Washtenaw County Board of Commissioners meeting (Oct. 6, 2010): Financial concerns emerged in a variety of ways at Wednesday night’s meeting.
Commissioner Conan Smith, who’s leading a budget advisory team, gave a grim update on an anticipated deficit that’s facing the county for 2012 and 2013. Originally projected to be $16 million, the administration now believes the two-year deficit could be $20 million or more, with possible adjustments necessary to address a shortfall in 2011 as well. Declining property tax revenues and uncertain state funding are primary factors.
Smith said cuts made to deal with a $30 million deficit in 2010-11 had brought them down to the bone, and now structural changes will be needed. “Some of what the county does will likely disappear in the process,” he said.
Budget issues also were central to a public hearing on the proposed Act 88 millage, which commissioners have used previously to fund programs related to economic development. It’s a millage they can levy without voter approval. During the public hearing, commissioners heard from supporters of the Food System Economic Partnership (FSEP) and Ann Arbor SPARK – both groups have been funded from Act 88 millage revenues. David Klingenberger of The Brinery, for example, told commissioners that FSEP is helping him build a pickle empire in Washtenaw County. But two people from the Washtenaw County Farm Bureau spoke out against the millage, arguing that property owners are already burdened and that any new tax needs to be on the ballot for voter approval.
Also at Wednesday’s meeting, Tom Wieder spoke during public commentary to call for an investigation into per diem spending by commissioner Mark Ouimet. Based on documents obtained under the Freedom of Information Act, Wieder contends that Ouimet claimed per diem payments to which he wasn’t entitled, and that his spending far exceeded other commissioners. Ouimet responded by saying that if any discrepancy is found in his expense reports, “obviously I’d want to know about it so I can take care of it.”
Ouimet, a Republican from Scio Township, is running for state representative in the 52nd District against Democrat Christine Green. Wieder is listed on a page of endorsements on Green’s campaign website.
Board Preps for Budget Discussions
During Wednesday’s meeting, commissioner Conan Smith gave an update on preparations for the 2012-2013 budget cycle, offering a look at the county’s financial projections that are grimmer than previously expected. Smith is leading a planning advisory team focused on the budget.
For planning purposes, the county works on a two-year budget cycle – the current cycle runs through Dec. 31, 2011. [.pdf file of Washtenaw County 2010-2011 general fund budget] Planning has already begun for the next two-year period, from Jan. 1, 2012 through Dec. 31, 2013. On Wednesday, Smith said that the county administration originally projected a $16 million deficit during that period, but now believes it will be over $20 million. In addition, there will likely need to be adjustments made to the 2011 budget, he said.
For the 2010-2011 budget cycle, the county addressed a projected $30 million deficit by cutting costs across most departments, but few structural changes were made. Now, Smith said, “we’re down to the bone.” Noting that everyone is keenly aware of the economic situation they’re in, he described the upcoming process as one of the toughest the county has ever faced, with difficult decisions to make. “Some of what the county does will likely disappear in the process,” he said.
The purpose of the planning team is to engage the staff, administration and board, he said. About 80% of their general fund expenditures are tied to personnel costs, he noted, and the county’s labor negotiations team is already meeting to get updates on the situation. That group is led by Diane Heidt, the county’s human resources and labor relations director. A labor/management team is also meeting every two weeks, focusing in part on the budget. Smith said they’ll need full participation from employees to find ways to deal with the budget shortfall.
One of the biggest challenges in the process, Smith said, will be in prioritizing county services, and one of the highest priorities is a commitment to customer service. They’ll need to invest their resources in a targeted way, he said – for example, perhaps by addressing employment and housing, two of the roots of the budget crisis.
Early in the last budget cycle, Smith said, the board established a revenue target for the staff to use when developing the budget. They had been conservative, he said, and that had been a wise decision. [See Chronicle coverage: "County Board: Plan for Worst, Hope for Best"] The board again needs to establish their expectations for the staff to work with, he said. Along those lines, he urged his colleagues to keep an open mind. Smith noted that he’s fought tooth and nail to keep funding for land use, planning and economic development, but that he’s trying to keep an open mind about what stays and what goes. They need to give staff clear direction on that, he said.
Promising to give regular updates from the advisory team, Smith concluded: “So we’re off and running.”
Budget Discussions: Commissioner Comments
Barbara Bergman said the board needs to get serious and quantitative updates about the budget. She noted that openness is important, but expressed concern about scaring people.
Kristin Judge said she was glad to see the planning process underway – she thought 2010 should have been a planning year. [Judge had pushed for planning to start early in 2010, but the last substantive discussion on setting priorities occurred at the Feb. 17, 2010 meeting. She mentioned the issue at a May 5, 2010 meeting – the final meeting for former long-time county administrator Bob Guenzel:]
Finally, Judge expressed disappointment that the Thursday working session had been canceled. The board needs to get to work setting its priorities and getting public input, she said. Next year they’ll have to set the budget for 2012 and 2013, which will be a difficult effort. It’s already May, and they haven’t made much progress in preparing for that. “We have a lot of work to do,” she said, adding that she hopes they’ll start to make faster progress soon.
On Wednesday, Judge said she appreciated Smith’s remarks about setting aside their favorite things and keeping an open mind. She noted that the board’s current set of priorities had been developed when revenues were growing – it’s a very different time now, she said, adding that she feels a sense of urgency to move forward on this.
Rolland Sizemore Jr., the board’s chair, said he wanted to look at professional services that the county uses, as well as at the many appointed boards, commissions and committees that are in place – some might not be necessary, he said.
Wes Prater said the issue of mandated versus non-mandated services will be a factor, as it was in the last budget cycle. [This was an issue that Prater brought up at the April 2009 board retreat, when the group met for three hours to discuss priorities. They have not held a retreat since then.]
Jeff Irwin began by saying that it’s certain he won’t play a role in the next budget cycle. [Irwin is the Democratic candidate for state representative in District 53.] But one of the things that troubled him during previous budget talks had been the issue of mandated versus non-mandated services, he said. He urged commissioners to consider very deeply what each of the non-mandated services is for – each of the services had been created to address a need, he said. And while it’s probably good advice to set aside favorites and keep an open mind, it’s also important to reflect on why particular programs are your favorite ones, he said. The board shouldn’t lose sight of what makes this county special, he said.
Judge responded by noting that mandated services require about $66 million [out of the nearly $100 million general fund budget], and said that a lot of non-mandated services help keep costs lower in mandated areas. She cited the example of the county’s public outreach team (PORT), which works with the homeless and mentally-ill population who might otherwise end up in jail.
But Judge added that the money just isn’t there to support all of the county’s non-mandated services, and they need to be honest with residents about that. Something has to go, she said. They just can’t continue to offer the same services anymore.
Smith pointed out that sheriff Jerry Clayton and Greg Dill, director of sheriff administrative operations, were in the audience that evening, and that Dill also served on the budget advisory team. The sheriff’s department has been keenly focused on the systemic approach, Smith said, and understood the impact of non-mandated services. [Operation of the county jail is a mandated service.]
Sizemore concluded the discussion by saying that while the economy is bad, this opens up the opportunity to take a hard look at what they do. He wants the county to remain a leader in the state and nation, Sizemore said, and to be proactive in its approach to the budget, not reactive.
Ouimet Called Out for Per Diem Spending
During the time for public commentary, Tom Wieder said he wanted to bring to the board’s attention some “disturbing information” involving a “breach of trust” by commissioner Mark Ouimet. [Ouimet, a Republican from Scio Township, is running for state representative in the 52nd District against Democrat Christine Green. Wieder is listed on a page of endorsements on Green's campaign website.]
It’s common knowledge, Wieder said, that Ouimet has spent a disproportionate amount of the per diem budget for the board. For the four years prior to 2010, he said, Ouimet’s spending accounted for more than 30% of the total per diem payments to all commissioners. Holding up a sheaf of documents, Wieder said that Ouimet was reimbursed for roughly $23,000 in per diem payments for over 900 meetings, plus an additional $9,300 in mileage reimbursement. Those meetings included some held at the former Ann Arbor News, as well with township boards and former county administrator Bob Guenzel, Wieder said, referring to information obtained under the Freedom of Information Act. [.pdf file of Ouimet's per diem requests]
Wieder said that based on the county board’s rules, Ouimet was not entitled to compensation for many of these meetings. He said it’s time for this to stop, then noted that the board had changed its policy. [Starting in 2010, each commissioner has an annual flex account for expenses, capped at $3,550. A commissioner can only receive additional funds if another commissioner agrees to transfer unused funds from his/her account. [.pdf file of flex account rules)] Wieder said he hoped the board would investigate this matter, and that there should be an effort to get Ouimet to reimburse the county for funds that he wasn’t entitled to receive.
The “compensatory service” section of the board’s rules and regulations deals with this issue [.pdf file of full board rules and regulations]:
B. COMPENSATORY SERVICE
In addition to the salary received by the Board of Commissioners, each member of the Board may receive a per diem payment of $25.00 and County mileage reimbursement from their residence or from their actual place of departure whichever is less from their CFA allotment for the following activities:
1. Attendance for a committee, subcommittee meeting or Working Session of the Board, when the member has been properly appointed to that committee or subcommittee, the meeting has been called in accordance with the Open Meeting Act, Public Act 267 of 1976, and the meeting has not been canceled twenty-four (24) hours prior to the scheduled time of the meeting and the Commissioner has not been notified of said cancellation within twenty-four (24) hours of the scheduled meeting.
2. Attendance at a meeting of a non-Board committee, subcommittee, commission, board, or attendance at a conference or convention as a representative of Washtenaw County when the member of the Board serves by appointment of the Board of Commissioners or the Chair of the Board.
3. For the purpose of receiving per diems, the Commissioner must be present for at least 1 hour or half of the meeting, whichever is less. Commissioners shall note their arrival and departure times on the meeting attendance per diem slip submitted to receive payments.
Any member of the Board of Commissioners may waive his/her per diem and/or mileage reimbursement by giving written notice to the County Clerk.
Following Wieder’s remarks, commissioner Conan Smith turned to deputy clerk Jason Brooks, and said it was the responsibility of the clerk’s office to review per diem requests, and that the clerk should meet with Ouimet if there was a discrepancy. Commissioner Kristin Judge told Smith that she disagreed – it’s not the responsibility of the clerk to understand the board rules. It’s the responsibility of commissioners to understand and follow the rules, she said.
Later in the meeting Smith apologized to Brooks, noting that under the old rules prior to 2010, no review by the clerk’s office had been required.
At the end of the board meeting, during the time set aside for commissioner follow-up to citizen participation, Ouimet addressed Wieder’s remarks – though Wieder had left the boardroom by then. Ouimet said it was important to understand that each commissioner is responsible for “whatever goes down on that piece of paper,” referring to the reimbursement request. In this case, he said, he’s responsible. “If there is any discrepancy, obviously I’d want to know about it so I can take care of it,” he said.
Ouimet also said that when he has traveled out of the district for county-related business, he’s always paid his own way. He further stated that he gives the money he receives from the county to charity.
Ouimet has encountered previous travel-related blowback. A 2005 Ann Arbor News editorial criticized him and other county officials for attending a five-day conference in Hawaii. At the time, Ouimet told The News that he was paying his travel and other expenses on the trip. And in 2007, he canceled another planned trip to Hawaii for a conference on public pensions, after negative publicity surfaced about the trip. Again, he told The News that he had intended to pay his own way.
Act 88 Public Hearing
The board held a public hearing at its Wednesday meeting to get input on levying an economic development tax of 0.043 mills. Known as the Act 88 millage, it is expected to generate roughly $611,266 annually and would cost homeowners $4.30 for every $100,000 of a home’s taxable value. Because Act 88 predates the state’s Headlee Amendment, it can be approved by the board without a voter referendum. The board is expected to vote on the millage at its Oct. 20 meeting.
Last year, the board for the first time levied 0.04 mills under Act 88, and allocated funds to Ann Arbor SPARK, the Eastern Leaders Group, 4-H activities, horticulture/MSU Extension, agricultural innovation/MSU Extension, the Food System Economic Partnership, heritage tourism and the director’s job of the county Economic Development and Energy Department. So far, no specific allocation has been designated for the 2011 Act 88 funds. The resolution setting the public hearing stated that the board has the “option of assigning some of the generated funds to a non-profit organization which is engaged in the purpose of advertising the advantages of and encouraging trade within the County.”
Eight people spoke during the public hearing: Three in support of funding for the Food System Economic Partnership, three in support of funding for Ann Arbor SPARK, and two people from the Washtenaw County Farm Bureau who urged the board not to levy the tax.
Act 88: Food System Economic Partnership (FSEP)
Jennifer Fike, FSEP’s executive director, noted that the nonprofit has been supported in the past with Act 88 funds. Based in Washtenaw County, FSEP serves a five-county area and focuses on economic development via the local food system. Fike read a statement of support from Sharon Sheldon, a member of FSEP’s leadership team and an administrator with the Washtenaw County public health department.
Sheldon’s statement highlighted the importance of healthy eating as part of an overall strategy for good health, particularly during a down economy. The statement noted that FSEP has worked diligently with farmers and businesses to make fresh and healthy food more available in outlets across the county, and that having access to healthy foods in venues across the county is important so that people with all types of economic backgrounds have the ability to eat fresh and healthy food.
Sara Aeschbach, director of Ann Arbor Rec & Ed, said she was also coordinator of the wellness policy committee for the Ann Arbor Public Schools. She was speaking in support of FSEP, specifically for its work in the Farm to School program, which Aeschbach described as “phenomenal.” She mentioned several aspects of FSEP’s work with the schools, including classroom presentations by farmers and the start of a farmers market for Head Start families, in partnership with Food Gatherers. The schools’ food service program has doubled the amount of local produce it uses, thanks to FSEP’s efforts, and that amount is expected to grow. Aeschbach urged commissioners to continue their support for FSEP.
David Klingenberger of The Brinery described himself as a local food entrepreneur, selling fermented vegetables at the farmers market and to restaurants like Zingerman’s. He said he wouldn’t be in business now if it weren’t for FSEP’s help. “I plan to have a pickle empire here in Washtenaw County,” he said, and employ many people. [The Brinery's tagline is "Stimulating your inner economy."] FSEP is helping his business grow, and he asked commissioners for their support of the program.
Act 88: Ann Arbor SPARK
Elizabeth Parkinson, director of marketing and public relations for Ann Arbor SPARK, spoke after Klingenberger and said “it’s always been my dream to follow the Pickle King.” She noted that prior to this year, SPARK – the region’s economic development agency – had received funding from the county’s general fund. In 2010, its county funding of $250,000 came from Act 88 revenues. She described a range of activities that SPARK performs, including operating a microloan program and three business incubators. The $250,000 from the county allowed SPARK to leverage $5 million from other sources, she said. Parkinson then said she’d brought along two entrepreneurs who had benefited from SPARK’s services.
John Harding, founder of Current Motor Company, said his firm has taken advantage of several SPARK programs and services, including its entrepreneur boot camp and microloan program. They are tenants in the SPARK East incubator as well, he said, and now employ six people. His hope is to grow their business in Washtenaw County.
Mitch Rohde, co-founder of Quantum Signal, said that when the company was founded in 1999 as a University of Michigan spin-off, there was little help for businesses like theirs. And when they started interacting with SPARK three years ago, he said he was initially skeptical that the group could help. But he said he’s been nothing but impressed with SPARK, noting that they’ve helped Quantum secure a state MEGA tax credit and negotiate a good deal on a new headquarters in the historic Union School in Saline. SPARK is also helping them create a new spinoff company, which he said is on the “hush hush” at this point. He said his firm has directly benefited and created new jobs because of SPARK.
Act 88: Washtenaw Farm Bureau
Ken Siler of Freedom Township said he was there representing the Washtenaw County Farm Bureau, which has about 7,500 members. Siler is president of that group. He reminded commissioners that he’d spoken at their meeting a year ago in support of Act 88, specifically for funding of FSEP and the Michigan State University Extension. However, this year the farm bureau board passed a resolution opposing renewal of the Act 88 millage, he said. While noting that the organizations funded by Act 88 are deserving and the action to levy the millage is legal, he said the members of the farm bureau believe the greater issue lies in giving property owners the right to decide by voting on a tax. Therefore, they are asking the board not to approve the millage. Siler said they are forwarding their resolution to farm bureaus across the state.
John Ochs, also of Freedom Township, described how farming and agriculture have been at the center of his life, whether as a political reporter, press secretary for the U.S. secretary of agriculture or PR director for Ford trucks. He is now chair of the policy development committee for the Washtenaw County Farm Bureau, and reiterated the group’s opposition to Act 88.
Any tax on people’s homes should be put on the ballot, he said. He’d heard commissioners express concern about foreclosures, and wondered why it made any sense in this economic climate to put an additional burden on homeowners. They’d said they were concerned about veterans, he noted, so how do they feel about taking away a veteran’s right to vote? [At its Sept. 15 meeting, the board gave final approval to levy 1/40 mill for indigent veterans’ relief, administered by the county's Department of Veteran Affairs. Like Act 88, it does not require voter approval.] Ochs concluded by saying the ballot is what separates America from third-world countries, and he urged commissioners not to levy the Act 88 tax.
Commissioners did not respond to commentary at the public hearing. They are expected to vote on the millage at their Oct. 20 meeting.
Awards and Recognition
During the meeting, the board honored several individuals, groups and businesses.
Saying Farewell to Mark Lindke
The board honored Mark Lindke for nearly 38 years of service to the county. Lindke, who is director of Washtenaw County Dept. of Veteran Affairs, is retiring this month, and received a standing ovation from commissioners and others in the room. Several commissioners praised Lindke for his work. Ken Schwartz said that veterans organizations look up to and respect Lindke, and Barbara Bergman described him as one of her mentors. Leah Gunn recalled a time when he had hand-delivered a disability check to a veteran by finding him at the St. Andrew’s breakfast for the homeless. “This is what he does … and I thank him greatly for his service,” she said.
Lindke said his parents had taught him the value of community service. He noted that many of the people in the room likely knew his mother, who had been active in civic affairs, and that his father had been a member of the “Greatest Generation,” flying combat missions in Europe during World War II and later working for 38 years at General Motors.
Lindke praised his staff, in particular Patricia Parker-Self, saying that the administration would do well to sit down with her and get her advice, then sprinkle that throughout the county government. But he said the biggest gift the county gave him was the opportunity to meet a young librarian more than three decades ago – he and Bernice Lindke have been married for 31 years, he said, and throughout that time she’s been his best friend. He always asks her advice, adding that at the moment, she’d probably advise him that it’s time to take a seat. “I salute all of you,” he concluded.
Environmental Excellence Awards
Janis Bobrin, the county’s water resources commissioner, and Jeff Krcmarik, the county’s environmental program supervisor, presented several awards on Wednesday to businesses and organizations honored for their environmental stewardship. Bobrin thanked the board for supporting the county’s environmental efforts, and said the honorees set an example for the rest of the community.
The winners are:
- NSF International – 2010 Environmental Excellence Award. NSF was honored for implementing a comprehensive waste reduction and recycling program, constructing a model stormwater and erosion control system involving native plants, and keeping toxic materials out of the waste stream.
- Barton Hills Village –2010 Excellence in Water Quality Protection Award. The village was recognized for its numerous water quality protection measures and environmental stewardship. Earthen Jar Vegetarian Cuisine received an honorable mention in this category.
- Four Points Sheraton of Ann Arbor – 2010 Excellence in Waste Reduction and Recycling Award. The hotel was honored for its extensive recycling program, purchasing of recycled products, and fostering a conservation ethic among its employees. Greenhills School of Ann Arbor got an honorable mention in this category.
- Sensors Inc. – The 2010 Excellence in Pollution Prevention Award. The Ann Arbor firm was noted for reducing the use of toxic substances and preventing pollution before it is produced.
Cyber Security Awareness Month
Commissioner Kristin Judge presented a resolution declaring October 2010 as National Cyber Security Awareness Month. A breakfast meeting earlier in the day – hosted by the Washtenaw County Cyber Citizen Coalition, which Judge spearheaded – had marked the kick-off of the month, and the launch of the group’s new website. Judge highlighted the website’s page of resources for victims, noting that it was a way to find information about reporting a variety of Internet crimes.
Judge presented the resolution to sheriff Jerry Clayton, who told commissioners that preventing cyber crime from occurring was just as important as dealing with its aftermath. He cautioned that unlike in the past, when predators had to be physically present at locations where children could be reached, now the threat to children is often unseen. Washtenaw County is a model for being proactive in this area, he said.
Magnet Program Students from Skyline High
Several students from Skyline High School’s communication, media and public policy magnet attended Wednesday’s meeting, along with their teacher, Pat Jenkins. They were introduced by Michael Smith, the county’s veteran service officer who also serves on the magnet program’s advisory board. Smith said the students were there to “observe government in action.” Their projects include production of public service announcements, he said, and Washtenaw County is a client, as is the city of Ann Arbor. Jenkins told commissioners that “this is our first meeting – but you’ll see us at others as well.”
Present: Barbara Levin Bergman, Leah Gunn, Kristin Judge, Jeff Irwin, Mark Ouimet, Wes Prater, Ken Schwartz, Rolland Sizemore Jr., Conan Smith
Absent: Ronnie Peterson, Jessica Ping
Next board meeting: The next regular meeting is Wednesday, Oct. 20, 2010 at 6:30 p.m. at the County Administration Building, 220 N. Main St. The Ways & Means Committee meets first, followed immediately by the regular board meeting. (Though the agenda states that the regular board meeting begins at 6:45 p.m., it usually starts much later – times vary depending on what’s on the agenda.) Public comment sessions are held at the beginning and end of each meeting. [confirm date]