watchdog

2009-12-09T11:50:00.004-06:00

PENSION MINUTES SEE THE LIGHT OF DAY

I asked for the City of Memphis pension board minutes for the last year and I recently got them. I will have to compliment Mayor Wharton and the City Attorney's Office for their handling of this request. They sent the files electronically which is a great improvement over the past administration. Congratulations.

In looking through the minutes several things jump out at me. First you have to understand that the pension board is made up mostly of insiders who have a self interest in the results of the board's decisions. Look at the make up in the attached file. There is only one public member representing the interests of the taxpayers who pay for a large portion of these pensions.

I find the following areas of interest.

Disability retirements, ordinary versus line of duty
Disability retirements in general in most cases are approved and where they are not there are lawyers available to take the matter to court.

It appears that line of duty pensions are more generous than ordinary pensions and therefore there is a great interest in getting a line of duty disability pension approved. I have attached a section of the pension ordinance on this subject.

Several other items in the minutes are interesting. Page 29 (Jack Sammons), Page 48 (Keith McGee and W. W. Herenton) and page 56 (Yalanda McFadgon).

Click here to see the City of Memphis pension board minutes for the last year

Click here to see the makeup of the City of Memphis pensioin board
Click here to read the provisions of the City of Memphis pensions plan concerning disability pensions

2009-12-07T11:02:00.002-06:00

THE JANUARY 2001 PENSION SCAM

Is there any better example of the games that the political class plays than the attached story from the Commercial Appeal. I talked to Jim Strickland about this story and he only found out about this situation when certain people started retiring who were not in appointed positions when the January 2001 ordinance was revoked in 2004. Scott McCormick wrote the language and it was assumed then that only those who were currently in appointed positions in 2004 would be covered under the January 2001 pension resolution which allowed elected and appointed people to retire after 12 years regardless of age.

What happened? Well it turns out that Sara Hall and certain Herenton administration officials twisted the language and determined that if a civil service employee was later moved to an appointed position after the revocation of the January 2001 ordinance and if they had 12 years or more of service, they could retire regardless age. Some have and more are probably lining up.

It is a disgrace and it points out that the pension system should be changed so that all future employees should be covered by a 401K like the people who make the whole system possible, the taxpayers. It is time for the taxpayers and voters to take back control of the system and their pocketbooks.

Click here to read the Commercial Appeal article

2009-12-01T09:22:00.003-06:00

With all the talk about consolidation panels and school problems, the one clear fact that I have found is BIGGER IS NOT BETTER. The further you move away from the voters, the taxpayers, the parents and students and the more layers of bureaucracy that are involved, the worse are the results. The optimum and the most efficient size of a school district is about 40,000 students.

I have attached several results of studies of school consolidation. My conclusion is that consolidation of government is probably similar. Bigger is not better.

Mike Carpenter responded to the above email to say that no one is considering consolidating the City and County school systems. I would be willing to bet that there is a substantial element that would love to see this happen during any City/County consolidation effort. My point is that consolidation in and of itself may be a bad idea as bigger is not necessarily better. e.g. (our Federal Government). I would even propose that the Memphis City School system would be better if it was broken up into two smaller systems concentrating on neighborhood identities with more parental involvement and smaller and more efficient school administrations. Crazy, maybe, but why not study this option?

Click here to see the history of school consolidation

Click here to see the reality of school consolidation

2009-11-26T10:17:00.004-06:00

IS CONSOLIDATION A GOOD IDEA? A PRELIMINARY STUDY!!

With all the talk about possible consolidation in Shelby County and the formation of a consolidation study panel, I decided that the first thing that should be done was to gather information about Metro Shelby, Metro Davidson (Nashville) and Metro Jefferson (Louisville). Little did I know that this would be easier said than done.

I started with the CAFRs (Comprehensive Annual Financial Reports) for Memphis and Shelby County and all the incorporated cities in Shelby County and then attempted to compare them to Metro Davidson (plus their incorporated cities) and Metro Jefferson (plus their incorporated cities). The purpose was to take a broad view and comparison of the three counties and see if there were any possibilities of savings before going down this study path.

I admit that I am not a financial expert but I can read a CAFR. I wanted to concentrate on the broad numbers without getting into the details. I am interested in the population, the overall spending and the major spending items such as police, fire, education and debt payments. If there are areas that stand out as red flags of possible savings, then I would point them out.

What I found was that it is very difficult to get all the information but most of the CAFRs are on line. Metro Jefferson has a very different organization with the state involved in some of the major areas such as courts. I have no doubt made mistakes or left out important points but I would appreciate public comments and corrections. This would be done much better by an independent financial panel and the consolidation panel should consider doing this. Here are my major findings from the CAFRs ending June 30, 2008.

The population of Metro Shelby (MS) is 906825, Metro Davidson (MD) is626144, Metro Jefferson (MJ) is 713877
Total government spending MS ($3.41 billion), MD ($2.11 billion), MJ ($1.85 billion)
Government and public school employees, MS (38399), MD (19666), MJ (15166)
Annual expenditures per resident MS ($3765), MD ($3380), MJ ($2601)
Public school employees MS (22638), MD (10013), MJ (8048)
Public school students MS (151000), MD (74733), MJ (79931)
Total education expenditures MS ($1.61 billion), MD ($780 million), MJ ($739 million)
Total cost education/student MS ($10704), MD ($10446), MJ ($8777)
Police/Sheriff employees MS (5239), MD (2715), MJ (1680)
Police/Sheriff employees/1000 residents MS (5.77), MD (4.33), MJ (2.35)
Fire Employees MS (1843), MD (1182), MJ (1493)
Fire Employees/1000 residents MS 2.03), MD (1.89), MJ (2.09)
Annual interest on debt MS (125 million), MD ($77 million), MJ ($52 million)

The red flags for Metro Shelby are City of Memphis employees which have gone up in ten years while population has gone down. The increase is 1204 employees (6560 to 7774). This is somewhere around $60 to $100 million extra expense. The figures in the Memphis School system are even worse with an increase as shown below.

Memphis City Schools	Year 1998	Year 2008	% difference
number of students K12	109137	103000	-5.60%
number of employees	10693	16500	54%
general fund budget	$550,147,000	$931,966,000	69%
CPI up over 10 years			31%

Here we are talking about $200 to $300 million dollars extra.

Another critical item is our OPEB (Other Post Employment Benefits, mainly retiree health care) unfunded liability. It is currently over $3.5 billion dollars for Memphis, Shelby County, MLGW, City and County schools.

Until we address these three big red flags, no consolidation plan will lower our cost of government. Here is a statement in the 2008 Metro Davidson CAFR report.

"Long term liabilities increased by 20.4% due to the issuance of new general obligation debt in excess of principal payments and due to the inclusion of the Government's liability of $137 million for other post employment benefits (OPEB), discussed further under Other Matters below. " The City of Memphis unfunded liability is over $800 million and the Memphis city Schools is over $1.25 billion.

I have attached my spreadsheet mentioned in this report.

Click here to see a preliminary spreadsheet comparison of Metro Shelby, Metro Davidson and Metro Jefferson

2009-11-16T13:34:00.002-06:00

UNCOVERING HERENTON'S LUMP SUM PENSION PAYOUT

I have been trying for about four weeks to get all the information about Herenton's big lump sum payout from the City of Memphis pension system. Here are the facts as I know them at this point.

I asked for the formula from which Herenton's lump sum payment was calculated, who furnished it and where is a lump sum payment authorized in the pension ordinance.
I finally got the following answer. "Former Mayor Herenton's lump sum payment was calculated based on Pension Ordinance Sec. 25-1 (1) b. (total amount of his contributions multiplied by a return multiple). This section also authorizes a lump sum payment to participants who retire or terminate employment."
I did some research on this answer and found some interesting information.
I have attached the old section of the pension ordinance which is now numbered 4-4-1 (b) rather than 25-1 (1) b. You will note that the return multiple for 16 years or more has an asterisk (*) in the return multiple column with the note saying "The multiple for years 16 through 20 will be set prior to third reading after a review of actuarial information from the administration."
Then I found that Ordinance #5303 dated 5/19/09 was passed replacing the asterisks with actual return multiple numbers that increased the return from 3.0 to 4.0. I have attached that ordinance.

So these and other questions remain.

Did the ordinance, which was passed just before Herenton resigned, increase his payout?
Exactly how was his benefit calculated? Was it $126711 times 4 = $506845 and would the actuarial calculation of the old ordinance language been less?
Why are there no minutes of the pension board meeting where this action went down?
The old schedule of years of service and return multiples which was replaced by Ordinance 5303 stated that "The multiple for years 16 through 20 will be set prior to third reading after a review of actuarial information from the administration."

In looking through past City Council agendas, I find that there are many ordinances passed quietly that increase payouts and pensions but there is no requirement that the cost of these changes be calculated in advance. No wonder they did not want me on the pension board. I will be reporting further on this incestuous pension board which quietly increases their pension benefits at the taxpayers' expense.

Click here to read the recently changed pension ordinance increasing the payouts

Click here to read the old pension ordinance chart

2009-11-03T08:21:00.002-06:00

November 3, 2009

Just in time for Halloween, Mike Ritz sent me this spreadsheet, which I have attached. It shows that $26.5 million dollars in Shelby County taxes are unpaid as of October 22, 2009. They are in five classifications.

Tennessee Regulatory Commission Taxes
Personalty Taxes
Realty Commercial
Realty Residential
Realty Other

The astounding thing is that state law charges interest on delinquent taxes as shown below. Sounds like your Visa bill. It is true that some of these tax debts are in dispute and in the process of appeal. The interest could be as high as 20% or higher.

Tennessee Code Annotated, Section 7-4-204

Taxes due and payable that are not remitted to the tax collection official on or before the due dates are delinquent.
The person owing the taxes shall be liable for interest on any delinquent taxes from the due date at the rate of eight percent (8%) per annum, and, in addition, for a penalty of one percent (1%) for each month or fraction of a month that the taxes are delinquent. The interest and penalties shall become a part of the tax required to be remitted in this chapter.

Click here to see the top 50 shelby county tax delinquent taxpayers in 5 classifications

2009-10-06T13:43:00.002-05:00

A WATCHDOG IN A HENHOUSE FULL OF FOXES

See the attached article from the current Memphis Flyer concerning the following appointment and my work as the Watchdog.

Myron Lowery, the longtime City Council member and temporary Mayor of Memphis after Willie Herenton's resignation, called me in September and asked if I was a member of any board or commission. I said I was not. He then asked if I would like to be and I said that depended on which board or commission. He said "How about the pension board of the City of Memphis". I said that would certainly be interesting.

Myron and I go back a few years and we are friendly. He has met several times with groups such as the effort by John Lunt to get rid of the January 2001 pension resolution and the formation of the Charter Commission. While we do not agree on every issue, I believe his repeated statements that he is for absolute transparency in government, my holy grail as far as politicians go. His performance as Chairman of the Charter Commission was outstanding, fair and balanced, and his grasp of Robert's Rule of Order demonstrated that he knows how to run an orderly and fair meeting.

Well the actual confirmation process for the only citizen member of the Pension Board turned out to be more than interesting. I was told to attend the personnel subcommittee meeting first which I did on September 1. There were a number of other potential appointees there for various jobs and they all sailed through without objection. Then my name came up and I gave a one minute resume of my life. My appointment was moved and then Janice Fullilove jumped up and said that she would like to have the appointment delayed. Harold Collins agreed with Janice but eventually I was approved (3 to 2, Flinn, Strickland and Hedgepeth) as the appointment was subject to a full City Council vote two weeks hence.

On September 15, I showed up at the full City Council meeting dressed in my best sport coat and tie. Most of the meeting was devoted to the effort to get rid of the current City Attorney, Elbert Jefferson. Then a curious thing happened as Allan Wade, the City Council Attorney, opined that the City Charter required seven votes (a majority of the full 13 members rather than a majority of those present and voting) for approval of the motion to get rid of Jefferson. This opinion torpedoed the effort and Jefferson was retained.

Eventually my appointment to the pension board came up and two union members spoke about how my serving on the board would undermine morale, harm widows and children and generally threaten world peace. Barbara Swearengen Ware agreed and I requested a prompt vote so I could return home and continue beating my wife.

A vote did eventually come and somehow I won on a 6 to 5 margin. As I was leaving City Hall, I was called back and told that I lost as Allan Wade said I needed 7 votes, not just a 6 to 5 margin of those present and voting.

In my response to Ware and the union members, I pointed out that I was the only non interested (public) member of the incestuous pension board. I had no authority to change pension rules and I was only one chicken in a henhouse full of seven foxes. Alas, my pleas fell on long pointy deaf ears.

Click here to read the current article in the flyer about the watchdog

REAL WORLD EXPERIENCE WITH A STATE RUN HEALTH CARE SYSTEM

2009-10-05T10:43:00.001-05:00

Real World Experience of State Run Health Care

My brother and I ran a manufacturing business here in Memphis for over 40 years. We employed over 50 people including welders, metal workers, press brake operators, machinists, electricians and engineers. We provided competitive wages and benefits including health care insurance and profit sharing.

Over the years, until we sold the business in 1993, the laws concerning health care changed and we had to change to remain competitive with firms in other states and around the world. Our health insurance cost was a major cost factor but we managed to survive with changes in our program.

I was in charge of hiring employees both for the fabrication end of the business and the engineering department. Engineering, testing and innovation were major factors in our success. During that time I hired a number of great employees who helped us grow into the computer age of modern manufacturing. One employee comes to mind because of his interesting background and experiences.

His name is Roman Mitelman. He was born in the former Soviet Union and is of the Jewish heritage. He was trained as an engineer in Russia and he is an intelligent and thoughtful person and was an excellent employee. He was also a trained woodworker and model maker and crafted a working small scale model of one of our fire door systems which we used in sales presentations.

Recently Roman called me and asked me about my thoughts concerning the most important national issue today, the reform of health care. I told him that I was against a government run plan but that there were changes that needed to be made in the current system. Tort reform and regional or national health insurance competition in my opinion were two of the most important. Also more oversight of medicare claims to prevent fraud is a major factor.

Roman and I discussed the various factors and then he told me about some of his experiences in Russia that I think are important for native born Americans to hear. It is a fascinating story.

Roman was born in 1935 in Minsk in Belorussia. His father was a woodworker, very smart, but had no formal university education. He joined the Communist party in 1927 when living in Georgia. He was young and idealistic but over time he came to realize what a fraud the Communist system was and he became privately very anticommunist. Naturally it was dangerous to publically express such an opinion. He and his wife and Roman were in Minsk when the Germans invaded. The family retreated to the southeast in advance of the German army, getting out of Minsk on the last train to leave that doomed city. Roman's father was an officer in the Red Army and was wounded three times in combat in defense of Moscow. Because of his multiple wounds, his father was put in charge of all cultural and entertainment programs in a major hospital near Moscow. When the hospital was moved west to within 15 miles of the front, Roman was put in the orphanage because there was no one to take care of him as his Mother was ill. It was not a pleasant experience since he was Jewish. He was taunted by the other boys and life was very hard for him.

After the war, Roman and his wife worked as engineers. Whenever they or their two children needed medical services, they would have to go to the local center and take a number and wait for hours in an overcrowded hallway until their number came up. Then you would be seen and the medical attention and service was basically good but minimal. Many doctors were well trained and mostly dedicated but poorly paid. You had no rights of protest and the medicine and equipment were inferior. Of course everyone in Russia knew that the party members, politicians and important business people had access to special hospitals, not open to people like Roman and his family. These special facilities had the latest western equipment and medicines which were not available to the general public.

Life in Russia during this time was very hard for Roman and his family. He wanted to leave but it was very difficult and dangerous to apply for an exit visa. During this time he was approached by members of the KGB and questioned and Roman felt that he was pressured to report on other Jews, friends and past contacts. He never knew what would happen to him if he failed to cooperate but finally he strongly refused to cooperate with them. He had put his family's name on the list to leave Russia but his place in the list was near the end and the pace of approval was very slow. But something happened in 1978 when American senators Jacob Javitts, Scopp Jackson and Abraham Ribicoff came to Minsk. For political reasons, the Russians allowed Roman and his family and many others to leave. The trip was by train through Poland, Czechoslovakia and finally into Austria. His description to me of the passage through the last barrier of seven fences into Austria was very moving.

With the help of organizations the family came to Detroit and eventually to Memphis where Roman went to work for a company previously owned by Walker Wellford Sr. Roman was experienced in wood kiln engineering and woodworking. His wife found a job also and now they are both retired. The Mitelman's two children have a very interesting story also. Olga is 39 and is currently working for Merck. She went to Williams College, the University of Pennsylvania Medical School and Wharton Business School. She is a medical doctor and also has a BA in business administration. Anna is 34 and went to Wesley College and MIT business school. She has a master's degree and currently works for an investment firm. Both are grateful for the opportunities they had available in the free USA society and feel that the proposed single payer government run health care plan that the current administration wants to impose would be a mistake and the first step back towards the Russian style imposed health care system, that is one system for the masses and another for the political and business elite

Despite what politicians say, a two tier system is what is being proposed. The state run single payer system will be for us and the upper tier system will be for the politicians, bureaucrats and their political friends. If a government run single payer system is ever imposed on this country, it is hoped that it will never become the two tiered Soviet system, but it will certainly move it in that direction.

Roman pointed out to me that today, in Russia, they have two systems. The first is a private system and is a pay for service system by those who can afford to pay. The doctors basically extort money from people who need and can afford their services. The second system is for those who cannot afford to pay and it looks much like the system that Roman had access to when he was in the Soviet Union only is worse now than it was then. His warning is to Americans, do not go there with the government proposed single payer system.

2009-09-19T13:23:00.003-05:00

Last week there was an article from the Daily News about my appointment by Mayor Myron Lowery to the Memphis Pension Board. My appointment was approved barely by the subcommittee on a 3 to 2 vote (Shea, Chairman, Strickland and Hedgepeth FOR, Fulliove and Collins, AGAINST). (I have attached an article from the Daily News about the vote).

The favorable subcommittee vote had to be approved or denied by the Memphis City Council at a subsequent meeting on September 15^th. I was under no illusions that the approval would be easy as there is a hard core of Herenton supporters on the City Council who are against anything that might upset the current status and course of City Government and their control of that course.

My agreement to serve was based on my belief that all transactions in Government should be transparent. When asked to speak before the City Council I pointed this out and pointed out that I had proposed a change in the City Charter (during the Charter Commission hearings) that would have required all significant contract and financial transactions be immediately posted on the City Website. Had this been approved, then the Elbert Jefferson payments to Robert Spence would have been revealed in time to do something about it. I also pointed out that I would be the one public member on the board and would have no power to change anything and that only the City Council could change pension plan provisions. I did say that I thought that the pension system should be changed for future employees to a defined contribution plan (like for profit companies and employees) but not for existing public employees.

I was opposed by two union representatives who said that my presence on the pension board would hurt employee morale. I also was opposed by Barbara Swearengen Ware who quoted from my website about revelations that I had uncovered by open records requests. In general I was depicted as an all around horrible person and I requested the time to leave early so I could go home and continue beating my wife.

In the end I was approved on a 6 to 5 vote and as I left the chamber, I was called back and told that I was defeated because they claimed that I needed seven votes to pass (according to Allan Wade, the City Council attorney). I have been told that that standard is not true for appointments but the matter is still under discussion.

I want to thank those on the Council who supposed me and my call for transparency in government. I also want to thank Mayor Myron Lowery for having the courage to appointment me and to call for transparency in all government affairs and for an end to the black/white racial divide. There is, however, a hard core group on the City Council who are determined to block any real reforms.

Regardless of what happens, I will continue to call for transparency in government and I ask for your support in this effort. I have some good news and plans for the future which I will be communicating to you soon. Thanks for your past support and encouragement.

Click here to see a recent article about my aborted appointment to the pension board

2009-09-02T09:03:00.003-05:00

LOCAL HOUSING SCAM ARTISTS INDICTED

I recently published an article about a local housing scam, flipping one house three times in several years and making over $600,000 on the deals. I asked why the Commercial Appeal had not published any detailed news of this. I sent the information on to the authorities for investigation and hopefully prosecution. Well, these scam artists have finally been indicted. (See the indictments below and a national article on housing scams, especially Memphis).

Here is the article that I published before the recent indictments.

IS THIS A GREAT COUNTRY OR WHAT? LOCALS FLIP JUST ONE PROPERTY THREE TIMES AND MAKE OFF WITH $684,000

Last week there was an interesting article in the CA concerning fraudulent appraisals of properties. The lead conspirator was not named at that time. The appraiser would take low priced properties, get an inflated appraisal, and then through a series of transactions, the property was sold and mortgaged and the difference was pocketed. In many cases, Fannie and Freddie or some bank and eventually the taxpayers would end up eating the difference between what the parties paid for the property and the amount of the inflated mortgage. These people would flip the same properties three and four times in the period of a few years.

There are hundreds of these type transactions listed locally in Shelby County and DeSoto County and I have shown some listed in the attached pdf files. However the one that stands out is at 744 Melrose. Mykisha Williams bought the property in April 2004 for $145,000 and sold it in May for $385,00000 ($240,00000 profit). Then in January 2005 Gloria Buntyn bought the property for $170,000 and in February sold it to Mykisha Williams for $385,000. ($215,000 profit). Then in February 2006 Kieth Threatt bought the property for $190,000 and in May 2006 sold the property for $419,000 to Sanchez Richmond ($229,000 profit). Total profit $684,000 less a few expenses.

This is a good local example of what happens to large government programs where there are people just waiting to scam the system. We are talking hundreds of millions of dollars here and this is just in Shelby County Tennessee and Desoto County Mississippi. This is a local example of how this current economic crisis happened and who is responsible, namely scam artists and politicians buying votes. Are you listening Barney and Chris?

I have listed below just three pieces of local property. There are many more and I hope that the FBI is investigating these transactions.

Basically the scheme illustrated by the attached pages of transactions from Tom Leatherwood's site shows properties at 144 Person, 395 Edith and 744 Melrose. The scheme goes like this.

A foreclosed property is bought for a low price. The buyer then sells the property a few months later to an associate for three to four times the purchase price. An inflated mortgage is obtained and sold to Federal National Mortgage Association or a bank. Then later, the property is foreclosed after no payments are made on the mortgage. Then, unbelievably, the same cycle happens again to the same property just a few months later. Another example is shown below.

144 Person: Federal National Mortgage Association sells property to Washington Mutual Bank for $7500. The same day, Washington Mutual sells the property to Mykisha Williams for $7500. A little over a month later, Mykisha Williams sells the property to Melanie Wilkes for $60000. The same day Melanie Wilkes gets a 90% mortgage from Argent Mortgage for $54000. Argent Mortgage must have unloaded the mortgage to Wells Fargo Bank as they ended up buying it on the courthouse steps for $50000 on December 2005. Then in June 2006 Wells Fargo sells it to Keith Threatt for $18000 and in October 2006 Keith Threatt sells the property to Onitsha Paige for $59000 and Onitsha gets a mortgage for $50150. Unbelivably a third flip is in the process.

Look at the other two sheets showing 744 Melrose and 395 Edith.

I think you get the idea. I have also attached a list of transactions from Tom Leatherwood's site for Mykisha Williams and Southern California REO LLC. This is just the tip of the iceberg. There are hundreds of such deals in the records. Why is this happening? Is there no oversight? Why is no action being taken? Why is the paper concentrating on $5 payments for favors in the County Clerk's office when here it is obvious that millions are being lost.

Some of my friends say the government has only the best of intentions. Just look at the results and guess who gets to pay the bill for each of these transaction. THE TAXPAYERS AS USUAL TAKE A BATH AND THE GOVERNMENT SHRUGS OFF SUCH DEALS AS ISOLATED INCIDENTS.

Well, take a look at the article on the link below. The title is "5 Indicted and 1 guilty plea in Tennessee flipping fraud allegations"

http://www.mortgagefraud.org/journal/2009/8/20/5-indicted-and-1-guilty-plea-in-tennessee-flipping-fraud-all.html

This is going on all over the country and this is not the only local frauds. Thanks to Barney Frank, other DC politicians and Freddie and Fannie, we are seeing billions in fraud and they are only indicting a small fraction of the crooks. This is your Congress at work.

I have attached the indictments. They make interesting reading.

Click here to read one of the indictments

Click here to read one of the indictments

2009-08-11T11:44:00.004-05:00

TOWN HALL HEALTH CARE MEETING

My wife and I went to the town hall meeting last Saturday put on by Representative Steve Cohen. It was well attended and very interesting.

It was obvious that the majority of people attending and the majority of doctors who spoke all had grave doubts about the house proposed plans, three of which are working their way through the baloney making process in Congress.

A number of questions were asked and answered (kind of) but the real knee slappers were the following.

You will be able to keep you present insurance that you like
Illegal aliens will not be covered
Congress will be forced to take the same plan that finally develops for the citizens
No one will make a decision to deny you treatment when you are old
Your waiting time after adding 47 million new people and no new doctors will not be increased
The house plan will be revenue neutral

There were many others that got raucous laughter but the above came to mind. One interesting sign behind where I set read "83% love single payer plan". When I asked where she got the sign, she said "MOVEON . ORG".

One question that I wanted to ask but did not get to was this. "What is the unfunded liability of medicare and social security"? I looked up an answer from the Wall Street Journal.

"According to the trustees, Medicare's unfunded liability is $74 trillion -- five times that of Social Security. According to the Congressional Budget Office, health-care spending is on a course that could crowd out all other government programs. Clearly the time has come for fundamental reform." (February 28, 2008).

Clearly Medicare and Social Security need reform. The Obama plan is not it. There was an article in yesterday's Commercial Appeal by the smartest national writer in the country, Charles Krauthammer. Here is what he said.

(1) Tort reform: As I wrote recently, our crazy system of casino malpractice suits results in massive and random settlements that raise everyone's insurance premiums and creates an epidemic of defensive medicine that does no medical good, yet costs a fortune.

An authoritative Massachusetts Medical Society study found that five out of six doctors admitted they order tests, procedures and referrals -- amounting to about 25 percent of the total -- solely as protection from lawsuits. Defensive medicine, estimates the libertarian/conservative Pacific Research Institute, wastes more than $200 billion a year. Just half that sum could provide a $5,000 health insurance grant -- $20,000 for a family of four -- to the uninsured poor (U.S. citizens ineligible for other government health assistance).

What to do? Abolish the entire medical-malpractice system. Create a new social pool from which people injured in medical errors or accidents can draw. The adjudication would be done by medical experts, not lay juries giving away lottery prizes at the behest of the liquid-tongued John Edwardses who pocket a third of the proceeds.

The pool would be funded by a relatively small tax on all health-insurance premiums. Socialize the risk; cut out the trial lawyers. Would that immunize doctors from carelessness or negligence? No. The penalty would be losing your medical license. There is no more serious deterrent then forfeiting a decade of intensive medical training and the livelihood that comes with it.

(2) Real health insurance reform: Tax employer-provided health care benefits and return the money to the employee with a government check to buy his own medical insurance, just as he buys his own car or home insurance.

There is no logical reason to get health insurance through your employer. This entire system is an accident of World War II wage and price controls. It's economically senseless. It makes people stay in jobs they hate, decreasing labor mobility and therefore overall productivity. And it needlessly increases the anxiety of losing your job by raising the additional specter of going bankrupt through illness.

The health care benefit exemption is the largest tax break in the entire U.S. budget, costing the government a quarter-trillion dollars annually. It hinders health-insurance security and portability as well as personal independence. If we additionally eliminated the prohibition on buying personal health insurance across state lines, that would inject new and powerful competition that would lower costs for everyone.

Will this sensible solution happen? Not likely with this Administration but keep up your letters, emails and telephone calls because this crazy Obama care needs to be stopped and real reform put in its place.

I have attached a picture of Cohen. He ran a good meeting. I wish there was another choice than Cohen or Herenton.

Click here to see Rep Cohen at the recent town hall health care meeting

2009-08-01T11:39:00.000-05:00

August 1, 2009

MY THOUGHT ON MAYOR HERENTON

My thoughts on Mayor Herenton are many but I think the following are the most important after almost 5 years of research on local government and open records access.
• He is the poster child for the value of term limits. His first two terms were reasonably good. After that it has all been downhill. It takes about two terms or less for politicians to get a handle on power. After that, it is all arrogance and entitlement. Look at Washington DC and the need for term limits.
• His administration is all about jobs, not about governmental operational efficiency in the spending of taxpayers’ money. This is how politicians maintain power, by their ability to hand out jobs. This is also true of the school system and to a lesser extent our County government.
• I don’t expect anything to change, regardless of who wins the election. Until someone addresses reform of pensions, OPEB and benefits, nothing will change and our City and County will continue to decline.

Regards, Joe Saino, memphiswatchdog.org and shelbywatchdog.blogspot.com

2009-07-26T11:00:00.002-05:00

THE GREAT PROPERTY ASSESSMENT SCAM

One of the most interesting research items that is now of interest me is the rising property tax payments on residential housing in Memphis and Shelby County in the last ten years.

Look at the City of Memphis CAFR for 2008 (Comprehensive Annual Financial Report) and the Shelby County CAFR. I have attached four pages from the City report and two pages from the County report that has to do with the property tax assessed values for residential and commercial property in the City and County. You will see that the residential property assessed value in Memphis went from $3.2 billion in 1999 to $5.2 billion in 2008, an increase of 62%. The commercial and industrial assessed value went from $3.6 billion to $4.3 billion an increase of 19%. For Shelby County the residential property tax assessed value went from $6.1 billion in 1999 to $10 billion in 2008, an increase of 64%. The commercial and industrial value in the County went from $4.4 billion to $5.4 billion, an increase of 22%. The total tax levies from 1999 to 2008 for the City and the County went from $545 million to $1.1 billion, an increase of 100%, basically doubled. The population increase from 2000 to 2008 for Shelby County is 1%.

Does any of this make sense to you, the taxpayers? The property tax assessor told us that the 8.8% increase in property values for Shelby County was perfectly alright and in accordance with reality. I went to zillow.com (an outstanding real estate valuation site) and found the following information.

Shelby County home values during the last year are down 10%, not up 8.8%.
Shelby County home values are up 17% in the last ten years, not 64%.
Inflation is up 30% over the last ten years, not 100% which is the take from property taxes.

I will be reporting further on what politicians are doing with the tax rate and what they are hiding from you, the taxpaying public.

Go to this website to verify this information. http://www.zillow.com/local-info/TN-Shelby-County-home-value/r_1388/#metric=mt%3D34%26dt%3D1%26tp%3D6%26rt%3D6%26r%3D1388%2C32811%2C10264%2C11594

Click here to see property tax data from the latest Memphis and Shelby County CAFR reports

2009-07-08T08:53:00.002-05:00

Well the budget battle (more like a rout) is over and the other shoe (millions more for the Memphis School System) is still to drop requiring more taxes this year. Now the Mayor is going to resign (or maybe not) requiring an expensive special election. What a circus.

I am still doing what I do and that is investigating and publishing information on the cost and excesses of our local political system and the need for REFORM.

I have attached to this email the expensive and inflated portion the City of Memphis personnel manual. We need to cut back on these benefits to bring them in line with the "for profit" world of taxpayers. I call you attention to the following candidates for reform.

Appointed employees- page 1. The charter needs to be changed to allow only a few appointed positions, if any.
Age requirements- page 2, an employee can go to work at age 18, work 25 years and retire at age 43 with his pension. The cost of health care to the City is huge between age 43 and the Medicare age and this early retirement age needs to be revised to the Medicare age.
Holidays- pages 3-4, 11 days
Vacations- pages 5-9, 5 weeks after 25 years. Too many, cut back to three or four.
Sick leave (2/1/2 days per MONTH) after 15 years. That is 6 weeks per year)/bonus days- pages 10-19. Way too many. Cut back to 1 per month.
Jury/witness duty- page 20-22
Death in family leave- pages 23-26, 3 days
Time allowed for voting- page 27, 3 hours
On the job injury- pages 28-31, 6 months with pay
Educational leave- pages 32-33, w/0 pay, 1 year plus
Personal leave w/o pay- pages 34-35
Retirement-pages 36-37 ( I will publish the complete pension system terms later).
Tuition reimbursement- pages 38-40
Rest Periods- page 41, ½ hour per day
Parking City Hall Garage- pages 42-43

I call on the Memphis City Council and the new Mayor (if we get one) to cut back these inflated benefits to the levels available to the people who pay the bills, the taxpayers.

For future reference and for employees and the public to use, I have attached in two files, the entire City of Memphis personnel manual. Due to the file size I had to put it in two files, pages 1 to 129 and pages 130 to 264.

Click here to see the above sections from the City of Memphis personnel policy manual

Click here to see the first half of the complete City of Memphis Personnel Manual

Click here to see the second half of the complete City of Memphis Personnel Manual

2009-06-28T12:39:00.004-05:00

HELP, THERE IS A ROBBERY IN PROGRESS IN MEMPHIS AT THE PENSION BOARD

Those of you who wanted to see the end of the long running term of Mayor Herenton probably did not count on Herenton's crony friends holding up the pension system when he left.

Now that our Mayor is getting a City of Memphis pension and a School System pension when he retires, he is going for the BIG BANANA in Washington to add Federal Perks to his haul. And the worst of it all is that it is legal.

For those of you who are not aware of the terms of our pension system, I have shown below a brief resume from the City of Memphis CAFR (Comprehensive Annual Financial Report) and the City of Memphis Retirement System showing the details of the system. Some important points are

The City of Memphis Retirement System is administered by a Board of Administration under the direction of the Mayor. Separate financial statement for the plan are not issued.
The assets of the plan are down 33% from July 1, 2008 to March 31, 2009.
As of June 30, 2008 there were 4070 retirees receiving benefits or entitled to receive them
There were 3056 active employees fully vested and 3165 non vested.
Generally employees may retire after 25 years of service regardless of age.
Those appointed people may retire after 12 years of service regardless of age due to the disastrous January 2001 pension resolution which Tom Marshall said would help the City get and retain good people.
ONE SIGNIFICANT PART OF THE PENSION SYSTEM IS THAT THE PENSION IS BASED ON A PERCENTAGE (2-1/4% OR 2-1/2%) OF AVERAGE MONTHLY COMPENSATION. THE DEFINITION OF AVERAGE MONTHLY COMPENSATION IS AS FOLLOWS. "THE HIGHEST AVERAGE MONTHLY COMPENSATION RECEIVED FOR ANY FIVE CONSECUTIVE YEARS OF SERVICE, OR THE MOST RECENT YEAR'S EARNING, IF GREATER".

Now do you see why Willie put his cronies in these high paying jobs last year? So they could increase their pension payout.

Also I have attached a list of employees and salaries from a 2005 open records request listed by top to bottom salary. Those with NO in a column are appointed employees. These salaries are up 5 to 7% from 2005.

Click here to see a 2005 list of appointed employees listed by salary many of whom will be retiring and start receiving their pensions

Click here to see the terms of the pension plan which is run by the Mayor and his cronies and which allows the pension to be increased after only one year at a new higher salary

HERENTON’S LAST BUDGET FARCE?

2009-06-26T09:23:00.001-05:00

THE BUDGET FARCE IN MEMPHIS AND SHELBY COUNTY

The recent budget farce in the City of Memphis was acted out and the result is the confirmation that our government is run by an incompetent administration and a majority on the City Council that has never run a business and has never seen a public job that they do not love.

The annual farce started with our Mayor who predictably presented a $617 million dollar budget that was higher than the year before ($580 million). The City Council initially was determined to get tough with the Mayor this year and demanded that he cut the budget by $50 million dollars or about the amount that they previously cut from the Memphis City Schools. That cut is in litigation and may come along to add to our already existing highest in the state property tax rate. The Mayor's answer was the old trick that he has used before, presenting a budget with cuts in public safety, senior citizen centers, libraries etc. The City Council, of course, rejected this and then determined that they would go through the budget line by line and make the cuts they wanted.

After weeks of meetings of various subcommittees, they were able to come up with $14 million in savings. (Remember the old maxim about a camel is a horse designed by a committee). The defining characteristics of "design by committee" are needless complexity, internal inconsistency, logical flaws, banality, and the lack of a unifying vision.

Then enter Jim Strickland who at least had a plan and a unified vision, but alas, he did not have the seven votes. There was no majority to cut the pay raises for employees (3% on top of 5% the year before last). There was no majority to cut their own pay and those of top overpaid and incompetent City crony employees. There was no discussion of cuts in benefits which allow a 15 year employees to have off 13 weeks a year with pay. There was no discussion of the condition of the defined benefit pension plan and the deep losses in the plan's assets. (Please note that Keith McGhee, chief administrative office at a salary of about $145,000, is retiring at age 43). There was no discussion of the promised retiree health care benefits which has an unfunded liability of $823 million dollars.

We are cursed with an incompetent and self interested administration and a City Council with a majority that cares only about preserving their jobs and those jobs of City employees and have no interest in the tax payers of the city of Memphis. Unfortunately, the County Commission is very similar in structure and operation.

The end game is that the City and County will continue to lose population and tax base similar to many other cities in the country. Wake up America. We need to clean house and elect reform candidates who will put the interest of the tax payers first and operate government like a "for profit" business.

2009-06-15T19:35:00.002-05:00

IS THIS A GREAT COUNTRY OR WHAT? LOCALS FLIP JUST ONE PROPERTY THREE TIMES AND MAKE OFF WITH $684,000

I have listed below just three pieces of local property. There are many more and I hope that the FBI is investigating these transactions.

Basically the scheme illustrated by the attached pages of transactions from Tom Leatherwood's site shows properties at 144 Person, 395 Edith and 744 Melrose. The scheme goes like this.

Look at the other two sheets showing 744 Melrose and 395 Edith.

Click here to see the transactions from Tom Leatherwood's site. This is one of hundreds of such local transactions

Click here to see the transactions on 395 Edith from Tom Leatherwood's site. This is one of hundreds of such local transactions

Click here to see the transactions on 144 Person from Tom Leatherwood's site. This is one of hundreds of such local transactions

Click here to see the transactions in which Mykisha Williams was involved from Tom Leatherwood's site. This is one of hundreds of such local transactions

Click here to see the transactions on this California outfit from Tom Leatherwood's site. This is one of hundreds of such local transactions

2009-06-01T09:28:00.004-05:00

ANOTHER TURKEY COMING HOME TO ROOST?

Recently it was reported in an article in the Commercial Appeal that the Memphis and Shelby County Sports Authority was considering to again reconfigure the debt on the FedEx Arena. I have been trying for some time to get the most recent financial statement (December 31, 2008) from the Sports Authority but was told by the County Attorney that the document does not exist yet and to ask again on June 30, 2009.

I think it is instructive to see what was said in the December 31, 2007 document which is attached. In reading through the document, it sounds like the Captain of the Titanic saying that there is no danger to the ship from icebergs as the ship has a double hull. According to the article in the paper, “The refinancing and an accompanying transaction known as an interest-rate swap helped reduce the sports authority's payments to about 4.25 percent. However, the financial crisis pushed the interest rate to about 9 percent. Interest rates are low now, and the authority believes it could reduce its payments by switching to a fixed rate.” Read through the December 2007 document and you will read many statements that the risk of interest rate increase in the swaps was low.

Where does the money to pay these bonds and interest come from? The Senior Lien Revenue Bonds shall be payable from the following sources.

1) A $ 1.15 per seat use charge on paid Arena events..
2) Rebate of sales tax revenues to the City and the County for the exclusive use of the Sports Authority derived from NBA Franchise events, concessions and the sale of NBA franchised merchandise in the County.
3) City Hotel/Motel Tax Revenues derived from certain hotel/motel taxes imposed by the City pursuant to the provisions of City Ordinance 4824. (A 1.7% tax was added to the existing 5% plus the + the 8.25% sales tax for a total of 14.95%). This tax has been dedicated until 2016 to the payment of debt service for the expansion of the Cook Convention Center.
4) Certain County Hotel/Motel Tax Revenues (to the extent certain tourist
development zone sales tax increment moneys are received) and subordinate to certain pre-existing debt which is pledged for the Cook Convention Center Bonds, the County Bonds for the Pyramid and a specified amount to the Convention and Visitors Bureau.
5) Payments in lieu of taxes from the Water Division of MLG&W pursuant to that certain PILOT Agreement between the City and MLG& dated July 1, 2001. The payment will be $2.5 million per year until 2028.
6) A new 2% County-wide car rental tax imposed pursuant to Section 67-4-1907 of Tennessee Code Annotated.

If these revenues are not enough to pay the bonds, then the taxpayers are on the hook except that property taxes (ad valorem) are not to be used. (This restriction was the result of the 2001 petition by Heidi Shafer to get the taxpayers the right to vote on the building of the Arena). However we will still have to pay one way or the other or maybe we will get a bailout.

Click here to read the December 31, 2007 sports authority report describing swaps and derivatives which backfired

2009-05-28T14:51:00.007-05:00

THE PUBLIC PENSION SITUATION IN MEMPHIS AND SHELBY COUNTY

I finally received the update of the city of Memphis pension report dated March 31, 2009. I have attached that report and the report from the end of the last fiscal year ending July 30, 2009. It shows that the market value of the fund dropped from $2.11 billion to $1.45 billion, almost by 1/3. Also I have attached a report on who is on the City of Memphis pension board. This is quite interesting and almost incestuous. Talk about foxes guarding the henhouse. The members of the pension board are

The Mayor or his designee
The comptroller
5 employees with at least 10 years of service
1 citizen member
1 retiree of the plan
1 member of the City Council, non voting
Director of personnel, ex officio member, non voting

The important points here are two facts.

The pension promises are full faith and credit promises backed up by the taxing authority of your elected officials regardless of our ability to pay.
This whole process needs to be opened up with more public members (read taxpayers) on the pension board as it is their taxes that guarantee these promised pensions. The employees do contribute but so do the taxpayers and the guarantee is from the taxpayers.

Unless we have a miraculous market recovery, we will see huge pension increases in contributions from the taxpayers. We need to reform this system so that future new employees have a defined contribution plan (like a 401k) rather than a defined benefit plan. This is what taxpayers in the "for profit" world have and this is what public employees should have.

Click here to see the June 30, 2008 pension valuation report

Click here to see the latest monthly pension valuation report to see what it has lost

Click here to see who is on the pension board watching over your money

2009-05-19T12:22:00.002-05:00

THE MISSING PUBLIC SERVICES & NEIGHBORHOODS BUDGET SECTION

If you go to the City of Memphis website, the Finance Division, you will find that the 2009 Adopted Operating Budget has a section missing (http://www.cityofmemphis.org/framework.aspx?page=947). It was taken down after two rape victims were turned away recently from the Sexual Assault Center. Also you will see that the City Attorney's section is missing but you find it under the second listing for Grants and Agencies.

I have found the missing section and have attached it to this email. No wonder they are hiding it. There is over $500,000 difference between what the City received from the state and what they spent. Where is the money?

Concerning the 2010 proposed budget, the most ridiculous statement is in the Mayor's letter in the introduction to the budget. He says the following.

"We've gone through it line by line to identify areas where we can cut costs, modify services and make necessary personnel adjustments. One way we have realized cost savings is by modifying our service delivery model as it relates to our Parks and Public Services Divisions. For example, City golf courses will be open fewer hours, as will community centers and libraries. These measurers enable us to make sure that every full-time employees working for us today has the opportunity to work for us tomorrow. However, since personnel costs make up about 70 percent of our operating budget, we focused on other opportunities to cut expenses in this area. Therefore, rather than laying off a single full-time employee, we have eliminated funding for over 125 vacant positions across the organization. "

Why do they include vacant positions in the budget in the first place? The answer is padding so that they come in under budget.

How about laying off some cronies. Here is some information from a Commercial Appeal article in February 2008 about cronyism appointments for Deputy Directors in Memphis.

Janet Hooks left the City Council after the legal problems of her husband and was appointed as the Director of Multicultural and Religious Affairs (part of the Public Services and Neighborhood budget) at $75,000/year. Then she went to Community Enhancement at $100,000/year.
LaSonya Hall, executive division, $100,000
Tony Elison, public works/solid waste, $100,000
Michael Gray, library services, $100,000 and last but not least
Yalanda McFadgon, public services and neighborhoods, $100,000

Think about all of the above as you look at your checkbook as you pay your property taxes this year.

Click here to see the missing 2009 public services and neighborhoods budget

IT IS TIME TO LET THE TAXPAYERS VOTE ON TAX INCREASES

2009-05-17T16:53:00.001-05:00

Why do we continue to build schools when the enrollment continues to fall? Why do we continue to pay $3 to the City for every dollar we spend on a county school. There has to be a better answer. Our huge county debt is due mainly to school construction with the above payment formula. If the City of Memphis and Shelby County are looking for reasons for our financial crisis, they need to start with our two school systems. Our County school system is pretty good and their cost per student is lower than the Memphis City School system. Many people talk of combining the two systems or of giving taxing authority to the school boards. What a terrible idea. State law requires that when you combine two systems, you must bring the lower cost per student system up to the higher cost system. Stupid yes, but we are talking politicians here, not rocket scientists.

People ask me if I have an alternate answer to building new schools for a shifting population. I have several suggestions. Close and tear down the under populated schools to save on the maintenance costs. Then take the tax money spent on each student in the City or the County where the overcrowding occurs, an offer it as a voucher for a qualified private school education. Ask the parents if they want to participate in a drawing and then give the lucky winners a voucher to be used to pay for a private school education at a qualified and certified private school.

The most egregious problem and error is the ADA (Average Daily Attendance) split law between the City and the County. The law states that when the County builds a school in the County, they must give the City of Memphis School System the cost of the new school multiplied by the ADA split. The law, however, has a provision that allows the county to build the school with taxes collected outside the City of Memphis to avoid this disastrous payment to the Memphis City Schools (MCS). One school (Arlington High School) was built by this provision in the law and county taxpayers are paying 4 cents per year in property taxes for this school over and above their normal county property tax. Since, then the County Commission has refused to build further schools using this method in the law. The results are shown below. $539 million dollars in extra cost plus another $50 million starting last year.

CAPITAL IMPROVEMENT BUDGET SCHOOL FUNDING
Funding bases on ADA (Average Daily Attendance)
FY	City	County	Total
1999	$57,300,000.00	$27,150,000.00	$84,450,000.00
2000	$95,296,146.00	$48,838,828.00	$144,134,974.00
2001	$57,300,000.00	$31,800,000.00	$89,100,000.00
2002	$57,300,000.00	$27,300,000.00	$84,600,000.00
2003	$57,300,000.00	$18,800,000.00	$76,100,000.00
2004	$57,300,000.00	$51,975,000.00	$109,275,000.00
2005	$57,300,000.00	$20,000,000.00	$77,300,000.00
2006	$57,300,000.00	$20,000,000.00	$77,300,000.00
2007	$43,000,000.00	$17,000,000.00	$60,000,000.00
Totals	$539,396,146.00	$262,863,828.00	$802,259,974.00

TOTAL PAID TO CITY OF MEMPHIS OVER AND ABOVE COST OF COUNTY SCHOOL CONSTRUCTION COSTS		$539,395,935.00

The reason for this financial crisis lies at the feet of the politicians and their refusal to make reasonable decisions that taxpayers have to make every day. It is time that taxpayers take back control of their government from the politicians by cutting off the tax faucet. I propose a voter referendum next year that would not allow an increase in the pot of property tax money in the County to state as shown below. It is time we allow the voters to decide if they want to pay more property tax money due to reappraisals.

Section XXX Amendments to the Shelby County Charter.

The total ad valorem revenue from the previous year being the ad valorem revenue based on the previous year's total assessed value of taxable property within Shelby County, may not be increased without the majority vote of those registered voters voting in a countywide election. If the county commission, by majority vote decides, that they want such an election and an election is not scheduled within 120 days of the majority vote, then a special election shall be called. Ad valorem tax revenue from new construction and improvements not included on the previous assessment roll may be included in the amount authorized to be spent without voter approval.

2009-05-17T16:29:00.002-05:00

I have reviewed The City of Memphis 2010 proposed operating budget which is now on line. I would like to point out some facts

The FY 2010 projected budget is $577 million with a funded staffing level of 6215. Compare this to FY 2006 Actual budget of $479 million and a funded staffing level of 5162. Both of these are up 20%. And also consider that the City Council took $57 million out of the budget in 2009 (School Funding) and it is still up 20% from 2006.
In the budget summary there is this ridiculous statement. "The largest cost impact across divisions is the 3% salary increase for all employees over FY2009 budgeted at $11 million. To balance this increase, we have eliminated funding for over 130 vacant positions (without laying off any employees).
GASB 45 requires the City to value the cost of providing post employment health care benefits (OPEB). In FY 2008, we established an investment trust to pre-fund $3 million in future OPEB obligations. For FY 2010, $6 million has been budgeted for post employment benefits. GUESS WHAT THE UNFUNDED LIABILITY WAS IN 2007? $823 MILLION DOLLARS.

It is time to bite the bullet and reform and cut the budget.

My recommendations for the 2010 budget year is the following.

A 10% personnel cut in the City of Memphis. The cuts should be actual jobs, not phony ghost jobs.The actual funded staffing level for 2007 was 5534. The adopted 2009 funded staffing level was 6309, an increase of 14%. A 10% cut is not unreasonable. It should be across the board from the top to the bottom. For instance, we do not need a deputy director in each department. This is a layer of bureaucracy that we can do without.
We need a fundamental change in our personnel policy to bring it more in line with the "for profit" world where all the tax money originates. We now have at the top end of years in service (15 years or more) 5 weeks vacation, 6 weeks of sick days, 11 holidays, 4 bonus days and three days death in family leave. This amounts to over ¼ of the year. On top of this we have the federal FLMA (Family Leave Medical Act) which allows up to 12 weeks of unpaid leave for various reasons. Private for profit companies do not have anywhere near this level of days off. We could cut our work force by 15 to 20% by bringing days off down to private levels.
We have over $800 million of unfunded liability in OPEB costs (other post employment benefits) that represent promises made by politicians for retiree health care costs but without the money set aside to pay for them. We are now promising to pay 70 to 75 percent of these costs. We need to reduce this promise by 5% a year for the next 14 years so that the retirees can prepare for this reduction and to not make this promise to future employees.
We need to move to a defined contribution pension plan similar to a 401K used in the for profit world of companies for all new employees. The present plan for existing qualified employees would be maintained.
We need to look at changing the retirement age of employees which currently is after 25 years of service regardless of age. The highest cost of retiree medical insurance is for retirees at ages before they become eligible for Medicare. I have recently gotten current financial reports for the MLGW and have asked for the same from the City and the County. It is not a pretty picture. The MLGW is increasing their contribution by $18 million dollars because of losses in the market.

The guiding principle of these recommendations is that public employees' salaries and benefits should be no greater than the salaries and benefits of the taxpayers (the people who work in "for profit" businesses). Fairness and equity demand this.

2009-05-17T16:18:00.003-05:00

TOUGH ECONOMIC TIMES AND PUBLIC PENSIONS

I have reported on the unfunded liability for OPEB (Other Post Employment Benefits) to the tune of $3.5 billion dollars. Now I have been looking into the local pension funds. Generally, in the past, I have believed that they were in reasonably good shape compared to the reckless funds and excessive benefits seen in the past in places like San Diego and Houston. However with the severe downturn in the market I wanted to get a look at the current figures. Also there is a current investigation of possible pay to play actions by certain fund managers that has come to light.

I have requested and received annual reports from Memphis, Shelby County and MLGW. I have also received current monthly reports from MLGW and Shelby County. The City of Memphis has not sent the latest monthly report but hopefully they will in the next few days.

First, we all hope that the market will improve for our own investments and also for the pension funds. Regardless of your political persuasion, the last 25 years (excluding 2008) have been a good time for investments. However here are the facts from the annual MLGW report and from the current Shelby County monthly report.

MLGW. Total recommended plan contributions for 2009 are $40+ million (26.7% of payroll), compare to $22 million (15.18% of payroll) for 2008. This is an increase for 2009 of $17.69 million.
Shelby County's pension fund is down $325 million as of the end of March 2009 from the end of June 2008. This is a 32.3% drop. It is not know yet what the 2010 contribution requirement will be.

These are legal full faith and credit obligations for the rate payers and taxpayers of Memphis and Shelby County. No doubt the City figures will be the same or worse which is probably why they are dragging their feet in not letting me have the information. I have attached the MLGW and the Shelby County documents mentioned above.

Click here to read the December 31, 2008 MLGW annual pension report

Click here to read the March 2009 monthly Shelby County pension fund report

THE SHELBY COUNTY CLERK’S OFFICE

2009-05-17T12:21:00.001-05:00

On Tuesday, April 28, I had an appointment at 10 AM in the office of Debbie Stamson, the Shelby County Clerk and her assistant, Susan Henning. This was a meeting that I requested pursuant to my open records request concerning automobile registration and other functions of the Clerk's office. In response to my initial request I got a very oblique answer from Mr. Craig Willis, the Assistant County Attorney. Not satisfied with this answer I asked to meet with Ms. Stamson and the meeting was graciously granted.

The next day, I heard on the news that eight employees from her office have been indicted and that Councilwoman Ware was also involved. What a shock.

My investigation had nothing to do with the criminal charges against the eight employees. All I was asking was "What are the duties of your office and are you sure you are collecting all the fees that are due to you?" They had no answer and basically depend on the honesty of the average citizen to do the right thing. Take a look at other cars as you drive around and see if everyone has a 09 or 10 little sticker on their license and is it a legitimate one or one cranked out on their computer.

What I found was a typical bureaucratic mess that is symbolic of practically all government, local and national. Their main job is selling more than 650,000 vehicle license plates per year. (the wheel tax is about $106.00 for city residents and $30.00 less for a county car).They have no way of checking to prove if everyone is paying their legal fees which is different in the City limits versus the county. Suppose someone who paid last year simply does not pay? How about the owner of a car from another state who moves here? The penalty for not paying is practically nonexistent. The person can claim that it was setup and not driven for the last year. There seems to be very little cross checking with other data bases. Moreover, they collect the hotel and motel tax (about $150 million per year), take 5% for the support of their office and turn over the rest to the County Trustee.

I will report more in the days to come as I check what other states do in this area. For now I am still trying to digest another local scandal and wondering why I am still living in Memphis and hoping for a better future.

2009-05-01T09:59:00.002-05:00

Here is another fact from the previous City of Memphis reports that points out the fact that the Memphis City budget is all about jobs, not efficient government. With the improvements in computer management and government computer programs, they should have been able to reduce the number of employees from 1996 to 2008 with only an 8% increase in population. But their objective is not efficiency, it is about jobs.

YEAR	1996	2008	DIFFERENCE
POPULATION CITY OF MEMPHIS	614,289	664,215	UP 8%
FUNDED STAFFING LEVEL	4764 (actual)	6225	30%

One other point. I asked last week for a copy of the proposed budget. I was told that it was not on line and would not be available until after it was finally adopted. I complained and asked how the public could review the administration requested budget without a copy on line. I have been told that Council Chairman Myron Lowery will have it on line by the end of this week. I have posted below the budget committee meetings, dates and times. Let us show up and let them know that we want real reform and cuts in the budget.

Here is what needs to be done.

My recommendations for the 2010 budget year is the following.

A 10% personnel cut in the City of Memphis. The actual funded staffing level for 2007 was 5534. The adopted 2009 funded staffing level was 6309, an increase of 14%. A 10% cut is not unreasonable. It should be across the board from the top to the bottom. For instance, we do not need a deputy director in each department. This is a layer of bureaucracy that we can do without. Also crony friends of the Mayor who have been given plum jobs should be laid off.
We need a fundamental change in our personnel policy to bring it more in line with the "for profit" world where all the tax money originates. We now have at the top end of years in service (15 years or more) 5 weeks vacation, 5 weeks of sick days, 11 holidays, 4 bonus days and three days death in family leave. This amounts to over ¼ of the year. On top of this we have the federal FLMA (Family Leave Medical Act) which allows up to 12 weeks of unpaid leave for various reasons. Private for profit companies do not have anywhere near this level of days off. We could cut our work force by 15 to 20% by bringing days off down to private levels.
We have over $3 billion of unfunded liability in OPEB costs (other post employment benefits) that represent promises made by politicians for retiree health care costs but without the money set aside to pay for them. We are now promising to pay 70 to 75 percent of these costs. We need to reduce this promise by 5% a year for the next 14 years so that the retirees can prepare for this reduction and to not make this promise to future employees.
We need to move to a defined contribution pension plan similar to a 401K used in the for profit world of companies for all new employees. The present plan for existing qualified employees would be maintained.
We need to look at changing the retirement age of employees which currently is after 25 years of service regardless of age. The highest cost of retiree medical insurance is for retirees at ages before they become eligible for Medicare. I have recently gotten current financial reports for the MLGW and have asked for the same from the City and the County. It is not a pretty picture. The MLGW is increasing their contribution by $18 million dollars because of losses in the market.

2009-04-25T09:59:00.002-05:00

IT IS ALL ABOUT JOBS, EDUCATION IS SECONDARY, LOOK AT THE FIGURES

I have been studying the various school systems for months such as Nashville, Louisville, Memphis and Shelby County. I have been going through the budgets and reports. Finally, someone suggested I look at the student population, number of employees, the budgets and the CPI from 10 years ago (1998) and compare them with 2008. Bingo!!

Here is all you need to know about the Memphis City School System (MCS). Yesterday when I first published these figures I had the student population at the MCS as 110,000. I since found out that Dr. Cash confirmed in a Flyer article that the figure is 103,000 and this was confirmed by a School System executive. This then shows a 5.6% decrease over ten years in student population but a 54% increase in employees and a 69% increase in budget.

Memphis City Schools	Year 1998	Year 2008	% difference
number of students K12	109137	103000	-5.60%
number of employees	10693	16500	54%
general fund budget	$550,147,000	$931,966,000	69%
CPI up over 10 years			31%

It is obvious that the objective of the MCS system is not education, it is jobs. The control and the increase of jobs is what gives politicians power. Minus 5.6% decrease in students over 10 years but 54% increase in employees. There is no excuse. The results of the system are abysmal. On top of this fiscal outrage in employment is the cost of new schools for a static school population which has seen a huge increase in the debt of Shelby County.

One answer is to cut the employment and cut deep. Another is reform of the system. Moreover we need competition. We need an educational experiment. Let's take half of the average cost per student, $4500, and offer it to the families of students to buy an education at a qualified private school and take the other $4500 and add it to the budget of the MCS. This would give the MCS more money per student and then let's track the performance of those students who leave for private schools and see the results versus the MCS.

I have attached the MCS documents to verify the above figures. Now is the budget making cycle at the City and the County. Call your City Councilman, your County Commissioner and your school board representative. Let your voice be heard.

Click here to see the backup documentation for these figures

2009-04-21T12:28:00.003-05:00

ON WHAT IS THE TENNESSEE STIMULUS BEING SPENT?

Recently there was an article detailing a committee set up by both Mayors to oversee the stimulus spending in Memphis and Shelby County. In talking to one of the members of the committee and looking at the website, no details were posted as promised on the following website. http://memphistn.gov/stimulus/default.aspx. I then went to the state website http://www.tnrecovery.gov/032509-TN-Allocation-Summary.pdf and found the following information which I put into a spreadsheet. I have attached the spreadsheet and organized the money into social programs (non stimulative) and other programs that could stimulate business. In looking at the spreadsheet, I found that 80% of the almost $4.5 billion dollars for Tennessee are for social programs that in no way promote business recovery. Look at the spreadsheet and if you want to get further information about any particular program, go to the state website link above and read a further description of what the money for each particular program is intended to do. e.g. Under education there is $194 million for Title 1 Grants to LEAs. The explanation is to provide funding grants to Local Educations Agencies (LEA’S) for basic school expenditures. Available in school years 2009-2010 and 2010-2011.
What this all amounts to is borrowing taxpayer money to fill in for the expected shortfall during the next two years in the hope that the economy will recover and the stimulus money will not be needed after that time. Borrowing, instead of cutting the budget and becoming more efficient. What a terrible business strategy.

Click here to see a spreadsheet detailing how 80% of the over $4 billion for Tennessee is welfare and only 20% will help business

2009-04-21T11:10:00.002-05:00

WHAT IS GOING ON IN THE SHELBY COUNTY CLERK'S OFFICE?

Last week I sent out an email and published a blog posting detailing my frustration with the City of Memphis Auto Inspection process. It seems I hit a sensitive nerve as I got lots of responses. Here are the main points that were made in your replies.

1) There is no need to inspect new cars in the first four years of their use.
2) Why inspect only City of Memphis cars if County cars outside of Memphis are not inspected?
3) The whole process should be done away with as the inspection process is a waste of money and is just intended to create city jobs.
4) Turn the inspection process over to private service stations.

Then I sent an open records request to the Shelby County Clerk’s office as follows.

HERE IS MY REQUEST

Ms. Debbie Stamson, County Clerk
150 Washington Avenue
Memphis, Tennessee 38103
Dear Ms. Stamson,

In accordance with instructions and as a taxpayer of the Shelby County, I would like to inspect the municipal documents in accordance with the Tennessee Open Records Law that contain the following specific information.

2) I want to inspect your records and documents that show how many of the above vehicles have paid the registration fee in the same 2008 period.

I trust that you will inform promptly whatever department and personnel are necessary to make this information and documents ready for my inspection. If you need any additional information or have questions about this request, I am available during working hours at 754-0699.

Sincerely yours,

Joe Saino
6560 Kirby Forest Cove
Memphis, Tennessee 38119

HERE IS THE ANSWER!!

Mr. Saino:

In response to your March 23, 2009 email to Ms. Debbie Stamson, Shelby County Clerk, please take note of the following:

Registration data for 2008 requested by you is not available in any existing record. It is not possible for the Office of County Clerk to indicate how many registered vehicles were in Memphis or in Shelby County outside Memphis during the year 2008. There is no existing record that compiles this information, and it is not possible to generate such a record.

The Office of the County Clerk can provide the total number of registrations, but only as of the date the data is extracted. Only current vehicle registration information is available.

It is anticipated that this information can be provided to you on or about April 6, 2009.

In addition, the Office of the County Clerk can provide information indicating payments to the City of Memphis and the number of registrations paid for in the calendar year of 2008.

This information would also be available on or about April 6, 2009.

In accordance with provisions of the Tennessee Public Records Act, specifically, Tenn. Code Ann. § 10-7-503(a)(7)(C)(1) and Tenn. Code Ann. § 10-7-506(a), you would be responsible for the reasonable labor costs in excess of one (1) hour in producing the information and records you request. Pursuant to these provisions, it is anticipated you would be billed for labor charges in the approximate amount of $240.00. Additionally, you would also be billed for reasonable copying charges in an amount yet to be determined.

If you would like for the Office of the County Clerk to provide the information and records described above, please provide advance payment in the amount of $240.00. Checks should be payable to the Office of the Shelby County Clerk. At the time the information is produced you will be billed for any labor amounts in excess of this plus reasonable copying charges. (If actual labor costs excluding the first hour are less, charges will be adjusted accordingly.)

Any delay in providing advance payment will result in a delay in providing the information described above.

If you have questions please contact me or my paralegal, Edna Ward, who can be reached at (901) 545-3101.

Thank you.

Craig Willis

Craig E. Willis
Assistant County Attorney
Shelby County Government
160 N. Main Street, Suite 660
Memphis, TN 38103
Tele: (901) 545-4917
Fax: (901) 545-4687
Craig.Willis@shelbycountytn.gov

My question to you is this. Am I missing something here? Do they not know how many registered vehicles there are and how many of those registrations have paid the fee? I talked to a local county political figure and was told that they have no computer program recording all this information and they do not know how much tax income they are missing. If anyone has any clarifying information, please let me know. I intend to pursue this issue.

2009-03-24T08:48:00.001-05:00

THE AUTO INSPECTION HASSLE

It is interesting how things come together when you are out and about. The other day, I had to get my annual car inspection since I am unfortunate enough to live in the City of Memphis and have to pay more than my neighbors who live in unincorporated Shelby County. ($117.00 versus $87.00).

I got on line and looked at the camera photos from the three Memphis inspection stations. I looked at the one on White Station but you could not tell how long the wait was since the camera is mounted on the station and only shows the line that is backed up on the entrance driveway. You cannot see if the line extends out in to White Station and around the corner as it does from time to time. I finally decided to go on a Wednesday at 9:30 AM in the middle of the month since I am not working at a full time job as I am retired. I had to wait about 45 minutes which was better than normal. I feel for the working folks who do not have my options. (My suggestion is that a current waiting time be regularly posted on the website in addition to the photo which is worthless).

This is a problem for every Memphis vehicle owner that got me to thinking about this issue. The recent CA article about special treatment for friends of politicians makes all of us who wait in line and pay the full fee boil. First, why do the people in the County not have to have their cars inspected? Will the exhaust from their cars and trucks stop at the boundary line of Memphis and not foul our air? Also the question occurred to me about how many vehicles are registered in Shelby County (both in the City and in the County outside the City) and are they all paying their fees? I asked the Clerk (Debbie Stamson) for the number of autos registered in Memphis and Shelby County for 2008 and how many paid a fee. Simple question you would think.

Her first answer was as follows.

“As far as reviewing our records, all motor vehicle records contain personal information and are covered under the Federal and State of Tennessee Drivers Protection Act.”

My open records request was as follows.

1) I want to inspect your records and documents that show how many licensed vehicles have owner registrations at Memphis addresses and how many have addresses outside of Memphis but in Shelby County.The period should be for 2008. I do not need to see any restricted information but only the total numbers for the 2008 fiscal period.
2) I want to inspect your records and documents that show how many of the above vehicles have paid the registration fee in the same 2008 period.

I have other ideas about auto inspections but more later on those thoughts.

2009-03-13T10:25:00.004-05:00

HIDDEN TAXES

A good friend sent me some information about the GIANT detention (proposed) pond in Overton Park and other water projects. I do not pretend to be an expert in this area but it reminded me of the hidden tax contained in the City of Memphis storm water fee hidden on the back of your MLGW bill. Also you will find there the sewer charge, the solid waste fee and the mosquito/rodent control fee. These are all items that have been removed from the normal operating budget and are regularly and quietly raised each year. They are taxes, just like your property taxes, but they slip by mostly unnoticed.

The Storm Water Fee started out in Fiscal Year 2007 at $2.54/SingleFamilyUnit/month and then it escalated to $2.88 in FY 2008, $3.30 in FY2009, $3.64 in FY2010 and then $4.02 in FY 2011.
This is a 58% increase in 4 years. I have attached the original ordinance and you will see that the increases are built into the ordinance. I have also attached the 2009 budget section showing the amount of money raised by this fee, $14 million in 2008 and $20 million in 2009. Back door taxes.

Click here to see the hidden taxes built into the storm water ordinance passed in 2006

click here to see the amount raised in this storm water fund

TRANSPARENCY IN GOVERNMENT

2009-03-04T09:31:00.001-06:00

TRANSPARENCY IS THE KEY TO GOOD GOVERNMENT

Ever since I filed my first open records request in November 2004 and my first open records lawsuit in February 2005 I have been convinced that transparency in government is the most important tool in honest government. When a politician gets caught with his hand in the cookie jar, his cohorts proclaim that we need a new ethics code. Then they write up a set of complex reporting and gift standards and proclaim that everything is settled, that is until the next incident.

The truth is that no one can stop the borderline ethics violations such as giving jobs to unqualified cronies, giving no bid contracts to friends by setting bid restrictions that only the friends can meet and seeing that legal business goes to supporters and contributors. There are many ways to bend and stretch the ethics codes and politicians are savvy at finding loopholes.

I have been pushing and recommending for some time the use of the internet to use as a bulletin board for transparency in government. Now with the explosion of blackberrys and iphones and with the introduction of new and advanced software there is no excuse for politicians to not put every important document on the internet.

Recently I looked at the City Council Agenda on the internet. I noticed that there were two proposed ordinances that were listed on the agenda. One was an ordinance to provide for Minimum Energy Efficiency in Rental Properties, Ordinance #5292. The other was an ordinance to amend Chapter 2, Article XI, Code of Ordinance, City of Memphis so as to Change the Reporting Requirements for Small Businesses, Ordinance #5293. I contacted Councilman Jim Strickland and asked him why the full text of the ordinance was not put on the internet. He, as a councilperson, of course had the full text of the ordinances sent to him in electronic format. He checked with the council staff and was told that the law only required that the full text be published in the Memphis Business Journal and that it was published weeks ahead of showing up on the agenda for action.

He urged the Council staff to change the procedure and they agreed to publish the full wording of the ordinances and also the resolutions on the internet which they are hopefully now doing. Then I decided to check with the Shelby County government and to my surprise I found that they had been doing this since May of 2008 and I found that the program and webpage was outstanding. You can see this at http://agendapub.shelbycountytn.gov. Not only do they publish all resolutions and ordinances but they publish contract awards. They purchased a program called S.I.R.E. and it seems to work quite well.

Upon further checking I found that the City has a similar program called GRANICUS which could provide similar information but they chose not to provide the same level of disclosure as the County Commission. Also it is to be noted that Shelby County government did not outsource their IT (Information Technology) department like the City of Memphis did when they gave the work to ACS in a controversial contract.

We are making progress in transparency with these developments but it is a work in progress. The next thing that I would like to see is for all public contracts put on the internet with the wining and losing bids exposed and with the reason for the selection of the wining bidder explained if the winner was not the low bidder. The Mayor of Memphis has the contract authority whereas the Shelby County Mayor must get Commission approval of all contracts. Maybe that is why the City Mayor's job is more attractive to politicians.

2009-02-19T08:19:00.001-06:00

THE UPCOMING 10th SEASON OF THE GRIZZLIES

The 10th season of the Memphis Grizzlies begins in the fall of 2010 which is under two years from now. What is significant about this fact? Well, I have attached the complete Memphis Arena Use and Operating Agreement between Memphis and Shelby County and Hoops, L.P.

The Mayor told the citizens of Memphis and Shelby County that he had to sign the agreement and that it was a good deal for Memphis because the Grizzlies (Hoops L.P.) had agreed to pay all operating expenses as expressed in the section 7(b) (page 19 of 53) of the operating agreement.

This section says: (b) Operating Expenses. In addition to the rent (rent consists of $1.15 per ticket, no ticket sales, no rent) required to be paid by HOOPS, HOOPS shall be responsible during the entire Term for all costs and expenses of every kind and nature related to the use, occupancy, possession and operation of the Arena Complex, including without limitation all operating loses. In addition, HOOPS shall be obligated to reimburse CITY/COUNTY in the amount of any deductible related to insurance coverage maintained by CITY/COUNTY in accordance with Section 9(a)(i) hereof.

However the hooker here is the next section, Section 8, Arena Repairs and Maintenance (page 19 of 53) Section (a) states that during the term of the agreement, the City and County will be responsible for and, at its cost shall make all Capital Repairs as shown in Exhibit B (pages 48 and 49 of 53). In other words, the big ticket items are to be paid by the tax payers, not HOOPS. HOOPS is responsible for (1) making all minor repairs, (2) undertake normal and routine maintenance, (3) provide adequately trained janitorial, maintenance and support staff and keep the Arena in a safe, uncluttered, clean, sanitary and sightly condition and (4) provide security for the Arena Complex 24 hours a day, 365 days a year. In addition the City and County have to pay for all fire insurance policies and other perils.

And for this, we gave up the right to have events in the unpaid for Pyramid and the Coliseum. [See section 21, 29 and 30(b), pages 34 of 53, 37 of 53 and 38 of 53]. Also HOOPS has a way to get out of the agreement if Memphians do not buy enough seats under Section 31(page 40 of 53), EARLY TERMINATION RELATING TO SHORTFALLS.

This terrible, stupid agreement was signed by Mayor Herenton and Mayor Rout on June 29, 2001. Mr. Heisley has stripped the investment of the well meaning local Memphis investors of their equity. No one ever accused Mr. Heisley of being dumb like our two Mayors.

Click here to see the full arena operating agreement which has cost us so much

2009-02-16T10:33:00.003-06:00

WHY IS THE MEDIA NOT REPORTING ON OVER $3.5 BILLION DOLLARS OF UNFUNDED OPEB PROMISES?

With almost $800 billion dollars of bailout funds just voted by Washington politicians, it is easy to understand why the local media continues to not report on our local and state politicians who have made promises to public employees about retiree health care and retiree life insurance which they have no intention of funding for the long term. $3.63 billion is pin money in this absurd spending world.

A local Memphis School Board member asked me recently why I did not report on the unfunded OPEB (Other Post Employment Benefits) figure of the Shelby County School System. I did then ask them for this information and they promptly reported that their unfunded OPEB liability was $548 million bringing the total of the unfunded OPEB liability to $3.63 billion dollars for the City of Memphis, the Memphis School System, the Shelby County government, the MLGW and the Shelby County School System.

This got me to thinking about the rest of the state of Tennessee and I wonder what the total is for the entire state of Tennessee and then for the entire country. Add in Medicare, Social Security, the coming universal health care, etc. etc. etc. and you have to conclude that there is no promise that politicians will not make as long as long as you keep voting them into office.

In case you don’t remember, the local $3.63 billion dollar problem has been caused by local politicians promising to pay 70 to 75% of retirees’ health care cost without putting the money aside to pay for it in the long term. We must solve this problem by cutting this promise by 5% a year for the next 14 years so that the retirees can prepare their lives for other medical insurance. To continue to ignore this problem is unconscionable.

I have attached a file showing the relevant pages from the five actuarial reports with the unfunded figure shown. Also I have attached the five full actuarial reports.

POLITICAL DIVISION OPEB UNFUNDED LIABILITY
City of Memphis $823,000,000
MLGW $709,000,000
Shelby County $353,000,000
Memphis City Schools $1,250,000,000
Shelby County Schools 548,000,000

Total $3,683,000,000

Click here to see the relevent pages from the complete OPEB reports shown below

Click here to see the OPEB actuarial report for the Memphis City Schools

Click here to see the OPEB actuarial report for Shelby County

Click here to see the OPEB presentation for the City of Memphis

Click here to see the OPEB actuarial report for the Shelby County Schools

Click here to see the OPEB actuarial report for the MLGW

2009-02-11T12:47:00.003-06:00

OUR LOCAL SCHOOL SYSTEMS, WHERE IS THE MONEY GOING?

I have noticed one immutable fact about government. When times are good and there is plenty of tax money, they expand government jobs. When times are bad and tax money is nonexistent, they claim that more government jobs are needed to solve the financial problem. And once the problem goes away, through no government action that I can discern, the new government jobs never go away.

I have been investigating two local government bureaucracies through open records requests. They are the Memphis City Schools (MCS) and the Shelby County Schools (SCS). I first asked for a list of job titles, number of employees, salaries and benefits. I had to finally sue the MCS in order to get the information which was 1334 sheets which undoubtedly came from an electronic spreadsheet which they refused to furnish. The SCS furnished the information in electronic format. I have attached several files showing a recap of the information I received. Here is my initial take on this information.

• There seems to be an overabundance of custodial helpers (1017) in the MCS system. I do not find this in the SCS system.
• There seems to be a lot of maintenance people in the MCS system (electricians, carpenters, sheet metal workers, etc). It seems to me that this work could be contracted out on an as needed hourly basis.
• There seems to be a wide range of salaries with the same job titles. e.g. in the SCS system, elementary teachers range from $100,000 down to the $40,000 range. There is a similar range at the MCS system.
• I find no reference to the MCS nutrition center workers although they may be in the list I got. The past scandal there requires further information which I am investigating.

The files that I have attached include the MCS salary schedule organized by job titles a to z with salary ranges and number of people in each job title designation. Also the MCS salary schedule high to low but not including Dr. Kriner Cash who makes over $250,000. Also I included 12 sample pages from the 1334 pages of information I received from the MCS system. On page 3 of 12 your will see the Chief Contracting Officer, Sybille Nobile at $145,000 salary plus benefits.

For the SCS system I included a pdf version of the spreadsheet they sent organized by salaries high to low and another by job titles a to z. Finally a file that shows the number of job titles in the Shelby County School system.
I know this is lot of information but the Memphis City Council and the Shelby County Commission need to analyze these two systems and figure out a way to reduce cost and make them more efficient without hurting the students. More money thrown at the system is not the answer. The answer is opening up the system to competition from private systems such as the Catholic Jubilee schools, voucher and charter schools and reform of the present two systems. More money thrown from Washington is still your tax money.

Click here to see the MCS salary schedule and job titles a to z

Click here to see the MCS slary schedule high to low

Click here to see some sample pages from the 1134 pages of the Memphis City School
job titles and salary and benefit schedule

Click here to see the SCS high to low salary and benefit schedule

Click here to see the SCS job titles and benefits listed alphabetically

Click here to see number of each titled job at the SCS system

2009-02-05T14:22:00.002-06:00

COUNTY WORKFORCE REDUCTION PLAN VERSUS HERENTON'S "NOT" PLAN FOR THE CITY
There is a good contrast between the City and the County on workforce reductions. I have attached two items that will be introduced in the Shelby County budget committee agenda today. It is a proposal for workforce reduction of 8.4% for the county producing a savings of $58,341 per position for a total savings of over $20 million dollars. Contrast this with the Mayor Herenton’s proposal of 100 buyouts at $70,164 per position which is shown in the third attachment. This is a reduction of 1.5% and produces no immediate savings. The City needs to match the County’s serious proposal and reduce the City employee roll by 8.4% or 530 positions and save up to $30 million dollars. We need serious reductions now to match what the County is doing and to help the taxpayers who are already tightening their belts.

Click here to see Mike Ritz's proposal for real immediate reduction in Shelby County's workforce

Click here to see the current workforce count for the County

Click here to see the high cost, low layoff plan from Mayor Herenton for the City

2009-01-27T16:31:00.005-06:00

The Commercial Appeal Article on Beale Street but not the 17 boxes of hidden Beale Street documents

January 28, 2009

There was an article yesterday morning in the Commercial Appeal concerning how the City of Memphis is getting tough on John Elkington and Performa Entertainment. However I reported on this in 2005 in two website article. In those article I reported that I received a tip that there was boxes of Beale Street documents and reports hidden in a locked storage room at 701 N. Main, the Offices of Housing and Community Development run by Robert Lipscomb. I called the then City Attorney, Sara Hall, and asked her to check and she stated that she could not go down there but sent Elbert Jefferson, the current City Attorney, to check. He did if fact find 17 boxes of Beale Street documents and Wil Gotten, a retired lawyer, and I did eventually get to see them but only after they were sent to Ricky Wilkins for his review.

The City of Memphis has done nothing to enforce their rights since 1992 even though they had all these documents and reports. There was an audit done in 1992 but the results were never allowed to be published. The City of Memphis cannot now claim that they have been in the dark all these years. They have simply failed in their fiscal responsibility and oversight to the taxpayers of the City of Memphis. This failure needs an independent audit and investigation by the City Council. Following are the two website article published in 2005.

MORE INFORMATION ON BEALE STREET SCAM

November 30, 2005

Will Gotten and Joe Saino have been involved in trying to find out why Beale Street Development/Performa Entertainment have not paid one cent to the City of Memphis since 1982. Previously we have published the leases to Beale Street Development Corporation and to Performa Entertainment in this website section in an article dated September 19, 2005. We asked the City of Memphis and Performa to furnish the quarterly and annual financial reports required under the lease agreements. The City of Memphis initially said that they did not have the reports that showed how much the City had been paid but then they revised that answer to say that they in fact had some reports but that there were no reports showing money that had been paid since they have not received any money from Beale Street since 1982.

The story gets more interesting because Joe Saino received information from a source that there were a number of boxes of reports and files that were in a locked closet at the Offices of Housing and Community Development at 701 N. Main. This information was given to the City Attorney and she said that she never knew that the reports were sent to HCD. She sent someone from her office down to HCD and in fact there were seven boxes of documents about Beale Street there in a locked closet.

She sent the boxes to Ricky Wilkins (the attorney representing the City in the Beale Street case) for his review and then she contacted Will Gotten and Joe Saino to allow a review and inspection of the contents of the boxes. She also provided copies of some of the quarterly and annual reports from John Elkington and upon inspection of these reports she admitted that she did not understand the reports and could not determine what monies, if any, were owed by Elkington to the City of Memphis.

The conclusion of all this effort and investigation is the following.

• No one from the City Administration has been doing any oversight on Beale Street and no one knows or seems to care if the reports are accurate.
• The City Administration has abdicated its fiscal responsibility in this matter and has allowed John Elkington to do as he wants.
• The City of Memphis, the State of Tennessee and the Federal Government have spent millions of dollars on Beale Street and no one can show whether the money has been spent wisely or whether it was worth the cost.
• There have been no independent audits or verification of the Beale Street reports.
• Hundreds of thousands of dollars have been spent in useless litigation by the City of Memphis concerning Beale Street Development Corporation and Performa Entertainment.

This is yet another example of the incompetence of the Herenton Administration.

Check below some of the missing annual reports from John Elkington to the City of Memphis.

Click here to see some of the Beale Street Reports sent to the City of Memphis about which they are doing nothing.

Click here to see the Beale Street Budget for 2005 sent to the City of Memphis.
MR. MAYOR AND MR. ELKINGTON, WHERE ARE THOSE REPORTS?

September 19, 2005

Recently an outstanding Memphis citizen sent an open records request to Ms. Sara Hall, the City Attorney, asking for information about Beale Street Development Corporation. His name is Will Gotten and he is a retired lawyer. Here is his request.

From: William Gotten
>To:
>Subject: Beale Street Development Corp.
>Date: Wed, 22 Jun 2005 10:52:28 -0500
>
>Dear Mr. Jefferson: In November, 1982, the City of Memphis entered into a
>lease of Beale Street property to Beale Street Development Corp. (BSDC), a
>non-profit corporation, which then, with the approval and knowledge of the
>City, subleased to Elkington & Keltner and its successor in interest,
>Performa, Inc. The lease and sublease provide that rental payments are to
>be made to the city based on rental income received from the demised
>property during its term.
>
>As a taxpayer and citizen of Memphis, I would like to inspect the municipal
>documents, records, letters and communications, both written and in
>electronic form, that contain information relevant to the following
>subjects:
>
>
>1. The amount of money that the City of Memphis has received each year as
>rent of the demised property directly from BSDC since 1982 to the present
>date.
>
>2. Any written agreements that provide for payment of rent for the demised
>premises to be made directly to the City of Memphis by an entity or person
>other than BSDC.
>
>3. The amount of money that the City of Memphis has received or is receiving
>currently by an entity or person other than BSDC, since the inception of
>such payments to the present date.
>
>4. All annual, semi-annual or quarterly accountings of gross funds received
>and/or expenses deducted, which is determinative of the rent the city has
>received or is currently receiving for the rental of the demised property.
>
>
>Please provide promptly a date, time and place for the inspection of
>documents and personnel for making copies if desired. The reasonable cost
>of such copies will be paid at that time in accordance with City of Memphis
>policy concerning furnishing copies of city documents.
>
>Thanking you for your cooperation, I remain
>
>Sincerely yours,
>
>
>
>William M. Gotten

After almost three months and repeated requests for an answer he finally sent a communication saying that he was filing suit to obtain the information. The next day he got a call and an answer. Here is the answer from Ms. Hall.

VIA E-MAIL AND
U.S. MAIL

September 14, 2005

Mr. William Gotten
6426 Kirby Oaks Drive
Memphis, TN 38119

Re: Open Records Request

Dear Mr. Gotten:

I am writing in response to your August 31, 2005 letter to me and as a follow-up to our telephone conversation this morning. As I stated at the outset of my call, I called you this morning to personally apologize for the amount of time it has taken to answer your open records request. Also, during that telephone conversation, I gave you the answers to the questions you asked in your open records request and stated that I would follow-up with a letter to you, which I am doing now. Your inquiries and the City's preliminary responses are as follows:

1. The amount of money that the City of Memphis has received each year as rent of the demised property directly from BSDC since 1982 to the present date.
Answer: I have checked with the General Services and Finance Divisions and have been advised that the City has not received rent from BSDC since 1982 to the present date.

2. Any written agreements that provide for payment of rent for the demised premises to be made directly to the City of Memphis by an entity or person other than BSDC.
Answer: I have checked with the General Services and Finance Divisions and have been advised that there are no written agreements that provide for the payment of rent to be made directly to the City of Memphis by an entity or person other than BSDC -- that is, other than the documents that we have already produced to you which include the lease between the City and BSDC and the sublease between BSDC and Elkington and Keltner Properties. In as much as you indicated that you already had these documents in your possession, I have requested a check in the amount of $8.25 be made payable to you as reimbursement for those copy costs.

3. The amount of money that the City of Memphis has received or is receiving currently by an entity or person other than BSDC, since the inception of such payments to the present date.
Answer: I have checked with the General Services and Finance Divisions and have been advised that the City has not received rent or other money related to these agreements or premises from any entity or person other than BSDC.

4. All annual, semi-annual or quarterly accountings of gross funds received and/or expenses deducted, which is determinative of the rent the city has received or is currently receiving for the rental of the demised property.
Answer: Since the City has not received any funds, there are no accountings of funds received.

Mr. William Gotten
September 14, 2005
Page 2

Again, I apologize for the delay in responding to your request. As you are probably aware, the City has been involved in lengthy litigation with a number of parties over the operation of Beale Street for a number of years. Also, there have been various City officials assigned the responsibility of overseeing activities on Beale Street over the years, many of whom are no longer employed by the City. I appreciate your understanding.

Sincerely,

Sara L. Hall
City Attorney

xc: Keith McGee, Chief Administrative Officer

A little history is necessary here. We have attached below the two leases in question, the lease between the City of Memphis and Beale Street Development Corporation (BSDC) and the lease between Beale Street Development Corporation and Elkington and Keltner Properties, Inc. (lessee) and its successor in interest, Performa, Inc. Both leases are dated November 29th, 1982.

The lease between the City and BSDC is signed by interim Mayor Wallace Madewell who succeeded Mayor Wyatt Chandler when he resigned. In that year the FBI and the IRS investigated BSDC records and BSDC signed a 32 year lease with the City and contracted with Elkington and Keltner Properties to co-develop and manage the properties. (Later Elkington and Keltner renamed Beale Street Management as Performa Entertainment Real Estate Inc.) In 1994 an option was signed to extend the contract to 2034. In March of 1992 Mayor Herenton ordered an investigation of BSDC and Elkington’s Company. In October of 1994 Herenton said that he had no audit to share after the City spent $276,123.00 dollars and 2-1/2 years on audits.

In a Commercial Appeal article dated October 25, 2001 there was the following quote by Elkington.[Elkington said he wrote city officials in May, and again in the months since, about his readiness to transfer funds. "I've been repaid now. I'm happy," Elkington said.
Elkington, chief executive officer of Performa Entertainment Real Estate, the district's management company, said he was finished repaying Performa for money loaned to the district's operation during lean, early years.]

The real point here is shown in item #4 of Sara Hall’s answer to Mr. Gotten.

4. All annual, semi-annual or quarterly accountings of gross funds received and/or expenses deducted, which is determinative of the rent the city has received or is currently receiving for the rental of the demised property.
Answer: Since the City has not received any funds, there are no accountings of funds received.

In the BSDC/Elkington and Keltner Properties, Inc. lease, Section 5 it says “Lessee shall furnish Lessor and the City quarterly reports in writing, not later than the 15th day of each following quarter, showing the amount of Gross Rental, as hereinafter defined, from the premises during the preceding quarter. Lessee further agrees that it will submit to the Lessor and the City within one hundred and twenty (120) days after the expiration of each full lease year a complete statement certified by Lessee or an independent CPA if the Mayor so requires in writing, showing in reasonable detail the amount of Gross Rental Income from the premises during said period.

Therefore there should be 92 quarterly reports and 23 annual reports. But Ms. Hall says that there are no reports and zero funds received by the City. As a citizen of the City of Memphis and a taxpayer, I demand an investigation of this situation and call on the Mayor, the City Council and the FBI and the IRS (as was done in 1982)to immediately investigate this situation and audit the books and determine how much money is owed to the City from Beale Street. Federal, State and City money has been invested in Beale Street and taxpayers need an explanation.

Click here to see the City of Memphis/Beale Street Development Corporation lease.

Click here to see the Beale Street Development Corporation/Elkington lease.

2009-01-13T14:01:00.004-06:00

January 13, 2009
A REPORT ON MEMPHIS CITY SCHOOL SALARIES, JOB TITLES AND BENEFITS

After filing a law suit I finally got the Memphis City School schedule of job titles, names, salary ranges and partial benefit costs. As you may or may not know, the Memphis City School system is the biggest local cost for taxpayers and the biggest public employer. The schedule that I received was 1335 pages. Before filing this report I was asked by a School Board official to submit it to Dr. Cash for review. I did this but have received no reply for over a week. Therefore I am submitting this report to the public. School budget funding is under consideration and this is information that is relevant.

I have been going through this massive document and trying to make sense of it. I have attached two spreadsheets on which I have made a partial analysis. One shows the 312 job titles from A to Z and the other shows the job salary ranges high to low. I have not finished yet but I wanted to make publish this so that I could get some public comments and input. My partial spreadsheets covers only about 11600 employees but there are over 17000 employees working at the Memphis School System. This does not cover the Shelby County School System as I as still trying to get their information.

I have also attached some sample sheets out of the 1335 pages. You will see job codes, salary grades, salary ranges, the FICA cost, the retirement cost, the insurance cost, the unemployment cost, the job title and the employee name.

I would appreciate public comments from people who know more about this bureaucracy than I do but some things I wondered about and noted below.

The school system pays 7.65% for social security and medicare and I presume the employees pay an equal amount. I assume that when they retire and reach medicare age, their state pension is reduced when they start receiving social security. As I understand it, other City and County employees pay only the medicare portion of social security which is 1.45%.
The school system pays 6.2% for the retirement pension fund and I assume the employee pays a matching amount. The system as I understand it is run by the state of Tennessee as the Tennessee Consolidated Retirement System. This is a defined benefit pension plan.
The medical insurance payment is substantial but it varies as a percentage of salaries. I assume this depends on whether the insurance is for the employee only or for a family. The difference can be as much as $6000 per employee. I do not know at this point how much the employee pays for this insurance but I will enquire about this.
As I understand it, teachers work 10 months during the 12 month year. I am not sure about holidays, sick days, personal days or any other benefits but I will inquire.

In looking through the list I find lots of high priced employees with titles that make you wonder what it is they do. Also note that executive directors make more than directors. Then there are 174 librarians, 1014 custodial helpers, 1098 educational assistants and 228 professional school counselors. It should be noted that the custodial helpers work at a relatively low pay scale but they receive insurance coverage the cost of which in some cases is almost ¼ to 1/2 of their salary.

I did not find the name or salary of Dr. Kriner Cash but he has a base salary of $258,000 per year. I will continue to try to get further information on the Memphis School System and the Shelby County School System and let you, the taxpayers, know what it is that you are paying for to the combined tune of $1.5 billion dollars.

Click here to see a partial list of job titles listed alphabetically

Click here to see a partial list of job salary ranges, high to low

Click here to see a partial list of the 1335 pages in this salary, benefit and job title report

TRANSPARENCY IN GOVERNMENT

2009-01-06T10:06:00.001-06:00

TRANSPARENCY AT THE CITY VERSUS SHELBY COUNTY

I keep learning about government and the things I discover continue to amaze me. I recently complained to several City Council members that when they published an agenda on the internet and it contained a proposed ordinance, that the full wording of the proposed ordinance was not shown on the internet. For example, I have shown below two proposed ordinances that are on the agenda for the January 6, 2009 meeting.

11. ORDINANCE to provide for Minimum Energy Efficiency in Rental Property, up for FIRST reading.

Ware Ordinance No. 5292

12. ORDINANCE to amend Chapter 2, Article XI, Code of Ordinance, City of Memphis so as to Change the Reporting Requirements for Small Businesses, up for FIRST reading.

Halbert Ordinance No. 5293

I emailed this to Jim Strickland and he referred me to the City Council staff. They told me that the full wording was published in the Memphis Business Journal weeks ahead of it appearing on the agenda. I said that this was not satisfactory as it met the requirements of the law but not the spirit of transparency. (Remember the January 2001 pension resolution which slipped through without a remark). That will eventually cost the taxpayers millions of dollars in extra pension costs.

I complained again about Ordinance 5292 and 5293 which are on the upcoming agenda. I sent information to several city council members and the City Council staff person has agreed to change to procedure and in the future they will post all ordinances and resolutions in full with the agenda.

Then I checked the Shelby County website agendas and I find that Shelby County has been doing this since the early part of 2008 as they use the SIRE system. You can see this if you go to the following site. It is quite outstanding and includes also copies of public contracts.

http://agendapub.shelbycountytn.gov.

I then called the Shelby County Information Technology office and they told me that the system cost $400,000 and that the City of Memphis also has a similar system. Apparently they could have published all this information like the county but have chosen not to do so.

Take a look at the County system and then ask several questions.

Why has the City of Memphis not given the taxpayers the same public information that Shelby County has done?
Why have the City of Memphis spent millions on outsourcing their Information Technology to ACS whereas Shelby County has kept their IT in house and apparently done a much better job at a lower cost?

We need some answers to these questions and we need the full matching website information format that Shelby County is giving to their taxpayers.

2008-12-13T11:03:00.002-06:00

CAN DEMOCRACY SURVIVE WITHOUT A STRONG, INVESTIGATIVE PRINT MEDIA?

I went to the Rotary Club meeting last Tuesday and John Malmo was the speaker. His subject was “Can Democracy survive if investigative newspapers do not”. It was an important speech and he is uniquely qualified to speak on the subject.

I am sending it along to you to read as news breaks about the Governor of Illinois, Rod Blagojevich. We need tough, suspicious reporters working for investigative print newspapers but they are disappearing before our eyes. What will replace them and catch the next crooked governor, mayor or even president? I need you thoughts on this important subject.

Click here to read an important speech by Mr. John Malmo concerning the future of print media and the survival of democracy

AN AD IN THE WALL STREET JOURNAL

2008-12-12T13:45:00.001-06:00

There was an ad in the Wall Street Journal on Tuesday, December 9th on page D3. The ad featured three houses in Tennessee, Nashville, Memphis and Chattanooga.

The Nashville house had 5 bedrooms, 4 baths, 4413 sq. ft. at a price of $499,900 with taxes of $3952.

The Chattanooga home was the same price with 4 bedrooms, 4 1/2 baths, 5710 sq. ft. at the same price with taxes of $3657.

The Memphis home was the same price with 4 bedrooms, 3 1/2 baths, 4008 sq. ft. with taxes of $7200.

This illustrates the problem we have here in Memphis with high property taxes which continues to drive people out of Memphis to other locations. We need to lower propety taxes if we are to compete with others areas of Tennessee and the Mid South.

2008-12-12T13:25:00.003-06:00

A DROP IN THE BUCKET

I have been investigating the huge unfunded liability associated with the promises made by our local politicians to our public retirees concerning paying most of their health insurance premiums after retirement. To date they have been paying only the annual actual costs, not the future actuarial costs. This is called OPEB (Other Post Employment Benefits). The unfunded liability according to the actuarial reports for the City of Memphis, MLGW, Shelby County and the Memphis City School System is over $3 BILLION DOLLARS.

Recently I talked to people at Shelby County and they are talking about funding this liability up to possibly $20 million this year. The MLGW set up a fund in 1997 but has not contributed much if any since then. The City of Memphis in their 2009 budget has said that they are contributing $6 million dollars towards their unfunded liability of $823 million. (See attached 2009 budget pages, page 2 of 4). This shows that they will not keep providing this benefit in the future and they have indicated that they will cut this benefit soon. There is no way we can afford these promises and it is time now to tell the truth to the present and future retirees so that they can make other arrangements for their health care in the future.

POLITICAL DIVISION	OPEB UNFUNDED LIABILITY
City of Memphis	$823,000,000
MLGW	$709,000,000
Shelby County	$353,000,000

Memphis City Schools $1,250,000,000

Total $3,125,000,000

2008-11-24T09:03:00.002-06:00

TRANSPARENCY MEANS HAVING ALL THE INFORMATION BEFORE THE VOTE

Last week I wrote about the stealth tax increase for your solid waste fee which was passed in June 2008 and increased from $19.00 per month to $21.55 per month. I wrote to City Councilman Jim Strickland about this and other ordinances and complained that the agendas published by the City of Memphis mentions certain ordinances but does not give the actual wording of the ordinances. Jim is very good about responding on the issue of transparency and at his instance the City Council staff responded that the full ordinances are published in the Memphis Business Journal. Although I did not know that fact, you will see when looking at the file that they sent (a copy of this which I have attached) that they were published on 5/6/08 and 5/30/08.

While this meets the letter of the law, it does not satisfy the spirit of transparency. If you will look at the attachment you will see that there are three ordinances that affect your pocketbook. Ordinance 5261 raised your solid waste fee to $20.55 from $19.00 per month. Ordinance 5263 asked the property tax rate to be set to $4.01 per $100 (per the Mayor) of assessed value. This was later lowered by cutting the school funding. Ordinance 5264 got a unanimous vote to raise the pensions of City retirees by up to 3% depending on when they retired.

All of this information needs to be readily available to the public at the same time that it is available to the City Council. Just publishing it in the Business Journal and the Daily News is not sufficiently transparent to the tax payers who have to pick up the bills for the garbage and the pension increases. We need all pending ordinances and passed ordinances posted on the City website in advance of their consideration by the City Council and all final passed ordinances posted to a City website archive. The taxpayers need the same information that is provided to their elected representatives in advance of their votes.

Click here to read the ordinances that raised your garbage fee and increased your pension costs and who voted for the increases

2008-11-18T16:44:00.003-06:00

HOW ARE PENSION FUNDS DOING AMID THIS FINANCIAL MELTDOWN?

Those of you who are invested in the stock market through your 401K’s and other investment accounts have seen them fall drastically during this year, particularly in the last two months. The Dow industrial average is down 22% since September 15th and down 35% year to date.

Well you might get some comfort (maybe not) that the various pension funds for the City of Memphis, Shelby County and the MLGW are also down. I have asked these three organizations for a report on current values and have received two answers and that from Shelby County and the MLGW. I must say that the openness of Shelby County at the direction of Mayor Wharton and the MLGW at the direction of Jerry Collins has been very good. As usual, the City of Memphis, no doubt at the direction of the Mayor, is slow and difficult and I have received nothing to date.

The County and the MLGW reports are attached. Shelby County is reporting through September 30, 2008 down 17.2% YTD and probably another 10% for the month of October which was a bad month for everyone. Down 27% in this market is not bad compared to 35% for the Dow. Their investments seem well diversified and the management fees seem reasonable considering the size of the portfolio. The MLGW report is even better as they are down 12.4% year to date through September and probably another 9 or 10% in October. I have attached both reports.

The only information I have on the City portfolio at this time comes from the 2007 CAFR (Comprehensive Annual Financial Report). I have attached a copy of that report and there are several things that could cause some concern. They had $117 million in collateralized mortgage obligations, $148 million in mortgage backed pool securities, $110 million in real estate and $15 million in high yield bond funds. All of these investment categories took a real hit in the latest meltdown. Hopefully the fund did not but I will report when I get the information.

While I was talking to several County officials about the retirement in general and particularly about the OPEB (Other Post Employment Benefits) unfunded liability, they said that the County was planning a substantial contribution this year in order to begin a trust fund to fund these promises made to retirees. The MLGW set up such a fund in the past but has made no additional contributions since setting up the fund. The City of Memphis has done little in this area to date.

The County has a policy of requiring employees to purchase Medicare part A so that Medicare becomes their primary health insurance when they retire and this cuts the OPEB costs substantially. However a big problem is that many retirees are under the age of 65 and this is one of the big costs for retiree health care. Pension reform, at a minimum, should address this early retirement rule in order to cut costs. 25% of retirees are under the age of 65. Many retirees who are not eligible for Medicare either due to age or not having contributed to Medicare during their working career are eligible because their spouse has Medicare.

My overall impression is that the County and MLGW (under Jerry Collins) are well run. The City of Memphis and the Memphis School System are the problem and badly need budget, personnel and structural reform and a commitment to transparency and openness.

Click here to see the latest update on the Shelby County pension fund

Click here to see the latest update on the MLGW pension fund

Click here to see the structure of the City of Memphis pension fund from the 2007 CAFR. The latest update has not been reported yet to the watchdog

2008-11-12T09:23:00.008-06:00

PENSION REFORM IN MEMPHIS AND SHELBY COUNTY

With the help of many friends, I am in the process of creating an organization called MEMPHISSHELBYREFORM. The purpose of this organization will be to educate taxpayers in the area of needed reforms in our City and County governments. The only way to slow down or reverse the decline of Memphis and Shelby County is to push for reform in government aimed at the efficient use of our limited tax money.

I will be posting a series of proposed reform ideas and would appreciate your thoughts on them. I have already posted my thoughts on the Memphis School System.

Today I would like to look at our pension system that we have at the City of Memphis. The system in Shelby County government, the MLGW and other governmental agencies is similar.

Our system promises a defined benefit pension payment if you meet certain requirements. In a simplified report I have attached the general outlines of the City of Memphis system. The plan benefits vary depending on when you started, how long you worked and whether you are a policemen or firefighter or a general employee. But generally you can earn a pension up to 72-1/2% of average monthly compensation. The employees contribute to this system which is generally matched by the City of Memphis.

Most private sector employees who work for private for profit companies do not have a defined benefit plan. Rather they generally have a defined contribution plan like a 401K. The difference is that the public pension plan is a legal obligation on the taxpayers of Memphis and Shelby County. This is a huge difference.

What I propose as a reform is that for future employees of the City of Memphis, MLGW and Shelby County we go to a 401K type plan where we are sure of the cost of the plan each year and are not obligating ourselves for a future payment from our tax stream that we may or may not be able to pay. I am not talking about taking anything away from current employees as they would be grandfathered into the current plan.

Another big part of the promises that politicians have made to current public employees concerns the post retirement medical and life insurance benefits where generally the taxpayers pay 70 to 75% of the medical premiums after retirement. This is a huge benefit and unfortunately the politicians have not been funding this promise. The current unfunded liability of Memphis, Shelby County, the MLGW and the Memphis City Schools is $3.125 BILLION DOLLARS. That is BILLION, NOT MILLION. The government is requiring that these organizations put this unfunded liability on their balance sheets starting next year. This huge unfunded debt will make borrowing money much more expensive as the balance sheets will look much different. Realistically, the taxpayers cannot meet this obligation and the politicians are already talking about cutting this benefit which is not a legal obligation.

The whole point of my reform plan is this. Why should the average taxpayers who works in the private business sector offer more to public employees than they are offered in the for profit private sector. Politicians always manage to feather their nest at the tax payers expense. The truth is that all taxes come from a for profit business and without business profits, there would be no money available for any public sector employee.

Click here to read the essential details of the current City of Memphis defined benefit pension plan

2008-11-10T16:52:00.003-06:00

HOW TO SAVE OVER $100 MILLION DOLLARS PER YEAR

Change is in the air. Change can be good and change can be bad. I have been advocating change (reform) in local government for years and now that we have a local and national financial crisis, we are going to have to learn to live on less tax money. Therefore we need more efficiency in the delivery of governmental services.

Local politicians have been talking about consolidating our City and County governments for years but nothing has been done. Therefore I started investigating this subject and as a start I have come up with some interesting statistics by comparing on one hand the combined Memphis and Shelby County government employment figures with the already combined figures of Nashville which is called Metro Davidson government. You may remember the ex Mayor of Nashville, (Bill Purcell), who at a Rotary Club meeting stated that he hoped Memphis would never consolidate because he did not want Memphis to be more competitive with Metro Davidson for new residents and new businesses.

The following are some interesting figures.

Population of Memphis and Shelby County 911438

Population of Metro Davidson 578698

Total Employees of Memphis and Shelby County 33570

Total Employees of Metro Davidson 16000

Employees per 1000 people for Memphis and Shelby County 36.83

Employees per 1000 people for Metro Davidson 27.6

School population of Memphis Schools 113000

School population of Shelby County Schools 45000

School population of Metro Davidson 74733

School employees for City of Memphis 17000

School employees for Shelby County 4243

School employees for Metro Davidson 8361

School employees per 1000 students for City of Memphis 150

School employees per 1000 students for Shelby County 94

School Employees per 1000 students for Metro Davidson 112

It is obvious where one big problem is and it is in the Memphis School System. This over $1 billion dollar taxzilla is nothing but a job factory where education results are secondary to providing employment. If we reduced the school employment to the same ratio employee ratio per student as the Shelby county school system, we could operate with 6328 less school employees. At an average of $45,000 each, this would save $284 million dollars per year. David Pickler (see attached report) reports a difference in cost per student for the Shelby County School system of $1344 less than the City School system. Calculated by this, we could save $151 million by running the City System as efficiently as the County system. He also points out that we definitely do not want to consolidate the well run County School system with the bloated and inefficient City School system. It is obvious that millions could be saved by reforming and cutting the Memphis School System. Reform needs to come to this school system and we need it now. I will report further this week and next on other possible local savings reforms.

Click here to see what David Pickler has to say about the consequences of consolidating the Shelby County School system with the City of Memphis School System

2008-10-31T15:12:00.001-05:00

Where does tax money come from?

My brother and I ran a manufacturing business for 40 years here in Memphis. We made and sold industrial doors, fire doors and electronic door operators. In most years we made a profit, we employed a lot of people and the company and our employees paid local, state and federal taxes.

I hear people complain about the current situation. They say that the government should intervene and should control and raise taxes on greedy businesses. I have asked them a simple question. Where does tax money come from? They say that is simple. Part of my salary goes for taxes, or part of my interest or dividends on investments goes for taxes. But I say if you are a government employee (fireman, policeman, public hospital employee, etc.) your salary comes from the real taxpayers as you produce no profit. (That is not to say that these jobs are not important because they are).

The point here is that the fountain of all tax money is a for "profit business" that hopefully produces a profit and pays salaries, benefits, dividends and interest. Examples of real businesses are chemical companies, oil companies, manufacturing companies, mining companies, aircraft companies, farmers, home builders, software companies, even banks and the like. An example of a non producing business is the gambling and the lottery business which produce nothing and is really a transfer tax from the dumb to the smart.

Now we have politicians who want to raise taxes on business or give greater power to unions or give greater sway to trial lawyers which will hurt the source of all tax money, the golden fountain of business profits. There is nothing wrong with unions as long as they realize that their very existence depends on the health and profitability of the company they work for. You need look no further than the auto companies to see what happens when unions overreach. Trial lawyers have destroyed more businesses than any other group in our history.

I ask that voters step back and look at your choices and they are not good. We have probably the worst group of politicians (local, state and national) to pick from that I can remember in my over 70 years here in Memphis. We need to replace the whole lot with people of honor who put country first. Pray for America but also take some action. “For profit businesses” are the real wellspring of tax money. Kill that source and we have nothing.

2008-10-31T13:32:00.003-05:00

DO YOU KNOW WHAT A TIF IS?

With all the financial turmoil in our country and our city, I have been investigating the various Tax Incremental Financing (TIF) deals in Memphis and Shelby County. What are our financial obligations and are the taxpayers liable for the bonds issued under the various TIF deals?

I have found that it is very difficult to get this information but I am making some progress. I have found that from July 1, 2007 to June 30 2008 the state of Tennessee returned to Memphis $1,050,683.25 for the FedEX Arena, $276,489.94 for the Red Birds and $2,373,742.90 for the Uptown Development. What we do not know is the amount of bond payments and if these required payments are being met. For instance the required interest and principal payments for the Arena for 2008 is $8.07 million as shown on the attached Memphis and Shelby County Sports Authority audit and financial statement.

What is a TIF? The politicians claim that it is a no risk way to develop an area or a building (arena) or a convention center. We have four that I have identified and they are the FedEx Arena, the Redbird stadium, the downtown development zone and the Highland area. The FedEx Arena has several sources of money to pay these bonds. They are the seat rental fee at $1.15 per seat, the state and local sales tax (except the .5% designated for local education) paid on sale of admissions, sale of concessions and sale of NBA franchise goods and products, the car rental tax, the city wide hotel/motel tax except that that is dedicated until 2016 for the Cook Convention Center, the county-wide hotel motel tax except that it is dedicated for the Cook Convention Center, the Pyramid and the Convention and Visitors Bureau and finally $2.5 million per year of your MLGW payments from the Water Division.

We need a full and transparent accounting of all these financial obligations, especially in this difficult period where sales tax and property tax revenues seem headed in a downward spiral.

Click here to see the latest financial statement for the FedEx arena

2008-10-31T10:33:00.000-05:00

JOE SAINO RECOMMENDATIONS ON CHARTER AMENDMENTS

As usual the Commercial Appeal is mostly wrong. Many friends have asked me about these charter proposals and here are my thoughts and what I am voting for and against and the reasons. Also there is a huge question which is going unanswered. Charter Commission Referendum No. 4 calls for the suspension with pay for an elected or appointed official. Charter Commission No. 6 talks about filling a vacancy in the Mayor’s office. Suppose the Mayor is indicted. The City Council Chairman takes over and becomes the Mayor Pro-Tem and can serve for up to 180 days or until the next general election at which time a new Mayor could be elected even if the indictment has not been resolved. Interesting possibility.

County Commission Ordinance No. 364. YES as this is the best we can get and I do not want the Mayor appointing any of these positions as the voters should decide, not politicians.

County Commission Ordinance No. 365. YES as the County Commission wanted more than two terms for themselves even though the voters years ago voted for two four year term limits. Because they are mad that their attempt to get more than two terms failed, they are proposing only two terms for these five formerly constitutional officers. Vote yes because term limits for everyone is a good thing in this new American era of corrupt politicians.

City Council Ordinance No. 5232 Vote Yes.

City Council Ordinance No. 5265 Vote NO as it is ridiculous to require city officials to live within the city. They should be able to live where they want in order to get the best people to take these jobs.

Charter Commission Referendum No. 1 Vote YES as this is term limits. The Commercial Appeal brings out the old argument that the voters can vote out incompetent politicians. Everyone knows better as it is very difficult to vote out an incumbent. It takes them 8 years to learn how to steal and then we need to turn them out. The prime example for term limits resides at City Hall.

Charter Commission Referendum No. 2 Vote NO as the argument is that we need experienced politicians in these positions. Thirteen new City Council members at one time would be better than six incumbents and seven new people. Also this would allow the first group of politicians to get 11 years in office rather than 8 years as the first three years would not count towards term limits if term limits passes which I hope and pray it will.

Charter Commission Referendum No. 3 Vote YES on no sale of MLGW without voter approval.

Charter Commission Referendum No. 4 Vote YES on suspension, with pay, for appointed or elected officials who are indicted.

Charter Commission Referendum No. 5 Vote YES on instant runoffs. It is not complicated and it saves money and it corrects the situation where you get a big vote at the first election and a small vote at the runoff.

Charter Commission Referendum No. 6 Vote YES and hope that the Mayor’s office becomes vacant.

2008-10-02T19:25:00.003-05:00

MORE NONSENSE FROM CITY HALL AND DOWNTOWN

The basic question is do we need a new convention center? Recently there was a puff piece written by Kevin Kane, CEO of the Memphis Convention and Visitors Bureau, "If they build it, they'll definitely come here." Mr. Kane makes over $250,000 in salary as head of the bureau. In making the case for a new $600 million dollar convention center, he points out the following. 1) No property taxes or any other taxes on local residents were used for the project completed in 2003 to expand the Cook Convention Center. He says that this expansion has generated over $200 million in new business in five years. Yet when you look at the total sales tax income for the City of Memphis from 1999 to 2007 as a percentage of General Fund Revenue for the City of Memphis, it is flat at 12%. Moreover, when you look at local sales taxes over the same ten year period, the percentage of general fund revenue has gone down from 26% to 19%. However, there has been one increase in tax revenue to the city of Memphis. Unfortunately, that is property taxes which as a percentage of General Fund Revenue have gone from 28% to 38%.

In order to further check on the facts on the convention center, I obtained a copy of the Memphis Cook Convention Center Financial Statement dated June 30, 2007 which is attached. It was not easy to get this document even though it states in the latest 2007 Comprehensive Annual Financial Report for the City of Memphis and for Shelby County that the statement is available at 225 N. Main. It was not available and I finally had to get it from a friend who had some influence.

In going through the statement I noted that they exceeded the budgeted event days, attendance and rental revenue by a considerable amount. However, in spite of exceeding the budget figures, they managed to lose $3.5 million dollars. The interesting fact on the financial statement is that the City of Memphis and Shelby County governments contributed $3.2 million dollars to cover the loss. I have to wonder if Mr. Kane forgot about this contribution when he stated in his article that the Cook Convention Center is not costing the taxpayers any money.

Any revenue projections coming from CEOs of convention centers or consultants who have an interest in seeing a project go forward have to be taken with a large portion of salt as I have never seen a consultant with a negative report or a convention center CEO who did not want to expand his operation, regardless of the cost to the taxpayers.

Click here to see the convention center financial statement

2008-09-16T08:22:00.002-05:00

$600 MILLION FOR A NEW CONVENTION CENTER???

If there ever was a great argument for term limits, Mayor Willie Herenton makes the case. Now after blowing over $100 million for our present convention center ($60 million over budget), he is now talking about $600 million +++ for a new convention center.Guess where he (and unnamed others want it), close to the Peabody Hotel , Beale Street, the new Westin Hotel and the FedEx Arena. Look at the attached map. I have been told that they are talking about the area bounded on the east by S. Danny Thomas, on the north by Union Avenue, on the west by Hernando and on the south by Gayoso. I wonder what or who influenced this location?

First of all regardless of where it is, it makes no financial sense at all. The Mayor and Kevin Kane talk about keeping up with the Jones (read Nashville). They are talking about a $600 million dollar new Nashville convention center which has been proposed but at this point it is still just talk. At least in Davidson County they have a provision in their charter that there will be NO PROPERTY TAX INCREASE WITHOUT VOTER APPROVAL. Naturally we do not have such a provision in either our City or County charter, although I proposed that when I ran for City Council.

This is just a warning to beware of Greeks bearing gifts, or Mayors promising development without risks to your pocketbooks. I have also attached two newspapers articles about similar no risk Tourist Development Zone financial deals in Chattanooga, Knoxville and Sevierville. Have a nice week.

Click here to see where Herenton wants the proposed new $600 million dollar convention center to be located

Click here to read about the Sevierville project. Sevierville has a $39 million dollar operating budget but is on the hook for $180 million in development costs

Click here to read about the downtown development in Chattanooga using TDZ bonds

2008-09-11T09:17:00.003-05:00

YOU HAVE TO ASK YOURSELF WHAT ARE THEY SMOKING DOWN AT CITY HALL?

THE PYRAMID/BASS PRO DEAL , FAIRGROUNDS, ELVIS PRESLEY, HIGHLAND AVE AND NOW $600 MILLION FOR A NEW CONVENTION CENTER!!!

HAS ANYONE PAID ANY ATTENTION TO THE OVER $3 BILLION UNFUNDED OPEB LIABILITY FOR RETIREE HEALTH CARE PROMISES MADE BY THESE POLITICIANS? OUR DEBT AS A PERCENTAGE OF THE LEGAL DEBT LIMIT HAS RISEN FROM 50% IN 1998 TO 75% IN 2007.

We are now seeing a rush of deals being put forward by City Hall and local developers. What they are saying in their sales pitch is that "This building or this area is dead and we can bring it back at no risk to the taxpayers". Is that true?

I want to concentrate on the Pyramid deal as this is the current one that is being promoted by the City and the County.

After reading the Development Agreement, the following is a list of my thoughts on this agreement which need to be addressed before we decide whether to go ahead.

We need an accounting of all the current tourist development zone (TDZ) bonds and what portion of the increased income tax stream takes precedence over the Bass Pro deal. I talked to the State of Tennessee Department of Revenue concerning TDZ financing and they said that they start with a base of taxes in the TDZ zones and that only the increases over the base goes to pay the TDZ bonds. The state portion base is increased annually by the average sales tax increase for the whole county (not just the TDZ) and therefore only the tax portion over the average increase goes to pay off the bonds. They pointed to several TDZ deals in Tennessee that had zero increase in the TDZ tax rebate due to their average increase in sales tax receipts not being greater than the county average increase.
The next thing that needs to be done is to survey other similar tourist development zone (TDZ) deals around the country that have been in effect for at least five years to compare terms of agreement and to see how the initial promises made in fact turned out such as sales, new tourists, sales taxes, etc. I have attached an article about a similar deal in Texas that was done by a competitor of Bass Pro. Also I have attached a list of Bass Pro and Cabela stores.
Herenton and Lipscomb claim in the document that "Under the terms of the Development Agreement, local government would have no financial risk or local government funding in the Pyramid redevelopment project". However they fail to state that the bonds that would be issued in a TDZ project are full faith and credit bonds and that if the additional tax income is not there, then the taxpayers of Memphis and Shelby County are on the line as they are for all the other downtown projects financed by TDZ bonds.
Bass Pro gets a large tax credit which means that they will pay less federal income taxes. And yet they are competing with Walmart and other smaller hunting and clothing goods stores in the area that pay property taxes and income taxes. Is that fair? We need to hear from these people.
The agreement calls for the City and County to complete a title search and review of the surrounding site as well as those parcels of land which may be beneficial to the success of the project. This raises the question of emminent domain similar to the Kelso case and the prospect of the City and County taking property away from owners by emminent domain.
Finally, as in the past, if we decide to go ahead with the deal, we must be assured that we hold our investment at no more than the $30 million plus the remaining debt. I can envision a scenario where we start on front end infrastructure work and invest a lot of money and then they pull out and say the market is not right, goodbye. We need an arrangement that we are protected by a clause that makes Bass Pro guarantee payment for these expenditures if they pull out during the construction period. Our history here in Memphis is to walk into a deal and once we get involved, we have to go forward when unexpected things happen. Look at the past Convention Center debacle.

Click here to read about similar deals in Texas involving Bass Pro and a competitor, Cabela

Click here to see where Bass Pro and Cabela have stores in the United States

2008-09-09T09:14:00.006-05:00

BASS PRO AND THE PYRAMID! IS IT A GOOD DEAL FOR THE TAXPAYERS?

I have been studying and reading about the Pyramid deal with Bass Pro until I have almost gone cross eyed. Please inform yourself about this deal and the whole area of what I call Stealth financing that is growing in Memphis and the whole country. Is this a good deal for the taxpayers or is it a good deal for Bass Pro and the downtown developers and landowners? Could it be good for all? Here is a link that will take you to the City of Memphis website that shows the proposed development agreement between the City, the County and Bass Pro.

http://www.cityofmemphis.org/pdf_forms/082508_PyramidPresentation0001.pdf

Also I have attached a copy of the Bass Pro meeting with the County Commission. Pay particular attention to the questions from Mike Ritz and Steve Mulroy who are trying to get answers to the inside workings of this complicated deal. Also look at the testimony of Charles Carpenter, a local attorney and good friend of the Administrations who has gotten a lot of bond work on all these deals and is remembered in connection with MLGW bonds and Larry Thompson. One last thing is an article I have attached talking about TIF (Tax Incremental Financing) deals in Texas involving a competitor of Bass Pro.

This whole area of TIF's in Memphis is growing and should be looked at closely. Politicians are selling TIF financing as a no risk way to development, that is, no risk to the taxpayer. In any deal like this you have to ask "Cui Bono", Who Benefits.

Clearly Bass Pro benefits. They put up very little money on the front end and they can pull out without paying very much. If the project goes forward, they get huge tax benefits through the New Market Tax Credits thereby paying much less in Federal Income Taxes on profits. The favored developers and landowners downtown benefit by increased traffic and business and possible increases in land value. The favored attorneys benefits through legal business and bond business, like Charles Carpenter.

Do the taxpayers benefit? Possibly, but the property does not pay any property taxes. Sales taxes will be used to pay off the bonds and due to the Tourist Development Zone agreements, additional sales taxes will go to pay off other downtown zone bonds. Looking at the latest City of Memphis Comprehensive Annual Financial Report, which I have attached, you will see that sales tax collections that go to the general fund revenues have decreased significantly over the last ten years. This is probably due to the diversion of these tax revenues to cover the downtown and other TIF and TDZ (Tourist Development Zone) projects. We need a complete accounting in one place for all the obligations put on sales taxes in these various TIF and TDZ areas so that we can know what our true bond obligations are and why sales taxes receipts for the general fund are dissapearing.

What about the other businesses in Memphis and Shelby County who sell products that are competitive to Bass Pro? They do not have the political clout of a Bass Pro, Target or WalMart and therefore they have to pay property taxes and if they make a profit, they have to pay federal income taxes at the full rate.

Finally, why are we in this situation? It is because of the ill conceived contract that the City and the County signed for the FedEx Arena. That contract made the Pyramid useless and a silver elephant. I remember Mayor Herenton saying that he had to sign the contract because Hoops was to be made responsible for the maintenance and possible losses of the Arena. But if anyone read the contract, they would see that the one of the hookers in that contract was in Section 8, Arena Repairs and Maintenance. Section (a) states that during the term of the agreement, the City and County will be responsible for and, at its cost shall make all Capital Repairs as shown in Exhibit B (Heating and Air Conditioning, roof, etc). In other words, the big ticket items are to be paid by the tax payers, not HOOPS. HOOPS is responsible for (1) making all minor repairs, (2) undertake normal and routine maintenance, (3) provide adequately trained janitorial, maintenance and support staff and keep the Arena in a safe, uncluttered, clean, sanitary and sightly condition and (4) provide security for the Arena Complex 24 hours a day, 365 days a year. In addition the City and County have to pay for all fire insurance policies and other perils. Also HOOPS has a way to get out of the agreement after 10 years if Memphians do not buy enough seats under Section 31, EARLY TERMINATION RELATING TO SHORTFALLS, and the clock is running. Also, of course, the contract did not allow any functions at the Pyramid. Some deal.

I ask that you look over this information and let me have your thoughts. Many of you have written me on other subjects and I am aware that you are a lot smarter than I am and I would appreciate your thoughts and expertise. I will hold your comments confidential unless you say otherwise.

Click here to see the Bass Pro presentation to the County Commissiion

Click here to read an article about TIF financing involving BAss Pro and a competitor in Texas

Click here to see how sales tax collections in Memphis have gone down and property taxes have gone up over the last ten years

2008-09-02T06:03:00.005-05:00

MAYOR HERENTON, JOB CREATOR

National politicians make promises about job creation during every political cycle. It is usually all talk and hot air. However our local Mayor, WW Herenton, takes this job seriously. With this article I am posting the personnel files from the two most recent Deputy Directors, Tony Elion (Solid Waste) and Yalanda McFagdon (Public Services). Both start at $100,897.68. Then before I could get these two posted, WW announces that his good friend Joseph Lee, late of the MLGW and pumping for over $400,000 from the MLGW in legal fees, has been appointed as another Deputy, this time to the Park Service at $105,000. Also Maura Black Sullivan at the Office of Planning and Development at $98,000. Where will it end?

Take a look at the resumes of Yalanda McFagdon and Tony Elion.

Yalanda McFagdon:

Page 4- She got raised from $72,000 as Executive Director of Second Chance to this $100,000 job. On page 5 you will see that the funding grant for second chance ended. Second chance is a federally funded program intended to give at risk people another chance, a very worthy objective. However, who has ever audited or honestly reviewed the effectiveness of this and the thousands of other similar programs. These programs certainly give the Mayors a great opportunity to employ friends and cronies.

On page 10 see a letter to WW noting that the job title for Yalanda should be changed from WORKSORCE DEVELOPMENT SPECIALIST to SPECIAL PROGRAMS COORDINATOR at a salary increase. Who ever said that job titles are not important. At City Hall, they mean big salary increases.

On page 12 you will see the re-employment form in 2000 after serving 5 months in prison in 1999 for concealing $70,000 in drug-dealing proceeds and interfering with a federal search. Previous to serving time, she was head of Herenton's bodyguard detail.

Tony Elion:

His resume is not nearly so colorful as Yalanda's but I do have to credit Yalanda for persisting in her education. Here again, he was involved in protecting the Mayor. Apparently this is the path to promotion. Could it be that they are both potential witnesses to events in our government? Who knows. But protecting the Mayor gets a 5% salary bonus for what could be hazardous duty service. (See page 5).

I can't wait to read the other personnel files from our Directors and Deputy Directors.

Click here to see parts of the personnel file of Yalanda McFagdon, your new Deputy Director of Public Services

Click here to see parts of the personnel file of Tony Elion, your new Deputy Director of Solid Waste

2008-08-27T19:47:00.003-05:00

August 27, 2008

What are the qualifications of the Administration execs?

With all the recent news about the Memphis city Council wanting to approve the Deputy Directors of the City of Memphis, I decided to start reviewing the personnel files of the top City of Memphis Administration executives. We all know about the Mayor and his qualifications so I am starting with Mr. Keith McGee, the CAO of the City of Memphis. I will then go on to the Directors and Deputy Directors and post all the information on line. By the way, the City Council caved in on the proposed change to the City Charter that would have given them approval of Deputy Directors as well as the much more important one concerning approval of professional contracts which the Mayor now gives out as he alone decides.

I have attached Mr. McGee's file and please note the following.

Page 2- This is the job description and requirements. Please note the minimum qualifications.

Pages 3 and 4- This is his job history and education.

Page 7- A salary of $143,903.76.

Page 40- Note the accumulated sick leave days of 235.5 days (47 weeks). Veteran City employees earn 2 -1/2 sick days per month which if not used, they can carry forward. This is 6 weeks (12 times 2.5= 30 days= 5 weeks)per year in addition to 5 weeks vacation, 11 holidays and 4 bonus days. Over 13 weeks per year when they might not be working. ATTENTION TAXPAYERS: DO YOU HAVE SIMILAR BENEFITS!!!

The city sets the educational and job requirements for these high paying jobs. Apparently they accept internet degrees from anywhere and rate them the same as degrees for classrom colleges and universities. Then this makes the applicant qualified, according to the city, for the job. This whole world of taxpayers funded salaries and benefits needs to be reviewed and compared to for profit businesses in Memphis and Shelby County.

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Click here to see the personnel file for the Chief Administrative Officer of the City of Memphis

2008-08-24T20:07:00.005-05:00

PAST LEGAL FEES OF THE THREE MUSKETEERS, SPENCE, WILKENS AND WADE

I
researched my files to see what information I had on how much Robert Spence, Ricky Wilkens and Allan Wade has received in legal fees from the City of Memphis. This is from 2004 and 2005 and I have not updated these figures but I think I will soon. How about $3.29 million. Nice work if you can get it and they can.

Click here to see how much these three buddies of Mayor Herenton have earned under his administration and this is only for two years 04 and 05

2008-08-20T13:14:00.002-05:00

The voters of Nashville, Knoxville, the City of Chattanooga and Shelby County have the right to propose a citizen referendum written into their charters. This is how Shelby County got term limits. Did you know that the citizens of Memphis do not have that right?

I have researched the information about Nashville, Chattanooga and Knoxville. I have attached the portions of the charters for Nashville, City of Knoxville, Knox County and the City of Chattanooga. Hamilton County (where Chattanooga is) has no charter and operates under state law. (They have consistently rejected a County Charter form of government).

The long and the short of it is that all of them allow citizen initiated petitions, all except the City of Memphis. Nashville requires the signatures of 10% of those who voted in the preceding general election. Knoxville is 25% of those who voted in the last Mayoral election. Knox County is 15% of those who voted in the last gubernatorial election (This lowering of the requirement passed by 79% in Knox County). Chattanooga is 25% of those who voted in the last mayoral election.

Enough said. We need this in our charter and we need a reasonable signature figure, not 15% of registered voters as is currently required in Shelby County. (By the way, the County Commission could and should lower this figure according to State law).

Here are six items that are currently approved by the Memphis Charter Commission to be put on the November ballot for the voters to say yes or no.

1. Filling Vacancy in the Office of the Mayor: In the event of the Office of the Mayor becomes vacant, the City Council Chair, who will at that time have the title of Mayor Pro-Tem, shall serve as Mayor for up to 180 days following such vacancy, at which time the public shall elect a duly qualified person to serve the remaining unexpired term of the vacated office, provided that if no general or municipal election is scheduled to occur within 180 days of such vacancy, a special election shall be held within 90 days of such vacancy to elect a candidate to fill the Office of the Mayor through the end of the remaining unexpired Mayoral term.

2. Suspension from Official Duties: Any elected or appointed official charged with official malfeasance, shall be suspended with pay pending resolution of the charge.

3. Sale of Memphis Light Gas & Water: Any proposed sale of Memphis Light Gas and Water or any of its electric, gas, and/or water assets shall not be final until first approved by a majority of duly qualified voters in the City of Memphis.

4. Term Limits: With respect to all municipal elections held hereafter for the Office of Mayor, City Council, and City Court Clerk, no person shall serve more than 2 consecutive terms in any given office.

5. Staggered Terms: The candidates seeking election to the Memphis City Council shell be elected for a term of four (4) years, and may succeed themselves. For the first election held pursuant to this section, in order to establish staggered terms of office, the candidates from even-numbered districts shall be elected for a term of two (2) years, and the candidates from the odd-numbered districts shall be elected for four (4) years. For all subsequent selections, the City Council candidates will be elected to a four (4) year term. (This will be modified as the Charter Commission made a mistake about the two year term as they apparently want to put the City Council election on even years rather than odd years to save election costs).

6. Instant Runoff Voting.

There is another proposition that will be voted on this Thursday (August 21) and it is very important. It is the proposition to allow the citizen and voters of Memphis to file a citizen petition to put forward for the voters' approval, a change or addition to the City of Memphis Charter. It will be something like the following.

Citizen Petitions to Amend Charter (This will be voted on this Thursday)

WHEREAS, it may be necessary for the citizens of the City of Memphis to propose amendments to the City Charter that are in the best interest of the citizens and which may not be promulgated by members of City Government.

Voters of the City may frame and proposed amendments to this charter. They may propose any such amendment by a petition addressed to the Council of the City and containing the full text of the proposed amendment. Any petition proposing a charter amendment must be filed with the City Clerk and must be signed by qualified voters of the city equal in number to at least 15 percent of the persons who voted in the city in the last gubernatorial election. The clerk shall immediately deliver it to the county election commission. When such petitions have been determined sufficient, the county election commission shall submit same to the voters of the county in accordance with this section.

The county election commission shall submit to the voters of the county any charter amendment proposed and delivered to them in accordance with the provisions of this section. A petition for recall, referendum or initiative shall be filed at least sixty (60) days before a general municipal or county election may be held on the question contained in such petition. The question contained in a petition filed less than sixty (60) days before an upcoming general municipal or county election will be placed on the ballot of the following general municipal or county election.

Click here to see the citizen petition clause for Metro Davidson

Click here to see the citizen petition clause for the City of Knoxville

Click here to see the citizen petition clause for Knox County

Click here to see the citizen petition clause for the City of Chattanooga

2008-08-15T09:01:00.004-05:00

THE MCS TAXZILLA EATS THE CITY OF MEMPHIS

August 15, 2008

I have finally received answers to my open records request to the Memphis City School System concerning salaries and benefits for the some 16,500 Memphis School System employees. The report is some 1335 pages and I am hoping to publish the full report in the near future and post it on the internet. I had to file suit in Chancery Court to get a reply but after I filed suit I received good cooperation from Van Turner of their legal department and I thank him for his cooperation in this matter.

I have published 10 pages of this report below to give you some feel for the salary and benefit levels of this huge bureauracry that has a budget of over $1 billion dollars.

On page 1 you will see Classroom Teachers/K3 in a salary range from $45,000 to $55,000.

On page 2 you will see K3 teachers with Masters degrees in the range of $65,000.

On page 3 you will see non-union educational assistants in the $17,000 range.

On page 4 you will see some striving teachers who are defined in #9 below.

On page 5 you will see some teachers with Ph.D’s but not paid much better than the teachers with masters degrees.

On page 6 you will find ROTC instructors that are paid up to $75,000.

On page 7 you will see special education principals in the $90,000 range.

On page 8 you will find elementary school principals in the high $80,000 range.

On page 9 you will find High School principals at $100,000.

On page 10 are the totals for the first 1094 pages, some $637 million dollars and that is not the total which is over $700 million.

I have not had time to seek out those with salaries well over $100,000 but I did find Sybille S Noble, late of the Shelby County government, as Chief Contracting Office at a salary of $143,655.

In looking at the ten pages I asked some questions about the codes and benefits and got the following answers.

1. Question: Looking, for example, at page 1, the second line, classroom teachers, I notice two lines for each teacher. I assume that this is the range (low/high for this job). Is that correct?

Response: The top row is the current year salary for the employee based on an assumption that the employee works a full school year. In other words, it is not the actual amount paid; instead, just an annual projection. The second row is the projected salary for the 2008-09 school year based on contracted salary increases for the number of years of experience, education, and certification. It is not a low/high range for the job.

2. Question about FICA. Response: FICA is the 7.65% of salary that the division pays. The employee pays a matching amount.

3. Question: Under retirement, this amount is what the MCS pays (about 6.23%) and I assume that the employee pays a matchding amount into the pension fund.
Response: In 2007-08, MCS paid 6.24% for certificated employees and 9.34% for non-certificated staff. The rate changes for 2008-09 and is factored in the projected amount. These dollars are the district’s match. The employee must contribute a state mandated rate of 5%.

4. Question : Under unemployment, this amount ($54) is what the MCS pays and there is no matching amount from the employee.
Response: Correct.

5. Question: I notice that some employees have a BS degree and some have M A degree (masters?) but the M A get paid less. Is this a question of seniority or what?
Response: The difference is due to the years of service. You will notice on the top row for each employee that it begins with a salary grade and step which may read 300 10 indicating that this is a 10 month teacher with a BS degree and ten years of experience. If it reads 310 10, then it equates to a 10 month teacher with a MA degree and 10 years experience.

6. Question: What does the last line (PCT) mean? Most have 1.0 but some have .94.
It means that 94% of the employee’s salary is charged to that particular coding (regular instruction). In this example, the other 6% is coded to project 040 BEP 2.0 for working 30 additional minutes each day (extended day).

7. Question: Do the employees have the option to choose to have benefit deductions classfied as tax-exempt allowing contributions to be tax exempt from federal withholding tax? In other words health insurance premiums are deducted from salary pre tax.
Response: Our insurance is a ‘cafeteria’ plan; and therefore, is tax exempt.

8. Question: What does C and B indicate?
Response: C indicates that the employee has opted to be paid over a 12 month period (deferred payments) and B indicates that the employee has chosen to be paid in 10 months (normal work year).

9. Question: What is the difference between a striving classroom teacher and a BS teacher?
Response: In 2007-08, certain schools were identified by the state as requiring additional support and the new State BEP 2.0 funds were used to provide that assistance. These schools worked the extra 30 minutes a day and were paid for extended day.

10. Question: What is a MA + 45 teacher that seems to be better paid than MA teacher?
Response: They have received so many hours of credit in a doctoral program but have not received the degree.

11. Question: What is an Ed S degree teacher as opposed to the others?
Response: Education Specialist degree, which is more than a masters but less than a doctorate.

12. Question: Are educational assistants part time? What do they do? How many hours in a year do they work? Response: Many are considered part-time since they only work 4 hours per day, appx. 720 hours. Some work 5 hours, and others work a full school day. They assist teachers in the regular classroom while others assist with special education students.

13. Question: How many hours in a year do full time teachers work?
Response: The school day is 7 ¼ hours, which includes lunch. The teacher is paid for 200 days (180 classroom days, 5 in-service, 4 administrative, 1 parent-teacher day, and 10 vacation days).

Click here to see some representative pages from the 1332 page report on the salary and benefits of the some 16,500 Memphis City School employees

2008-08-05T20:36:00.002-05:00

August 6, 2008

JOIN A GROUP THAT HAS THE TAXPAYERS' INTEREST AS ITS CENTRAL CONCERN

MEMPHISSHELBYREFORM
I have been involved in open records requests and investigation of governmental activities and financial affairs for almost four years. These activities, lawsuits and internet postings have been a solo activity and I think have had some positive effects on local government.

However the time has come to expand the operation and to enlist the support of the most important and underserved group in this City, County, State and Country, the taxpayers.

The Democrat and Republican parties are primarily interested in political power to advance their political and economic agendas which are not always in the best interests of the taxpayers. For instance, they cater to the public employee and teachers unions because they are a large voting block with an agenda that many politicians are afraid to oppose although that agenda is not always in the best interest of the taxpayer who pays all the bills.

Therefor it is obvious to me that the taxpayers need an organization around which they can rally and make their thoughts known and make the politicians listen and act on those thoughts. I envision and plan to organize a group that will work for the following initial objectives.

• A government that is transparent, open and accessible and that posts all financial and personnel information on the internet (e.g. all RFPs and bid results with winners and losers of the bids shown and explanation of why the winner was chosen, all personnel information with job descriptions, job qualifications, salaries, benefits, perks, promotions, all financial information with budgets and budget changes, all contracts before and after signing and all other relevant information that affects government efficiency).

• A government whose employees are paid at the same level of salaries and benefits as private for profit employees for similar job skills. (e.g. very few private for profit employees receive a defined benefit pension plan (they normally have a 401K) and very few get a generous health insurance plan after retirement paid mostly by their former employers.

• A City and County charter that allows citizen initiated petitions to change the laws under which they are governed and taxed. That petition right should include a level of signatures that is no higher than that required in the Tennessee Constitution for a Charter Commission, Article 11, Section 9) which is 10% of those voting in the most recent general municipal election. In 1997 the Tennessee Legislature changed this requirement for home rule cities and counties from 10% as above to 15% of registered voters thus raising the bar because they do not want the taxpayers to have a voice in their government.

• An open records law that requires the requested information to be supplied in electronic format (normally a spreadsheet or a word document). I have found over the last four years that the requested information normally starts out as a spreadsheet and then they give me printed copies of the spreadsheet and charge for these copies. This prevents me from having the electronic spreadsheet which makes it much easier to analyse the data. (a great example of this is my recent request to the Memphis School System for all salary and benefit information on the 16,500 MCS system employees. They let me look at over 1100 pages of the information which obviously came from a spreadsheet. I asked for the electronic information and they have not responded yet to my multiple requests.

• Under the current open records laws the person requesting the information is not entitled to ask for a particular electronic format even if it is obvious that it is available in that format and even if it would be cheaper than making paper copies. The only conclusion is that they do not want to make it easy for the taxpayers to know what is going on. A great example of this is the recent effort by Representative Brian Kelsey and Senator Paul Stanley that the election commissions in counties, with larger populations (e.g. Shelby, Knox, Hamilton and Davidson), be required to furnish their political contribution and expenditure reports in the same electronic format that state candidates adhere to. Actually it is easier to do so when compared to the current system of paper records. Moreover it certainly makes it easier to find out who contributes to whom and how the money is spent. Sound like a good idea? Of course it is except for one thing. THE LOCAL POLS DON'T WANT YOU TO KNOW WHO IS CONTRIBUTING TO WHOM AND HOW MUCH. Therefore, despite good faith efforts to get it passed, HB2929 died.

Therefore I have started an effort around the formation of MEMPHISSHELBYREFORM. I plan to get 50 initial founders at $500 each (I already have commitments from 18 taxpayers). I am applying for the formation of a 501c3 non profit organization and will then use the initial capital to solicit 500 members at $50 each and then 5000 members at $20 each. The money will be used for educational and research efforts to point out to the public and the media inefficient and questionable government practices. The exposure of this information and the amount of backing from thousands of members will cause our elected officials to legislate the reforms necessary to bring efficient government and lower taxes to the people who pay for everything, the taxpayers. I ask for your help in this effort.

I have attached an article that appeared yesterday in the Memphis Daily News concerning the formation of this new organization.

Click here to read the Memphis Daily News article about the formation of MEMPHISSHELBYREFORM

2008-06-29T22:28:00.002-05:00

IT IS WELL BEYOND TIME THAT PEOPLE START READING GOVERNMENT BUDGETS-LET US START WITH THE CITY OF MEMPHIS

We read a lot about the lean mean budget of the City of Memphis. The City Council says it is fat but they pass it anyway. The City Administration says it is lean and cannot be cut. Who is right? What should be done?

Well I decided to make a start and put the budget on a spreadsheet and I intend to continue on until I get some answers and let the people who pay the bills, the TAXPAYERS, know about their budget.

This project is extensive but I intend to continue to work on it, the City, the County, comparable cities (Nashville, Louisville, and others) and see how we compare and compute.

I start with the attached spreadsheet which shows the various departments from the 2008 adopted City budget and compared it with the 2006 City budget, actual numbers. The following items should make the taxpayers and the City Council ask questions.

Here are the various departments:

EXECUTIVE, HUMAN RESOURCES, FINANCE, PUBLIC SERVICES, CITY COUNCIL, FIRE SERVICES, GENERAL SERVICES, CITY COURT JUDGES, POLICE SERVICES,HOUSING AND COMMUNITY DEVELOPMENT, CITY COURT CLERK, PARK SERVICES, CITY ATTORNEY, GRANTS AND AGENCIES, PUBLIC WORKS, SPECIAL REVENUE FUNDS (metro alarm fund, zoo, museums, mlk park, solid waste management and office of planning and development), DEBT SERVICE FUND, ENTERPRISE FUNDS (sewer, storm water and golf), INTERNAL SRVICE FUNDS (health insurance, printing and mail and vehicle maintenance).

Here is what I found. Look for yourself.

In the executive suite at City Hall, the employee count went from 36 to 98 and $12.6 million got added to the lean budget.
In Human Resources, 39 to 64 people with $6 million added to the budget.
The City Attorney added 16 people and $5.7 million
Housing and Community Development added 10 and $2.1 million.
Park Services added 54 people and $4.3 million.
Solid Waste Management added 72 people and $12 million.
Sewer workers added 39 people and $5.5 million.
Total Budget employees went up 1317 employees.
THAT IS $48.2 MILLION JUST FOR STARTERS

The total operating budget is $744,577,884 not $540 million. Why? Just look at your utility bill and hidden on the back are the City of Memphis Sewer Charge, the Solid Waster Fee, the Storm Water Fee and the County Mosquito/Rodent Control Fee. Rather than put the first three on the operating budget, they charge you this tax through your MLGW bill.

Call or email your City Council members and let them know you want the City budget cut and by a substantial amount as there is plenty of fat there, especially starting at the top.

<Click here to see how $48.2 million got added to your 2006 budget for the 2008 budget

2008-06-23T15:13:00.002-05:00

HERE IS A REALLY GOOD REFORM IDEA (FULL ELECTRONIC DISCLOSURE OF CONTRIBUTIONS AND EXPENDITURES) THAT GOT SHORT SHIFT BY OUR TENNESSEE LEGISLATURE

I proposed to Representative Brian Kelsey and Senator Paul Stanley that the election commissions in counties, with larger populations (e.g. Shelby, Knox, Hamilton and Davidson), be required to furnish their political contribution and expenditure reports in the same electronic format that state candidates adhere to. Actually it is easier to do so when compared to the current system of paper records. Moreover it certainly makes it easier to find out who contributes to whom and how the money is spent. Sound like a good idea? Of course it is except for one thing. THE LOCAL POLS DON'T WANT YOU TO KNOW WHO IS CONTRIBUTING TO WHOM AND HOW MUCH. Therefore, despite good faith efforts to get it passed, HB2929 died.

These contributions are legal but they buy influence which can possibly lead to illegal activities as we have seen from recent convictions and pending trials. Making it easy to see who is contributing and to whom is a good idea to support honest government.

Here is a recap of the proposed bill that failed.

Campaigns and Campaign Finance - Requires candidates for local public office and political campaign committees in local elections in any county having a population in excess of 250,000 to file contribution and expense statements with the registry of election finance instead of with the local election commission. - Amends TCA Title 2.

To give you an example of the benefits of the state system, I have attached pdf files that came from the state excel spreadsheets on BELZ contributions for just one year to the parties listed and contributions to Ophelia Ford for just one year. The Belz's gave $148,257.97. In a separate report, Ophelia Ford got $59,686.88. Also a really big factor is the contributions of PACs (Political Action Committees). I have attached a list of over $5 million dollars in Tennessee for just one year of contributions that came from the state list.

Locally if you want similar information on Herenton or any other local politician you have to go to the election commission and pay 25 cents per sheet for these reports which in most cases started out as an excel spreadsheet. For instance, I have attached a Herenton file which I paid for and then converted to a pdf file showing that he got $185,000. Also I have attached a file on Ricky Peete showing contributions and contributors over a period of time compiled by a group of citizens from the difficult Shelby County Election Commission records. Total of $235,810. Does this more difficult process make sense? Of course it does, because the contributors and the receipients do not want you to know who is giving to whom and the present scheme make this difficult. Go figure.

Write your representatives and senators and demand that next year they rectify this situation and pass HB2929.

Click here to see what the Belz family gave to statewide candidates in 2006

Click here to see who contributed to Ophelia Ford in 2005

Click here to see who gave to Mayor Herenton from 2003 to 2005 from the difficult to obtain records at the Shelby County Election Commission

Click here to see who gave to Ricky Peete for a few years also from the difficult to obtain Shelby County Election Commission records

Click here to see more than $5 million dollars in PAC contributions during 2006. The list comes from the state electronic data base

SCHOOL BUDGETS CAN BE CUT-LOOK AT MIAMI/DADE

2008-06-18T15:08:00.001-05:00

Since the subject of budget cuts to the Memphis City Schools is so much in the news, I investigated the Miami Dade County School system website and found the following interesting items about school budget cutting in the previous home of our new superintendant. Budget cuts can be made when the laws do not stand in the way.

DISTRICT BUDGET UPDATE
Superintendent Rudy Crew Addresses Budget Crisis

June 9, 2008

With a new fiscal year fast approaching and with Florida lawmakers having severely cut funding to our schools, the School Board will meet later this month to finalize more than $284 million in cuts for the 2008-09 school year.

In April, the Board approved a reorganization plan to save the District approximately $13.7 million in recurring annual costs. Last month, the Administration brought forth additional reduction plans, some of which were not approved, including a recommendation that would have saved the District an additional $33.9 million in position cuts, furloughs, and other down-sizing measures.

There are outstanding cuts still to be made, with all options necessarily on the table. As always, the best interest of our students must be and will be our overriding concern.

With nearly three-quarters of the District's $3 billion operating budget going to salaries, a further reduction in the District's workforce is inevitable. Times are tough, here and across the state, and it falls to us in the Administration and on the School Board to make the tough calls. This is hard for all of us, especially those affected by these reductions. Accordingly, we are recommending a plan to help ease the transition for affected employees, including job-placement assistance inside and outside the School District.

The Board will discuss the budget at a workshop on June 12, 2008, at 10 a.m., and its monthly meeting, June 18, 2008, at 1 p.m.

M-DCPS BRIEFINGS:
Statewide Cuts Lead to Reduction in Force and Other Budget Updates, (5/14/08)
Superintendent addresses Florida lawmakers' huge cuts to education funding, (5/6/08)
School Board Considers More Than $284 million in Cuts to 2008-09 Budget, (5/2/08)
Superintendent Recommends Reorganization and Restructuring, (4/15/08)
Board Chair Offers FL Legislature Cost Neutral Plan and Other Budget Updates, (3/26/08)
Education Policy Brief: K-12 Funding Update, (3/26/08)
Funding Cuts Impact M-DCPS Employees and Services to Students, (3/7/08)
District Faces Budget Cuts, (2/28/08)
Reductions to Salary Expenses Anticipated, (2/15/08)
Tough Times, Tough Calls, (2/1/08)

RELATED RESOURCES:
Budget Workshop Presentation, (6/12/08)
A–3 Presentation to the Board, (5/21/08)
Budget Workshop Focus on FY 2008-2009, (5/13/08)
Process for Repurposing Schools Workshop, (5/13/08)
Budget Workshop Focus on FY 2008-2009, (4/28/08)
Tentative Budget Cuts 2008-09
Dollars & Sense Presentation
State Revenue Reductions 2007-08
Budget Presentation
Five-Year Capital Plan

RECENT ARTICLES:
Florida schools fear gains may vanish, The Ledger (4/13/08)
Tax changes fuel fears of funding loss, TradingMarkets.com (3/30/08)
Tax-cut proposal leaves big questions, The Miami Herald (3/19/08)
Florida agencies face deep cuts across board, The Miami Herald (3/16/08)
School, court funds slashed,
The Miami Herald (3/06/08)
Schools need more cash for state goals, The Miami Herald (2/28/08)
Schools to take another hit from state, The Miami Herald (2/27/08)

YOUR TENNESSE LEGISLATURE RULES OUT EFFICIENCY

2008-06-16T16:21:00.001-05:00

With all the controversy about the City Council cutting the budget of the Memphis School System and possible lawsuites, I decided to look at the law that they are arguing about. I looked up the applicable portions of the Tennessee Code Annotated and found the following law.



	(B) (i) Notwithstanding any other law to the contrary, for fiscal year 1992-1993 and any subsequent fiscal year, if state funding to the county for education is less than state funding to the county for education during the fiscal year 1990-1991 or less than the previous fiscal year's state funding to the county for education (except that a reduction in funding based on fewer students in the county rather than actual funding cuts shall not be considered a reduction in funding for purposes of this provision), local funds that were appropriated and allocated to offset state funding reductions during any previous fiscal year are excluded from this maintenance of local funding effort requirement;



		(ii) It is the intent of this provision to allow local governments the option to appropriate and allocate funds to make up for state cuts without being subject to a continuation of funding effort requirement as to those funds for any year during which the state reinstates the funding (or restores the previous cuts), and during any subsequent year should the state fail to restore the funding cuts.

What this means to me, a non lawyer but a businessman, is that you cannot save money by running a more efficient school system. I do not know the history of this law but it obviously was promoted and sponsored by the public teaching establishment to keep the possibility of cutting job off the table. It says that you cannot cut the budget from the previous year unless you have fewer students. But suppose you come up with a more efficient management or teaching plan that requires fewer administrators or fewer teachers but improves efficiency and learning? Sorry, you cannot cut the budget. It completely destroys the incentive to run a system more efficiently.

Under this law, the only way you could cut the budget would be to have the same budget as the year before and because of inflation, you would be spending less due to the lower value of the dollar. The politicians thought that they were doing something good but what they accomplished was a monument to inefficiency with no incentive to improve the system. We need a change in the law that would allow efficiency savings which would lower the school budget without a state penalty due to the above law.

2008-06-11T08:16:00.003-05:00

It seems it takes economic hard times to get politicians to address the root cause of our high taxes. Now we see the Shelby County Commission talking abut cutting the lush benefits of our public servants. Their reaction is predictable. They are mad.

I wrote about this in 2005. Here is the article that I wrote at that time after doing an exhaustive and extensive benefit survey and comparison of the City of Memphis, the MLGW, Shelby County and the two school systems. The point of the article was that our public servants were better paid and benefited than the taxpayers who work in private industry. Here is the article and attached is the benefit comparison for 2005. Also shown below is a national news article about the difference between those who work in the public sector and those who labor and pay for their benefits in the private sector.

http://www.usatoday.com/news/nation/2008-02-01-civil-servants_N.htm

Click here to see the comprehensive benefit spreadsheet compiled in 2005 for the City of Memphis, Shelby County, MLGW and the two school systems

2008-06-01T16:58:00.004-05:00

OPENING THE MEMPHIS SCHOOL SYSTEM OYSTER

June 2, 2008

The Memphis City School System (MCS) is much in the news lately and most of the news is not good. Investigations, allegations of fraud, mismanagment and poor quality of education results are among daily news items.

Back in January and February of this year I sent two open records requests which were basically ignored until I filed suit in Chancery Court for open records violations. I then started getting some answers but am still waiting for the basic information about job titles, job descriptions, salaries and benefits and information on computers purchases with details on the winning and losing bidders and reasons for the selection of the winning quotes.

As an interim step I have attached some information that I have been furnished concerning square footage and acreage of schools, names, locations and ages of schools and makeup of the school population. This is basic informaiton that should be on their website for parent and taxpayer information. After all, their budget for the coming year is over $1 billion dollars. We continue to spend money building new schools when basically the school population has not increased. Why?

I will keep you informed as I develop more information on this huge part of our tax cost in the City of Memphis as we struggle to keep our heads above water.

Attached are the following files

Enrolled students by school and by grade level

Enrolled students by school, grade level and ethnic catergory

Facilites data by school, date built and area

Zone 1,2,3 and 4 schools by name with acerage, buildings, classrooms, square footage, portable classroom numbers and square footage

Click here to see the student enrollment by school and grade

Click here too see the student enrollment by school, grade and ethnic breakdown

Click here to see the data about the schools in Zones 1,2,3 and 4 schools by name with acerage, buildings, classrooms, square footage, portable classroom numbers and square footage

Click here to see the square footage of the various Memphis City Schools

2008-05-19T14:38:00.005-05:00

May 19, 2008

Minority Contracting at City Hall-The Taxpayers Pay the Bills

Since 1997, the city has had a minority purchasing ordinance and while there is a misconception by many at city hall that this entitles minority firms a piece of the pie with or without bids, it does not.

To put it bluntly, the problem is not the process of awarding contracts it is the process of finding minority firms. Only CERTIFIED minority contractors are consider minority firms by city hall. And who certifies minority firms? It isn’t the city, it’s the Mid-South Minority Business Council (MMBC) and it involves a minority firm handing over everything related to its business in order to prove its minority ownership is genuine – enough to discourage some. The certification may also take months, which means that by the time a bid comes around it is too late to register as a minority firm that is unless someone tips you off in the City that a contract is coming in time to certify.

There is also another problem. What might take months to get minority status for some can be expedited for others, as we saw with Reginald French’s firm Integrate Technologies. This is the true disparity in the city’s minority purchasing ordinance. Some minority firms appear to be favored over others. See the attached email expediting Integrate Technologies application.

Has there been any audit of whether firms are certified fairly? Imagine the power the MMBC holds as the gatekeeper of minority contracts at city hall. Who is monitoring what they are doing? I have tried, which resulted in a lawsuit and a nice letter that basically said they were not obligated to give me anything.

Elbert Jefferson is quoted in a recent article as saying, “And if you find that there was inequity, you have to determine whether those inequities are the result of whether those businesses may have been inexperienced, whether there were market factors that affected their inability to contract with the city, or whether there were intentional acts on the part of the municipality or municipal employees that triggered those contracts not going to a particular segment of the community.”

What would trigger a contract not to go to a minority firm based solely on the company’s minority status? The City Charter for one! The City Charter plainly states:

Sec. 6-92-8 M/WBE goals.
A.iii. Twenty-four (24) percent - total goal.
The annual goals provided above shall be reviewed annually by the M/WBE advisory committee. These overall M/WBE participation goals are only intended to be benchmarks for evaluating the overall performance of the M/WBE program on an annual basis. These participation goals are not and, shall not be quotas. For purposes of determining or satisfying annual participation goals, only the participation of minority- or woman-owned business enterprises located within the Memphis MSA and certified by the city’s contracted central certification agency will be considered.

Sec. 6-92-11 Miscellaneous.
B. Bid Preferences. If upon review of the results of the annual program goals, the city determines that it has not achieved the individual M/WBE program goals based on contracts let or bids made during the preceding fiscal year for women or minority business enterprises, then the city may consider amend the ordinance codified in this chapter to include bid preferences as may be permitted by law.
What does this mean? The city cannot use this ordinance as a preference towards vendors based on race and if they intended to, a disparity study must be conducted and the charter changed. Odd that this is being done on the cusp of charter committee recommendations, don’t you think?

I have attached a previous disparity study done in 1994. Look at recommendations #6, #10 and #15. #6 calls for the elimination of the ability of Division Directors to override the decisions of procurement agents by implementing a penalty system against those who do so. #10 reduces insurance and bonding requirements to State law requirements to induce greater MWBE participation. #15 calls for cutting up the bid packages so that they are just under $50,000 so that they are not bound by the open bid law.

Also I have attached a December 2004 email from Carlee McCullough, the Contract Compliance Officer, to the Mayor telling about her success in the minority contracting area but complaining about Mel Scheuerman, the BDC Administrator. Also look at page 2 and look at who has feasted on this work, Allan Wade, Ricky Wilkins, Lesure Computer Services, Mitchell Technology, Thomas Technologies and Integrate Technologies. Enough said. The pie is big, but the slices are few and favored.

Is Mr. Jefferson so mistaken that the city can award contracts based on set aside goals? I believe so. The City’s purchasing ordinance is clear. No contract under $50,000 is to be awarded to any vendor unless deemed through an open bid process to be “lowest and best.” The minority ordinance is only meant to monitor and is not meant to govern the act of purchasing, that is unless a disparity study shows a disproportionate gap between minority and non-minority firms. Then and only then, if it will hold up to a legal challenge, can the city force award contracts to minorities.

Another thing that troubles me about the meeting is that no where is it mentioned that the study will look at those who have been turned down for minority status, those who have lost contracts, and those who choose not to participate in the minority program because of the level of disclosure. Or, how many minority firms have had their fill of contracts and are now operating at an equitable level and need to step aside for other firms or the actual statistical data of minority/non-minority businesses in Memphis.

A recent newspaper article stated the following.
“The city is working with a team of consultants to complete what’s being called a ‘disparity study.’ Memphis city government, which functions with the help of a half-billion-dollar operating budget, also depends on the contributions of contractors and vendors it hires for a variety of tasks.
The city wants to hear directly from those people.”

I don’t think asking the fox in the hen house if he has had his fill of chickens is necessarily the best thing to do when determining how many more chickens to buy. The interest of the taxpayers, who pay all the bills, need to be considered and every contract should clearly show the premium paid over and above market price for the goods or services purchased. My experience and research with the City of Memphis ACS contract and previously with the County shows that we paid up to 30% or more over market price for millions of dollars in computers. The County has corrected this situation but the City still continues its past practices.

Click here to read the fax from Carlee McCullough to expedite Reginald French's application with the Uniform Certification Agency

Click here to read the 1994 disparity study and items #6, #10 and #15

Click here to read the 2004 report from Carlee McCullough to the Mayor about minority contracting and on page 2 see who gets the bacon

2008-05-06T13:59:00.004-05:00

May 6, 2008

THE CITY OF MEMPHIS PARKS DEPARTMENT INACTION?

I received the following email recently from Walter Broadfoot who has an office next to this City of Memphis Park. He has tried to purchase this property in the past but the City will not give him the time of day. Finally he and his neighbors took some action which the City has refused to do for years. He sent this email to the City Council members. Please note the pictures.

Here are a few before & after pictures of concerned neighbors cleaning up at the park at the corner of Madison, Belvedere & Lockett. The Park Commission has never done anything but cut the grass. Trees, weeds & bushes had taken over our park which gave the homeless a place to drink, shoot up & sleep it off. As you can see now there will no where for them to hide. We have removed the bushes, trees & the stumps have been ground out. All paid for by the concerned citizens living in our neighborhood. Our next project is to kill the weeds & plant Bermuda grass & some flowers. This park has been in this condition for decades & if private enterprise was responsible for its maintenance it would have been maintained properly. We will be keeping you updated as the improvements continue.

PS - The cutting of the trees, weeds & bushes & grinding the stumps out took a total of 2 hours at a total cost of $1,580.00 which we paid for. Please do not feel that this must be paid back, we would not want to burden the city or WW with any more debt.

Thanks,

Walter

Walter M. Broadfoot, Jr.

Visit My Photos - 10 Pics

My Album

2008-04-23T09:09:00.008-05:00

April 23, 2008

UNPAID FOR PROMISES MADE BY POLITICIANS

I have finally gotten replies from the City of Memphis, the Shelby County Government and the MLGW concerning the unfunded liability for retiree health care and life insurance. The total unfunded liability is, "DRUM ROLL! ARE YOU SITTING DOWN"

$1.885 BILLION DOLLARS

POLITICAL DIVISION	UNFUNDED LIABILITY	NUMBER OF ACTIVE EMPLOYEES	RETIREES
City of Memphis	$823,000,000	6225	3235
MLGW	$709,000,000	2608	2493
Shelby County	$353,000,000	6669	1800
TOTAL	$1,885,000,000

When I looked at these numbers, I immediately noticed that the MLGW was the highes cost per retiree, the City of Memphis was next and Shelby County was the lowest. I am still studying the numbers and I do not have a full report from the City but I have attached the three reports for you, the readers, to study.

It seems to me, that in reading over the reports, we are being taken for a ride by the City and the MLGW. No surprise there. The County is apparently costing the taxpayers less per retiree. In looking at their plan, I did notice that the retirees' share of the cost depends on years of service at retirement (see page 24 of 39) whereas, at the City and the MLGW, the retriees' share of the cost stays the same regardless of the years of service. This is just another example of how the taxpayers are being taken to the cleaners by the City of Memphis and MLGW.

Any way you look at it, the obvious conclusion is that we are being left a huge future problem in funding these reckless promises made by the present and past politicians. We need to organize and plan for a solution to this problem. See the three reports which are attached.

Click here to see the Shelby County report on unfunded retiree health care promises

Click here to see how much the City of Memphis have promised their retirees in health care benefits but have not paid for

Click here to see the MLGW unfunded liability promises to their retirees

2008-04-17T19:59:00.002-05:00

If the City of Memphis and Shelby County are looking for reasons for our financial crisis, they need to start with our two school systems. Our County school system is pretty good and their cost per student is lower than the Memphis City School system. Of course Mayor Herneton wants to combine the two systems which would require the County School System to spend more per student to lower their achievement level to the City system as state law requires that when you combine two system, you must bring the lower cost system up to the higher cost system. Stupid yes, but we are talking politicians here, not rocket scientists. The City School System and Mayor Herenton continue to block a separate school district for the better performing county school system.

However the most egregious problem and error is the ADA (Average Daily Attendance) split law between the City and the County. The law states that when the County builds a school in the County, they must give the City of Memphis School System the cost of the new school multiplied by the ADA split. The law, however, has a provision that allows the county to build the school with taxes collected outside the City of Memphis to avoid this disastrous payment to the Memphis City Schools (MCS). One school (Arlington High School) was built by this provision in the law and county taxpayers are paying 4 cents per year in property taxes for this school over and above their normal county property tax. Since, then the County Commission has refused to build further schools using this method in the law. The results are shown below. $539 million dollars in extra cost plus another $50 million starting this year. No wonder Mayor Wharton is looking to tax you more.

CAPITAL IMPROVEMENT BUDGET SCHOOL FUNDING
Funding bases on ADA (Average Daily Attendance)
FY	City	County	Total
1999	$57,300,000.00	$27,150,000.00	$84,450,000.00
2000	$95,296,146.00	$48,838,828.00	$144,134,974.00
2001	$57,300,000.00	$31,800,000.00	$89,100,000.00
2002	$57,300,000.00	$27,300,000.00	$84,600,000.00
2003	$57,300,000.00	$18,800,000.00	$76,100,000.00
2004	$57,300,000.00	$51,975,000.00	$109,275,000.00
2005	$57,300,000.00	$20,000,000.00	$77,300,000.00
2006	$57,300,000.00	$20,000,000.00	$77,300,000.00
2007	$43,000,000.00	$17,000,000.00	$60,000,000.00
Totals	$539,396,146.00	$262,863,828.00	$802,259,974.00

TOTAL PAID TO CITY OF MEMPHIS OVER AND ABOVE COST OF COUNTY SCHOOL CONSTRUCTION COSTS		$539,395,935.00

Funding based on Joint Agreement of 50/50 split of $100 million
FY	City	County	Total
2006	$0.00	$8,000,000.00	$8,000,000.00
2007	$0.00	$30,000,000.00	$30,000,000.00

Note: Final $12 million to County Schools paid in FY 2008. City School payment of $50 million to begin in FY2008

2008-04-15T10:40:00.004-05:00

ON THIS TAX PAYMENT DAY, MAYOR HERENTON'S BUDGET NEEDS TO GO ON A DIET

Now that the citizens of Memphis have reelected Mayor Herenton, here comes the cost of that reelection, new taxes to pay for jobs for his bloated government. Look at the figures and facts.

In Fiscal Year FY) 2006 there were 5162 total actual employees.
In FY 2008 he showed 6225 employees, an increase of 1063.

The City finally responded to my open records request for a detailed list of these employees and that list is on this website and on (www.memphiswatchdog.org ) . It shows 5728 employees. Take a look at the attached list of jobs and salaries.

In addition to the salary list, I have attached the union contract between the City of Memphis and the American Federation of State, County and Municipal Employees. The benefits, over and above salaries, amount to about 45% of the salary and of course includes the huge unfunded healthcare retirement promises where the taxpayers are paying 70% of the premiums. Recently the City finally said that this unfunded liability amounts to $824 million dollars just for the City and not including the MLGW and the County.

Look on page 16 (holidays), page 17 (vacations), page 18 (sick leave) and page 20 (bonus days). This amounts to 14.4 weeks off per year or over ¼ of the year not working. What private company gives these kinds of benefits? This generosity at the expense of the taxpayers naturally requires more employees than would be required in a private business.

The City Council has the authority to tear this budget apart, carefully examine all the parts and put back together a leaner, meaner plan that cuts this fat to the bone. They should hire outside, independent people to do the job and not depend on information from the Administration.

The recent $700,000 efficiency study (see attached) states in several ways the foillowing.

The City's budget process does not result in a financial plan that aligns with long-term strategies and service expectations within the City. In contrast, the current budget methodology and development process is incremental in nature and does not tie budgetary allocations to service levels, outcome measures or program achievements.

In other words, they just take last years budget and add something to it and send it to the City Council and expect them to approve it, which is what the City Council has done in the past. Hopefully, the new City Council will be different as the current financial situation is insupportable.

Click here to see the union contract and benefits you are paying for

Click here to see the job descriptions and salaries of city employees

2008-04-09T16:05:00.005-05:00

OH BY THE WAY HERE IS ANOTHER $823 MILLION DEBT THEY FORGOT TO TELL YOU ABOUT BEFORE THE ELECTION

On June 5, 2007 (before the October 2007 Mayoral election) I wrote the following open records request to the City of Memphis.

1) I want to inspect the records and documents that show the calculations that document the unfunded liability that the City of Memphis will have to finance to meet the GASB 43 and GASB 45 requirements. These records and documents should show the total unfunded liability and the amount over and above the normal pay as you go annual funding that is required to meet the future unfunded liability.

The City refused to answer the request until yesterday (April 8, 2008) and now I know why. The answer is in a presentation presented to the City Council on November 6, 2007 (after the election). In it you will find the following devastiting news of our unfunded liability for non-pension liability for post employment retiree health care benefits. It amounts to

$823 MILLION DOLLARS(see attached document)

This includes any non-pension, post –employment benefits provided to retirees (i.e. medical, dental, vision, hearing, and related benefits). (By the way, the MLGW and the County have similar problems)

The required annual contribution is $51.1 million whereas they have historically been contributing $20 million annually to cover retiree healthcare costs.

To get around this high cost to fully fund the unfunded liability, the plan is as follows.

They will set up an investment trust to pre-fund post employment benefits.
Future changes to the retiree health plan are likely.
Other consideration will include possible changes to plan benefits design and cost sharing. (Look out retiress, they will take it out of your hides)

For Fiscal Year 2008 they will contribute only $3 million rather than $31 million (the difference between the $51 million real cost to fund this unfunded liability and what they normailly contribute.

WHAT THIS REVEALS IS THAT POLITICIANS HAVE KNOWN ALL ALONG THAT THEY PROMISED MORE THAN THEY WERE WILIING TO PAY FOR AND THEY ARE GOING TO PUT IT OFF INTO THE FUTURE AFTER WHICH THEY WILL BE GONE AND HOPEFULLY RECEIVING THEIR PENSION AND BENEFITS CHECKS FROM A BANKRUPT CITY.

The presentation finishes with a quote from Standard & Poor's (12/01/04). "THE FUNDING OF THESE OBLIGATIONS IS OF AN INCREASING CREDIT CONCERN, EXACERBATED BY THE RAPID COST ACCELERATION IN MANY HEALTH-RELATED AREAS… CLOSE ATTENTION WILL BE PAID TO THE NEWLY QUANTIFIED OPEB UNFUNDED LIABILTIES, GIVEN THEIR EXPECTED MAGNITUDE, AND TO EMPLOYERS' STRATEGIES FOR MANAGING THEM."

THE POLITICIANS KNEW ALL ALONG THAT THEY WERE PROMISING MORE THAN THEY COULD DELIVER, BUT DID IT ANYWAY. NOW THEIR SOLUTIONS IS "PUT IT OFF INTO THE FUTURE" OR "TAKE IT OUT OF THE HIDES OF THE RETIREES".

I have another solution. Get rid of the irresponsible politicians at the next election and cut off the tax increases that are sure to come by the means of a citizenn petition charter change requiring voter approval before any tax increases. Cutting off the money is the only way to get their attention.

Click here to read about the $823 million in extra promises city Hall forgot to tell you about

2008-04-04T16:31:00.003-05:00

IN 1997, THE CENTER CITY REVENUE FINANCE CORPORATION (CCRFC) GAVE A BLANKET 15 YEAR EXTENSION OF PILOTS (PAYMENTS IN LIEU OF TAXES) TO 61 DOWNTOWN PROPERTIES

I have recently been investigating PILOTS given by the Memphis and Shelby County Industrial Development Board and the Center City Revenue Finance Corporation (CCRFC). I recently reported on some properties granted pilots by the Industrial Development Board of Memphis and Shelby County.

Then I went to the Center City Commission and read through some of their files. Whether you agree or disagree with the purpose and actions of the Center City Commission, we are fortunate to have Jeff Sanford running the organization. He is a person of the highest integrity and his files are completely open to the public as are the actions of the various boards.

What I found was that a lot of properties are paying very low taxes and for a very long period of time. Then I found that before Jeff Sanford took over in June 1998 (Ed Armentrout was the previous President), the board of the CCRFC gave 61 downtown properties a blanket 15 year extension on what was already a lengthy tax exclusion. The purpose of the extension was to divert the tax funds that would normally be coming into the city and the County at the termination date of the original pilot, and use those tax funds to finance new Downtown public projects, mostly parking garages. I have attached a sheet explaining the extension program. Also I have attached a spreadsheet showing the 61 properties involved.

Whether you agree with this program or not, it is important that you understand it and recognize that it will be a long time until we see if the promised golden tax eggs for a revived downtown ever gets laid or if it is just a program to help those downtown property owners on the backs of the residential taxpayers in Memphis and Shelby County.

Click here to see the 61 downtown properties that got a 15 year PILOT extension

Click here to see the rules for the 15 year extensions and how the money is to be used to build downtown garages rather than go to the budget

2008-04-02T09:33:00.002-05:00

SOME SUGGESTIONS FOR CUTS IN SPENDING FOR SHELBY COUNTY AS THEY PREPARE TO RAISE PROPERTY TAXES

Mayor Wharton and the County Commission are looking for ways to raise more money on the backs of overburdened residential tax payers. They claim that there are no places that they can cut. Bare boned they call the budget proposal. This is April Fools Day but this is no joke.

I will be the first to admit that the County is better than the City of Memphis in their transparency and their willingness to admit that we are in an unsustainable financial situation. However the City School System and the County are largely responsible for the huge county debt.

SHELBY COUNTY BONDED DEBT OUTSTANDING TOTAL FOR EACH YEAR
YEAR	Total bonded debt for school purposes	Total general obligation bonded debt, not for school purposes	Total bonded debt for Shelby County
1998	374,695,201	513,298,731	887,993,932
1999	462,652,365	570,419,996	1,033,072,361
2000	452,521,665	544,385,696	996,907,361
2001	582,727,876	523,964,486	1,106,692,362
2002	622,958,087	597,214,274	1,220,172,361
2003	689,737,629	627,359,732	1,317,097,361
2004	913,093,850	667,904,373	1,581,998,223
2005	881,448,367	655,741,606	1,537,189,972
2006	1,052,751,140	664,012,691	1,716,763,831
2007	1,155,445,388	626,558,892	1,782,004,280

Look at the debt from 1998 to 2007 for school purposes, an increase of $780 million. Why has this happened when there has been no appreciable school population increase? When they build a county school for say $10 million, they raise $40 million and give $30 million to the City Schools. They do not need to do this as by law they can finance the $10 million dollar school with the county tax payers outside the City limits paying for the new school. They did this once on the Arlington High School. But now the County Commission will not allow this as they want to give the extra money to the City Schools. Humbug.

Then look at the roll up costs of city and county employees. Those employees with longer years of service can get up to 13 weeks per year of time off due to vacations, sick days, personnel days, holidays and bonus days that means that they can be off work 25% of the year. Obviously this means that more people must be employed to get the work done. Very few in the private sector have such benefits. We need to take a hard look at our government and see if we can tighten belts beyond what politicians say is possible.

We need to look down the road at consolidation and have an independent study done (not connected to any political group or politician) and determine if consolidation (like Metro Davidson) would really save a lot of money. I contacted Metro Davidson and got great cooperation from them with a prompt response to my questions. (Such a difference in my dealing with the City of Memphis). I found the following information.

Total full time public employment for Metro Davidson is 9500 employees with an additional 1250 part time employees.

As near as I can tell Memphis has 6225 and Shelby County has 6802 for total of 13027. Our population is somewhat larger than Metro Davidson but similar government functions should not account for a 37% higher employment total.

We need to know if consolidation would be financially beneficial as we are headed in a downward spiral with the pending tax increases.

2008-03-29T09:34:00.003-05:00

March 31, 2008

RICKY WILKINS FEEDING AGAIN AT THE TAXPAYER HOG TROUGH

On December 1, 2007 I sent the following open records request to our City Attorney, Elbert Jefferson.

Dear Mr. Jefferson,

As a taxpayer of the City of Memphis I would like to inspect the

municipal documents, records, letters and communications, both written

and in electronic form, that contain information relevant to the

following subjects.

1) I want to inspect the records and documents that show all

information about the hiring of Mr. Ricky Wilkins and/or his law firm as

a legal council or advisor to the charter commission. I want to see any

contract or communication that shows the agreement as to the cost of his

services to the charter commission and that addresses the services that

he is to perform.

After repeated requests for a reply and preparation for a open records suit in Chancery Court, I finally got the following answer from Mr. Jefferson.

I am unaware of any separate contract for his services. You should have his existing contract already. The Charter Commission has requested the monies authorized by the Council last year for legal and other support services. If I am not mistaken, the Council authorized $100K for temporary support staff, legal and other services. Any Council actions on those items are available via the City Council's website.

I then emailed City Councilman Myron Lowery to tell him of the stonewalling of Mr. Jefferson and he got in touch with Mr. Jefferson and I got a prompt reply for which I thank Mr. Lowery.

This office previously responded to Mr. Saino that we were unaware of any separate contract between the Law Offices of Ricky Wilkins and the City of Memphis, by and through Charter Commission or its City Council. If I am not mistaken, Mr. Saino has previously requested and received documentation regarding the attorney fees paid to The Law Office of Ricky Wilkins. It is our understanding that the Charter Commission agreed to an unwritten arrangement in which The Law Office of Ricky Wilkins was to perform legal services averaged on a monthly basis at the rate of $210 per hour, not to exceed $15,000 per month. Payment at the $15,000 rate was made for two months. The Charter Commission reduced the amount of work required of Mr. Wilkins to an average of $5,000 per month. We are unaware of a formal document that sets forth the specific tasks to be performed; however, they appear to be numerous based on the proposed clean-up of the current Charter and specific items identified through the numerous community meetings. Only the City Attorney and Mayor have authority to hire Special Counsel. Thus, the City's existing contract with The Law Office of Ricky Wilkins was used for purposes of relating services between the City, the Charter Commission, the City Council and The Law Offices of Ricky Wilkins and payment of invoices. The City Attorney's Office pays the invoices and receives reimbursement from the City Council based upon the $100,000 dollars approved by last year's Council. Invoices from outside counsel contain privileged information, including proposed strategies and thus are protected by the attorney-client privilege. Nonetheless, it is my understanding that the City has paid approximately $50,000 for services rendered since September 2007.

Obviously, Mr. Jefferson knew this information all along but did not want to reveal the information until prodded by Councilman Lowery. It is interesting that there is no written contract and Mr. Wilkins billed $15,000 per month (the monthly maximum) until they cut him back to $5000/month and then he billed the maximum per month for four months for the $50,000 to date. I have been to most of the Charter Commission meeting and his $50,000 of work is certainly not in evidence. Also where are his billing and work records to justify the payment?

I have investigated legal fees paid to friends of the Mayor in the past but have not updated my files to current date. I have attached the 2005 records for Ricky Wilkins, Allan Wade and Robert Spence and you will see that he had received nearly $2.5 million dollars then. No telling what it is now. Nice work if you can get it and you can if you are a friend of our wonderful Mayor.

Click here to see the lawyer friends of the Mayor who are feeding at the taxpayers funded hog trough

2008-03-25T08:52:00.005-05:00

March 25, 2008

OUR TAX BUCKET HAS A HOLE IN IT!!!

March madness leads to April fools day and this year is no exception. The madness was Mayor Herenton’s announcement that he is going to resign this summer and move on to ruining the Memphis School system or maybe the US Congress. I am sorry to tell him that both are already well on the way to destruction.

The recent announcement by Mayor Wharton and Marlin Mosby that our present course in Memphis and Shelby County is unstainable is something that I have been warning of for some time. Mayor Herenton continues to deny the obvious, making a change of course more difficult. Recently I pointed out some of the major causes of our financial problems and some of the hard and politically difficult decisions that need to be made. I want to explore further another aspect of the financial problem.

There are over 15000 buildings and properties in Shelby County that pay zero property taxes. There are many more that pay only a part share of the full property tax rate. Of the no property tax facilities, they run from an appraisal of over $150 million down. The total is over $3.5 billion. The types of properties include religious, government, apartments, office buildings, manufacturing and warehouse.

Looking more specifically at some examples helps a discussion of why these properties pay no taxes. We could probably all agree that the main church worship building should be free of property taxes. Churches are a big business in Shelby County. But what about all the ancillary activities and property that goes along with many churches such as schools, child care facilities, nursing homes and retirement communities. There are many that feel that some of these facilities should pay some tax, possibility at a lower rate than residential or commercial properties.

Some specific examples are Kirby Pines Estates at 3535 Kirby Road and Trezevant Manor at 177 N. Highland. Together they have a total market appraisal of $110 million. Concerning office buildings you have the Morgan Keegan Building at 50 N. Front at an appraisal of $35 million and Peabody Place at 149 Union at $44 million. Then look at warehouses such as 4880 Tuggle (Ford Memphis Parts Distribution, 4155 E. Holmes (Memphis Distribution Center Panattoni Development Co. LLC), 5461 Davidson (Hamilton Beach, Prologis), and 5200 Tradeport (Chickasaw Distribution Co) for a total appraaisal of $111 million. And then there is the Yellow Freight System at 3914 E. Shelby Drive at over $5 million. All of these paying no property taxes on the buildings as of 2004. How long do these tax abatements run? It varies but as an example, the Ford deal runs from 2002 to 2014.

Who gives these no tax or reduced tax benefits? Principally they are the Industrial Development Board of Memphis and Shelby County, the Center City Revenue Corporation, the Shelby County Health and Education and Housing Facility Board and various other boards constituted in Collierville and other incorporated cities.

We need an honest and transparent discussion of these no tax and partial tax properties in Shelby County as we are facing massive tax increases this year and next. With a shrinking tax base of people able to bear the load, we could be facing a financial disaster. I will be reporting further on this subject in future reports.

2008-03-17T15:45:00.002-05:00

March 17, 2008

"Shelby County is now on what we all know is an unsustainable journey to the future." Mayor A. C. Wharton

Congratulations to Mayor Wharton for saying what many of us have known for some time but which few have had the courage to express publicly.

Click here to read the recent Memphis Flyer article stating a fact that few want to face but which is becoming more obvious every day

After reading the article a local person who I respect highly said the following. “Development still shapes policy in this town. Growth is a money maker in the short run and we as citizens pay for it in the long run. We have “bought...built” a bigger “house…community” than we can sustain.”

Memphis has always been run by developers but we can no longer continue to develop without planning and control. Developers hate the thought that this is needed and that the citizens can no longer pay for the schools, roads and infrastructure for their subdivisions and developments. We must plan for a sustainable future or there will be no future for Memphis and Shelby County.

2008-03-02T08:22:00.003-06:00

MARCH 3, 2008

DID YOU KNOW THAT THERE ARE OVER 15,000 PIECES OF PROPERTY IN SHELBY COUNTY THAT PAY ZERO PROPERTY TAXES. HERE IS THE LIST.

I have shown attached the list of NO TAX properties as of 2004 here in Memphis and Shelby County. The long list is arranged alphabetically and a large number of the properties are churches and governmental properties. Churches seem to be a very large business if the number of them is any indication. Generally only the sanctuary is excluded from taxes but there are a number of other exemptions for schools and other purposes and these are detailed in the Tennessee Code and can become very complicated. Obviously no operation by churches should compete with the tax paying private sector.

In the shorter selected list attached I have deleted those names that are obviously religious or governmental properties and left those other properties that pay no taxes. Also I have arranged them in decending order of property assessment. You will recognize by the addresses some very prominent pieces of property around town and in the county. As I have time, I will check out these properties to see why they are paying no taxes and report back.

Click here to see those properties that pay no property taxes as of 2004 in Memphis and Shelby County. Look at the addresses and the market appraisals

Click here to see the full list of property tax exempt properties in Memphis and Shelby County as of 2004

2008-02-26T14:15:00.007-06:00

FEBRUARY 27, 2008

THE COST OF PILOTS IN MEMPHIS AND SHELBY COUNTY! WHO BENEFITS? WHO PICKS UP THE DIFFERENCE?

As the debate goes on about how to raise more tax money, sthere is a huge elephant standing in Shelby County sucking up tax money in great bundles. It is the PILOT (Payment In Lieu of Taxes) program. I have attached a spreadsheet compiled by the State of Tennessee for the year 2006. It shows that Shelby County gave away $48 million dollars (the difference between what sould have been paid on the properties at the full property tax rate minus what was actually paid). Look at the names and amounts on the list. Were these pilots worth it? Are they being audited and reported to make sure that the original promises are being kept. Are the length of the pilots being extended without public notice? $48 milliion dollars would go a long way towards quelling the call for more taxes on the poor homeowner. Look at the difference between Davidson County (column A, #19 indicates Davidson County) and Shelby County (column A, #79 indicates Shelby County).

Click here to see that the pilot program is costing us $48 million per year. See who is getting the benefits as homeowners pick up the slack

2008-02-25T12:46:00.003-06:00

Shelby County job positions and salaries, 6663 of them at a cost of $275 million

With all the talk about tax increases from both the City and the County, I think that it is time to put the information before the public as to how much we are paying for City and County services and the information about base salaries and benefits. Through a series of open records requests, I have asked the City of Memphis, Shelby County, the Memphis City School System, the Shelby County School System and the MLGW for salary and benefit information.

As usual I have received good cooperation from the MLGW, (since Jerry Collins has taken over there is great openness at the MLGW), and Shelby County and the Shelby County School System. Also, as usual, getting information from the City of Memphis and the City of Memphis School System is like pulling teeth.

I have decided to publish the information that I have over the next few weeks so that the public can look at what their tax money is paying for and make up their own minds as to whether they are getting value for their tax dollars and if there are ways that the cost of government can be reduced. I have the names of the employees that are attached to these salaries but I decided, for now, to only publish the job titles and the yearly salaries. The yearly total is $275 million dollars.

Please be aware that there are substantial benefits attached to these figures that run up the additional cost to about 45% of the base salaries. Those employees with longer years of service can get up to 13 weeks per year of time off due to vacations, sick days, personnel days, holidays and bonus days that means that they can be off work 25% of the year. Obviously this means that more people must be employed to get the work done. Very few in the private sector have such benefits. We need to take a hard look at our government and see if we can tighten belts beyond what politicians say is possible.

Click here to see what your public servants are earning and what their job titles are

2008-02-22T14:21:00.006-06:00

WHY OUR DEBT IN SHELBY COUNTY IS SO HIGH

For some time I have been trying to get comparative information on school costs in Memphis, Shelby County and Metro Davidson. In looking over the finances of Memphis and Shelby County, I have come to the conclusion that our schools are our biggest cost and particularly the Memphis City Schools our biggest failure.

In a recent article I showed that our County's huge debt grew in 9 years from $374 million to $1.1 billion for just those bonds due to school construction. Much of this money went to the Memphis School System under the stupid ADA formula giving the City Schools $3 for every $1 dollar spent on county school construction.

Now I am looking at the facts and figures of each system. I have attached a very complete and well done 2 page fact sheet about the Metro Nashville School System. I asked Shelby County Schools and Memphis Schools for similar open records information. I got a courteous reply from Shelby County and after a short period I received a well done document similar to the Nashville document. I still have not heard back from the Memphis School System which is not surprising given my past experience with them.

I have not done a complete analysis but here is some information. One thing is obvious. If we combine the two school systems into one huge system, by law we will have to bring the County cost per student up to the City cost and this will add $71 million dollars to an already bloated bureaucratic cost. ($7930-$6397= $1533X46584 students+$71.4 million dollars. Do you really want to take Mayor Herenton's advice on this?

	Number of Students	Annual Budget	Cost per Student
Memphis City Schools	114756	$910000000	$7930
Shelby County Schools	46584	$298006557	$6397
Metro Nashville	74155	$563230100	$7595

Click here to see a report on the Metro Davidson County school system

Click here to see a report on the Shelby County School system

Click here to see how our bonded debt increase in Shelby County is mainly due to schools construction and payments to the Memphis School System per the ADA formula

2008-02-15T12:39:00.011-06:00

February 15, 2008

COMMISSIONER CARPENTER'S RESPONSE TO COMPLAINTS ABOUT THE COUNTY'S HUGE DEBT DUE TO SCHOOL CONSTRUCTION. THAT DEBT HAS RISEN FROM $374 MILLION TO $1.1 BILLION IN 9 YEARS

In response to emails sent to County Commissioners by readers of the memphiswatchdog.org and shelbywatchdog.blogspot.com postings concerning the ADA law passed in 1997, Commissioner Carpenter responded with the following email. I will answer some of his points.

1) I admit that many of our government problems come from stupid and unnesessary requirements and stipulations passed down from Washington and the Courts without the funds to pay for their implementation. One of the worst was that the County and the City must fund schools at the same level as the previous year regardless of performance and probably regardless of funds available and attendance. This means that if you cut overhead and expenses, you still cannot cut funding. This takes away any possibility of good management reducing costs.

2) His next point concerned the Needs Assessment Committee (NAC). I have attached a copy of their report and anyone who reads and believes this report I would like to sell them a waterfront lot in Mayor Herenton’s Banneker Estates. I point you to two attached articles. One is a Memphis Flyer article that points out the following.“According to figures from the Tennessee Department of Education, SCS's population remained stable for the past decade while the population of Memphis City Schools (MCS) grew by roughly 10,000 students. In 1995, the county schools served 43,800 students. Despite that figure spiking to almost 49,000 in 1999, it was down to 45,000 in 2005. Over those 10 years, MCS' population went from 108,000 students to 118,000”.

3) If you read the NAC report, you will see the schools and the spending that they want for a system that is barely growing if any. This makes absolutely no sense. It would be like a manufacturing company building lots of new factories when sales were flat. This is lunacy. Also I have attached a portion of a report done for the Memphis School System by MGT of America at a cost of $575,000. This portion of the report shows that MCS went $80 million dollars over budget on new school construction and repairs. The MCS system is completely inept and out of control and deserves our contempt but not our tax money.

Moreover, I have attached a report on the consequences of consolidation by David Pickler, the very competent and knowledgeable head of the County School Board. This shows that consolidation of the City and County Schools systems, as Mayor Herenton wants, would be a complete disaster and would only serve to raise the already monumental education costs and probably bankrupt the City and County.

What is the answer to this crisis? The answer will not come from politicians, but only from taxpayers. Taxpayers have to take back their government from the politicians and let them know that they want reform and discipline in their government. We should start with the County by a petition to propose “NO PROPERTY TAX INCREASE WITHOUT VOTER APPROVAL” or a proposal for no total tax increase (in whatever form) greater than the increase in the inflation rate. That will get their attention.

Click here to see how the Memphis School Board ran over budget in just a few short years by $80 million dollars on school construction and repair

Click here to read the joint Needs Assessment Committee report on the huge spending they want to do on a school system that is static in student growth

Click here to read David Pickler's report on the consequences of any consolidation between the City and the County's school system as Mayor Herenton has proposed

Click here for flyer article on the school situation

Here is his Commissioner Carpenter’s email response.

Thank you for your e-mail. I am also concerned about the county's debt, which as a new Commissioner I inherited and our approach to school construction. However, the information Mr. Saino has provided to you is not completely accurate.

The 3 to 1 ADA formula was created by state statute. However, the statute was necessitated by a lawsuit and State Supreme Court ruling that required it. The lawsuit dealt with funding for rural school systems, which the state of Tennessee lost, and resulted in the supreme court requiring the overhaul of the education funding system. This legislation had to be agreed upon by the court and the legislature. In addition to the ADA formula, the lawsuit resulted in the BEP funding formula and "maintenance of effort," which means that the County must fund schools to the same level as the previous year, whether the school systems are performing well or not.

With that background, rural school bonds are an option in some cases. However, the idea that rural school bonds are the answer to all of our debt and school construction problems is misleading. The Needs Assessment Committee (NAC), a group of private citizens appointed by Mayor Wharton, to help us set construction priorities, identified nearly $500 million in deferred maintenance in Memphis City Schools. Many of these schools have been neglected and in some cases life/safety repairs need to be made. While I, nor anyone else, is happy with the management of Memphis City Schools, there are legitimate construction needs that in my view outweigh many of the County needs.

So what are the answers? First of all discipline. The county debt is actually 1.793 billion, which is a decline from last year. Our debt has been restructured and if we hold CIP spending to $75 million or less annually, the debt will continue to come down. Second, is we must use all of our leverage to get the two school systems to agree to standardized construction processes. This is one area the NAC has not been successful. Another option is to look at the possibility of a Joint Board of Control, which with the agreement of the two school systems would take responsibility for construction out of the hands of the two school boards.

As far as developer impact fees, this Commission is holding developers accountable for infrastructure. Our decisions on development to this point demonstrate that. In relation to schools however, developer impact fees wouldn't begin to pay for the cost of school construction. Particularly now when the housing market is depressed. In a boom, this could be viable, but now would not do much for us.

Thanks again for your e-mail. Please contact me any time.

Sincerely,

Mike Carpenter
County Commissioner

2008-02-11T10:24:00.000-06:00

February 11, 2008

WHILE WE WERE ASLEEP, THE POLITICIANS PUT THEIR HANDS IN OUR POCKETS

I have often wondered how we came to the situation where if Shelby County builds a $10 million dollar school, it ends up costing $40 million, with the extra $30 million going to the City of Memphis School System. I started investigating and found that in 1997 the Tennessee Legislature passed a law which was designated HB3093 by Representative Rhinehart, SB3244 by Senator Henry.

Click here to see the summary of the bill that sent millions of dollars to the memphis city schools every time the county built a new school

One provision of the law requires that all proceeds of any capital outlay for school construction be shared with the Memphis City Schools on the basis of average daily attendance, roughly 3 to 1. The effect of this has been the huge increase in the debt of Shelby County which is now over $1.8 billion dollars. The split between debt from schools and other debt is $1.15 billion for schools and $626 million not for schools. This is made worse by the fact that the overall City and County school population has not increased very much in the last ten years, just moved around from the city to the county.

Click here to see, from Shelby County's most recent financial statement, that 65% of the County's huge debt is due to school construction and the money county taxpayers are forced to send to the Memphis School System

However, in reading the law passed in 1997, there is a further provision that reads as follows. “9-21-129(c). The proceeds of any bonds or notes issued for school capital outlay purposes shall not be required to be shared if the county or metropolitan government elects to pay for such bonds or notes pursuant to any applicable provisions of 49-3-1005(b) or (c).” This latter provision states that the bonds can be payable with a tax only upon that portion of Shelby County outside the City of Memphis. In talking to a knowledgeable member of the County Commission, this Commissioner stated that only one school was built by this provision and that was Arlington High School. There is a note in the latest Shelby County financial statement that states “Beginning in 2003 an additional $0.05 tax rate funds only Rural School Bonds and is applied only to taxpayers outside the City of Memphis.” The Commissioner also stated that a majority of the current Shelby County Commission will not allow further schools to be built like the Arlington High School because they want the extra tax money to go to the Memphis School System.

Click here to read the law and the exception that allows the County to finance new school construction without sending money to the Memphis School System if the Coouty Commission would allow it

What could be a worse outcome for the taxpayers than to feed the corrupt money hungry taxzilla called the Memphis School System. Back in 2005, a bill passed the Tennessee Senate 31-0 allowing the Shelby County school system to become a special school district and thereby freezing its boundries. However it was killed by the House K-12 Education subcommittee after the Memphis City School Board decided to aggressively oppose the bill. The bill would have also ended the requirement that Shelby County send $3 to the MCS for every $1 spent on Shelby County School construction.

This opposition by the Memphis City School Board is outrageous and there should be a solution. Every taxpayer in Shelby County including City of Memphis residents should let their legislators know how they feel about this issue and call on the Shelby County Board of Commissioners to finance further school construction in the County in the most cost efficient way and to put an end to the 1997 law that brought this about.

2008-02-01T16:18:00.000-06:00

February 1, 2008

BUSINESS AS USUAL AT THE MLGW!!!

With all the misinformation floating around about the need for new taxes by both the City and Shelby County, it is easy to forget that the first responsibility of government is to spend the limited tax money wisely. Memphiswatchdog has been investigating corruption and mismanagement for over three years in both the City and Shelby County and we have been reporting on contracts that have been going to friends and supporters of the Mayors for some time. These special non bid or limited bid contracts have been costing the taxpayers millions in tax dollars.

There are four firms that have been favored for years with basically no bid contracts for equipment and software.These firms are Integrate Technology Inc. (Reginald French), Thomas Consultants, Inc. (Darrell Thomas), Mitchell Technology Group (Marvel Mitchell) and LeSure Computer Services. They have received millions under the ACS Information Technology contract with the City of Memphis which is currently under investigation by authorities. However the MLGW is also involved in giving business to these favored firms. A recent example is shown in an attached file as a result of an open records request. Thomas Consultants got a contract worth $1.83 million dollars for Dell computer servers bidding against two other minority firms, Mitchell and S.O.S. Computers dba Technology Express.

Watchdog received an email from a source that stated in part the following. MLGW’s IT department was forced to award to Thomas after he applied pressure to the MLGW board. I can tell you for a FACT that he was not low bid. Not even close. They broke the law and the rules by awarding it to him. Dell Computers was low. (this email was referring to a previous bid award to Thomas). They had done business with Dell direct for years. Watchdog has no first hand proof of this claim but we did check on Dell Direct and Western State Contracting Alliance (WSCA) and came up with a price for the same computers at least 25% lower in price. This needs to be investigated as to why Dell Direct and WSCA did not bid and was any pressure applied to the board of MLGW . With taxes getting ready to be raised in both the City and the County and with politicians bemoaning their lack of money, it is a crime to waste precious tax money to reward cronies.

Click here to see how the MLGW is spending your utility dollars

2008-01-28T09:29:00.000-06:00

January 28, 2008

FINALLY AN ANSWER ON THE NUMBER AND NATURE OF APPOINTED POSITIONS IN THE CITY OF MEMPHIS GOVERNMENT

Since September 13, 2007 I have been trying to get an answer as to how many appointed positions there are in Memphis city government. Also I asked for the cost of the January 2001 pension resolution to date and the annual cost going forward.

The latter two questions have been answered and I published the information in a recent posting to my website and blog. (www.memphiswatchdog.org and www.shelbywatchdog.blogspot.com). The cost to date is $6 million dollars and the annual cost going forward starts at $1.5 million and will grow.

Now the City says that there are 412 filled appointed positions which may vary some as some entire City departments are appointed (e.g. legal) and this figure may change from time to time. Sara Hall (the former City Attorney) had previously stated that the City Charter provided about 110 appointed positions. Also they are saying that there are 521 appointed positions (412 filled), 163 in the City Administration, 15 for the City Council, 3 for the Court Judges, 3 for the Court Clerk and 337 for the Library System.

Of these 412 filled positions, 377 are in positions or departments specifically named in the Charter and 35 were approved to be appointed by the Mayor and the City Council. Also they state that as of December 31, 2007, there were 44 positions that were over and above the 412 positions they claim are allowed and that these were converted to civil service positions starting in 2008.

Finally, they state that there are 161 positions that are eligible for the January 2001 (12-year) pension resolution and that there are 46 current appointed employees that meet the eligibility requirements for this 12 year pension ordinnance, that requirement being that they must have been employed prior to November 1, 2004.

What we, the taxpayers, must be vigilent about is the posssibility that someone in a lower paying position that is not eligible for the January 2001 pension rule is put into a higher paying slot, then retires and hence gains a higher pension at the taxpayer’s expense. This has happened in the past as the example of Janet Hooks shows. Fun and games at the taxpayer’s expense. See the attached file for all the details.

Click here to see how 110 appointed positions per the city charter grew to 521 at your expense

2008-01-24T16:21:00.000-06:00

January 24, 2008

THE POLITICIANS WANT TO TAKE AWAY YOUR VOTE.
THEY WANT TO APPOINT YOUR SHERIFF, YOUR TAX ASSESSOR, YOUR TRUSTEE AND OTHER CONSTITUTIONAL OFFICERS. THEIR PLAN IS CONSOLIDATION AND THIS IS THE FIRST STEP.

It is time to take back your government and show the pols that the taxpayers, who pay all the bills including their salaries and pensions, have a voice. This petition will send them a message that will be heard all over Memphis and Shelby County.
Please sign the petition on this brochure and let them know you want to retain the right to choose your own Sheriff, Tax Assessor, Trustee, Register and County Clerk. Letting the Mayor appoint these important jobs gives any Mayor too much power over your lives and pocketbook.

We need to get over 100,000 signatures by April 15 so we can put this petition on the August 7th 2008 ballot. We ask you to sign the attached petition and return it to Concerned Citizens of Shelby County as shown at the botton of the petition.

Click here for a downloadable petition with places for three signatures on the front and six more on the back

2008-01-23T13:44:00.000-06:00

January 23, 2008

THE PAST CITY COUNCILS HAVE LEFT US A $6 MILLION DOLLAR BILL PLUS $1.5 MILLION A YEAR GOING FORWARD. THANKS FOR THE MEMORIES

On September 13, 2007 I asked for information about who had retired under the January 2001 pension resolution, the costs to date and the ongoing annual costs. Also I asked for other information about the number of appointed positions authorized under the City Charter. I got no answer for three months and then after threatening a lawsuit, I finally got some answers. I am still analyzing the information but I have attached the data on the cost to date, the people involved in this costly City Council travesty and the ongoing cost to the taxpayers.

To date, this terrible decision in 2001 has cost $6 million in direct pension and health insurance costs that need not have been paid if it had not been enacted. The ongoing annual costs is $1.5 million and likely to rise. To refresh your memory, this is the January 2001 pension resolution that allowed elected and appointed people to retire after 12 years of service regardless of age and start receiving their pensions and health insurance benefits immediately. Tom Marshall, at the time that it passed, said that this was a good thing as it would help to get and retain good people.

Look at the list as there are some interesting names.

Roland McElrath, the current Director of Finance.

Rick Masson, currently on the MLGW board

Robert Spence, former City Attorney and recipient of millions in city legal fees

Narquenta Sims, former manager of Multi-Cultural and ReligionAffairs, a job that is now occupied by Janet Hooks, former City Council member responsible for passing this resolution. Ms. Hooks will now be eligible for a much higher pension than under her former city council salary.

Gale Jones Carson, former communications person for the Mayor and now at the MLGW heading up their communications department. She is receiving her MLGW salary as well as her pension at the same time.

Ricky Peete, former city council member, now headed for prison.

Tom Marshall, former City Council chairman

Jack Sammons, former City Council member

Brent Taylor, former City Council member

And on and on it goes. Get out your checkbook, because tax increases are coming.

Click here to see who is feasting on your tax dollars