Archive for the ‘City Council’ Category
November 25, 2013
I Did Not Know I Was Paying For Free Phones Every Month
As I was looking at my phone bill yesterday (it was up from the month before) I noticed that the Federal Universal Service Charge was up from $3.07 to $3.61 cents per month. I decided to investigate and this is what I found.
The Lifeline program began in 1984, an attempt to ensure that America’s poorest had access to landline phone service to call 911, work, or family members. But in 2008, the FCC expanded the service to include mobile phones, and under the Obama administration, as welfare rolls swelled, more people became eligible for a subsidized phone — part of the reason they’re often known as “Obamaphones.” The following article is from National Review and reports on an effort by the state of Georgia to reign in abuse of this program.
By 2012, the cost of the national Lifeline program had risen to $2.189 billion a year, up from $822 million before cell phones were included. In Georgia, after Lifeline expanded from landlines to mobile phones, the number of users shot from 150,000 to almost 1.1 (more…)
November 14, 2013
Voting is proceeding on the ½ cent sales tax increase. There is a lot of money being spent to pass this initiative as evidenced by the two expensive direct mail pieces I received yesterday. This was paid for by the Memphis Pre-K initiative.
You know my position on this as I am against it until City Hall and the City Council reform their finances and get them on a sustainable basis. For more information on this question, there is a very good article in this week’s Memphis Flyer.
However look at the whole question of sales taxes. According to Robert Lipscomb there is an endless source of money for development in Tax Incremental Financing (TIF) developed by Tourist Development Zones (TDZ) in Memphis. According to Mr. Lipscomb all you have to do is build it and it will be paid for by the incremental amount of sales taxes spun off from the development. Don’t worry about whether the incremental amount of sales taxes will be there to cover the principal and interest. The full faith and (more…)
November 4, 2013
This is an issue that the City of Memphis is trying to sneak by the voters in a vote that will probably have a low turnout. These are the reasons to vote NO. Early voting starts today. As they say in Chicago, vote early and often.
- The Commercial Appeal writes that 63% ($30 million) goes to Pre-K and the rest (1$17 million) to property tax reduction. However look at the wording of the Ordinance which states that the money goes to a Pre-K Commission appointed by Mayor Wharton which will make the decisions. Do you trust such a commission?
- Our sales tax is already very high (9.25%) and this would take it to 9.75%, the highest in the state, a very regressive tax.
- There is no evidence that Pre-K works and has any long term benefits,.
- There should be no new taxes until the City of Memphis and the City Council reform pensions and health care costs and get on a path to reduce unfunded liability as pointed out by the State of Tennessee.
October 28, 2013
Taxpaying citizens often feel like they are ignored until election time. Then the politicians come out of the woodwork and tell them what a great job they have been doing for them and promise all sorts of solutions to real problems. Then they get reelected and those promises go on the shelf in most cases. The citizens feel frustrated and impotent and don’t know what to do.
Well I know the answer and it is to organize, talk to each other, don’t get discouraged and let the pols know what you want. I want to give you some examples.
In 1994 a petition drive by Citizens Against New Taxes proposed an amendment to the County Charter setting term limits to two consecutive four year terms for the County Mayor and for County Commissioners. The amendment passed with 81% support. Then in 2004 John Lunt and a group of citizens, including myself, instituted a charter commission which resulted in two four year term limits for the Memphis Mayor and the City Council members.
What was the politicians’ reaction to the 1994 amendment to the County Charter. That Charter was enabled by petitions with required signature amounting to 15% of those who voted in the last gubernatorial election. AHA said the politicians. Let’s change that to 15% of registered voters, a much higher and almost impossible bar. That will teach those citizens who want to mess in our business, a lesson. Here is the language in the County Charter with the amendment passed in 1997 at the state level.
[may propose any such amendment by a petition addressed to the board of county
commissioners and containing the full text of the proposed amendment. Any petition
proposing a charter amendment must be filed with the clerk of the board of county
commissioners and must be signed by qualified voters of the county equal in number to
at least 15 percent of the persons who voted in the last gubernatorial election in Shelby
County. 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.
Editor's note: The Charter, § 5.05C., which states "at least 15 percent of the persons
who voted in the last gubernatorial election" is superseded by the state law, T.C.A. § 2-
5-151(d) which states "at least fifteen percent (15%) of those registered to vote in the
That makes my blood boil. How about you? Let’s let the state Senators and Representatives know we want to go back to the old language for petition signatures.
After the 1994 term limit success, Walter Bailey and two other pols filed suit to overturn term limits and they lost. Unfortunately Walter Bailey sat out and was reelected later. Unfortunately the term limit language did not have the provision of the US XXII amendment which will prevent George Bush, Bill Clinton and Barack Obama from being reelected again.
Finally I have attached a shame honor roll showing the longest term USA Senators and Congressmen. What happened to the founders’ intention to serve for a short term and then return home and live, work an earn a living under the laws that they passed rather than becoming a highly paid and corrupt lobbyist insulated from those laws.
Stand up, organize and let your representatives know you are sick of what you see.
This is an anniversary of sorts. I have been at the work of informing the public about local government for nine years. I have created two website, filed seven lawsuits to open records and have had some effect on local government. Here is a short recap of my efforts and results.
You see above a campaign sign from the 2004 effort to elect a charter commission after John Lunt started a campaign to reverse the financially disastrous January 2001 pension resolution that allowed City of Memphis elected and appointed officials to receive a pension after only 12 years of service regardless of age. None of the named people in the above sign were elected. However the result (more…)
September 10, 2013
Halloween and Smart Meters
Halloween is approaching and a good friend and neighbor told me that he had seen Janis Fullilove following around two men dressed in scary costumes. They were knocking on doors and telling residents that they were there to deliver their “SMART METERS”. While it was impossible to tell who these two costumed gentlemen were, one wag told me that he heard them calling each other Jerry and Chris.
Well no one has knocked on my door yet, My neighbor apparently is in one of the chosen groups that are scheduled to get the first of the recently approved smart meters. After the knock on his door, he asked how to opt out of the program and he was given the attached letters and documents. Talk about scary!! He is still looking over the details of the OPT OUT and has not come to a decision yet. The documents point out lots of good things that will happen if he OPTS IN and lot of bad things that can happen if he OPTS OUT.
But be of good heart. You time will come eventually in the OPT IN/OPT OUT game. In the meantime study the choices. And let me know what you think.
October 7, 2013
The Sears Crosstown Project
I am old enough to remember going to the Curb Market in crosstown with my mother and buying a bushel of snap beans for canning. I would have to spend the rest of the day cleaning and preparing them. On many occasions we then went to the Sears Crosstown store. It was huge and impressive. It was built for a certain time and market and whether it paid for itself over time I do not know. Looking at the Sears Company today, you have to wonder about their long term business knowledge. The Sears catalog was the amazon of its day and this store I believe was a catalog sales and warehouse center. Too bad they did not keep up with technology.
Now we have a choice. Tear down the old Sears building or spend at least $175 million to turn it into another Robert Lipscomb non tax producing renovation project. Where is the financial pro forma report on this project? If it is available I would like to see it.
Meanwhile let us look at how this is currently being financed according to a recent CA report.The Crosstown Development team says it has essentially assured $160 million in
funding — $25 million raised privately, $30 million in historic preservation tax credits,
$15 million in new market tax credits, $10 million in grants and other sources, and an
$80 million loan. Add the $15 million requested from the City of Memphis and you have the $175 million supposed front end cost.
- $30 million in historic preservation tax credits. The legislative incentive program to encourage the preservation of “historical buildings”. Congress instituted a two-tier Tax Credit incentive under the 1986 Tax Reform Act. A 20% credit is available for the rehabilitation of historical buildings and a 10% credit is available for non-historic buildings, which were first placed in service before 1936. Benefits are derived from tax credits in the year the property is placed in service, cash flow over 6 years and repurchase options in year six.
- $15 million in new market tax credits. The New Markets Tax Credit (NMTC) Program was established in 2000 as part of the Community Renewal Tax Relief Act of 2000. The goal of the program is to spur revitalization efforts of low-income and impoverished communities across the United States and Territories. The NMTC Program provides tax credit incentives to investors for equity investments in certified Community Development Entities, which invest in low-income communities. The credit equals 39% of the investment paid out (5% in each of the first three years, then 6% in the final four years, for a total of 39%) over seven years (more accurately, six years and one day of the seventh year) . A Community Development Entity must have a primary mission of investing in low-income communities and persons.
If it goes forward, will it throw off tax money to the City of Memphis? If there are new small businesses that rent space or locate in the general area because of new traffic and people who live in the renovated building, I suppose there could be new sales tax money and employment opportunities. However it sounds like most of the occupiers of the space will be non-profits and art enterprises. There will be people living in the building but many of these will be rent subsidized people under section 8 or other federal and state programs. Taxpayers will be funding the whole project funded through these various federal tax credits.
As far as the building is concerned, I think it is ugly and really not worth saving. Possibly the architects can make it beautiful but at what cost compared to tearing it down and doing something else? I would like to see a financial analysis of this proposed project and no decision should go forward without this being presented to the public for discussion.
September 26, 2013
As I read through this massive document I want to point out some of the good suggestions from the ridiculous ones. I have attached a section entitled “Implement Strategies to Lower Volatility of Pension ARC”
The Pension ARC is the annual required contribution necessary to fully fund the promised pensions. For the plan year ended June 30, 2012 this figure was $89 million dollars. WOW!! The City of Memphis put in 22.6% of this. The difference in the ARC and what the City actually contributed of course adds to the unfunded liability plus the interest on the difference.
The suggestions from the plan are as follows.
- Freeze cost of living (COLA) adjustments until the plan achieves 90% funded status.
- Contribute the full ARC each year. Where is the Money ($69 million) coming from?
- Close the current defined benefit pension plan and begin a defined contribution plan.
- Extend the City’s 2011 pension reforms to non-vested employees. Extending the 2011 reforms to all non-vested employees (47.7% of total employees) would reduce the ARC by $5 million in 2014 and by $28.2 million from 2014 through 2018.
Read through the report and let me know if you think any of this is really going to happen. The answers are there to make real reforms (more…)
September 19, 2013
For three days running there have been lead articles in the CA about our City of Memphis pension unfunded liability.
Finally yesterday, they mentioned the even greater OPEB unfunded liability (cost of health care for retirees).
I have attached the report from PWC consultants for your review. Read it at your leisure but here are some highlights.
- Despite better than average asset returns for 2010 and 2011, the plan’s funded status will continue to deteriorate, from $682 million to $740 million.
- Assuming no other changes, it is estimated that it would require an annual asset return of 13% over each of the next 10 years in order to fully fund the plan.
- Conclusion: Based upon the actuarial assumptions used to determine the plan’s liability and ARC, a projection of a workforce similar in size to the current one, and the current funding policy of 6.0% of compensation, the plan is not sustainable in the long-term.
September 16, 2013
I am reviewing another part of the Shelby County Efficiency Review, Legal costs. Ugh! I will be the first to admit that good legal advice is necessary in our litigious society. So let us look at the County versus the City.
I have attached some pages from the City budget and the County budget. The County budget for the County Attorney’s Office is $3.7 million for 35.5 people. This includes legal services for the County Commission. From this in the future, if the suggestions are adopted, they propose to cut $300,000.
Now look at the City of Memphis. Their actual expenses for FY2012 were $13.6 million with 58 people. Their proposal for 2014 is $9.5 (more…)