Health & Fitness
Citizen's view of the State of the City
With some apprehension and consternation, I attended Mayor Jim Ellison's State of the City Address July 23rd. My purpose for attending was to hear the Mayor address the goals, challenges, and priorities of the City of Royal Oak. I didn't attend to time his reading of the document,what words he used, or how many times he used them. My only concern was content. I will, in this article, place my emphasis and stress on those areas that I'm most concerned about as a resident, taxpayer, and user of city services.
It may surprise many residents to learn that the problems that presently plague Detroit, to a lessor degree, also plague The City of Royal Oak. The biggest and, and most pressing. is our unfunded employee legacy costs. These are pensions and benifets that employees have already earned but, unfortunately, we have not set aside the money to made payments on these debts when they come due. I have broached this subject ad nausium with the city commission over the past 5 years and now the city sees we have a problem. To my surprise, Mayor Ellison recognized the problem but probably due to an "oversight" failed to tell us how big this is. To rectify that oversight here are the numbers as of June 30, 2012 :
Pension Unfunded Liability : $ 66.562 million
OPEB (Other Post Employment Benefits) : $ 113.165-million
Total Unfunded Liability : $ 179.727 million
Put another way every man, women, and child in Royal Oak has a debt of $3.268. Reasons for our plight are many. Here are just a few:
- For decades our elected officials and city administrators spent money they didn't have and made promises they couldn't keep. Also termed "Kicking the can down the road."
- The insertion of pension protection into the state constitution.
- The enactment of PA 312 and binding arbitration.
- This generation, my generation, using city services and passing the cost on to future generations.
- "Spiking" pensions on the retirement or back end.
- Sky rocking health costs.
- Early retirements.
- Ratio of active employees to retired employees.
- Looking for financial solutions (Millage, federal/State grands, bonding) rather than structural solutions which are much tougher but long term. This is evidenced in the cities majority decision to accept the ICMA recommendation to propose a public safety millage but totally ignore their structural recommendation to privatize portions of the fire service.
- Late entry into defined contribution plan.
The mayor directed comments toward the Human Rights Ordnance and his position but failed to address the progress and status of the Ethics ordnance and consequent city circus. Did it just go away with a change of commissioners?
I didn't hear an explanation as to why we have 8 bargaining units who have expired contracts. That short 2 year contract seems to allow the units to look at whats on the table after a successful millage and see whats up for grabs.The last state of the city address did emphasize the bargaining units especially in give backs. Maybe PA 312 is alive and well.
I sensed that from this reading by the mayor we will need to prepare to cough up more revenue in the form of mileages. Bond issues also seem to be on the table but looking at the city unfunded liabilities and our close proximity to Detroit that might be a tough sell.Yes Johnny, you will probably see a "dedicated" millage for infrastructure.
Each of these items merit examination and discussion on their own. In following weeks I will be posting information about each of these items and others. My goal is not to inflame discourse but to allow all of us to make better informed decisions regarding the future direction of our city. In the near future I will hold another public forum to discuss these issues.
I have had people who agree and disagree with my positions. However, I have always respected people who are up front, honest, and don't throw barbs and then hide behind silly names to "protect" their identity. If you cannot go through the blog, call me on my home phone listed in the local directory or send me an email theshaw10@yahoo.com. I will answer you and respect your privacy.
If you have any comments questions, or remarks remarks, please fee free to let me know.
Thank you.