow local governments (such as Maplewood) the ability to issue revenue bonds in order to make low-interest loans to qualifying commercial, industrial and residential property owners for energy improvements. The loans are paid back through assessments on the improved buildings' property taxes.
I expect we'll hear more about this program; it certainly seems like something Maplewood should implement for the benefit of our residents and businesses.
I expect we'll hear more about this program; it certainly seems like something Maplewood should implement for the benefit of our residents and businesses.
Labels: environment, finance
Friday, June 04, 2010
Outside the Ox
Minnesota cities face tremendous strains in today's economic and political environment. The Executive Director of the League of Minnesota Cities, Jim Miller, recently wrote in an e-mail to city officials:
People are invited to visit outsidetheox.org, to share reactions, comments, and ideas.
We have recently contracted with the University of Minnesota for an analysis of the trends that will shape city budgets in the decade to come and the dire financial constraints and painful policy choices that lie ahead for all cities. We are preparing to publicly release the results of this analysis at the League’s Annual Conference in St. Cloud, June 23-25. The results are stunning – both in the severity of the pain ahead and in how widespread that pain will be felt if nothing changes.The League of Minnesota Cities has launched a new campaign to build awareness and solicit input from the public on the topic of city services and funding. Part of the campaign is the following web video:
People are invited to visit outsidetheox.org, to share reactions, comments, and ideas.
Sunday, May 16, 2010
Weekend Reading: Are Local Government Workers Overpaid?
Conventional wisdom (or at least people who rail against cost-of-living adjustments) says that state and local government are paid too much compared to the private sector. A recent study commissioned by the Center for State and Local Government Excellence and the National Institute on Retirement Security examined this belief.
The authors, both economists at the University of Wisconsin, found:
The authors, both economists at the University of Wisconsin, found:
Wages and salaries of state and local employees are lower than those for private sector employees with comparable earnings determinants such as education and work experience. State workers typically earn 11% less and local workers 12% less.You can read the entire report online, or the shorter fact sheet.
During the last 15 years, the pay gap has grown - earnings for state and local workers have generally declined relative to comparable private sector employees.
Labels: finance
Thursday, April 29, 2010
More on Insurance
This week's Maplewood Review includes a story with more information about our reduced insurance deductible, a topic I wrote about a couple weeks ago.
Tuesday, April 13, 2010
More Good News: Bond Upgrade, Low Interest Rates
On top of last week's good news about a reduction in our special insurance deductibles, last night our bond advisors let the City Council know that the City of Maplewood received an upgrade to its bond rating.
Since 1998, Maplewood has held an Aa2 bond rating from Moody's. This year we were rated by Standard & Poor's, who gave us AA+ — the equivalent of a Moody's Aa1, and only one step down from triple-A ("AAA" at S&P, "Aaa" at Moody's), the highest rating possible. (Wikipedia has a handy chart that shows the equivalent terminology for different credit rating agencies.)
Just like for personal loans and mortgages, better credit ratings on the city's bonds mean lower interest rates. The results were apparent in the bond sale yesterday, as we borrowed money for this year's public works projects. Much of the borrowing itself is to allow residents and business to pay special assessments over time rather than all at once, so the savings will be passed along to the property owners whose streets are being rebuilt.
We sold "Build America Bonds," a financing tool created last year by President Obama's stimulus plan. Unlike traditional municipal bonds, interest on BABs is not exempt from income tax. As a result, their owners are paid higher interest rates — but the federal government rebates 35% of that interest cost to the bond issuer. In theory, this might be a wash, on the assumption that munis get sold to individuals and corporations who are in the highest tax brackets. But in practice, there is more demand for the BABs; you are buying the credit quality and stability of a municipal issuer while getting a higher coupon rate, and not paying for a tax exemption that may be of less value (if the bond holder is in a lower tax bracket, if it's held in a tax-free account like an IRA or HSA, or if the bond holder itself is exempt from income taxes). More demand means lower rates.
The winning bid in yesterday's bond sale was a true interest rate of 4.5630%. Taking into account the federal rebate, the net interest rate is just 3.0222% — a healthy improvement over last year's rate of approximately 3.4%.
Following the policy we established last year, these savings will be reflected in the interest rate applied to special assessments, which should be around 5% for this year's assessments versus the 5.4% applied last year.
Since 1998, Maplewood has held an Aa2 bond rating from Moody's. This year we were rated by Standard & Poor's, who gave us AA+ — the equivalent of a Moody's Aa1, and only one step down from triple-A ("AAA" at S&P, "Aaa" at Moody's), the highest rating possible. (Wikipedia has a handy chart that shows the equivalent terminology for different credit rating agencies.)
Just like for personal loans and mortgages, better credit ratings on the city's bonds mean lower interest rates. The results were apparent in the bond sale yesterday, as we borrowed money for this year's public works projects. Much of the borrowing itself is to allow residents and business to pay special assessments over time rather than all at once, so the savings will be passed along to the property owners whose streets are being rebuilt.
We sold "Build America Bonds," a financing tool created last year by President Obama's stimulus plan. Unlike traditional municipal bonds, interest on BABs is not exempt from income tax. As a result, their owners are paid higher interest rates — but the federal government rebates 35% of that interest cost to the bond issuer. In theory, this might be a wash, on the assumption that munis get sold to individuals and corporations who are in the highest tax brackets. But in practice, there is more demand for the BABs; you are buying the credit quality and stability of a municipal issuer while getting a higher coupon rate, and not paying for a tax exemption that may be of less value (if the bond holder is in a lower tax bracket, if it's held in a tax-free account like an IRA or HSA, or if the bond holder itself is exempt from income taxes). More demand means lower rates.
The winning bid in yesterday's bond sale was a true interest rate of 4.5630%. Taking into account the federal rebate, the net interest rate is just 3.0222% — a healthy improvement over last year's rate of approximately 3.4%.
Following the policy we established last year, these savings will be reflected in the interest rate applied to special assessments, which should be around 5% for this year's assessments versus the 5.4% applied last year.
Labels: finance
Saturday, April 10, 2010
Good News: Deductible Reduced
City Manager Antonen notified the council that this past Wednesday he attended a meeting of the League of Minnesota Cities Insurance Trust board. On the agenda was Maplewood's upcoming policy renewal.
Two years ago, shortly after I had joined the city council, special terms and a higher deductible were applied to Maplewood because of the city's extraordinarily bad claims history in the 2006-2007 period. Those terms increased our deductible from $50,000 per incident to $200,000 per incident for employment-related lawsuits.
Thankfully, since I've been on the council we have had no new employment-related lawsuits. One commissioner did sue the city in 2009, but dismissed the suit after her request for a TRO was denied in terms that strongly suggested the court saw no merit in her claim.
So the good news from the LMCIT is that our special deductible is being cut from $200,000 to $100,000. I hope that, with continued good management and sensible policy direction from the city council, it will be reduced even further in the future.
Two years ago, shortly after I had joined the city council, special terms and a higher deductible were applied to Maplewood because of the city's extraordinarily bad claims history in the 2006-2007 period. Those terms increased our deductible from $50,000 per incident to $200,000 per incident for employment-related lawsuits.
Thankfully, since I've been on the council we have had no new employment-related lawsuits. One commissioner did sue the city in 2009, but dismissed the suit after her request for a TRO was denied in terms that strongly suggested the court saw no merit in her claim.
So the good news from the LMCIT is that our special deductible is being cut from $200,000 to $100,000. I hope that, with continued good management and sensible policy direction from the city council, it will be reduced even further in the future.
Labels: finance
Tuesday, March 30, 2010
Build America Bonds
For this year's bond sale, Maplewood is considering the possibility of selling Build America Bonds rather than the traditional tax-exempt municipal bonds. Build America Bonds pay interest that is taxable income to the bondholder, but the federal government pays a rebate to the bond issuer. For some tax brackets the result may be a wash, but this makes BABs potentially attractive to some investors who would not otherwise buy munis -- for example, retirees who may be in lower income tax brackets, or IRA holders whose investments are tax exempt or tax-deferred. Greater demand for BABs versus traditional munis generally translates into lower net interest costs to the cities that issue them.
Yesterday the Minnesota Independent had an interesting article on the topic of Build America Bonds, discussing concerns expressed about them by some people.
Yesterday the Minnesota Independent had an interesting article on the topic of Build America Bonds, discussing concerns expressed about them by some people.
Monday, March 15, 2010
Fire Training Facility Vetoed by Pawlenty
We just received word that Governor Pawlenty has used the line-item veto to eliminate funding for the East Metro Regional Fire Training Facility.
I guess he's maintaining his budget-slashing reputation for the national audience of his presidential ambitions. Too bad it's at the expense of safety for the East Metro.
I really hope our next governor, whatever his or her party may be, is not such a relentless enemy to local government.
I guess he's maintaining his budget-slashing reputation for the national audience of his presidential ambitions. Too bad it's at the expense of safety for the East Metro.
I really hope our next governor, whatever his or her party may be, is not such a relentless enemy to local government.
Labels: finance, public safety
Friday, February 19, 2010
Fuel Under Budget
Deputy Public Works Director Thompson reported to the city council this week that the city has locked in prices for gasoline and diesel for March through December of 2010. Including tax, we will pay $2.42 per gallon for gas and $2.30 per gallon for diesel. While not as good as the $1.87 (gas) and $2.04 (diesel) that we were able to get in 2009, these contract prices are lower than what the 2010 budget assumes. The result will be savings of about $20,000.
We'll see the actual contracts included for council approval on the consent agenda in March.
We'll see the actual contracts included for council approval on the consent agenda in March.
Labels: finance, public works
Thursday, February 18, 2010
Bonding Bill Moves Forward
This is a somewhat belated update on the progress of the bonding bill, but Minnesota's House of Representatives passed the bonding bill on Monday, after the Senate did last week. In both chambers it had bipartisan support (though Republicans who supported it are apparently coming under attack from their own party). The bill now goes to conference committee to iron out differences between the two versions. Last I heard, the East Metro Regional Fire Training Facility was included in both versions, so it should make it out of conference. Whether it will survive the threatened vetoes from the governor, line item or otherwise, remains to be seen ...
Labels: finance, media, public safety
Sunday, January 17, 2010
The Latest Call for Duplicate Audits
The Sunday Pioneer Press includes an article about a petition seeking signatures to ask the State Auditor to examine Maplewood's books. Leading the petition drive is Elizabeth Sletten, one of former Mayor Diana Longrie's most devoted fans (you may also remember her as one of the candidates in last year's city council primary), and Longrie herself.
Long-time readers of my blog may recall that we've talked about this before. As my term began in 2008, I seriously considered whether we should ask the State Auditor to look at our books, after the mismanagement and incompetence of the Longrie-Copeland era. You can read my entry on the topic from April 7, 2008.
Then-Mayor Longrie wrote an April 8, 2008 opinion article in the Pioneer Press about her wish to see an audit; she ran the same text as her article in the May 2008 city newsletter. Longrie's laundry list of concerns focused not on Copeland's time at the city's helm — rather, she wanted an inquiry to focus on policy disagreements such as the amount of city debt, and bizarre personal obsessions like someone joking about naming a street after Will Rossbach. (Perhaps Longrie thinks "Comedy Police" is part of the state auditor's job description.)
In the new Pioneer Press article, Sletten claims to have obtained more than 400 signatures so far — roughly the same number as votes she received in last year's primary. To meet the required 20% of registered Maplewood voters, she'll need about 4,200. Even then, the scope of the audit is determined by the auditors, not the petitioners. To quote the State Auditor's website:
Long-time readers of my blog may recall that we've talked about this before. As my term began in 2008, I seriously considered whether we should ask the State Auditor to look at our books, after the mismanagement and incompetence of the Longrie-Copeland era. You can read my entry on the topic from April 7, 2008.
Then-Mayor Longrie wrote an April 8, 2008 opinion article in the Pioneer Press about her wish to see an audit; she ran the same text as her article in the May 2008 city newsletter. Longrie's laundry list of concerns focused not on Copeland's time at the city's helm — rather, she wanted an inquiry to focus on policy disagreements such as the amount of city debt, and bizarre personal obsessions like someone joking about naming a street after Will Rossbach. (Perhaps Longrie thinks "Comedy Police" is part of the state auditor's job description.)
In the new Pioneer Press article, Sletten claims to have obtained more than 400 signatures so far — roughly the same number as votes she received in last year's primary. To meet the required 20% of registered Maplewood voters, she'll need about 4,200. Even then, the scope of the audit is determined by the auditors, not the petitioners. To quote the State Auditor's website:
If a petition audit is certified by the county auditor, staff from the Office of the State Auditor would then meet with a committee of petitioners to review the petitioners' concerns. The audit staff then would review the concerns to determine the scope of the audit. The audit might not include all the concerns identified by the petitioners if the audit staff determined that the concerns were based on decisions within the discretion of the governing body.
I believe the State Auditor would duplicate the work already done by our independent auditors every year — which, let's be clear, has included a lot of clean-up of issues from the Longrie-Copeland era. But staff and auditors have repeatedly told us that there's no evidence of wrongdoing, just errors that we can reasonably believe came as a result of the loss of most of the accounting department, who were driven away by the toxic environment created in City Hall by Copeland and his masters. To emphasize the point once again, a state audit would not just duplicate our independent auditors' work, but the city's taxpayers would have to pay for the cost of the audit in a year when the budget is already stretched thin.
I don't believe that this money would be well spent, especially in these lean budgetary times. Still, if 20% of Maplewood voters want it, we'll indulge the personal obsessions of the former mayor and her cronies on the taxpayers' dime once again. I don't expect anything shocking will turn up, but I do still have my own list of questions, as I wrote in May 2008, that I will happily submit to the auditors if they're going to be examining the city's affairs anyhow.
Labels: council politics, finance, media
Friday, January 08, 2010
More on the Unallotment Decision
This week's online newsletter from the League of Minnesota Cities includes an article about Judge Gearin's decision to overturn the unallotment of funding to the Minnesota Supplemental Aid Special Diet Program. It provides a good explanation of the ruling and some of its impact, especially as relates to cities -- the main impact being "more uncertainty". It also says that the League board will discuss what if anything to do, in light of the decision, at its upcoming meeting on January 21st.
I've decided that I'm not eager to see the LMC and other entities join in a flurry of lawsuits to overturn the unallotments. I think it is vital to have a test case like the Special Diet Program to work through the constitutional issues, so I'm pleased with both Gearin's ruling and the Governor's decision to appeal it. This case ought to go to the Minnesota Supreme Court, either to clarify the statute's interpretation or to make the legislature rewrite it to pass constitutional muster.
But overturning Pawlenty's actions last year won't cause money to appear in the state coffers to restore those cuts. Any 2009 funding restored in court is only going to increase the cuts that will have to be made by the legislature and governor to balance the remainder of the biennial budget. It would be a zero-sum game, except for the legal fees that make it less-than-zero.
Partisan Angles
Many commentators seem to have taken Gearin's decision as a major blow to Governor Pawlenty and the Republicans, and some conservative partisans have gone further to suggest that it represents liberal judicial bias (a claim that doesn't really hold up in light of the many rulings in Gearin's career on the bench).
Sarah Janacek at Politics in Minnesota takes a different view than many of her colleagues on the right, calling the ruling "Good for the state and spectacular for Pawlenty and the Republicans." Janacek seems to accept the basic separation-of-powers argument in Gearin's ruling, without jumping to conclude that it was biased and wrong just because it was not the ruling the Republican governor had sought. The way she sees it playing out, the court decision may bring us back to legislative-executive gridlock, but she sees that situation as benefitting Republicans because Pawlenty will have nothing to lose. If he lets the government shut down for lack of a budget deal, it will only increase the national attention and anti-tax reputation that he seeks for his presidential aspirations. For his presidential run, the national reputation matters more than his popularity in Minnesota, where he won election and reelection with less than 50% of the vote.
Janacek's analysis is intriguing, though I'm not sure it will work out that way. What I do think is important is to realize that what politicians and parties want in the short term doesn't always play out the way they imagine it will. Republicans should not revile this decision just because it is a tactical setback for Pawlenty, and Democrats should not be too satisfied or mistakenly think that this represents a seismic shift of the budget negotiating terrain to their advantage. As Janacek points out, the governor still has the veto (and line-item veto), and as a lame duck official with aspirations for a higher office, he probably has less to lose than do DFL legislators if he decides to take a hard line and refuse compromise.
Maplewood's Bottom Line
No doubt there will be a lot of drama in the coming legislative session as state leaders wrestle with the budget. Unfortunately, I think the end result for Maplewood is pretty much the same in any scenario -- our Market Value Homestead Credit is gone, and I don't see it being restored. There's a lot of focus on the short-term forecasts and budgets, but the long term picture for state finances is even more challenging. I believe Maplewood has to plan for the future with the assumption that our MVHC, like Local Government Aid, is gone for good. If we do happen to get some in a future year, we should treat it as a windfall for one-time uses, such as capital expenses or debt reduction, rather than part of the operating budget.
I've decided that I'm not eager to see the LMC and other entities join in a flurry of lawsuits to overturn the unallotments. I think it is vital to have a test case like the Special Diet Program to work through the constitutional issues, so I'm pleased with both Gearin's ruling and the Governor's decision to appeal it. This case ought to go to the Minnesota Supreme Court, either to clarify the statute's interpretation or to make the legislature rewrite it to pass constitutional muster.
But overturning Pawlenty's actions last year won't cause money to appear in the state coffers to restore those cuts. Any 2009 funding restored in court is only going to increase the cuts that will have to be made by the legislature and governor to balance the remainder of the biennial budget. It would be a zero-sum game, except for the legal fees that make it less-than-zero.
Partisan Angles
Many commentators seem to have taken Gearin's decision as a major blow to Governor Pawlenty and the Republicans, and some conservative partisans have gone further to suggest that it represents liberal judicial bias (a claim that doesn't really hold up in light of the many rulings in Gearin's career on the bench).
Sarah Janacek at Politics in Minnesota takes a different view than many of her colleagues on the right, calling the ruling "Good for the state and spectacular for Pawlenty and the Republicans." Janacek seems to accept the basic separation-of-powers argument in Gearin's ruling, without jumping to conclude that it was biased and wrong just because it was not the ruling the Republican governor had sought. The way she sees it playing out, the court decision may bring us back to legislative-executive gridlock, but she sees that situation as benefitting Republicans because Pawlenty will have nothing to lose. If he lets the government shut down for lack of a budget deal, it will only increase the national attention and anti-tax reputation that he seeks for his presidential aspirations. For his presidential run, the national reputation matters more than his popularity in Minnesota, where he won election and reelection with less than 50% of the vote.
Janacek's analysis is intriguing, though I'm not sure it will work out that way. What I do think is important is to realize that what politicians and parties want in the short term doesn't always play out the way they imagine it will. Republicans should not revile this decision just because it is a tactical setback for Pawlenty, and Democrats should not be too satisfied or mistakenly think that this represents a seismic shift of the budget negotiating terrain to their advantage. As Janacek points out, the governor still has the veto (and line-item veto), and as a lame duck official with aspirations for a higher office, he probably has less to lose than do DFL legislators if he decides to take a hard line and refuse compromise.
Maplewood's Bottom Line
No doubt there will be a lot of drama in the coming legislative session as state leaders wrestle with the budget. Unfortunately, I think the end result for Maplewood is pretty much the same in any scenario -- our Market Value Homestead Credit is gone, and I don't see it being restored. There's a lot of focus on the short-term forecasts and budgets, but the long term picture for state finances is even more challenging. I believe Maplewood has to plan for the future with the assumption that our MVHC, like Local Government Aid, is gone for good. If we do happen to get some in a future year, we should treat it as a windfall for one-time uses, such as capital expenses or debt reduction, rather than part of the operating budget.
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John Nephew Election Committee,
628 County Road B East,
Maplewood, MN 55117
651-776-5963
john@johnnephew.com
John Nephew Election Committee,
628 County Road B East,
Maplewood, MN 55117
651-776-5963
john@johnnephew.com