What’s the Suttle recall really about? Union-busting?
A new restaurant tax? Bloated police and firefighter pensions? A decrepit sewer system? Republicans capitalizing on a bruised mayor?
Or is it really about kicking unions in the teeth? This story shows that what some of the big financial backers of the Recall Suttle side are really ticked off about is unions.
Omaha Mayor Jim Suttle
They cite a recent New York Times story, that said, “Across the nation, a rising irritation with public employee unions is palpable, as a wounded economy has blown gaping holes in state, city and town budgets, and revealed that some public pension funds dangle perilously close to bankruptcy.”
The World-Herald quotes the top contributor to the recall effort, Mike Simmonds, saying “It’s all about unionism in the public sector and their ridiculous strength.” He also said he’d like to see public employees barred from organizing altogether, or at least barred from political involvement, noting the fire union gave Suttle $30,000 in contributions in 2009. He said elected officials have an inherent conflict when they receive campaign support from the employee unions whose contracts they negotiate.
Which brings to mind the $13,500 two of the Lincoln City Council members received from Lincoln’s fire union last year — which is a lot more in terms of the total cost of their campaigns, compared to Suttle’s. The other two Dems on the council also got $5,000 in 2007. Lincoln’s fire union has been stepping up its campaign contributions to the point where they are the biggest single contributors to local city hall campaigns.
Aside from the unbelievable stupidity of the Suttle Homeless Shuttle, I found this story to be the most interesting angle on the whole Suttle recall saga. Could a few rich, powerful Omaha businessmen really throw city hall off course, and get someone into office that would support their anti-union agenda? We’ll find out tomorrow, when Omaha voters go to the polls.
Arena project getting less open and transparent all the time
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.
All of this will be done before Mortenson comes up with its guaranteed maximum price — which it must calculate when 60 percent of the arena design is done.
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)
Omaha mayor makes same mistake as Lincoln’s with e-mails
In the heat of a rugged campaign, it’s easy to make a mistake. That’s what appears to have happened up in Omaha, where Jim Suttle’s opponents say the mayor’s staffers broke the law by sending campaign e-mails from work.
The pro-recall side is saying Suttle’s staffers should not have used their city e-mail accounts to respond to the hullabaloo over anti-recallers busing homeless people to the election office to vote (presumably against) Suttle’s recall.
Nebraska state law says public officials can express their opinion on ballot measures, but they cannot use public resources to do so. They can only provide neutral, factual information about the proposal when they’re on the clock, although they can support or oppose ballot measures on their own time.
Suttle’s staffers sent out e-mails in response to a deluge of requests for a response to the allegations about the busing scandal. They now say they did nothing wrong, because they’re allowed to respond to requests for information.
This brought me back to April, when Mayor Chris Beutler held a press conference to talk about how he was going to make sure the arena-building process would be transparent and accountable — and he used the opportunity to also say the arena would be key to Lincoln’s “prosperous future.”
At the time, Nebraska Accountability and Disclosure Commission Director Frank Daley told me there are two exceptions to the law: Public employees and officials can respond to inquiries by the press or public and research and prepare materials to assist the governing body in determining the effect of a ballot question. Public employees also can answer questions about a ballot measure during a news conference on an unrelated topic.
However, Beutler’s information was hardly neutral, and he wasn’t asked to give his opinion on the arena project — it seemed a clear violation of the law, but Beutler’s city attorney thought it was legal, and apparently nobody complained to the A&D about it, so he got by with it.
In Omaha, it’s a bare-knuckled brawl — I doubt they’ll let Suttle get by with it.
Steve Forbes to visit UNL, chamber
Steve Forbes will be at the University of Nebraska-Lincoln on Feb. 1 to talk to students.
The former presidential contender and head of Forbes and editor of Forbes magazine will appear at the Union from 9 a.m. to 10 a.m., talking for about a half-hour and then taking questions from four students.
He will be the keynote speaker at the chamber’s 2011 annual lunch on Feb. 1.
Omaha mayor faces recall over dining tax; Lincoln mayor riding high
Often, while covering the arena project, it seemed like Lincolnites weren’t really “getting” how the project was going to be paid for.
The financing was admittedly complicated: About half the $340 million price tag would be paid off by a new tax on bar and restaurant tabs, car rentals and hotel rooms. However, the words on the ballot pertained only to whether the city should be allowed to bond the proceeds of the so-called “turnback tax” — state sales taxes generated in the arena and nearby hotels and “turned back” to the city for the arena.
Two different revenue sources altogether, but people seemed to mix the issues and conclude that only the bars, restaurants and hotels near the arena would be paying the new bar and restaurant taxes. No matter how many times I wrote that it would be a “citywide” tax, people’s eyes probably glazed over when they started reading about the JPA and turnback taxes and the fact that they were only voting on $25 million of a $340 million project and whether Beutler or Bereuter was presiding over this whole thing… it was a challenge to explain.
I knew we had a problem when it became clear during a conversation with the editor of the paper that he didn’t grasp that the tax would be applied citywide. If he didn’t get it, (and presumably he read all 232 stories I wrote) how was the average voter going to get it?
I don’t know if the architects of the finance plan wanted the whole thing to be confusing (I mean, just trying reading this story I wrote trying to put it all in English), but if they did, that was genius.
It seems people are finally catching on, now that the new 2 percent tax began being applied to their bar tabs and McDonald’s meals this month. You’re seeing letters to the editor complaining about the “tax on a tax” (because the bar and restaurant tax is computed, and then sales tax applied to that). I’ve eaten at restaurants where the owner hands over the bill and says “You can thank the mayor for that arena tax.”
My husband bought food at a grocery store deli the other day and they applied the restaurant tax; the workers said it was a royal pain because they were struggling to change over their checkout system to accommodate the new tax.
Meanwhile, in Omaha, Mayor Jim Suttle faces a recall election on Tuesday largely due to unhappiness over a 2.5 percent dining tax (on bar, restaurant and catering tabs).
Ours is 2 percent, plus there’s a new 4 percent tax on car rentals and hotel rooms. In addition, Beutler’s administration convinced people to raise their property taxes for a stormwater bond, increased property taxes a bit, and expanded the city’s telecommunications tax to include phone equipment. How did Beutler get by with all that, while Suttle is up against the wall? And don’t say Rick Hoppe, his political mastermind/chief of staff.
Well, whereas Omaha needed the money to get out of a budget crunch and pay for their pensions and awful sewer system, we get an arena to try to compete with theirs.
However, I think another key is that Omaha’s bar and restaurant lobby geared up right away, fighting Suttle’s proposed tax hard. The media really covered it, too, and things snowballed from there. The Republicans seized on the opportunity, and here we are, waiting to see if they’ll get an election do-over.
In Lincoln, bar and restaurant folks mostly wanted the arena, because they hope it’ll bring in more business (even though the city’s own study showed the new development to be built near the arena will capture the vast majority of the arena-goers’ walking-around-money) so they swallowed the tax.
It seems some of them are just now beginning to be bothered by the aftertaste.
Newcomer to challenge Cook for council seat
A member of the Lincoln Independent Business Association announced during a LIBA luncheon Tuesday he’ll be running for the Lincoln City Council seat now held by Councilman Jonathan Cook, who represents southwest Lincoln.
Travis Nelson
The Lincoln Journal Star has reported that Cook intends to run for another term, but Cook has declined to comment for Winterized, saying only that he’ll announce his intentions in January.
Want to know how much state employees earn?
The Platte Institute has a cool new website they call Nebraska Transparency, which allows you to search for any state employee and see what their salary and retirement benefit was in 2009.
Gov. Dave Heineman, for example, makes $109,000 and gets nearly $8,000 annually in retirement benefits. Attorney General Jon Bruning earns $95,000 and gets about $7,000 in retirement funds.
You can also see how much vacation they’ve accumulated.
You can search by department, by salary range, even by vacation hours or retirement compensation range. The website is still a work in progress, which is why you can only see 2009 data for now and the University of Nebraska is not there yet.
Berk Brown of the Platte Institute says eventually, they will have city and county salaries on the website, too. It takes time to get the data from all of these entities and get it in the right format.
Mayoral candidate meets the press
Lincoln’s Republican candidate for mayor had her first experience meeting the press today.
Tammy Buffington will run against Mayor Chris Beutler in the spring city election.
She was introduced by Councilman Jon Camp — who probably wished he were the one making the announcement, if it didn’t mean he’d have to give up his council seat.
Her three main issues are:
• “Massive” city debt — $720 million worth — although she couldn’t say what she’d do about that. Although to be fair, it’s not like you can wave a magic wand and make those debts disappear.
• Tax increases under Mayor Chris Beutler’s reign — she said there have been nine of them, although I can’t think of that many. There’s the voter-approved bar and restaurant taxes for the arena, a slight property tax increase and an expansion of the telecommunications tax. But she also listed impact fees (where developers have to help pay for the cost of bringing infrastructure to their projects) and utility rate increases, which I wouldn’t call taxes but they do hit voters’ wallets anyway.
• Ever-increasing salaries in labor agreements.
Buffington did fine with her speech, until it was time to answer reporters’ questions (which is the worst part of any press conference for the person behind the microphone).
She struggled when asked what she would do about the state-mandated system of setting public employees’ salaries (the ol’ CIR issue). State GOP Chairman Mark Fahleson helped her out by saying all Mayor Beutler has done on this issue is — to paraphrase — talk big and send a little ol’ letter to state lawmakers. Buffington would march up the capitol and really push for change, he was saying.
When asked whether she supported the bar and restaurant taxes that will help pay for the arena, she said she didn’t. She said she voted against the arena bonds. But she also said she’s excited about the project, which she referred to as “our situation.” That was somewhat confusing.
She was quite poised and well-spoken for a newcomer to politics — but she has a lot of homework to do before her first debate with Mayor Chris Beutler. Alas, the life of a non-incumbent. And kudos to any novice willing to enter the sometimes-brutal arena.
Cornhusker Hotel in trouble — while four more downtown hotels are on the drawing board
Cornhusker Marriott in Lincoln
With the venerable Cornhusker Hotel (that’s what we like to call it) teetering on the edge of foreclosure, one has to wonder what’s going through the minds of the developers who have four more hotels planned for downtown Lincoln.
Yep, four.
And the city plans to dole out financial incentives to all four of them — infuriating some existing hotel owners. There’s the hotel that will be built across the street from the yet-to-be-built arena, a hotel to be built by WRK in the Haymarket, another Haymarket hotel literally across the street from WRK’s being planned by B&J Partnership, and a hotel on the block straight south of the Gold’s Building.
I’ll be shocked if the Gold’s project ever gets built — but the other three seem pretty sure to be built right now. Buildings have already been demolished and work is scheduled to begin this year on the two Haymarket hotels.
But if the Cornhusker is having financial problems, how will four more hotels fare? And should the city be giving developers tax breaks to help them build, when most other Lincoln hotels are not exactly filling their beds?
The owner of the downtown Holiday Inn has previously expressed his unhappiness with the city’s plans to subsidize up to four more downtown hotels — but city officials have so far been undeterred, saying, in essence, if the market is too saturated, the developers won’t be able to get financing anyway.
The Holiday Inn owner warned in August that Lincoln’s occupancy rate is only about 54 percent, and said Lincoln didn’t have room for one more hotel, much less four subsidized hotels. He flat out said he would lose his investment in the Holiday Inn if the hotels are built.
Meanwhile, the Cornhusker Marriott will go up for public auction on Feb. 17 unless it comes up with enough money to pay its former management company, Island Hospitality Management. Island Hospitality is trying to force the issue by by threatening foreclosure against Shubh Hotels Lincoln, which owns the Cornhusker but has lost most of its other hotels nationwide due to financial problems.
Island Hospitality recently obtained an $800,000 judgment against Shubh Hotels for unpaid bills and got court approval to garnish rents from office tenants in Cornhusker Plaza, according to the Lincoln Journal Star.
It’ll be interesting to see if any city officials have anything to say about any of this, given their plans to help build four more — I’m not going to hold my breath though.
Buffington enters Lincoln mayoral race
Tammy Buffington will run against Mayor Chris Beutler in the spring city election.
Looks like Mayor Chris Beutler will have an opponent after all.
A Lincoln businesswoman named Tammy Buffington will announce her candidacy for mayor of Lincoln tomorrow at the state Republican headquarters.
In a press statement, Buffington said she is entering the political arena because she is concerned about Lincoln’s current leadership.
“I was initially concerned because of health care reform. Clients would come to me asking how this was going to affect them. Then I looked at what was going on right here in Lincoln. On the surface, our city appears to have smooth sailing, but the bills are coming due. Recent union contracts strapped to the backs of local taxpayers are egregious. We cannot continue to let taxes, out of control spending, debt, and union contracts drive us to a point of no return.”
Buffington owns A+ Brokerage with offices in Lincoln and Imperial. She is a Lincoln native who attended Havelock Elementary, Dawes Middle School, and Lincoln Northeast High School. She graduated from Vennard College in Iowa in 1984 with a Bachelor’s degree in Education. She returned to Lincoln where she was first employed at Miller & Paine and later National Bank of Commerce.
She married her husband, Kip, in 1985 and they have one son, Caleb, now 20. Together, the Buffington’s also own Freeway Muffler Brakes of Lincoln and rental properties in Lincoln and Beatrice.
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