I knew Mayor Chris Beutler’s re-election would guarantee a property tax increase this year, but I didn’t think he’d admit to it so soon after winning his second term.
But there it was, right between the lines on the front page of the LJS:
The mayor, already deep into budget analysis, said he expects to ask for a public discussion on some serious questions:
* Should the city make deep cuts in services or raise more revenue?
* Should the city have a limited roads maintenance and construction program or raise more revenue? This will include a discussion about using more bonds for roads building.
“Raise more revenue” — how does a city raise more revenue? Through fees and taxes. Fees have gone up every year Beutler’s been in office, so that’s a given. And this year I expect Beutler will finally propose a property tax increase. And any discussion about building more roads through bonds means a property tax increase, since that’s how bonds are paid off.
Beutler promised “serious cuts” — but in his first term he backed off pretty quickly at any whiff of public opposition to his cuts. Pool closures, library cuts, even “meter readers” — very rarely did he go through with major cuts. He often brags about cutting 120 city positions — but only a handful of those were pure layoffs.
He said “revenue increases” will be considered. Again, he’s avoiding the word “tax,” but that’s what a “revenue increase” is.
I expect he’ll try to lay a lot of blame on state lawmakers for cutting state aid, but that only accounts for $1.8 million of the problem. Even before that cut became known, the city was projecting a $6.3 million deficit — and that’s not even counting raises that will have to be given to most city employees. The city projects that gap will widen to $19 million in five years, if things don’t change. So we’re sitting in almost the exact same place we were before he was elected to his first term as mayor.
Beutler said in his interview that the city budget was structurally imbalanced even before the recession took hold and he took office. But Beutler ran for his first term on a promise to fix the budget, and didn’t do it.
Here’s what he said in 2007, while campaigning for mayor:
Citing his experience with state budgets as a 24-year lawmaker, he says it’s time to fix a “structural problem” with Lincoln’s budget: City expenditures are outpacing revenue, according to five-year projections. “The City Council and the mayor have let this go on for way too long,” he says, “so that today what you have going on is essentially a mess.” In the short-term, it’s going to take “real cuts” not “one-time” cuts the council and mayor have made recently. He promises not to raise property taxes to make ends meet.
Seems to me, little has changed since then. Here’s what he said this week:
Before he became mayor, city budgets were being plugged with “one-time funds or other manipulations,” he said. Beutler would like to “restore fiscal order” to the budget.
Deja vu, anyone?
Now before you start accusing me of beating up on Beutler too much, know this: I voted for the guy. So did 65 percent of voters on Tuesday. If that isn’t a mandate to make the tough decisions he promised to make four years ago, I don’t know what is.
Republican Mayoral candidate Tammy Buffington today put out a bombastic press release regarding Mayor Chris Beutler’s recent hiring of former Speaker Kermit Brashear to lobby for the city.
I’m just going to give you the whole press release. Here it is:
I opened my paper yesterday to discover that our mayor is once again spending MORE of the taxpayer’s money. He has decided to hire a former State Senator, a successful Omaha attorney to help with the city’s labor negotiations. It will cost us $350/hour with a projected total of $50,000 for the four weeks of work. This is more than half of the mayor’s yearly salary. Is this how our mayor stays away from the important work of the city? Pay others to do his work? He told a group last evening that they are welcome to come to city hall because he has many assistants to help them. Are these the 19 aides that he has hired at an average salary of $114,000 plus benefits and an additional 12% yearly retirement with no match?
Our mayor is painting the success of Lincoln in such glowing terms and accepting all the credit for this success. Has he ever thought that the reason we have a low unemployment is that citizens of Lincoln are hard working. Faced with a struggling economy and loss of jobs, many are going out and finding whatever they can to make ends meet. Spouses are going back to work instead of staying home with their children. People are making sacrifices. They are cutting back on luxuries. They are paying their bills as best as they can. Wouldn’t it be better for this mayor to find ways to cut back and put money back into the hands of the taxpayers? Wouldn’t it be better if he was a leader of this community and settled the union issues himself? Would that mean that he might not be able to take money from the unions in this election? Would it mean that he would have to hold the line on raising our taxes if he is elected?
I guess the voters will decide in 5 weeks if they like his leadership or if they want to try someone new that will look for ways to cut the budget and return the money to the taxpayers.
Winterized has learned that the .5 percent pay cut Mayor Chris Beutler recently said he and his staff will take won’t take effect until Sept. 1.
That is, assuming Beutler gets re-elected in May. If he weren’t re-elected, he and his staff wouldn’t take any pay cut unless the new mayor were to keep them on as directors and aides. Most mayors keep most of the old cabinet, but aides don’t often stay on, unless they’re from the same party as the outgoing mayor.
Anyway — a city hall source tells me the pay cut will not be effective immediately, but on Sept. 1, most likely to coincide with the beginning of the next fiscal year.
Beutler held a press conference this morning to explain that his administration is proposing to reduce retirement benefits for future directors, aides and mayors, but not current ones.
Here’s a link to the LJS story.
The city contributes 12 percent of Beutler and his directors and aides’ salaries into their retirement fund, with no match required. That’s more generous than any city employees get — even though Beutler has worked for nearly two years to try to convince employee unions to take less generous benefits. He was only able to convince them to agree to less generous benefits for new hires only.
Beutler now says his law department says he can’t change the benefits for current staffers. But since the directors and aides work at the pleasure of Beutler, I would think they could change it — but hey, I’m not a lawyer working for Beutler. Do they have contracts? Not that I’m aware of.
Today, I called on Beutler and his staffers to take a less generous retirement benefit, to set an example for other employees — heck, he could give the difference to charity.
Meanwhile, his Republican opponent for mayor, Tammy Buffington, has finally spoken up on the issue, issuing a press release saying Beutler has been dodging the issue since it came up last week, telling a radio talk show host he didn’t know whether he could change the benefits immediately.
“Now it looks like even the union members are getting the short end of the stick by this mayor,” Buffington said in her release. “ How many workers in Lincoln get money contributed to their pensions without having to put a cent of their own money into the fund? “
“Even union members aren’t getting what the mayor gives himself and his buddies,” she said. “I don’t know of any private business in Lincoln that can afford that kind of generosity and still stay in business.”
She said she thought Beutler called a press conference Monday morning to “show leadership.”
“This announcement just shows he’s keeping our dollars and leaving us with change,” she said.
Beutler administration suddenly ready to change directors, aides’ retirement benefit — but the devil is in the details
What a wild week it’s been at city hall.
For me, this all began on Valentine’s Day. I’d long heard that the mayor and his staff were still getting the kind of retirement benefits he has long decried as overly generous for city employees. Basically, the city contributes $2 for every $1 the employee puts in. Mayor Chris Beutler began lobbying hard in July 2009 to get the unions to agree to a lower city match than that. He couldn’t get traction on changing the benefit for existing employees, but he was able to convince all but one city union to lower the match for new hires only.
But nobody ever asked the mayor whether he would be willing to take a cut in his own retirement benefit, which is actually even more generous than what the city employees were getting. The city gives the mayor and his dozen directors and several aides 12 percent of their salary toward retirement, whether they put up a match or not.
I’d heard that, but wanted to make sure it was accurate information, so I asked the city controller how much the city contributes to the mayor’s retirement fund. This is a question that should easily be answered in about five minutes, by looking up his payroll data. I didn’t get an answer for eight days. On Feb. 22, I received an email confirming that the mayor gets about 12 percent of his $75,000 salary — with no match required.
Coincidentally — or maybe it wasn’t a coincidence at all? — on that very same day, the mayor held a press conference to announce that he and his cabinet and aides had decided to take a .5 percent pay cut in the coming year (assuming he gets re-elected in May). I suspect this was some political operative’s idea of a great way to blunt the effect of any story I might write about the retirement match issue. I wrote about Beutler’s pay cut deal, but added the information about the nice retirement benefit the same crew get.
Two days later, Beutler is on “Jack & John” talking about the pay cut issue when Jack (or was it John?) asks him about the retirement issue I wrote about. The mayor says he always intended to “eventually” also cut his and his cabinet’s retirement benefit, he just hasn’t really gotten around to it and isn’t sure whether it can be done unilaterally.
The following day, Coby Mach is talking about the whole pay cut-retirement benefit controversy on “Drive Time Live” — and expressing incredulity at the whole thing, when during a break he gets a call from the mayor’s chief of staff, Rick Hoppe, who tells him the City Council has on its agenda Monday (first reading, no public hearing until the following week) an ordinance that would change the retirement benefit for directors and aides from the 12 percent no-match-required deal to a 9 percent city match with a required 7 percent employee contribution.
But the really incredible part is that Hoppe tells Coby they’ve been talking about this since November. As Coby pointed out, the mayor had just said the previous day that he didn’t know whether it was possible to make such a change. You would think that in the time between July 2009 and February 2011, his staff would have had time to figure out whether they could make the same sacrifice he’s been asking other city employees to make. Then again, would you be able to find time to figure out whether to cut your own retirement benefits?
So the upshot is that on the City Council’s Monday agenda, suddenly there appears an ordinance to change the deal for directors and aides — however, TWIST! — the way I read it, the legislation would ONLY APPLY TO EMPLOYEES HIRED ON OR AFTER APRIL 1, 2011. So basically, they’re doing the same thing the unions did by saying, “We won’t cut our retirement benefits, but we’ll cut the new employees’ benefits.”
During a radio show this morning, Mayor Chris Beutler acknowledged that he and his cabinet and aides still get a very generous retirement benefit but said “eventually” those will be adjusted.
Eventually? Beutler first went public with his plan to reduce city employees’ retirement benefits in July 2009. Last year he got all but one city union to agree to reduce the match for new hires (from a 2-to-1 match to a 1.3-to-1 match). All the while, he and his cabinet have continued to take an even more generous deal.
According to data from the city, Beutler and his aides and department heads get about 12 percent of their salary in retirement compensation annually. And I’ve recently learned they get the city contribution whether they contribute a match or not. So that’s a better deal than any city employee gets. They get about 12 percent of their salary (most of the directors’ have six-figure salaries) and don’t have to match it to get it.
But now that Winterized has publicized the fact that Beutler never reduced his own retirement match, even while lobbying city employees to do so, he’s acting as though he’d always intended to change it.
“We need to follow through and adjust all of the pension ratios eventually,” he said on Jack & John today. “We haven’t gotten to some narrow categories but that process will come down to everybody in the end. We’ve been working with the broad categories, the big things… .”
So we are to believe that even though he has had since July 2009 to adjust the benefit for himself and his cabinet and aides, he just hasn’t gotten around to it? Wouldn’t a better approach have been to announce that he wanted to reduce retirement matches for city employees, and he would be the one to go first?
The radio host asked Beutler whether he couldn’t have just unilaterally made that change, and Beutler said he didn’t know.
“But we will get there,” he said. “It’s coming.”
Don’t believe me? Hear it here.
And you didn’t even know city employees could accept gifts, huh?
Mayor Chris Beutler today signed an executive order banning city employees from accepting gifts. The mayor said the new rules were issued to “further the cause of good government and ensure public confidence in our public servants” and not a response to any reported problems.
“I can honestly tell you that the people in city government are people of integrity who give their all each and every day to make this city the best it can be,” Beutler said. “Perception, however, accurate or not, can be a powerful force in shaping public opinion. If the public believes that impropriety can and may exist, we can never achieve all we can be. The rules that govern city hall must never leave a doubt that our employees are acting in good faith, that their guiding principle is policy, and not personal gain.”
I found this dog-and-pony-show interesting, considering the mayor and several city employees were flown around the country last October to look at arenas, and then the mayor refused to disclose who paid for the trip until his hand was virtually forced. (Nelnet paid for the flights on their jet.) And even then, he never said how much the trip cost.
Did anyone at the press conference ask Beutler whether his trip was OK? Is he subject to these rules? And what about calling up construction companies that are vying to for the job as general contractor on the $168 million arena and asking them for donations to your mayoral campaign? Just looking for some clarification on this, mayor.
Councilman Doug Emery joined Beutler for the announcement, and said he would ask other council members to consider adopting the same policy.
“We cannot ask the community to follow our lead if they are suspicious of our motives,” Emery said.
State law already prohibits city employees from using their positions to solicit or accept anything of value in exchange for a favor. Lincoln’s municipal code includes a similar prohibition. The new executive order replaces one from 1985 that allows for the acceptance of gifts valued at less than $10. Beutler said a weakness of the previous executive order is that it did not limit the number of gifts that could be received. The executive order also extends the ban to employees’ spouses, children and parents.
While I think Beutler needs to abide by these same rules, I give him credit for strengthening the city rules on this. A few years ago I wrote about how city employees get gifts and free lunches and holiday dinners — particularly from engineers and architects and construction companies vying for city business. They were violating the city rules, but nobody seemed to care.
Beutler said the policy allows for “common sense exceptions,” including gifts of snacks for holidays and other occasions; flowers received in connection with funerals; admission to events employees are required to attend for official city business; and ceremonial gifts given to the city. (Seems like a lot of loopholes when it might be easier to just ban all gifts.)
“The existing state law, city ordinances and executive order are not enough,” Beutler said. “The new guidelines are more fair, more clear and more representative of the ethical standard for employees expected by my administration and the public.”
The doling out of arena subcontracts may not be as open and transparent as originally advertised if the Joint Public Agency that governs the arena approves the pre-construction agreement on its agenda Wednesday.
Mortenson Construction of Minnesota and Hampton Enterprises of Lincoln are construction manager at-risk for the arena project, and the way they handle awarding of contracts is of great interest to companies hoping for a piece of the $340 million project.
However, the agreement (see it here: JPA-Attach-01-26-11 the agreement begins on about page 140) does not require Mortenson to follow the city’s usual open, transparent bidding process and hands over construction of two more projects that weren’t in the original project scope — a pedestrian bridge and arena plaza — to Mortenson rather than put them out for bid to give other companies a shot at them.
The mayor’s office responded to that, saying “The beginning and ending points for projects are hard to define, especially when it pertains to a bridge. The JPA has looked at the arena block and has generally assumed that the arena block would be built by Mortenson” and would avoid putting multiple general contractors in a “tiny area.” The bridge will land on the arena block, the mayor’s office said, and the JPA already has an agreement that Mortenson will carry a $25 million liability policy.
“When swinging stuff over active tracks it is in the best interest of the taxpayers to delegate the bridge responsibilities and liabilities, over to Mortenson, given its proximity to active railroad tracks,” the mayor’s press statement said.
Same goes for the civic square on the arena doorstep — the mayor’s office said that will be done by Mortenson. The statement didn’t address why neither the pedestrian bridge nor the civic plaza was mentioned in the original scope of service, but are now being added to Mortenson’s job.
Although the city had advertised for a company that would use the city’s bid process to choose subcontractors, the propposed agreement would allow Mortenson to choose subcontractors to do mechanical electrical and plumbing, structural steel, precast concrete, concrete, exterior walls and vertical transportation — which seems like a big chunk of the work. It appears Mortenson will handle everything except the “receiving” of the bids through the city’s eBid system. But then the proposals will be opened privately — which caused Mortenson some trouble in Kentucky.
In response to that, the mayor’s office released the following statement: “Mortenson has proposed to use the E-bid system. The proposal process will be transparent, which means that the scoring criteria and scorecard will be published with the RFQs and RFPs and the resultant evaluation will be published after award. Mortenson and Hampton will be explaining in greater detail at the JPA meeting tomorrow about how this process would work and how it has been used successfully on other projects. At the end of the day, what we they are proposing is standard and customary practice for CMAR projects. Typically, the selection of the subcontractors are the CMAR’s responsibility to select based on their contractual obligation to guarantee the cost and schedule and provide the best value and quality to the taxpayers.”
In other words, this is the way Mortenson wants to do it, the way they usually do it, in order to keep their promise to come in on, or under, budget.
Mayor Chris Beutler has long promised this project will be open, transparent and fair — but lately, city officials have been backing away from that open and transparent stuff, because it doesn’t seem to fit with Mortenson’s way of doing things.
Note these two grafs in a Nov. 25 Journal Star story:
Jim Martin, hired as program manager to coordinate all aspects of the local arena design and construction, has voiced concerns about using the city’s e-bid system, said Dan Marvin, who represents the city on the arena team.
The city’s e-bid system requires the purchasing department to explain why it is not taking the lowest bid. That process also allows the public to view bids electronically just minutes after they are opened. Too many restrictions may hurt the Mortenson-Hampton team’s efforts to get the project done on time and under the guaranteed price, Marvin said.
You can almost picture Marvin backing away, can’t you?
This agreement is not a done deal. It goes before the arena JPA on Wednesday. Tune in to the city’s Channel 5 at 3 p.m. Wednesday to see what happens. (JPA-Agenda-01-26-11)
So far in our very unscientific poll, Councilman John Spatz is your favorite to run against Beutler next year.
(And yes, the poll does guard against repeat voters, just in case you were wondering!) I’m surprised he got more votes than veteran Councilman Jon Camp, but I’m even more surprised at the number of write-in votes former Councilwoman Patte Newman is getting! I’m just curious what would possess Newman to a) get back into politics and b) run against a fellow Democrat, Beutler. But Patte is obviously popular with my readers, so she might want to think about coming back to city hall some day!
Coby Mach is in second place — which doesn’t really surprise me but he left no doors open to running when I asked him about it months ago. Usually if they want to leave open the possibility, they say something like, “I have no plans to run.” But he flat-out said, “I am not running.”
I will leave the poll open for a week. In the meantime, I’d like to hear thoughts on whether anyone thinks Beutler is beatable…
Since Tuesday’s election is going to be such a snoozer locally, is it too early to begin speculating as to who might run against Mayor Chris Beutler in the spring municipal election? Not at all.
As one political consultant told me about a month ago, any viable candidates should have their ducks in a row NOW.
So… based on some of the names I’ve heard thrown around as prospective candidates, what do you think? Let’s vote:
By the way, Mach told me a long time ago (the first time I heard his name bandied about) that he’s not running; Camp and Spatz won’t say if they’re running, and Foley has said he’s not interested. I’ve also heard people talk about Tony Fulton, but another reporter asked him about it some time ago and he said no.
And since the “other” nominations don’t show up when you look at the results, I’ll tell you who they are so far: Patte Newman, Deena Winter and Shawn Traudt. If Patte decides to run I’ll be her lieutenant… but I’m pretty sure she wouldn’t run for mayor for a million dollars!