County Lays Groundwork for Budget Talks

Washtenaw County administrator hopes to tackle $6.88 million in structural changes for 2014; board sets budget retreat for March 7

Washtenaw County board of commissioners meeting (Jan. 16, 2013): Washtenaw County government will be working to erase a projected $24.64 million general fund deficit over a four-year period from 2014 through 2017. County administrator Verna McDaniel and her financial staff gave a budget briefing to county commissioners at their Jan. 16 meeting.

Verna McDaniel, Washtenaw County administrator, Washtenaw County board of commissioners, The Ann Arbor Chronicle

Washtenaw County administrator Verna McDaniel gave a budget update to commissioners at their Jan. 16, 2013 meeting. (Photos by the writer.)

Although a much smaller general fund deficit of $3.93 million is projected for 2014, McDaniel hopes to make $6.88 million in structural changes that year – a combination of new revenues and cuts in expenditures. If that happens, “we’d be done – we’d have no deficit” going forward, McDaniel said, because those cuts and revenue increases would compound and carry over into future years.

To do that, for 2014 the goal is to generate an additional $1.2 million in revenue, reduce operating costs by $2.96 million, cut $100,000 from outside agency funding, and find $2.62 million in reductions to employee compensation and benefits.

McDaniel noted that for 2012-2013, the county overcame a $17.5 million deficit – but only about $7.3 million of that came from structural changes. Yousef Rabhi, the board’s chair, noted that even though the $6.88 million target is lower, the cuts will be a challenge because many services are already cut to a minimal level.

The board has set a planning retreat for Thursday, March 7 at 6 p.m. – to be held during its regular working session – to talk about budget priorities.

In other action at the Jan. 16 meeting, commissioners were appointed to more than 40 boards, commissions and committees. [.pdf of 2013 appointments listing] Because of changes approved late last year, commissioners will receive stipends based on the number of groups on which they serve, and the number of meetings that they are expected to attend.

Though there are still some details to be determined, a tentative tally of stipends shows a total of $8,800 for all nine commissioners, with individual pay ranging from a low of $0 for Ronnie Peterson, the only commissioner with no appointments, to $2,700 for Yousef Rabhi, whose appointments include several that are mandatory because of his position as board chair.

Unlike the previous per diem system – when commissioners had to request payments, which were administered by the county clerk’s office – the stipend payments will be pro-rated, aggregated and paid out biweekly as part of a commissioner’s paycheck. No one is responsible for monitoring attendance, and absences will only be addressed if brought to the attention of the board chair.

During the Jan. 16 meeting, commissioners also approved a variety of federal grants, primarily related to funding for homeland security and job training. And given initial approval was an application for a $20,000 grant to fund expansion of an after-school program called “Telling It” in the West Willow and MacArthur Boulevard housing developments – low-income neighborhoods on the east side of Washtenaw County.

The grant application is unusual in that it’s the first time a county unit – in this case, the sheriff’s office – has sought funding through the coordinated funding pilot program, which was designed to support human services more effectively in this community. The coordinated funding is a partnership of Washtenaw County, the city of Ann Arbor, the United Way of Washtenaw County, the Washtenaw Urban County, and the Ann Arbor Area Community Foundation.

County Budget Update

The county works on a two-year budget planning cycle. Its fiscal year matches the calendar year. In late 2011, commissioners set the budget for 2012 and 2013. However, because state law mandates that the board must approve the budget annually, commissioners voted on Dec. 5, 2012 on a budget “affirmation” for 2013, making several adjustments to the $102.8 million general fund budget. This year, they’re beginning the two-year cycle anew, planning for 2014-2015, with a longer-term view through 2017.

At the Jan. 16 meeting, county administrator Verna McDaniel and her financial staff gave commissioners an overview of the county’s current financial condition, setting the stage for preliminary estimates of the budget in 2014 and beyond.

County Budget Update: Current Conditions

In many ways, the county is in a better financial situation than it has been for several years, McDaniel told the board. The county maintains a AA+ bond rating – the second highest possible rating – with a debt ratio of 0.96%. That’s well below the 10% level that it must maintain by board policy. Although the county has tapped its general fund reserves to balance the budget in recent years, it has used less of the reserves than expected.

Washtenaw County, revenues, budget, The Ann Arbor Chronicle

Chart showing sources for the $102.8 million general fund revenues in 2013. The largest source comes from taxes and penalties – 59%. Another 20% of revenue comes from fees and services. (Chart provided in Jan. 16 board packet.)

It’s important to remember that several factors are still in flux, McDaniel said. A portion of the state’s revenue-sharing program will now be tied to incentives, which will affect how much funding the county receives. Starting next year, the county will only be getting about 75% of the amount it has historically received, she said – or about $4 million annually. About 20% of that $4 million will be tied to the state’s incentive program requirements.

This year, the county will receive about $2.7 million in state revenue-sharing, and will be drawing down the $4 million that remains in the county’s state revenue-sharing reserve fund. After this year, that reserve fund will be depleted.

Property tax revenues are still falling, though the decreases have begun to stabilize, McDaniel said. The original projection for 2012 was for a 5% decline in property tax revenues, but in fact revenues fell only 0.77%. For 2013, projections call for a 2% decline.

The state has also repealed the personal property tax. McDaniel said she hopes there will be replacement revenues for that, but the legislature hasn’t yet determined what that might be.

In general, Washtenaw County hasn’t been hit as hard as other communities, McDaniel noted, “but the impact has been significant to us.” Property taxes won’t return to the robust levels that the county was accustomed to for quite some time, she said.

Another significant factor relates to federal funding. The county has already started to see reductions in federal grants, and further cuts are expected, McDaniel said. “The question that remains for the board is how the general fund should respond to these reductions in non-general fund areas – that’s going to come to you.”

The county really won’t know the full picture for 2013 until April, when the annual equalization report is completed. McDaniel stressed that her presentation was a preliminary picture, and that she’ll be bringing a more detailed report in May.

County Budget Update: Current Conditions – Expenditures

Turning to the expense side, McDaniel noted that since 2002, the county has been managing reductions in its budget due to decreases in state revenues and property tax revenues. Most departments have been cut by at least 20%, and are now “down to the bone,” she said. “We don’t have fat in our organization, so [budget cuts] will be an even bigger challenge.”

Personnel costs account for 67% of the county’s expenses in the general fund budget – or about $65 million. Fringe benefits equal about 66% of salaries, and health care costs are expected to increase over 8% annually. The county has been able to offer excellent wages and benefits in the past, McDaniel said, “but this is something we’re going to have to monitor.”

Washtenaw County 2013 general fund expenditures, The Ann Arbor Chronicle

Chart of Washtenaw County 2013 general fund expenditures. Public safety services – including the sheriff’s office and jail – account for 54% of the budget, while judicial expenses are 18% of expenditures. (Chart provided in Jan. 16 board packet.)

Because the county is a service industry, personnel costs are the largest expense. The county’s unions have helped achieve previous budget goals in the past few years, McDaniel said. Contracts negotiated in 2011 resulted in most union and non-union employees not getting salary increases in 2012 and 2013, with “step” increases for union employees frozen in 2013. Separate agreements were made with two unions – Police Officers Association of Michigan (POAM) and the Command Officers Association of Michigan (COAM) – that are expected to save a total of $5.6 million over a four-year period through 2015.

This year, McDaniel said, the county will be entering into negotiations with nearly all of its 17 bargaining units, which have contracts that expire on Dec. 31.

Another major expense category is appropriations to non-general fund activities, which accounts for 16% of overall expenditures. Those expenses include the child care fund, public health, environmental health, and infrastructure, among others. For mandated services, the levels of serviceability need to be reviewed carefully, McDaniel said. Because those levels are “squishy,” she said, the administration needs to negotiate with other county elected officials to determine an appropriate budget. [Though units like the sheriff's office, prosecuting attorney's office, courts and clerk's office are overseen by elected officials and provide state-mandated services, their budgets must be authorized by the county board of commissioners.]

By function, 54% of the county’s general fund budget is allocated to public safety, with another 18% allocated to the judicial system. Another major expense category is general government costs (23%), which include county administration, human resources, IT, finance and other administrative services.

Tax appeals are another factor on the expense side, McDaniel said. Until recently, the county only budgeted about $100,000 to cover appeals that might be made on property tax assessments. Since the economic downturn, more people are appealing their assessments, she said. The 2013 budget includes $1 million to cover possible appeals.

All of this comes at a time when the community needs the county’s services more than ever, McDaniel said. She also noted that there has been a transition internally within county government, with two new commissioners, new board leadership, and more than 100 retirements at the end of 2011 that created a “brain drain.”

McDaniel reminded commissioners that the county overcame a $17.5 million deficit over the two years of 2012 and 2013. However, about $7.3 million of those reductions were one-time savings, not structural. So there’s more work to do, she said.

County Budget Update: Projections

Looking ahead, McDaniel provided preliminary estimates that show a general fund deficit of $3.93 million for 2014, which translates to 45.9 full-time-equivalent employees. That’s followed by projected deficits of $4.88 million in 2015 (56.9 FTEs), $6.53 million in 2016 (76.4 FTEs), and $9.27 million in 2017 (108.1 FTEs). McDaniel stressed that the projected deficits reflect a compounding impact if no action is taken. In addition, the FTE figures were merely a translation to show how many employees would hypothetically be affected in order to balance the budget – it’s not a policy decision to have layoffs, she said. McDaniel said she wanted to make that clear so that people in the organization wouldn’t be scared.

Kelly Belknap, Tina Gavalier, Washtenaw County board of commissioners, The Ann Arbor Chronicle

From left: Kelly Belknap, the county’s finance director, and finance analyst Tina Gavalier.

The projections assume a 2% decrease in property tax revenues for 2013, followed by only minor increases – 1% annually – in property tax revenues for each of the following four years. Other assumptions include lower state revenue-sharing and an 8% increase in costs for fringe benefits, with no across-the-board salary increases. However, the projections assume that step increases and longevity pay would be reinstated for union employees, and that there would be no furloughs or banked leave days.

McDaniel noted that most current union contracts expire at the end of 2013. The unions have formally requested a special conference with administration on Jan. 23, she reported. [After the meeting, Caryette Fenner – president of AFSCME Local 2733, the county government’s largest union – clarified for The Chronicle that the purpose of the meeting is to discuss possible responses to the state's right-to-work legislation. For a report on a Jan. 3 board working session about that issue, see Chronicle coverage: "County Board Weighs Right-to-Work Response." For a look at how the Ann Arbor Transportation Authority is responding to right-to-work legislation, see: "AATA OKs Labor, Agency Fee Accords"]

Nothing is off the table, McDaniel said, because even with 0% salary increases, the county still faces a deficit.

Contracts for police services – under which other municipalities pay the county for sheriff deputy patrols – are expected to include a 1% increase in both 2014 and 2015, but no subsequent increases in 2016 or 2017. That’s not a policy decision, McDaniel said, but a conservative estimate for budgeting purposes.

County Budget Update: Proposed Response

McDaniel stressed the importance of taking a long-term view, as well as the need to make some cultural changes. The county can’t be all things to all people, she said, and previous “needs” might now need to be re-evaluated as “wants.”

To do this, the board needs to give direction to the staff. An upcoming retreat will be focused on providing that direction, she said, and staff will be listening intently to discern the board’s priorities. The county needs to define its core services and determine what kind of community impact they want to make. McDaniel referred to a June 2009 article in the Harvard Business Review – “Making the Best of a Bad Situation,” by Robert Sutton – that describes what employees need during difficult times, including predictability, control, understanding and compassion.

McDaniel highlighted the impact of making $6.88 million in structural cuts in 2014. If that happens, “we’d be done – we’d have no deficit” going forward, she said. To reach that goal, the administration is proposing to generate an additional $1.2 million in revenue, reduce operating costs by $2.96 million, cut $100,000 from outside agency funding, and find $2.62 million in reductions to employee compensation and benefits. In that regard, McDaniel noted that 327 employees currently have what’s called a “Cadillac” health care plan. Under new federal health care laws, the county government will pay a 40% tax starting in 2018 if those plans remain in place.

McDaniel noted that for 2012-2013, the county overcame a $17.5 million deficit – but only about $7.3 million of that came from structural changes. Although the $6.88 million might seem like a “walk in the park” to some, she said, it needs to be done in the context of departments that have already made deep cuts.

She noted the importance of partnering, when it makes sense to shift county services to other organizations. As an example, she noted that this happened when the Ann Arbor District Library took responsibility for handling the Library for the Blind & Physically Disabled, which in the past was part of the county government. She also cited examples of partnering with the city of Ann Arbor on dispatch operations, and participating in the coordinated funding approach for human services. McDaniel noted that other examples of collaboration are posted online.

Felicia Brabec, Washtenaw County board of commissioners, The Ann Arbor Chronicle

Felicia Brabec led her first meeting as chair of the Washtenaw County board’s ways & means committee.

Overcoming the projected deficit is a great challenge, McDaniel said. She added that she felt really good about the county’s financial situation in 2013, “barring any crazy surprises nationally or state-wise.” But the 2013 strategy is using general fund reserves to balance the budget, she noted. “We need to get out of the business of using fund balance to balance the budget,” she said. Instead, the county should put an additional $4 million into those reserves. It’s important because those reserves are used to pay bills during the first six months of the year, before taxes are collected in July.

McDaniel also floated some questions that commissioners should consider in their upcoming deliberations: (1) Do current budget allocations have the impact that commissioners desire? (2) Should the general fund be used when there are federal/state revenue reductions in non-general fund programs? and (3) What community area(s) can the county least afford to impact any further?

The board has set a planning retreat for Thursday, March 7 at 6 p.m. – to be held during its regular working session – to talk about budget priorities. McDaniel said that March through August will be the time when the “meat” of budget preparation will occur – with labor negotiations, town hall meetings with employees, and internal analysis of departmental budgets. The goal is to bring a draft budget to the board in September, with adoption by the board in November.

County Budget Update: Board Discussion

Conan Smith wondered if the 1% projected increase in property tax revenues in 2014 through 2017 takes into account personal property tax reforms. Yes, McDaniel replied, but the projections assume there will be an 80% reimbursement of PPT. Tina Gavalier, the county’s finance analyst, reported that the projections reflect a $390,000 decrease in PPT.

McDaniel added that the county isn’t counting on the PPT replacement revenues, and the budget projections might have to be revised later this year. The board will get another budget update in May.

Regarding the police services contracts, Smith asked if the 1% increase is for revenues or expenditures. It’s a projected revenue increase to the county, Gavalier said. The contracting communities also will pay for any increases in fringe benefits.

Rolland Sizemore Jr. asked about the $100,000 cuts to outside agencies – what organizations are included? McDaniel said the outside agency funding is a separate list that includes human services groups like the Shelter Association of Washtenaw County, as well as dues and membership fees.

Alicia Ping wanted to see what would happen if different percentages were plugged into the projections. For example, instead of a projected 2% decrease in property tax revenues for 2013, what would the outlook be if revenues decreased only 0.77% – as was the case in 2012? She asked the finance staff to send that information, and also to calculate a 0% change in 2014, followed by an increase of 0.75% in 2015.

Andy LaBarre asked for clarification about how the projected deficit of $9.271 million for 2017 relates to the $6.88 million in structural changes that McDaniel proposed in 2014. McDaniel replied that the deficit compounds each year if nothing is done. The $6.88 million is the “magic figure” that if achieved, would eliminate the need for cuts in future years, she said. LaBarre characterized it as a “silver bullet.”

Yousef Rabhi, the board’s chair, praised McDaniel and her staff, saying he was proud to have a team like hers to lead the county through this difficult time. Even though there was some optimism in her presentation, which isn’t a bad thing, he said, Rabhi emphasized that the county has already been through a couple of rounds of major cuts. So they should be optimistic “in a measured sense,” he said, and understand that the $6.88 million in new revenue and cuts will be a challenge.

Ronnie Peterson asked when the structural changes might occur. McDaniel replied that the county won’t know what its 2013 revenues will be until April, when the equalization report is completed. She’ll be giving the board an update in May.

Peterson asked for a report on what’s happening at the state and federal levels, and how those changes might impact the county budget. He wanted to know if the board would be discussing the proposed structural changes at the retreat. He expressed concern about employees, noting that they have sacrificed a lot to keep the organization afloat. “Only so much blood is available from those who come to work every day,” he said. Peterson advocated for soliciting comments from employees about how to approach these changes. He wanted to ensure that employees continued to provide services, and were not forced to become recipients of those services.

Responding to Peterson, Rabhi said he’d like to accommodate some of those points during the upcoming retreat.

Conan Smith said it was nice that the county doesn’t have the same severity of budget challenges that they’ve faced in the past few years. He appreciated the focus on structural changes and the long-term outlook that McDaniel and her staff are taking.

McDaniel said the county needs to keep an open mind about the budget planning period. They’ve been looking at two years, but she’d like the board to entertain the possibility of looking beyond that.

Smith noted that Oakland County has moved to a three-year budget planning cycle, and it’s had a positive impact. He said he’ll keep an open mind, but he’s also concerned about the strictures that a longer budget cycle would put on future boards. [Commissioners are elected to two-year terms.] It would be helpful if McDaniel identified parts of the budget where longer-term stability is more important, he said, as well as places where having more flexibility is easier to accommodate. That would allow for flexibility to pursue commissioner interests, he said, as well as to respond to emerging issues throughout the community.

McDaniel agreed that a certain amount of flexibility needs to be built into the budget planning. It’s important to be nimble, she said, especially in this economy.

Smith then turned to the issue of cash flow as it relates to the county’s general fund balance. He noted that McDaniel had alluded to the need for those funds to cover the long gap between December and July, when the county’s property tax revenues are collected. He pointed out that the county came very close to depleting the fund balance last year – and finance director Kelly Belknap confirmed that this had been the case.

He highlighted McDaniel’s comment that the county should add another $4 million to its general fund reserves. McDaniel elaborated, saying that when she and other county staff meet with bond rating agencies in Chicago – for refinancing or other issues – the county has to meet a litmus test related to its solvency. One thing those agencies look at is the county’s general fund balance. If the amount were closer to 20% of the total general fund budget, the county would likely get a better bond rating. “We’re close to the top, but we’re not at the top,” she said. So the county needs to look at what can be done to “fatten up that fund,” she said.

Conan Smith, Washtenaw County board of commissioners, The Ann Arbor Chronicle

Washtenaw County commissioner Conan Smith.

Smith replied by saying that the county needs to do a comparative analysis of an incrementally better bond rating and what that rating might deliver – in terms of interest rate percentages on the debt that the county holds – and weigh that against the county’s ability to spend those reserves on community challenges instead. If adding to the reserves in turn improves the county’s bond rating, but only saves a few million dollars in interest, “then it may not be worth it,” he said. The money might be better spent on core community challenges, Smith said, so it’s important to be smart about that comparative analysis. Solid bond ratings and cheap interest are important over the long term, but the county shouldn’t shortchange more short-term needs, he said.

McDaniel added that it’s also important to look at the interest that can be earned from investing the reserves.

Smith said that over the years there have been calls for increasing the fund balance. He noted that former commissioner Jeff Irwin, who’s now a state House representative for District 53, advocated for a fund balance closer to 16%. At the same time, the county’s bond counsel has told the board that the county won’t be penalized as long as the fund balance is above 10%. “There’s a lot of give between 10 and 20,” Smith said, “and that’s where this board really needs to weigh in, on what to do with that money.”

Smith’s next line of questioning related to expense projections for personnel. A 0% salary increase applies to most, but not all, of the 17 bargaining units representing county employees. He clarified with McDaniel that contracts for employees represented by the Police Officers Association of Michigan (POAM) and the Command Officers Association of Michigan (COAM) don’t expire until the end of 2015. Tina Gavalier, the county’s finance analyst, said that expense projections factor in a 1% salary increase for POAM and COAM members in both 2013 and 2014.

Smith also highlighted the fact that the projections don’t include unpaid furlough days or banked leave days, but that it might be something that the administration could request for future labor agreements. When McDaniel affirmed that it wasn’t included in these budget projections, Smith replied “I think we’re still going to need it.” He said he appreciated that the projections were conservative both on the revenue side as well as in the county’s ability to reduce expenditures.

Felicia Brabec asked about the timeline for the state’s decision to eliminate the personal property tax (PPT). McDaniel replied that the PPT will be fully eliminated by 2016, but it will be incrementally eliminated for some businesses starting in 2014. There will be minimal impact in 2013, but the county will start seeing cuts in PPT in 2014. She suggested that Raman Patel, the county’s equalization director, could give the board more information on that at a working session.

Andy LaBarre asked whether McDaniel had any thoughts about the impact of a possible default at the federal level, and how that might affect the county. McDaniel said that if there are federal cutbacks, the county would have to scramble and the board would need to give direction about how to address the situation. For example, if a program is primarily funded through federal grants and that funding is cut, would the board want to authorize general fund dollars to support the program? If so, what other programs would be cut instead?

Rabhi noted that the Washtenaw Urban County – a consortium of local governments – receives federal funding for low-income housing and other programs. The staff have done projections, in the context of possible federal sequestration (automatic cuts), and determined that the best case scenario would be a 10% decrease in funding for local programs. “The worst case scenario could be a lot worse,” he said.

Brabec observed that even if sequestration doesn’t occur, federal and state money could be cut. So departments that bring in a lot of those funds need to start thinking about that possibility as well, she said.

Outcome: This was a non-voting agenda item, and no action was taken.

Commissioner Appointments

Each year, commissioners are appointed to various boards, commissions and committees – 43 in total. These appointments are made with nominations by the board chair, and a vote of the full board.

This year, board chair Yousef Rabhi scheduled an appointments caucus immediately prior to the start of the board’s Jan. 16 meeting to hash out details. Commissioners had sent him their preferences beforehand. The caucus was attended most commissioners, with the exception of Dan Smith and Ronnie Peterson. Kent Martinez-Kratz left the caucus early due to a family emergency.

The group generally reached consensus on their appointments. One exception was on appointments to the county parks & recreation commission. Dan Smith has served for the past two years, and had told Rabhi that it was the only appointment he really wanted. However, Conan Smith – who previously had served on the parks & rec commission before his tenure as board chair in 2011-2012 – now wanted to return to the position. Rabhi decided to appoint Conan Smith and reappoint Rolland Sizemore Jr. to WCPARC.

In addition to their general interest in a particular appointment, commissioners’ preferences sometimes were dictated by the time of day or day of the week when these boards or commissions meet. This was especially a factor for the commissioners who have full-time jobs, or jobs that are less flexible in allowing them to take time off during the day.

Commissioner Appointments: Stipends

Related to appointments, the biggest change this year is how commissioners will be compensated for the work on boards, committees and commissions. In the past few years, commissioners have been able to tap a $3,500 “flex” account from which they could seek mileage reimbursements and per diem payments for meetings that qualified for extra compensation. The payments required that commissioners submit forms to the county clerk’s office, requesting per diems or mileage reimbursements.

Washtenaw County board of commissioners, stipends, appointments, The Ann Arbor Chronicle

Chart showing tentative 2013 county commissioner stipend payments.

At their Dec. 5, 2012 meeting, commissioners approved replacing per diem payments with stipends, effective Jan. 1, 2013. Commissioners had previously debated the issue at their Nov. 7, 2012 meeting, giving the increase initial approval at that time.

The stipends are based on the number of boards, committees and commissions on which a commissioner serves, and the number of meetings that commissioners are expected to attend. Stipend payments range from $50 per year for groups that meet only 1-2 times annually, up to $1,000 for groups that meet more than 24 times. No stipends are paid for groups that meet only sporadically or on an as-needed basis.

In addition, commissioners are paid a base salary of $15,750. The leadership positions – board chair Yousef Rabhi; chair of the ways & means committee, Felicia Brabec; and chair of the board’s working session, Andy LaBarre – are paid an additional $3,000 annually. The board vice chair, Alicia Ping, receives an additional $1,000 annually.

Commissioners can continue to request reimbursement for mileage to authorized meetings. Commissioners also receive fringe benefits, including $1,163 that the county pays into a retirement account for each commissioner, as well as payment of 50% of health care insurance if the commissioner chooses to obtain health care through the county as a part-time employee.

For additional background on commissioner compensation – including a previous controversy related to the per diem payments – see Chronicle coverage: “Compensation Change for County Board?

Here’s a summary of appointments for each commissioner [.pdf of 2013 preliminary appointments listing] [.pdf of final appointments resolution]:

  • Kent Martinez-Kratz (D-District 1): Coalition for Action Remediation of Dioxane (CARD) ($300); Health Emergency Response Coalition ($100); Local Emergency Planning Committee ($100); Police Services Steering Committee ($300). Total appointments: 4 ($800).
  • Dan Smith (R-District 2): Economic Development Corp. ($0); Emergency Telephone District Board ($0); Local Development Finance Authority – Superior Township ($0); Michigan Township Association ($0); Retirement Commission (WCERS) ($300); Space Plan Committee ($150). Total appointments: 6 ($450).
  • Alicia Ping (R-District 3): Economic Development Corp. ($0); Emergency Telephone District Board ($0); Local Development Finance Authority – Saline ($0); Police Services Steering Committee ($300); Public Safety & Justice Oversight Committee ($0). Total appointments: 5 ($300).
  • Felicia Brabec (D-District 4): Community Action Board ($150); Emergency Telephone District Board ($0); Literacy Coalition ($100); Sustainable Revenue for Supportive Housing Services Task Force ($100); Washtenaw County/City of Ann Arbor Community Corrections Advisory Board ($100). Total appointments: 5 ($550).
  • Rolland Sizemore Jr. (D-District 5): Accommodations Ordinance Commission ($150); Community Action Board ($150); Detroit Region Aerotropolis ($100); Emergency Medical Services Commission ($100); Homeland Security Taskforce ($150); Local Development Finance Authority – Augusta Township ($0); Local Development Finance Authority – Ypsilanti Township ($50); Parks & Recreation Commission ($300); River Raisin Watershed Council (TBD); Road Commission ($500); Space Plan Committee ($150); Workforce Development Board ($150). Total appointments: 12 ($1,800).
  • Ronnie Peterson (D-District 6): No appointments.
  • Andy LaBarre (D-District 7): Area Agency on Aging 1-B ($250); Community Collaborative of Washtenaw County (formerly Human Services Collaborative Council) ($50); Southeastern Michigan Council of Governments (SEMCOG) ($250); Washtenaw Metro Alliance ($0); Washtenaw Urban County ($300). Total appointments: 4 ($550).
  • Yousef Rabhi (D-District 8): Agricultural Lands Preservation Advisory Committee ($300); Brownfield Redevelopment Authority ($300); Criminal Justice Community Collaborative ($100); Drainage Board ($300); Emergency Telephone District Board ($0); Head Start Policy Council ($150); Community Collaborative of Washtenaw County (formerly Human Services Collaborative Council) ($50); Public Safety & Justice Oversight Committee ($0); Public Works Board ($300); Solid Waste Consortium ($300); Southeastern Michigan Council of Governments (SEMCOG) ($250); Washtenaw Area Transportation Policy Study Committee (WATS) ($300); Washtenaw County Food Policy Council ($100); Washtenaw Metro Alliance ($0); Washtenaw Urban County ($300). Total appointments: 14 ($2,700).
  • Conan Smith (D-District 9): Drainage Board ($300); Environmental Health Code Appeals Board/Public Health Advisory Committee ($300); Washtenaw County Parks & Recreation Commission ($300); Retirement Commission (WCERS) ($300); Sustainable Revenue for Supportive Housing Services Task Force ($100). Total appointments: 5 ($1,300).

Commissioners have the option of waiving their stipends by giving written notice to the county clerk. Otherwise, starting in February the stipend payments will be automatically pro-rated, aggregated and paid out biweekly as part of a commissioner’s paycheck. The payments are made based on the assumption that commissioners will attend the meetings for boards, commissions and committees to which they’ve been appointed.

Rules related to attendance are laid out in the county board’s rules & regulations, which were approved at the board’s Jan. 2, 2013 meeting. In part, the rules state:

Habitual non‐attendance of Commissioners at meetings to which they have been appointed shall be reported to the Chair of the Board. If a member is absent three consecutive times without a reasonable excuse, he or she will be considered as having vacated his or her seat and a new Commissioner shall be appointed by the Chair of the Board and confirmed by a majority vote of the Board members elected and serving.

However, no one is responsible for monitoring a commissioner’s attendance to these meetings. Their attendance will be recorded as part of the meeting minutes for each board, committee or commission, but those minutes are not always easily accessible or provided in a timely way. Rabhi told The Chronicle that he is committed to ensuring that minutes for all of these groups will be made available.

Outcome: The commission unanimously approved various appointments for commissioners. Dan Smith and Kent Martinez-Kratz were absent.

After the vote Rabhi thanked commissioners, saying he put a lot of time and thought into the decisions, and he didn’t want anyone to take it personally if they didn’t get the appointment that they had requested.

Other Appointments

In addition to commissioner appointments, the board was asked to appoint members to the county’s workforce development board and food policy council.

Four nominations were made to the 15-member Washtenaw food policy council, all for terms ending Dec. 31, 2014: Amanda Edmonds, William Alt, Nicole Miller, and Patti Smith. The goal of the council is to support local small and mid-sized farmers by fostering policies that encourage local food purchasing and production. Formation of the council was approved by the county board at its March 21, 2012 meeting.

Nominated for reappointment was Scott Menzel to serve on the county’s workforce development board, which provides oversight of various job training programs and services. Menzel, whose previous term expired on Dec. 31, 2012, is superintendent of the Washtenaw Intermediate School District (WISD). His new term runs through Dec. 31, 2015.

Outcome: All appointments were approved unanimously, without discussion.

Homeland Security Grants

Three agenda items related to homeland security grants were on the Jan. 16 agenda.

The county board was asked to authorize a change in fiduciary for homeland security grants. The Southeast Michigan Urban Area Security Initiative (UASI) board oversees homeland security funding and policy for this region. The UASI has named Macomb County as regional fiduciary. Previously, Oakland County held that designation. The change requires that Washtenaw County sign a new inter-local fiduciary agreement with Macomb County before any funds from previously awarded grants can be distributed.

Marc Breckinridge, Washtenaw County emergency management, Washtenaw County board of commissioners, The Ann Arbor Chronicle

Marc Breckenridge, the county’s director of emergency management.

The county is receiving $816,713 in 2011 federal homeland security grant funds, for a period through May 30, 2014. The emergency services division of the county sheriff’s office has identified 10 projects to be funded with the grant, which will also help pay for three employees in that division. Allocations include $106,948 for the Washtenaw Metro SWAT Team; $87,500 for outdoor warning sirens; $82,000 for a vehicle and equipment for the Washtenaw County Hazardous Materials Response Team; and $75,000 for the Washtenaw County Road Commission to buy mobile, portable, and control station radios.

An additional $308,202 from a separate 2012 homeland security grant – for a period through May 31, 2014 – will fund a new standby power generator for the road commission ($150,000) and additional outdoor warning sirens ($125,202), among other projects.

According to a staff memo, Washtenaw County has received about $8.29 million in homeland security grants since 2001.

Homeland Security Grants: Board Discussion

Marc Breckenridge, the county’s director of emergency management, was asked to explain why the approval of these grants was happening at this time. He told commissioners it was a little complicated, and that the delays in part related to a decision by the Southeast Michigan Urban Area Security Initiative (UASI) board to change fiduciary from Oakland County to Macomb County. Some of the other counties in the UASI didn’t think that Oakland was doing a good job, he said. So the grants had to be rewritten and signed off by Macomb County, before the funding could be rolled out to the individual jurisdictions.

Outcome: All grants were approved unanimously.

Grant for After-School Program

County commissioners were asked to support an application for a $20,000 grant to fund expansion of an after-school program called “Telling It” in the West Willow and MacArthur Boulevard housing developments, low-income neighborhoods on the east side of Washtenaw County. [.pdf of grant application]

Jerry Clayton, Rolland Sizemore Jr., Washtenaw County sheriff, Washtenaw County board of commissioners, The Ann Arbor Chronicle

From left: Washtenaw County sheriff Jerry Clayton and county commissioner Rolland Sizemore Jr.

According to a staff memo, the Telling It program focuses on developing creative writing and literacy skills for at-risk youth. It would support an effort to fight gang-related activity – specifically, the dozen or so “cliques” in the Ypsilanti/Willow Run area. The memo defines cliques as gangs “without bylaws, or a code of ethics, ultimately heightening the threat. Criminal behavior is viewed as a rite of passage as youth longing to belong to something in some areas where they are being offered very little positive influence during the school year. The Sheriff’s Office has recognized the need to provide after-school enrichment programs that are not purely sports based.”

One of the main concerns in West Willow is an underground culture of “fight clubs,” according to the sheriff’s office – where teenage boys promote fighting between teenage girls, with the fights videotaped and uploaded to YouTube.

The grant application is unusual in that it’s the first time a county unit has sought funding through the coordinated funding pilot program, which was designed to support human services more effectively in this community. The coordinated funding is a partnership of the county, the city of Ann Arbor, the United Way of Washtenaw County, the Washtenaw Urban County, and the Ann Arbor Area Community Foundation.

The process has three parts: planning/coordination, program operations, and capacity-building. The approach targets six priority areas, and identifies lead agencies for each area: (1) housing and homelessness – Washtenaw Housing Alliance; (2) aging – Blueprint for Aging; (3) school-aged youth – Washtenaw Alliance for Children and Youth; (4) children birth to six – Success by Six; (5) health – Washtenaw Health Plan; and (6) hunger relief – Food Gatherers.

The grant application for Telling It would help pay for four program facilitators, a program director, and a psychotherapist to serve as a training consultant. It would fall under the coordinated funding category of capacity building.

Commissioner Conan Smith had previously raised some concerns about using the coordinated funding program, which was designed to support local nonprofits, to pay for a county-sponsored initiative. He has said that if it’s important to the county, the county should find a way to pay for it without using money that’s meant for outside agencies.

Outcome: Initial approval was granted unanimously. A final vote is expected on Feb. 6.

Job Training Grants

Three items on the Jan. 16 agenda related to an initial vote on funding for three workforce development programs – totaling about $1.35 million. The programs are overseen by the county office of community and economic development (OCED), which manages the local Michigan Works! office.

The grants include $1.16 million in federal funding for Partnership. Accountability. Training. Hope. (PATH), an orientation and job placement program for people who are applying for or receiving welfare assistance. The program was previously called Jobs, Education and Training (JET).

The county board also was asked to give initial authorization to a $111,750 increase in federal grant funding for the Workforce Investment Act (WIA) Dislocated Worker program. The additional funds will increase the program’s budget from $801,669 to $913,419. The program provides training for unemployed workers as well as on-the-job training for employees who need additional skills.

The third grant is $84,783 for the Food Assistance Employment and Training program, to provide job training for people who are receiving food assistance.

Outcome: Without discussion, authorization for the three grants was given initial approval. A final vote is expected at the board’s Feb. 6 meeting.

Communications & Commentary

During the evening there were multiple opportunities for communications from the administration and commissioners, as well as public commentary. Here are some highlights.

Communications & Commentary: Pure Michigan and Right-to-Work

Ronnie Peterson brought up the issue of the county’s contribution to support the promotion of tourism in this area, in collaboration with the state.

By way of background, the county collects a 5% excise tax from hotels, motels, bed & breakfasts and other small accommodations businesses, which is then distributed to the Ann Arbor and Ypsilanti convention & visitors bureaus and used to promote tourism and convention business.

The county keeps a portion of those tax revenues to pay for the cost of collection and enforcement. On Nov. 18, 2009, the board approved a five-year agreement with the CVBs, from 2010 through 2014, that increased the county’s share of the accommodation tax revenues from 5% to 10%.

At the board’s Sept. 21, 2011 meeting, commissioners amended the county’s contract with the CVBs to address the process for distributing excess funds that might accumulate from the county’s 10%, if that amount exceeds the expenses required to administer and enforce compliance with the tax. Beginning in May 2013, the county will continue to retain 10% of the tax proceeds, plus 10% of any remaining fund balance. If additional funds accumulate in the fund balance, they are to be returned proportionally to the two convention & visitors bureaus – 75% to Ann Arbor, and 25% to Ypsilanti.

At its meeting on Feb. 15, 2012, the county drew on those excess administrative funds, voting to allocate $200,000 to help fund a Pure Michigan campaign focused on the Ann Arbor area. At the time, more than $350,000 had accumulated in the administrative fund from the county’s share of the accommodation tax revenues.

On Jan. 16, Petersen said he had utmost respect for the local CVBs, but he was concerned about what the county might be contributing to the state’s Pure Michigan campaign, and how that money was being spent to promote the new right-to-work law. The county funds are designated to promote local tourism, Peterson said, and “I’m hoping our local money is not being spent for another purpose.”

He was referring to a controversy over full page “Pure Michigan” advertisement in the Jan. 8, 2013 issue of the Wall Street Journal, paid for by the Michigan Economic Development Corp. (MEDC). The ad in part touted the fact that Michigan is now a right-to-work state. Gov. Rick Snyder, a Republican who signed the legislation late last year, has criticized the ad.

Seven of the nine county commissioners – including Peterson – are Democrats, and opposed the right-to-work legislation. At their Jan. 3, 2013 working session, the board discussed the impact of right-to-work on the county government’s union employees, and explored possible responses.

Communications & Commentary: RTA

Conan Smith reported that Gov. Rick Snyder had appointed Paul Hillegonds, senior vice president of corporate affairs at DTE Energy, to chair the new southeast Michigan regional transit authority, which includes Washtenaw County. Smith said that it’s a non-voting position, but an important one. DTE’s main offices are in Detroit, but Hillegonds spends a lot of time in Ann Arbor, Smith said, adding that Hillegonds will likely be keenly interested in how those two communities are connected.

Smith noted that Hillegonds had served as speaker of the Michigan House of Representatives at a time when there was a 55/55 partisan split, describing the period as genial and productive. Hillegonds is a strong consensus builder, Smith said, and will be highly effective as RTA chair. [Link to a Jan. 17 WDET interview with Hillegonds about the RTA appointment.]

By way of background, Smith has been a strong advocate for the RTA, both as executive director of the Michigan Suburbs Alliance and as chair of the county board in 2011 and 2012. Specifically, he advocated for the inclusion of Washtenaw County in the authority, which also includes the city of Detroit and counties of Wayne, Macomb and Oakland.

His position has not been shared by the majority of elected officials on the county board or the Ann Arbor city council. On Nov. 7, 2012, the Washtenaw County board – which Smith chaired at the time – brought forward a resolution rescinding its previous support for Washtenaw County’s inclusion in the RTA. [.pdf of resolution to rescind support of the RTA]

And on Dec. 10, 2012, the Ann Arbor city council unanimously passed a resolution requesting that the state legislature amend the law to exclude Washtenaw County from the initial area of the RTA. The Ypsilanti city council is expected to consider a similar resolution at its Feb. 5 meeting. That amendment is something that state representative Jeff Irwin (D-53) has indicated to The Chronicle that he’ll be working on in the 2013 legislative session.

Gov. Rick Snyder signed the legislation into law in December 2012, giving each jurisdiction 90 days to make appointments to the RTA board. In Washtenaw County, those appointments must be made by the county board chair. Because Smith’s term as chair was ending on Dec. 31, 2012 – and because he wanted to make the RTA appointments himself – he pushed through an accelerated application and interview process.

Interviews with five finalists were held on Dec. 27, with three of those finalists participating via Skype. Smith announced his selection in an email sent on Dec. 31 just before 5 p.m., appointing Liz Gerber and Richard “Murph” Murphy. Gerber lives in Ann Arbor and is a professor at the University of Michigan Ford School of Public Policy. Murphy is an Ypsilanti resident and programs director for the Michigan Suburbs Alliance, the organization that Smith leads.

For additional background, including actions taken to address conflict-of-interest issues because Murphy is an employee of Smith’s, see Chronicle coverage: “Gerber, Murphy Named to Transit Board.”

Communications & Commentary: Public Commentary

Only one speaker, Thomas Partridge, addressed commissioners during the time set aside for public commentary. He criticized Republican Gov. Rick Snyder, saying that Snyder’s state-of-the-state address – which was being given at the same time as the county board meeting – was certain to contain bad news for the state and the county. He described Snyder as a bully with an unending appetite to destroy longstanding liberties and rights of Michigan residents, including the right to collective bargaining.

Present: Felicia Brabec, Andy LaBarre, Ronnie Peterson, Alicia Ping, Yousef Rabhi, Rolland Sizemore Jr., Conan Smith.

Absent: Kent Martinez-Kratz, Dan Smith.

Next regular board meeting: Wednesday, Feb. 6, 2013 at 6:30 p.m. at the county administration building, 220 N. Main St. in Ann Arbor. The ways & means committee meets first, followed immediately by the regular board meeting. [Check Chronicle event listings to confirm date.] (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 commentary is held at the beginning of each meeting, and no advance sign-up is required.

The Chronicle could not survive without regular voluntary subscriptions to support our coverage of public bodies like the Washtenaw County board of commissioners. Click this link for details: Subscribe to The ChronicleAnd if you’re already supporting us, please encourage your friends, neighbors and colleagues to help support The Chronicle, too!