Stewart Nelson

Amazing!  The headlines of the Ann Arbor News broke the bad news today about how the losses in the AA City Retirement Pension Fund may force cuts in services over the next three years.  The worst case scenario that Mr Crawford outlined to the reporter is another example of how disingenuous City staff can be.  The fact of the matter is that the worst case scenario Mr Crawford computed was on December 31,  2008 when the Dow was at 8800.  It is not 20% below that and now and I am sure Mr Crawford hopes that he even can make the worst case scenario now!

Defined Benefit Plan

It is amazing to me that the City still offers a defined benefit retirement plan.  They cannot meet the financial obligations that they have now so why are they still oferring a form of pension that virtually no business offers any longer?   I am sure that in addition to ”praying” for 7% a year in investment returns, they are also counting on the generosity of the Ann Arbor tax payers to help meet a moral obligation.  I will try to do some calculations on this in the next month but I think they will find that between the VEBA Trust that is less than 25% funded and the Pension Trust that is less than 70% funded, they would need to raise taxes by 15 to 25% to get them out of the hole.  How can the City Council continue to do business the way they are?  I have concluded that they are either in denial or they know they will not be in office when the proverbial feces hits the fan.

The pension plan has lost 50% of its value in the last 18 months.  At 7% annual return, it will take over ten years just to get to where we were 18 months ago!  The pension plan that 8 years ago was funded at 140% is now funded at less than 70%.  We should force our City Managers to stop promising defined benefit plans and take the pension plan out of the hands of well intentioned amateurs before we will all be forced to leave the City because we cannot afford our already ridiculous taxes.

I felt like calling the airline pilot that wrote the column in the Other Voices Column in the Ann Arbor News (Friday, March 13). Sol Castell complained about spending money to add 800 ft to the runway.  The pilot while I am sure that he had good intentions, had no idea what he was talking about.

In the article, the 747 pilot stated that the length of the runway has no bearing on the glide slope a plane flies on approach.  While his statement is basically true,  the real problem is not the length of the runway per se,  rather where it is located.  Picture a runway up close to the foothills of the mountains.  The length of the runway (assuming it is long enough) doesn’t dictate the slope of the approach, but the mountains sure do!   That is the problem at the Ann Arbor Airport that we want to fix.  The real motivation for the construction is to move the approach end of the runway away from the nearby road. (State St) If the approach end of the runaway moves west, then planes can fly a shallower and safer approach over the vehicular traffic on State St.

He was also wrong in stating that larger aircraft will be able to use the longer runway.  Sure there may be one or two larger aircraft that will now be able to land on the longer runway, but 800 feet will not significantly change the mix of aircraft arriving and departing.  To attract bigger and noisier aircraft we would have to have at least 5000 feet of runway and a precision approach.  That is not going to happen for a variety of reasons, not the least of which is the proximity of Willow Run  which is a much better airport for small business jets.

The thing that will happen is a safer operation. I wish that the pilot had called me before he put out his erroneous information that may cost a future pilot his life.  I was on the Airport Board for 7 years and a commercial pilot for 32 years. There were several very serious overruns while I was on the Board. Luckily none were fatal.   The current members of the the AA Airport Board are pretty smart folks and I can assure you they do not want to waste your money.

My 21 years in the the Air Force taught me that “Good People” make up for “Bad Equipment” everyday.  The advantage one achieves by having the best of equipment is always fleeting if you don’t have the best people using it, so given the choice I will always choose the best people and try to hang onto them.   

The Russians are a great example of good people making up for bad equipment.  During the cold war the Russians faced chronic shortages of every strategic material and computer available to us Westerners yet they continued to bluff us into thinking they were a superpower for 40 years.  They did it with their intellect and hard work.  Take a look at vintage 1980 Soviet aircraft.  Lacking sophisticated computers and wind tunnels  for advanced aerodynaminc modelling, the Russians just became very good at copying our basic designs and adapting them to their needs.  The results were nothing less than outstanding.  Couple adequate design and outstanding pilots and the results were a talented air force that was the envy of the world.

So if you ask me whether I would rather have a new city hall or a good police force and I am sure you will know what my answer will be.  Don’t get me wrong, we need an adequate place for our policemen and women to call home and then we need to invest in their training to insure that they are ready to protect us.  Remember, our young men and women don’t gravitate to law enforcement for the money!  They do it because of their desire to serve.  Let’s keep the best and the brightest and make our investments in “them” not the building.  We will all be safer if we do. 

I was deeply saddened to see Judy McGovern’s column yesterday that broke the news on the proposed layoffs in the Police Department.  During my campaign I asked Police Chief Jones if he could guarantee that when the new building opened he would guarantee that there would not be any layoffs due to budget constraints.  Although that is a tough question, I was pretty certain that his answer would be “No”.   It is ironic that the layoffs are announced not when this new building opened, but now even before they officially break ground. 

I was worried about this eventuality not because my crystal ball on the economy is much clearer than others, but because I have been through more of these business cycles than most of the present council members.  My business sense usually tells me when it is the time to “press on the accelerator”, “time for caution” or “time to step on the brakes”.  For some time now I have been feeling the warning signs that this recesssion is going to get much worse before it gets better.

Municipal finance is the next big crisis we face as a community.  The promises we have made to our City workers, delays in rebuilding our infrastructure, excessive borrowing, an archaeic and punative tax system all are leading us down a path towards total collapse if we do not act soon enough.  This is a time for fundamental change in the way we do business as a City and County.    

I am sure it will come as no surprise to you that I am here tonight to speak against the proposed police court renovation at Larcom.  I would like to go on record with my concerns about the continuation of this large and mostly unnecessary expenditure. 

Let me preface my remarks with an observation. I don’t think that anyone would argue that the police department needs substantial renovation and improvements for the physical plant due to neglect of past administrations so I will confine my remarks to the money allocated to the court and other additions to Larcom. 

Here are my major concerns:

1. First, this is not the time to commit residents that are struggling to make their own mortgage payments to a stream of interest payments totaling $26 M over the next 30 years to fix what essentially is not broken.  Nor is this is not the time to commit the DDA to a stream of payments of $15M over the next 30 years that will not benefit the downtown merchants.  

2. Next, the $47M expenditure for bricks and mortar forces the City and County to unnecessarily duplicate expenditures for court security, IT, transportation and administrative services in perpetuity.  Future administrations, more focused on Regionalization will view the lost opportunity to combine all the Court services as a single unit as a bigger financial boondoggle than the early retirements granted to our City employees.

3. Additionally, why do you think  the construction manager is lobbying heavily to convince the City to abandon the pursuit of LEED Gold certification? It is because they know they cannot bring the building in under budget with green building practices in the equation.

4. Lastly, City policy on Debt Management as outlined in the Adopted Budget 2009  for Limited Tax General Obligation debt stipulates that these bonds should be considered only when constraints preclude the practice of voter approved general obligation bonds.  What precluded the favored General Obligation bonds in this instance except the convenience of not having to obtain voter approval?   

You have the opportunity now to do the right thing and abandon this dangerous course and revisit the County’s offer to cooperate in “reengineering” government in Washtenaw County and use the cost saving to try to lower the tax burden of our residents and businesses.        

For the first time in a long while I feel proud to be an American again!  There are many daunting challenges that face our new president but I really believe that with his wisdom and energy, Americans are more than up to the challenge.  Our country has been so divided on so many issues and now we have a leader that can seemingly pull us together and help us find ways to live peacefully with our differences.  It is not going to be easy.  We dug a huge financial hole that we must climb out of now as we lost our way and succumbed to the idea that we could all get rich quickly.  Our parents and grandparents knew better, but these are lessons than we seem destined to have learn the hard way.

Whether Barack Obama is a successful leader will depend in part on how each of us does our part to help.  He cannot do it by himself.  In his Inaugural Address in 1961 John F.  Kennedy implored us all “To ask not what your country can do for you, but what you can do for your country.” President Kennedy then want on to say “My fellow cirtizens of the world, ask not what America can do for you, but what together we can do for the freedom of man.”  Unfortunately, this is even more true today than it was in 1961.

The world is indeed a much “smaller” place than it was in 1961!  We are clearly more dependent on each other than ever before.  The Buddhist concept of “Karma” and the interconnectedness of everything is becoming more and more apparent even to us rugged individualist Westerners.  Tomorrow morning when they are still cleaning up the confetti  in Washington DC, when we wake up and look in the mirror you will see the only person that can really make a lasting difference.  Please help Barack Obama as the leader of the greatest country in the world, show the rest of the world that from now on it is not about “I ” but “We”.  What a wonderful world it will be.  God Bless America!

In today’s “Other Voice’s” column in the Ann Arbor News, Sunday, January 19, 2009 pg A10,  Paul Dimond is “spot on” when he proposes that the current economic downturn is an excellent opportunity for us to reinvent local government by eliminating unnecessary duplication of government activity at the County and City level.  Mr. Dimond proposes that we eliminate “all non-school local jurisdictions throughout Washtenaw County and  substitute a Uni-Gov with an elected full-time, strong Mayor chairing a part-time council elected from 10 geographic districts.

The name given to the idea of combined governmental units is “Regionalization”.  Up to this point the due to political turf wars, only lip-service has been given to isolated instances where the City and County could combine services such as police and fire.  To my knowledge the only functioning combined County and City unit is the Office Of Community Development.

Before we start wasting time exploring a City Income Tax, a financial band-aid in my opinion, why not first take a step “back and and up” and  look at the entire County from 30,000 feet (were I spent much of my career) and we will see that that arbitrary political boundaries we have grown accustomed to are not carved in stone.

As we retool our economy to a post-auto centric model, why not take the time and re-engineer our local governmental model into a 21st century model that the supports our businesses and citizens in a manner that is more productive and one that eliminates the us against them mentality of the myriad fiefdoms that have their roots in almost irrelevant past centuries.

Does anybody really think this is a good idea.  Why don’t we start trying to find ways to cut expenses first? We may be forced to soon but first we need radical overhauls in the way we continue to spend money!

I am amazed that the idea of a conference center downtown keeps surfacing.  Rumor has it that the City and some other other influential people originally had their eyes on the the land at Huron Hills as a spot for a 400 person conference center.  The City even went so far as to have the land appraised.  When the town banded together and stopped the sale of the Huron Hills property, the focus shifted to the land above the newly approved underground parking structure on 5th Street next to the AA Public Library.  It seems to me that there are much better places to put a conference center if there is really a need for one.  Out near Briarwood Mall might be the best place.  If we as a City decide to build one it should be a joint effort on the part of the City, The State, The County and The University.   We need to start broadening our perspective and stop committing taxpayer funds to “Build It and They Will Come” concepts that could eventually cost the taxpayer more money.