posted by Mike Madison at 11:11 AM /
Regular Blog-Lebo readers will recognize Dave Franklin by name as a frequent, thoughtful commenter here. Dave is a Lebo native, a local lawyer, and a long-time community volunteer. Dave was so incensed by recent news that the Mt. Lebanon Commission has authorized a $2 million "wrapped" bond issue to pay for street resurfacing that he invested some serious study time in the issue, then wrote out a comment that is so long that it won't fit in the Blogger template.
Joe and I are welcoming Dave today as a guest blogger, so that his comment on the bonds can appear here, "above the fold." I posted my own thoughts on this insanity over at Pittsblog last night, in part because I wanted to show all of Pittsburgh (the Pittsburgh that reads Pittsblog, anyway) what foolishness is going on our here. Dave, however, hits the inside story on the head. What follows are his words:
After being somewhat harsh on this issue yesterday, I thought it best to give the Commissioners the benefit of the doubt and better understand their collective reasoning and their individual positions on this issue. So, I passed on the 11 & 12 year old Little League Championship game at Dixon Field last night and settled in to watch a replay of Monday's Commission Meeting. If you have not had the pleasure of hearing the debate (or lack thereof) for yourself, please try to catch one of the remaining replays. Not only is it important to better understand what just happened on the unbelievable street bond issue, but it is also an amazing (and somewhat disturbing) look at how decisions are made to spend our money.
I was shocked over how little debate or explanation occurred when the pro-bond Commissioners were pressed on the issue by two informed citizens and Commissioner Miller. I fully expected Messrs. Colby, Raja, DeIuliis and Daley to explain - on the record - why it made sense to completely depart from good fiscal practice and float a bond to re-surface 11 streets. I truly hoped that they would offer individual pearls of wisdom that had not been picked up by the P-G reporter in attendance and then it would all make sense. Sadly, that never happened. Instead, these guys AGREED with the comments made by the residents and Mr. Miller to the effect that such recurring infrastructure costs should *not* be the basis of a bond issue, and more importantly that such tactics do *not* make for good economics OR good governance. Mr. DeIuliis even gave a very sincere statement suggesting that this decision would improperly lay considerable debt at the feet of a future Commission (yo, what about my feet!) and added that the ONLY reason he was voting YES was because the municipality had already signed a contract to start the work.......right about then was when I almost jumped through the TV.
Let me understand this - during the last budget process, a decision was made to cut certain street and sidewalk work from the operating budget. In return, each household realized a tax savings equal to about a large pizza and a beer (not even 2 beers). Now, just 6 short months later, they magically conclude that 11 streets and sidewalks absolutely need to be re-surfaced.
Okay, perhaps I can live with the story up until this point. After all, our streets do need to be maintained. However, rather than first figuring out HOW they are going to PAY for the resurfacing work, they instead place the cart squarely in front of the horse and sign a $2 million contract with some lucky contractor and tell him to proceed. Then and only then do they stop and ask themselves, "How the hell are we
going to pay for this?"
Unfortunately, in times like these, our budget is stretched so thin that they came up with what they thought to be the only viable solution - a 20 year wrapped bond that essentially turns this $2 million expense into a $3.7 million long term elephant.
As they voted, each Commissioner (except for Mr. Colby) explained his vote. Mr. DeIuliis noted that the ONLY reason that he was voting for the bond was because the municipality had already signed the contract and the contractor had already started to perform. That may be true, but it also rings rather hollow. At a minimum, it begs the question of why would we even proceed down the path without the cash. Clearly, these officials all firmly believe that it is wrong to fund this type of
recurring work with bonds. Why then wasn't the critical question (HOW ARE WE PAYING FOR THIS?) asked before the contract was bid, awarded and signed? Or if that question was asked and insufficiently answered, why weren't contingencies written into the contract to allow the municipality to delay the work, reduce the work or terminate the contract based on the source of funding? At an absolute minimum, why not have a termination for convenience clause in the resurfacing contract? No one's hands would be tied then!
Mr. DeIuliis is a contractor, Mr. Daley is a lawyer, Raja is a business owner and, if that's not enough, we have a solicitor to watch over all of them. All of these men know that such customary provisions are readily available for their use and our collective benefit (and protection). Sure, we might then owe a couple bucks to the shunned contractor to cover some of his ramp up and raw materials costs, but nothing remotely close to the $3.7 million that we just signed up for.
I then anxiously awaited remarks from Raja. Surely he would offer the carrot that I was looking for. The one morsel of truth that would make all of this seem okay. Instead, Raja quickly commented that taxing and borrowing decisions are "balancing acts" and therefore he had to vote YES. With all due respect Mr. Commissioner . . . . Duh! Of course these decisions are balancing acts. What I want to know from you Sir is what facts, information, risks and benefits in your mind caused the see-saw to tilt in favor of incurring this type of debt for what everyone concedes is a project not worthy of bonding? How will we fund the resurfacing of 11 streets next year, and the year after that and the year after that? As Mr. Miller so perfectly offered, "If you pay your gas bill with a credit card, have you really paid your gas bill?"
I could go on and on, but I won't. I would just note that Messrs. Daley and DeIuliis seemed genuinely reluctant to vote in favor of the bond. They all but applauded the citizen's remarks in opposition to the plan and they each echoed portions of the passionate speech by Mr. Miller. I even sensed a sizable pause before Mr. DeIuliis cast his vote. I thought he was gonna flip! It just seemed to me that these guys were casting their votes based on something that the rest of us don't know about.
Those of you who follow this blog know that I despise conspiracy theorists, however it certainly appears that the decision to do a 180 on streets and sidewalks, as well as the decision to float a bond to make it happen, were both made with something else in mind. Were these reluctant votes made in exchange for a vote on something else? Who knows, but in my opinion, none of it passed the smell test and we all need to start paying attention.
Yes, I'm pissed off. I'm pissed off because in 20 years we'll still be paying for these 11 streets that, oh by the way, will probably need to be resurfaced at about that time. I'm pissed off because the Commissioners don't understand that while people expect a different level of services in Mt. Lebanon they cannot be reluctant to ask us to pay for them. I'm pissed off because in their desire to save face at budget time, we are now paying *more* for something that many of us assumed was already covered by the operating budget. I'm pissed off because I wasn't paying attention and didn't speak up.
And, I'm pissed off because I missed that baseball game.
Joe and I are welcoming Dave today as a guest blogger, so that his comment on the bonds can appear here, "above the fold." I posted my own thoughts on this insanity over at Pittsblog last night, in part because I wanted to show all of Pittsburgh (the Pittsburgh that reads Pittsblog, anyway) what foolishness is going on our here. Dave, however, hits the inside story on the head. What follows are his words:
After being somewhat harsh on this issue yesterday, I thought it best to give the Commissioners the benefit of the doubt and better understand their collective reasoning and their individual positions on this issue. So, I passed on the 11 & 12 year old Little League Championship game at Dixon Field last night and settled in to watch a replay of Monday's Commission Meeting. If you have not had the pleasure of hearing the debate (or lack thereof) for yourself, please try to catch one of the remaining replays. Not only is it important to better understand what just happened on the unbelievable street bond issue, but it is also an amazing (and somewhat disturbing) look at how decisions are made to spend our money.
I was shocked over how little debate or explanation occurred when the pro-bond Commissioners were pressed on the issue by two informed citizens and Commissioner Miller. I fully expected Messrs. Colby, Raja, DeIuliis and Daley to explain - on the record - why it made sense to completely depart from good fiscal practice and float a bond to re-surface 11 streets. I truly hoped that they would offer individual pearls of wisdom that had not been picked up by the P-G reporter in attendance and then it would all make sense. Sadly, that never happened. Instead, these guys AGREED with the comments made by the residents and Mr. Miller to the effect that such recurring infrastructure costs should *not* be the basis of a bond issue, and more importantly that such tactics do *not* make for good economics OR good governance. Mr. DeIuliis even gave a very sincere statement suggesting that this decision would improperly lay considerable debt at the feet of a future Commission (yo, what about my feet!) and added that the ONLY reason he was voting YES was because the municipality had already signed a contract to start the work.......right about then was when I almost jumped through the TV.
Let me understand this - during the last budget process, a decision was made to cut certain street and sidewalk work from the operating budget. In return, each household realized a tax savings equal to about a large pizza and a beer (not even 2 beers). Now, just 6 short months later, they magically conclude that 11 streets and sidewalks absolutely need to be re-surfaced.
Okay, perhaps I can live with the story up until this point. After all, our streets do need to be maintained. However, rather than first figuring out HOW they are going to PAY for the resurfacing work, they instead place the cart squarely in front of the horse and sign a $2 million contract with some lucky contractor and tell him to proceed. Then and only then do they stop and ask themselves, "How the hell are we
going to pay for this?"
Unfortunately, in times like these, our budget is stretched so thin that they came up with what they thought to be the only viable solution - a 20 year wrapped bond that essentially turns this $2 million expense into a $3.7 million long term elephant.
As they voted, each Commissioner (except for Mr. Colby) explained his vote. Mr. DeIuliis noted that the ONLY reason that he was voting for the bond was because the municipality had already signed the contract and the contractor had already started to perform. That may be true, but it also rings rather hollow. At a minimum, it begs the question of why would we even proceed down the path without the cash. Clearly, these officials all firmly believe that it is wrong to fund this type of
recurring work with bonds. Why then wasn't the critical question (HOW ARE WE PAYING FOR THIS?) asked before the contract was bid, awarded and signed? Or if that question was asked and insufficiently answered, why weren't contingencies written into the contract to allow the municipality to delay the work, reduce the work or terminate the contract based on the source of funding? At an absolute minimum, why not have a termination for convenience clause in the resurfacing contract? No one's hands would be tied then!
Mr. DeIuliis is a contractor, Mr. Daley is a lawyer, Raja is a business owner and, if that's not enough, we have a solicitor to watch over all of them. All of these men know that such customary provisions are readily available for their use and our collective benefit (and protection). Sure, we might then owe a couple bucks to the shunned contractor to cover some of his ramp up and raw materials costs, but nothing remotely close to the $3.7 million that we just signed up for.
I then anxiously awaited remarks from Raja. Surely he would offer the carrot that I was looking for. The one morsel of truth that would make all of this seem okay. Instead, Raja quickly commented that taxing and borrowing decisions are "balancing acts" and therefore he had to vote YES. With all due respect Mr. Commissioner . . . . Duh! Of course these decisions are balancing acts. What I want to know from you Sir is what facts, information, risks and benefits in your mind caused the see-saw to tilt in favor of incurring this type of debt for what everyone concedes is a project not worthy of bonding? How will we fund the resurfacing of 11 streets next year, and the year after that and the year after that? As Mr. Miller so perfectly offered, "If you pay your gas bill with a credit card, have you really paid your gas bill?"
I could go on and on, but I won't. I would just note that Messrs. Daley and DeIuliis seemed genuinely reluctant to vote in favor of the bond. They all but applauded the citizen's remarks in opposition to the plan and they each echoed portions of the passionate speech by Mr. Miller. I even sensed a sizable pause before Mr. DeIuliis cast his vote. I thought he was gonna flip! It just seemed to me that these guys were casting their votes based on something that the rest of us don't know about.
Those of you who follow this blog know that I despise conspiracy theorists, however it certainly appears that the decision to do a 180 on streets and sidewalks, as well as the decision to float a bond to make it happen, were both made with something else in mind. Were these reluctant votes made in exchange for a vote on something else? Who knows, but in my opinion, none of it passed the smell test and we all need to start paying attention.
Yes, I'm pissed off. I'm pissed off because in 20 years we'll still be paying for these 11 streets that, oh by the way, will probably need to be resurfaced at about that time. I'm pissed off because the Commissioners don't understand that while people expect a different level of services in Mt. Lebanon they cannot be reluctant to ask us to pay for them. I'm pissed off because in their desire to save face at budget time, we are now paying *more* for something that many of us assumed was already covered by the operating budget. I'm pissed off because I wasn't paying attention and didn't speak up.
And, I'm pissed off because I missed that baseball game.
Labels: Should we follow the money
1 Comments:
Well said Dave. How can anyone in good conscience say that they are basically against something and then still vote for it? This is one of the biggest mistakes that I have seen the commission make in a very long time -- and at our expense!
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