Monthly Archives: December 2010

The Song: Powerhouse

The Artist: Raymond Scott


Liveblogging the Failure to Make Progress on a Pensions-Funding Plan.

Right now, Council is debating how and how much to fund the city’s hunger groups in 2011. Councilman Burgess has recommended an increase to $125,000 worth of its CDBG funds, and Councilman Peduto is pointing out that this “has always” been matched by the mayor’s “ULO”. Burgess is now offering to withdraw his budget amendment for one week so as not to turn this into a political football. Councilwoman Smith mentions that she hopes that next year we can add some accountability measures to make sure the funding is going to the people we’re trying to reach, but now the question is resurfacing what accounts this money is coming out of. Councilwoman Rudiak says it’s “unfair to the groups in [her] district, in all of our districts, who must rely on this funding” to present an amendment on the day of tentative approval of the budget without previous discussion. “A house divided cannot stand.”

So basically, everybody is getting in the mood to discuss saving the pension fund.

Council votes without discussion to hold for one week (?) its consideration of the “present value calculation” solution concept (not hearing much about that one these days).

On the Revenue-Sharing Services Contract, Burgess motions to hold for one week (?) with discussion. Kunka and LAZ are invited to the table. Burgess’s introductory spiel takes us back to 1787 and the compromises in the framing of the Constitution.

And here comes the PowerPoint.

“This compromise plan has been supported by I think all of the unions who work for the City of Pittsburgh”, says Burgess, and he rattles off almost a dozen. “We have perhaps a week or less to do something against a state takeover.” Burgess says despite his previous strong advocacy, from here out he’ll be an honest broker and try to work out an agreement. “This is just a framework for us to have conversations.”

Councilman Lavelle, to Finance Director Kunka: “With the time we have left, how do you see this being done?” Kunka says we can’t get to a closing by the end of the year, but if we reach an agreement we can get some bridge financing.

Alan Lazowski from LAZ comes to the table, thanks Council for the opportunity, and the opportunity to hear constituent concerns to respond to them. Says people were not comfortable with a 50-year plan without revenue sharing, and not comfortable with high rates in neighborhood business districts. Says its not a lease, but a revenue sharing services agreement. Most rates, hours consistent with Council-Controller plan. LAZ also to chip in $340 million on construction, including $93 million in first (was it 10?) years. Plus new technology for the city’s own residential parking permit program — license plate recognition and online permitting, will be provided by LAZ.

In short, this is “a wonderful blend of both plans that everyone can be proud of.”

Nobody has questions for Mr. Lazowski, but some have some comments.

Councilman Kraus: “I have remained relatively quiet throughout this issue, though some have belabored their comments … as though to convince themselves of the validity of their arguments.” Has met resounding opposition from his constituents. “You cannot lease public assets to investment bankers.” “It’s liken to tearing up the floorboards of your house to heat it.” If we’re not managing the assets good enough, we have to do it better, so people profit not investment bankers. Has done extensive reading on Chicago, where there are boycotts and vandalism.

More Kraus – Somehow vehicle management got mixed up with pensions and that’s a shame. We should be talking about light rail from Downtown to Oakland. Some members are choosing to waver. Calls out Dowd in the paper, who sat here and pontificated about rejection and now says it’s the centerpiece. I will be more than happy to work with whoever we need to work with to solve this, but will not go against “99.99%” of his constituents.

Lavelle: I agree with Kraus that our constituency, 99%, have voted down original plan. Public has NOT had the opportunity to learn / sound off since real State takeover consequences came out, and since this new plan came out. “I think there’s a conversation to be had.”

Councilman Dowd: Hasn’t wavered one bit since 2009. Doesn’t believe everything he reads in the papers. Will now take as much time as he needs (he warns us). Has always said public assets should remain public. That includes management of the pension fund. That includes managing our assets, but it doesn’t mean not working with anyone.

More Dowd – “For someone to say they’re totally opposed to anything and for the status quo … that’s a very easy path. But the reality is we’ve got to do something.” He doesn’t walk the streets and hear anyone happy about the status quo. “We have to get something going here.” “We’ll never get anywhere if we continue to dig our heels in and stick our heads in the sand.”

Smith – “We either want to solve this or we don’t.” Doesn’t even want to hold this for a week; wants to vote it. We shouldn’t be leaving this building until we solve the problem — no Christmas parties or anything. It shouldn’t matter who put the plan on the table. Is getting “fed up.”

More Smith – “If you want to bring up Chicago, we’ve learned something from Chicago, we’re doing things differently.” “LOOK AT OUR OWN BLOGS LOCALLY AND SEE WHAT THEY’RE SAYING ABOUT THIS.” ๐Ÿ™‚ ๐Ÿ™‚ ๐Ÿ™‚ “Somebody call a meeting and let’s sit down and work on this.

Peduto – The Wall Street Journal, Huffington Post, Bloomberg News, Rolling Stone have been covering this. Wall Street is using this to make money. Anybody who says this isn’t the same as Chicago “doesn’t even understand this issue a tiny bit.” ๐Ÿ™ ๐Ÿ™ ๐Ÿ™ “This is a deal that was struck by this mayor, and that’s why we can’t compromise — because he can’t walk away from this deal.”

More Peduto – “Mr. Laz, you’re a nice guy, but it’s time to go home.” “I don’t return your calls, because I don’t want to give you even a little bit of hope.” What do we sell next, the Water Authority? The City-County Building? Will be voting no so he can defeat bill and leave it from this chamber once and for all.

Back to Burgess (w/o 1st round discussion by Harris, Shields or Rudiak.) Asks about timeline and says is ready to work ’round the clock about compromise.

Smith – “Wall Street’s in it to make money. No kidding. That’s what they do. But last week I sat in a meeting with foreign investors (reference to the Harris life-insurance proposal!) and if I had to choose I’d choose Wall Street.” Taking umbrage at the suggestion that the problem is people don’t understand or aren’t well-enough read on the issue.

Dowd – “I do believe the Council-Controller plan is the best possible solution.”, doesn’t mean it can’t go through in the future. Thinks the 40-year duration in the latest LAZ proposal can be shortened further. Must start with that “idea block”. We need to go to “somebody”.

MOTION TO HOLD: Fails 4-5.

MOTION TO APPROVE: During roll call vote, Dowd asks for his full minute to think, and gets passed over. Finally: “I hate to abstain, but I have to abstain. I abstain.” 2-5-2. Motion fails.

What a convenience, to know who are the good guys and bad guys.

*-UPDATE: I don’t know why I keep forgetting these Wednesdays are just preliminary votes — they’re going to have the opportunity to make sure everybody understands all the big-picture arguments again through Tuesday 12/21.

9 Days Remaining in CHS Gift Drive…

Info about the nonprofit gift drive is still here; their website to learn exactly how to help is here. These are just a few composite stories, provided by Sue Kerr of CHS, to illustrate the kinds of people CHS helps and what will become of your gift card or other donation:

“Jim and Elizabeth are parents to a 3 year old girl and 4 year old boy. When a fire destroyed their rental home, they were forced to live apart in shelters because there are so few family shelters. Jim was unable to keep his job because of the housing instability. With the help of CHS family programs, they were able to find an affordable apartment and reunite their family. Jim works a full-time job and Elizabeth volunteers at the children’s preschool. Now that they are back on their feet, they need your support for the holidays so they can stay on track with their financial plan. Jim and Elizabeth have asked only for gifts for their children.”

“Joey is in his fifties, and independent. He lives near staff for a sense of security, but takes care of his own matters. His requests are modest — a few books of stamps, a VHS tape cleaner kit and a model for his collection. We’d like to treat Joey to a simple meal out (Wendy’s is a favorite) often outside of his modest budget as he always pays his bills. Joey is an example of how successful a Mental Health program can be.”

“Ken is a single father raising two teenage boys, one of whom is confined to a wheelchair by a physical disability. Caring for his sonโ€™s medical needs consumes a lot of Kenโ€™s energy and financial resources. With your help, he can continue to meet those needs and provide a memorable holiday for both of his sons. Kenโ€™s wish is simply to have gifts for his teenage sons, nothing for himself.”

“Bronson is in his mid-50s and has held the same PT job for 13 years. He shares an apartment. Bronson is an avid reader and writes many letters to the editor about an issue he cares about โ€“ free speech. Bronson and his roommate split the bills and housework 50/50, pooling their money to buy in bulk for savings. Bronson enjoys collecting clock radios and helps his neighbors by taking out the trash each week for those who are a few years older than he is. Bronsonโ€™s wish for the holiday is a winter hat and glove set and some blank paper for his printer.”

Like I said, here.


UPDATE, NEXT DAY: Council unanimously waved Rule 8 today in order to begin deliberation on the new proposal tomorrow. This could enable final action on it just a week from today, which is more or less what would have to happen to get it done. The P-G carries the so-called latest.

At least I hope** this is verifiable news:

LAZ Chairman Alan B. Lazowski sent council a second revision Nov. 29, and Councilman Patrick Dowd said he thinks it could be the centerpiece of an agreement. The Post-Gazette agrees. (P-G, Edit Board)

Dowd emceed the celebrity roast of the initial lease offer from LAZ, which in retrospect was deservedly dead on arrival. But now it seems his objections to it were detail-oriented rather than religious in nature. Maybe he was simply negotiating aggressively — while the rest of us got taken in by the “must be completed by October” deadline, which now seems rather quaint.

Irregardless. One step closer.

NOTED: Just in case it surfaces again, this theory sounds so broken I can’t even begin to wrap my brain around anyone’s supposed motivation to play their roles in it.

DISCUSSION QUESTION: If we’re having a difficult time relinquishing our government-run parking fiefdom and/or justifying it politically to some parties — shouldn’t we be asking for more money on behalf of our city? It seems perverse to be shaving features off of the deal while whittling the payoff further downward … perhaps instead we should be demanding more?

*-UPDATE: It is:

Let’s just not allow the perfect to become the avada kedavra of the good. And I’m sorry if I ruined Deathly Hallows for anyone but the book was released in 2007 and your time has expired!

**-UPDATE B: Or not. Or kinda:

How about I just give up trying to understand.

Santa’s Goin’ to the Su-uper Bowl


Kenney Completes Mission at PWSA.

Chalk up one scalp for Patrick, I suppose…

Michael Kenney resigned today as executive director of Pittsburgh Water and Sewer Authority in advance of a report expected to detail his personal ties to a vendor providing line insurance to PWSA customers. (P-G, Smydo & Lord)

Asked whether it was concerned what comes next for the embattled former authority director, Pittsburgh only shrugged.

Like Mr. Kerr, most of Utility Line Security’s principals also are executives with Utilishield, which sells water line warranties outside of the city, and Resource Development and Management, which is led by former Allegheny County officials Joseph M. Hohman and James J. Dodaro.

Mr. Kenney described a long professional and personal relationship with the firms and Mr. Kerr. (P-G, Rich Lord, 3/26/10)

That guy. Always with the reverse-trails of breadcrumbs. Alright, so this might not have been a successful scalping, so much as routine seppuku.

*-ADDED: Reading the article again, it’s unclear how near the report was to completion, but apparently there were some proceedings earlier this week:

As a rule I dislike using screencaps from Facebook, but the guy doesn’t tweet like he used to and does most of his city-related web-trafficking in facespace.

*-UPDATE: Null Space provides a whale of an update on all things water and PWSA.

AND NOW come the Plaintiffs…

It’s been reported that Firefighters Local 1 are suing the city on the grounds that a mandatory state takeover would violate only their collective bargaining agreement, but it turns out it’s a little more sophisticated than just that:

5. At all times relevant hereto, the Second Class City Code has provided that a pension fund be established in the City of Pittsburgh specifically for retired and disabled city firefighters…

6. At all times relevant hereto, the Second Class City Code has also provided that the care, management, and control of the “Fireman’s Relief and Pension Fund of the City of Pittsburgh” be exclusively performed by a local board of managers (“Pension Board”) which include City officials as well as members who are directly elected by the city firefighters and beneficiaries of the fund… (Firefighters v. Pittsburgh)

So they’re not arguing a takeover conflicts with their contract so much as it conflicts with the Second Class City Code, a prior established state law:

23603 Board of managers

There is hereby created for the care, management, and control of such fund a board of managers, consisting of twelve members, to be known as the “Firemen’s Relief and Pension Fund Board of the City of ………..” The personnel thereof shall be as follows: The mayor or chief executive, the president of council, the city solicitor, the city controller, the director of the department of public safety, and the chief of the bureau of fire, who shall be ex officio members, and six elective members from among the following classes of the members and beneficiaries of such fund: One member to be elected from among the deputy chiefs, battalion chiefs, captains, and lieutenants; three members to be elected from among the other members of the fund; and two members to be elected by the beneficiaries of the fund. (PA code)

The lawsuit goes on to establish the various tasks locals have been empowered to perform, frame this mandated empowerment as “rights”, and posit that under a state takeover their contractual, statutory and constitutional rights would be eliminated.

Now, this is where it gets interesting: the Firefighters are not suing to invalidate the new pension funding laws in order to uphold the older pensions board laws. They are suing to force the City to act in concert with both — that is, to cough up the money.

16. The City of Pittsburgh is mandated to appropriate sufficient funds, via tax increases if necessary, to comply with its collective bargaining agreements with its firefighters as a matter of law. Harney v. Russo 255 A.2d 560 (Pa. 1969) … Tate v. Antosh 281 A.2d 192, 201 (Pa. Cmwlth. 1971)…

17. Additionally, the May 20th, 2009 Act 47 Recovery Plan stated that a preferred option to pay for increased pension obligations would be, among other things, to adopt the Mayor’s plan to lease the parking assets…

18. The May 20th, 2009 Act 47 Recovery Plan stated that in the event that the City was unable to obtain sufficient funding for the pension plans, as a failsafe option, the City was mandated to pass as part of its annual budget sufficient tax increases to fund the required additional pension contribution for the budget year… (Firefighters v. Pittsburgh)

And therefore, they assert, since any “unilateral system modification” to the Pension Fund ultimately violates the PA Constitution, and any “dimishment” (not a real word) to the fund would ultimately violate the Home Rule Charter — the City should be ordered via injunction to get its 50% funding together by January 1, prohibited from allowing a state takeover to occur, and made to accept “one of the stated options to sufficiently fund the pensions”: that is, a lease, or taxes now so as to preserve the makeup of the fund, not comfortably in the future.

IMPRESSION: It’s hard for me to imagine a judge enacting a parking lease for us, or ordering a tax anticipation bond be issued (and taxes be raised) in this rapid a time frame, but I certainly see the potential for this to get chaotic as all get-out. The Firefighters have a credible enough complaint, and how a judge decides to resolve it, starting on Dec. 20, could ultimately surprise everybody.

POTUS on Impasses, Logjams, Rancor & Division