Privatization Of Government Services

Tue, 05/06/2008 - 3:22pm

When: February 27, 2012 at the Downtown Library: Multi-Purpose Room

Privatization of services is a growing trend in today's government. But, what factors should be identified when considering privatizing departments or functions? What policy issues should be considered in connection with transferring these departments/functions to a company within the private sector?The League of Women Voters is currently undertaking a study of privatization to examine these issues as well addressing the community impact and strategies to ensure transparency and accountability. Join the League as they host this community forum, which features panelists: 1st Ward Ann Arbor City Council Member - Sabra Briere; Former Washtenaw County Administrator - Bob Guenzel; Ann Arbor Public School Board Member - Susan Baskett; and Lois Richardson who serves as mayor pro tem of the city of Ypsilanti and is in her third term on the city council. This event is cosponsored by the Ann Arbor Alumnae Chapter of Delta Sigma Theta, Inc.

Transcript

• [00:00:26.46] DEBBIE GALLAGHER: Our moderator for this evening's program is Susan Greenberg, vice chair of the Ann Arbor League of Women Voters. Susan will introduce our panelists for this evening's program. The program is co-sponsored by the League and the alumnae chapter of Delta Sigma Theta. Miriam Bornstein of the League will begin tonight's program.
• [00:00:53.00] MIRIAM BORNSTEIN: Good evening, everyone. My name is Miriam Bornstein, I'm a member of the League of Women Voters of the Ann Arbor area. On behalf of the League, I want to welcome you to tonight's forum on privatization of government services. I'd like to thank the Ann Arbor District Library for hosting this event and to thank the panelists for sharing their time and expertise with us tonight. We're pleased to be co-hosting tonight's forum with the Ann Arbor alumnae chapter of Delta Sigma Theta, and I'm going to invite Joyce Parker up to say a few words from them.
• [00:01:31.45] JOYCE PARKER: Thank you. Good evening to everyone. The Ann Arbor chapter of Delta Sigma Theta Sorority, Incorporated is a private, nonprofit organization whose purpose is to provide assistance and support through established programs. As a member of the sorority, I am the chairperson for the social action committee. The committee is involved with supporting and educating the community on various issues such as public service delivery, advocacy, voter registration, and voter education. On behalf of the Ann Arbor chapter of Delta Sigma Theta Sorority, Incorporated, I would like to welcome you to the forum regarding privatization of governmental services, and thank you for taking the time to come out to hear about the changes and how they may affect you and your neighbors. Thank you very much.
• [00:02:43.27] MIRIAM BORNSTEIN: The National League of Women Voters is completing a yearlong study on the privatization of government services, and tonight's forum is an effort for us to understand how privatization plays out locally in our own backyard, in our cities, our country, and in our schools. At this point, I'd like to call on Susan Greenberg, the League vice president, to introduce the panel and to moderate tonight's forum.
• [00:03:04.90] SUSAN GREENBERG: Thank you. Good evening. I'd like to first just describe the purpose of this study. It's to identify what factors a government entity identifies when considering privatizing certain departments or functions performed by government entity. And what policy issues are considered in connection with transferring these departments or functions to a company within the private sector. In addition, the League will review the stated goals of transferring these job functions, the community impact, if any, and what strategies are developed to ensure transparency and accountability. We have invited tonight people from local government that we hope will share with us things that they're familiar with.
• [00:04:11.22] We're going to start inviting people to take their seat. Bob Guenzel, who's the former county administrator, and Bob's going to be the first seat. The next person is Sabra Briere, 1st Ward councilmember from the city of Ann Arbor. The middle seat is Andy Fanta, who is from the school board in the city of Ypsilanti. Seat number four is Susan Baskett, city of Ann Arbor school board member. And the last seat is Lois Richardson, First Ward councilmember, city of Ypsilanti. OK, and Bob, we'll start with you and we'll just go right down the line.
• [00:05:20.33] BOB GUENZEL: Thank you, Susan.
• [00:05:21.79] SUSAN GREENBERG: Oh, I'm sorry. Lois asked if she could start off.
• [00:05:28.30] BOB GUENZEL: Absolutely.
• [00:05:29.99] SUSAN GREENBERG: So let's shift gears and we'll let Lois get started.
• [00:05:35.71] LOIS RICHARDSON: Good evening, everyone. And actually, Susan, I'm now mayor pro tem of the city of Ypsilanti. I am still Ward 1 representative, that's how I got there, but I am the mayor pro tem.
• [00:05:48.18] Good evening, everyone. It's nice to be here. And I asked to go first simply because I wanted to do a little bit of background on privatization. I didn't realize that you all have been having these ongoing-- and still don't know how many people have been coming, or there's some people that just might not really understand. But back a number of years ago, back around '97, '98, the state and local governments across the country were struggling, and have been struggling, with the public's demand for better service and increasing services, but at the same time wanting to spend less money. And so one response to that was to privatize government functions. And that is to transfer certain services from public sector to the private sector. And basically there are four general types of privatization-- outsourcing, asset sale, commercialization, and vouchers. And I'll talk a little bit about each one.
• [00:07:00.33] Under outsourcing the government entity, whether it's a school board or whether it's a municipality or township, remains fully responsible for providing the service and maintains control over all the management decisions, but a non-government entity actually carries out the function or performs the service. This is the most common privatization method and includes contracting out, granting franchises to private firms, and using volunteers to deliver public services. And this is the type of privatization that Ypsilanti has adopted, and we only have out one area, and we're outsourcing our garbage pickup. And we could do that without bringing a hindrance to our overall DPW department.
• [00:07:57.61] The second is an asset sale, which involves actually transferring ownership, actually selling a government asset to a private party. And once it's sold the government rarely has a role in overseeing or managing the private company, or has any say in what happens. Commercialization occurs when a government stops providing a given service and citizens may do without the service or contract with the private company to continue receiving it. And commercialization occurs most often at the local level.
• [00:08:37.07] And vouchers are government financed subsidies given to people to use in purchasing specific goods or services on the open market from either the private or public sector. And I think the most that we've heard about vouchers is in the education sector where vouchers have been given for schools. And there's still a greater push for vouchers to be given to schools. And also a part of that-- not necessarily the vouchers-- but the outsourcing would be, for me charter schools come under that. I'm not a big proponent of charter schools, I'm not a big proponent of privatization.
• [00:09:19.14] As I mentioned we did outsource our garbage collection, our trash collection. And it does work good for us, for our city. We still have a very well-functioning Department of Public Works that is well-staffed. One of the reasons I'm not so fond of privatization is that, for me as what I've seen, it takes jobs away, actually, from the municipality. It takes jobs away from people in the community. When a service is privatized the people that perform that service can live pretty much anywhere. And I found that for our city, most of our people live within-- if they don't actually live within the city, they live within Ypsi Township, or they live within the county. They're not way across the state or wherever. So that works for us, we did save money in doing that. And the service is good, but we do have a word-- we can say what's going on.
• [00:10:36.86] The asset sale. I think that we're seeing some of that come about through a different way in Pontiac. On the way here I was hearing how they're beginning to sell off pieces of government land, the city owned property. And city owned services are beginning to sell them off. And to me, again, that all works towards destroying a community. It's not just the city, but it's a community. And for me community is important. It's not just the city of Ypsilanti, but it's the community of Ypsilanti, and the communities within Ypsilanti. And I do believe that governments-- the commercialization part-- I do believe that governments have a responsibility to their citizens and that just to commercialize all the services and people not really getting the services that are keeping the city or the municipality as it should be. I just really don't-- I'm not in favor of that.
• [00:11:55.25] So the state-- over the last few years, the state has engaged in several privatization efforts. And one of them was back in '92, the governor issued an order creating the Michigan Public-Private Partnership Commission and charged it with analyzing ways in which state services could be provided more efficiently by introducing competition into the public sector. Competition is a big factor in the whole privatization thing and whether or not the private companies can do the work as well for as reasonable amount of money as, actually, the city can do. And my time is up.
• [00:12:48.26] SUSAN GREENBERG: Excuse me, I'm going to give Mr. Fanta a water.
• [00:12:51.70] ANDY FANTA: Oh wow, thank you.
• [00:12:56.14] SUSAN GREENBERG: Bob? We'll let you go from here.
• [00:12:58.99] BOB GUENZEL: It's great to be here, my name is Bob Guenzel. I know many of you, but I was with Washtenaw County government for 37 years, 22 as the attorney and 15 as county administrator. So I know the community pretty well and I know a bit about contracting. And Lois really described the types of ways that public bodies deal with providing services in different methods. Turning it over to the private sector, contracting out and the like, and she did a good job of mentioning those. I'm the only one on this panel that was an administrator. The rest are elected officials, so I may have a little different view about this.
• [00:13:50.23] But as administrator up until a year and a half ago, the decision about recommendations about delivering of services was a bit of a challenge because there are those of us who absolutely believe in the nobility of public service. And that public bodies can provide those services in the best way possible. As Lois said, it's a matter for me of community and how we deal with our community, and in most instances I would not favor privatization. And we really stress that with our employees, and I think my successor, Verna McDaniel, continues to do that in terms of providing world class service by public officials.
• [00:14:38.25] Having said that, and having said that sometimes privatization seems like failure on the part of public bodies. Having said that, we have an obligation-- and I felt an obligation as county administrator-- to examine all ways of providing of services-- different methods-- and that has to be done because we need to provide these services in the most effective and efficient way. And especially when you're providing human services, for example. If you can save on overhead in direct costs and the like, you have more dollars to deliver direct services and, frankly, in some cases that means saving someone's life.
• [00:15:22.63] So it's incumbent upon an administrator-- a public body-- to examine these opportunities and these alternatives from time to time. It's especially then significant since about 2008, when public bodies in this state have faced financial crisis. And we're better off in Washtenaw County than most places. But with that financial crunch the look at alternative ways of providing those services became even more important.
• [00:15:58.93] But when you think about what are the limitations or the considerations, the first is accountability. A public body cannot give up accountability for those services. If it's contracted out, as long as-- especially for Washtenaw County where about 80% of what we did was mandated-- you can't contract out the ultimate responsibility for those services. And you can put terms and conditions and contracts and the like, but that's difficult.
• [00:16:31.38] As Lois said, there's a very difficult labor issue about jobs for our community and keeping those jobs here. Michigan is still a pretty strong labor state, so if a unit of government is thinking about contracting out, it's a mandatory subject of bargaining with the bargaining unit. Most of our contracts have clauses that say something like, you can't contract out if it results in layoffs of employees. There's ways to get around that, but obviously that's a pretty strong restriction and obviously unions and employees have fairly strong political clout. And I think the city of Ypsilanti, the city of Ann Arbor, and Washtenaw County have a living wage ordinance. So if you're going to save a lot of money by paying people a lot less, you're going to have to face the fact that we have living wage ordinances. So those are just some of the things you think about as administrator and when you recommend budgets and ways of providing services, when you recommend those to the board of commissioners.
• [00:17:47.17] What's been the history in Washtenaw County? Well, for years we've contracted out a lot of services that we don't think twice about. In the human service area we contract with several nonprofit human services, private bodies to provide those services. That's done certainly by the city of Ann Arbor, Washtenaw County. The WCHO, the Watchdog Community Health Organization, which is the organization that deals with substance abuse and mental health. So those have been fairly regular over the years. These nonprofits do duties and responsibilities that the public bodies could do, but it's well accepted because really the provision of human services is a hodgepodge. Some by government, some by the state, some by the county, some by the city, and then the nonprofits.
• [00:18:48.99] At the county level for years we've contracted out janitorial services. It actually goes back to the 1980s when it just made sense to do that, and I think many public bodies do that. We've contracted out-- or contract for towing services in this country through the sheriff. Ambulance services for years upon years rather than providing those services. So some have done pretty well accepted. When I was the county attorney, part of the time I was an independent contractor. So some legal services are certainly contracted out. I think some of those things are much more accepted because the idea is that you may need just professional advice or professional work from time to time in terms of making those provisions.
• [00:19:48.63] But clearly for the county government, which as I say 75% to 80% of what the county does is mandated by the state or the feds, it makes sense, in my opinion, to keep most of that in-house. For example, we have probably the finest public defender system in the state of Michigan, if you know Lloyd Powell and his office. And for years folks have said, well, why don't you contract that out, it would be much cheaper, that's what other counties do. And we have resisted that over the years because we felt that that function was so important it needed to be performed in a professional manner by attorneys who are not necessarily concerned about how quickly they could dispose of cases. Not to criticize other systems, but that's just an example of how you weigh the policy arguments about contracting out.
• [00:20:49.57] And I just say, finally, I think the issue of shared services between public bodies is much more attractive to me. I think that's really where we should be spending our time. The city of Ann Arbor and the county just combined regional dispatch of police that will save hundreds of thousands of dollars and it'll be just as good. We've combined the offices of community development, so those are opportunities that are out there. But I have to say my point is, as a public servant, you can't be blind to alternative ways of providing services. Obviously my preference, I've made clear, is to keep those services in-house. But during budget time, or on a regular basis, I would submit that you need to review how those services are provided. Thanks.
• [00:21:50.24] SUSAN GREENBERG: Thank you. Sabra? Would you like to go next, please?
• [00:21:54.90] SABRA BRIERE: Certainly. I'm Sabra Briere, and unlike Bob, I haven't been in public view for 30 years, but I've certainly been a member of this community for longer than that. I serve on city council in Ann Arbor. And everything that Bob and Lois have outlined is accurate to my knowledge. But I have to tell you when I went to the city and said, talk to me about privatization, I got a little bit of a blank look back because we don't privatize very much.
• [00:22:28.62] When I tried to focus on what I knew, we discussed whether having a contract for somebody to inspect properties was contractual or privatization and how we would define these things. We also talked about the fact that we do hire a janitorial service rather than provide our own. But most of what I learned was about solid waste. And oddly enough, in Ann Arbor that's where all the privatization-- the bulk of the privatization has been focused.
• [00:23:05.42] The city started its first private contract for something to do with solid waste in 1991, and that was contracting with Recycle Ann Arbor for curbside pickup of recyclables. Recycle Ann Arbor had been around since 1977 and it had started doing its own curbside recycling pickup in 1978. But it didn't cover the entire city. It was only when the contract with the city to go to every residence was signed that became part of their responsibility. And periodically the city has put out another RFP, Request For Proposals, and granted the contract to Recycle Ann Arbor. So from the first the focus was on recycling.
• [00:23:58.41] And the second contract that we actually put out was to handle building the Materials Recycling Facility at Ellsworth. Recovery, sorry. Materials Recovery Facility. That contract could have been for us to build it, but we chose to hire an outside source. It doesn't seem like much to do with privatization, but oddly enough it is because normally we would manage such a project ourselves. And in this case we actually had somebody else manage all the aspects because we didn't have the expertise on staff to build a materials recovery facility. That is still in what you'd call recycling.
• [00:24:53.22] We also in 2010 contracted out for running our compost facility. And that was the first time that I actually dealt with this as a member of council. For years we'd done our own composting. Ann Arbor's compost was picked up at your door and while there was a lot of argument over the years about how we were picking it up, when we were picking it up, and how to acquire the compost, we had staff who handled the compost facility. And in 2009 that staff sort of didn't do as good a job as they had in the past.
• [00:25:38.45] Oddly enough they put all the compost on sale and forgot when they had sold it all to take it off sale. They sold it to large contractors all over the state, people who came in with big trucks to get compost. A lot of us think of the compost facility as where our grass clippings go and where we can go get them once they've composted because we don't have space in our own yards to do that composting. But it turns out that it's a big process and that there's a lot of compost. And that at the end of 2008 there was a lot of leftover compost that they hadn't been able to get rid of. So they put it on sale in 2009, it was very inexpensive and they sold it off and they didn't take it off that price.
• [00:26:24.41] And so the next spring in 2010 it was still at the for sale price because the staff failed to pay attention to these little details. And they sold it all in a month. All the compost they had, and those of us who rely on going out to the compost center and picking up our compost suddenly began saying, how come I can't buy any compost? I can't explain that, I can only report it, but I can tell you that one of the things that happened was just about that time we started looking at a contract to privatize composting. Not compost pickup, but composting. And by the summer of 2010 we had a new contract with a private company. And that private company displaced three workers. We did not lay off any workers, we didn't fire any workers, but we moved them out of the compost facility into other parts of the city government.
• [00:27:38.54] Because just as Bob outlined we have union contracts and we are very much discouraged from laying off as a way of dealing with privatizing. It's not that we're paying less money or significantly less money, though we're supposed to experience some cost savings, because we do hold people to them-- our employment practices. One of the things that I had put out at the front-- and I have no idea if anybody picked it up-- was language that is in the city code about how employers or contractors actually have to agree to their hiring practices and to abide by our minimum wage, which our minimum-- living wage says you have to pay this if you give them insurance, and that if you don't and that is more money. So we are told that every person that we have a contract with whether it's a contract to build something, or it's a contract to manage our Materials Recovery Facility, or to manage our composting, pays at least a living wage. I'm not suggesting anybody gets rich on a living wage but it's certainly better than minimum wage.
• [00:29:09.57] It seems to me that the city doesn't have clear cut policies on when we privatize. And I'm talking about taking these services and moving them into the private sector, whether those are nonprofit or for-profit organizations. What we have is master plans that may say something like, we should look into this and then the staff look into whether it will save more money. They'll put out a request for proposals and they'll compare what the private sector can provide in services and costs with what Ann Arbor itself can provide. Ann Arbor has twice, for instance, put out a request for proposals for trash pickup and twice the news has come back that Ann Arbor can pick up your trash less expensively than hiring a private firm to do it, which is why that one component of solid waste has not been privatized. We also pick up the compost at your house, but we pay somebody else to manage the compost facility.
• [00:30:24.02] I have a soft spot in my heart for Recycle Ann Arbor having been a recyclist, as it were, since 1977 when they started their business, but they win their contract because they come in with the best bid. And there's more and more places now recycling and that are challenging the bid. Makes it more interesting, but it's also why we gave Recycle Ann Arbor a 15 year contract in 2010. Because a 15 year contract allowed them not to worry about whether they could put their investment into the city and only to find that it was being withdrawn.
• [00:31:08.89] One of the things that we were told to look at in all of this was what the community impact is. Ann Arbor is not an inexpensive place to live. And it's unfortunately true that far too few of our employees can afford to live here. I wish that weren't so, but we all hear about it. But the impact of not being able to complain when your garbage isn't picked up, or your compost is strewn all over the yard, or even worse your recycling container is dumped by a raccoon and the people who come and pick it up only empty the recycling container, they don't pick up the milk bottles that have fallen out. People in this community expect to be able to say, this wasn't done right. And the answer seems to be if that complaint occurs, I hear it, the staff hears it, and the contractor hears it and it's fixed right away. My time is over.
• [00:32:19.48] SUSAN GREENBERG: Thank you, Sabra, and the next speaker will be Andy Fanta from the Ypsilanti school board.
• [00:32:29.65] ANDY FANTA: Thank you very much, thank the League of Women Voters and the Ann Arbor Public Library staff for hosting this forum. I would like to take a little bit of a different tack and frame the issue of privatization perhaps in a little bit of a different manner. I know Sabra mentioned save more money and it reminds me of a quote of Oliver Wendell Holmes that said, "taxation is the price we pay for civilization." And to me that resonates with me.
• [00:33:13.10] A little miniature biographical departure, I think I became politically aware when I was in third grade and I was sent to the principal's office for some kind of gross classroom disturbance. And so [INAUDIBLE] was sitting behind his desk and he got up and he said, hold out your knuckles, I'm going to hit you with this ruler. And I want you to know that this hurts me more than it hurts you. And I said, well, [INAUDIBLE] then let me hit your knuckles with the ruler. And promptly my phone number was dialed and my mother came to school to pick me up.
• [00:33:55.82] But I became aware of a political world that was out there, and I remember very clearly as a teenager reading the literature-- and I grew up in Ohio reading the literature sponsored by the League of Women Voters and quizzing my parents as to who they would vote for and why and trying to develop a rationale. And I was personally very privileged and very excited when I cast my first vote and I voted all the way down every ballot since then. I came to Ann Arbor in 1970 and moved to Ypsi in 1993.
• [00:34:32.34] Now it seems to me what we're facing about privatization is we're really facing an issue that has sort of been sprung on us and its catapulted to the present level of discussion in a fairly modern sense, probably dating back 12 to 15 years. It's going to increase in velocity and it's going to expand in terms of its focus. What we, it seems to me, have to do is we have to take a technical term-- when you remove a term from common discourse and you make it a technical term then what you're doing is you're sorting out different paradigms, methodologies of approach, opportunity to be heard, minutes taken, all of that kind of thing. What we have to do is we have to take privatization and move it back into the political realm because that's really what we're talking about. In kind of a crude sense we're talking about capitalism eating its entrails. We don't make steel anymore, we import it from Korea or other places and on and on the beat goes.
• [00:35:44.94] We don't know exactly where the IT revolution is going to take us, and I'm not a paranoid person at all, if anything I am very affable, and in my ranking of order of values community comes first even before my family. Because if it were just my family we could be in a shack on a prairie with snow blowing a la the movie Fargo, if any of you saw that movie. There's my family all huddled together, but no community. So it's community and the tendrils that we put out in the community and the reciprocity of the community that is most meaningful to me in terms of my life. But every now and then when you awaken or you daydream and you can sort of see where the headlines are going to take you, privatization leads me to believe that it is a world that I'm not so sure I really want to live in.
• [00:36:45.27] Does it take a wild imagination to imagine Google or its progeny digitizing court records? Removing the employee-- a government employee-- that will take the accuracy and the responsibility for recording transcripts? I don't think that's out of the question, I think those records would be stored in Mumbai. I think there would be all kinds of spin-offs from that-- that given the composition of our Supreme Court might say, well look, this is not a lawsuit against the government, this outfit has a contract, it's a private dispute. I'm sorry that we can't get those records there, but we don't see that there is an issue. Transfer it to the post office. Why shouldn't a combination of UPS and FedEx take over the post office? They could do it efficiently, it would save an enormous amount of money. We're back to the cost savings again.
• [00:37:46.31] So you can pick off areas of the government where but for maybe the lag in technology-- I don't think so, but the lag in marketing the technology is going to make a very persuasive case for privatizing a whole wide range of services. We've seen this in a sense-- and I'm a lawyer, I do a lot of bankruptcy work-- but we've seen this with MERS, the electronic recording thing, in terms of mortgages. MERS doesn't have a title to your property. Probably 40% to 60% of the properties have clouds on their title. And just by being a good citizen and catching a snippet from television or honing in on an article you know what is going on in terms of the mortgage crisis and the robo-signatures, and on and on it goes. And we really haven't sorted that out at all.
• [00:38:46.50] So I see privatization, fair and square, as a political issue. Now I would be the last person here to say I would know what to do politically. But if you don't know what you have to do politically, then it seems to me you have to bring somebody in that can teach you and that can guide you. I'm not sure who that individual would be. I don't know whether we get Congressman Lewis to come up here and say well, share with us your experiences during the civil rights movement, what do you think would be appropriate for us to do here? Congressman Lewis-- and again I'm just using him as a speaking point-- what we're basically worried about is we're worried about our government being hollowed out from the inside. So that when we do go vote we find out we're just voting for people that are there passing some kind of resolution one way or the other, but the total function of government has been taken over by private services.
• [00:39:50.21] And if we probably had this meeting 20 years ago and somebody said, well, you know I think private corporations are going to feed, and clothe, and transport our armed forces when they're engaged in actions abroad, you might have gotten some scoffaws and say, well, that will simply never happen. So we've seen at our most precious reserve for those women and those men that put their lives on the line-- we're seeing a whole array of things being privatized and where the government is pulling back.
• [00:40:26.60] I'm not so sure, coming back to the saving of money, that that has, in effect, saved money in that regard. The Ypsilanti school district is really under siege concerning privatization. They want to privatize everything that they could try to privatize. And the rationale for that is, well, we have to cut costs. Well, if you jump into that, then you're going to react within that framework. And I prefer not to get into that framework but rather by saying, OK Andy, how do we politicize the citizens of Michigan to say it is a good thing to adequately fund public education? And you can go back and look at the commonwealth of Massachusetts, it has the strongest thing in its constitution, you shall educate your children. We are at the next tier down where we have to provide an adequate education. So there's, well, we don't know what that is, it's very elastic.
• [00:41:37.65] But I come back to the core values that make us the community that we are. And I think we have a lot to be proud of in Washtenaw County. As an attorney who files cases, I can tell you that the historical memory of the courthouse has disappeared with recent retirements. What used to take me five minutes to file a case-- actually only two minutes, but the remaining three minutes I was asking about the clerk's family and their kids and whatever. Which is a connection-- a real connection-- in terms of the community be it school, be it the courthouse, be it the post office or whatever, those are the base elements that make us who we are and how we relate to our fellow citizens. So it now takes me 20 minutes to file the case. I mean, it's an insignificant thing except I feel almost a quality of alienation instead of going into my county courthouse, talking to one of the judges secretary, they're now kind of interchangeable parts and you never know who you're going to run into.
• [00:42:52.60] The tip of the iceberg is there, it's discussed in the news, it's not discussed in a holistic fashion. People every now and then talk about toll roads it kind of goes on and on and I'm sure people in the audience are much brighter and could contribute many other examples that come up in the current conversations. So for me the act is an act of, how do we get back to the political realm? My time's up? My time's up. OK. Thank you.
• [00:43:26.76] SABRA BRIERE: You needed a buzzer.
• [00:43:28.69] SUSAN GREENBERG: Yes, we do. Thank you, Andy.
• [00:43:31.55] ANDY FANTA: You're welcome.
• [00:43:32.36] SUSAN GREENBERG: Susan--
• [00:43:33.46] SUSAN BASKETT: Thank you.
• [00:43:34.55] SUSAN GREENBERG: Susan Baskett from the Ann Arbor school board.
• [00:43:37.65] SUSAN BASKETT: Yes, I'm with the Ann Arbor Board of Education. And I have a handout in the back, for those of you who have it it'll be a little easier to follow. I'm going to stick to it. Thank you again to the ladies of the Delta Sigma Theta, the ladies of the League of Women Voters, and, of course, the Ann Arbor District Library. When Susan approached me to speak regarding this topic, I said, well, Susan, I'm not the expert. And I do have a very political bias regarding this, but Susan asked me to, again, stick to what the school has done and possibilities. So I'm going to try to keep my own personal politics out of this and walk you through the assignment that I was given.
• [00:44:19.99] And so the handout starts with the challenge. As my predecessors-- and speaking predecessors here-- have mentioned, we are all being challenged economically. And as Andy has said, the finances, that's a whole another story, but we did not get to this area of privatization lightly, so we are where we are. We look at privatization as just one of many ways of decreasing labor costs and program costs. And something to really keep in mind is the declining funding and the increasing retirement cost-- of which the school districts have nothing to do with, except pay the bill-- that's really where we're forced into. We have wonderful bargaining units who have already sacrificed their wages, but it's that retirement cost that's really got us up against the wall.
• [00:45:11.74] So as I look into this, again, what the district has done. There are 20 million definitions regarding privatization, so I outlined it-- again, it's on the handout-- and I looked at in terms of the impact to the employees, hence the impact to the community and our children. So I start with privatization that basically, as my colleagues have already said, it's transferring ownership and responsibility to a private enterprise, but I look at it-- the impact on the employees is it usually replaces paid employees-- currently paid employees. And then I move down to outsourcing or contractual services and the impact for the employees. These are renewable contracts, often it doesn't replace current employees, but because it's renewable you're always counting on that next contract being renewed and hence, your employment.
• [00:45:59.14] The next one is Design, Build and Operate-- DBO. Again, that's usually-- think of construction, which the school district underwent major construction. That's design, you're paying somebody-- again, usually you don't have that subject matter expert, as we would call it in the private industry-- somebody already on staff, you wouldn't keep an architect normally in the school district, for example. So we did do major contracting. Again, negotiating contracts for design, build and operating the construction there. And that's time limited. Again, we did not have that expertise in-house, however, we did decide-- as I would recommend anyone doing a big project like this-- having a dedicated employee to oversee those contracts. And so we have for a short term somebody to do that.
• [00:46:50.11] The last definition I want to talk about is what I call partnerships. That's where it's mutually beneficial, it's an agreement that may or may not have financial support. But both parties assume a piece of this program, a responsibility for operating a program offering of services. Again, it may be time limited, but it may be continual depending on your relationship, maybe formalized with the contract. But often there's a collaboration again-- a collaboration with your current employees-- and a potential opportunity for assimilating some of that partnership into your current infrastructure. So given those definitions, I have on my second page examples of where we've been. And I've tried to limit these examples to my time on the board, I've been on the board since 2003. In case you all have some questions, I want to be able to talk about it.
• [00:47:41.29] So I've limited it to these programs here. I'll quickly go through them because I'm on a clock here, but, again, you have the handout and so that will help guide if you have any questions. Custodians. Let's talk about the substitute custodians. Oftentimes there are days when we don't have enough custodians to report to work. And in the past we privatized with a service called DLS to provide those substitute custodians. And they've worked with us-- or did work with us for eight years, we just terminated that contract last year.
• [00:48:16.61] The substitute custodians earned what the in-house-- the Ann Arbor public school custodian, regular custodian. So they were contingent, again, they were very sensitive to what was contracted for the full time people. Right now that's $9.06 an hour, OK. And as Sabra spoke to the living wage in Ann Arbor, if the employer's offering health care benefits, it's $13.19 per hour. Did I get that right? I'm sorry, $13 an hour if the employer is not paying for benefits, $11.83 if the employer is offering benefits. So you already see a differential right there.
• [00:49:05.55] The comprehensive school improvement program, again, all that massive construction that was done with the bond and sinking fund from 2004. We did contract the big names there with Granger and Barton Malow that built the skyline, and so you know where we are with that. The next one is substitute teachers starting in 2007 the Professional Educational Services Group hires our substitutes. And that's for most of the districts, I believe all but Saline. So if you want to be a substitute teacher in our district, you go to this outside entity and they handle everything.
• [00:49:43.33] Food services, also in 2007 we turned over our food service employees to Chartwells, who provides our lunch program. It's a private company, and in exchange for this contract every year the district gets a sizable check and we are able to deposit that into our general fund.
• [00:50:01.67] Transportation services, there is a lot of issues regarding that. Three local districts, Ypsilanti, Willow Run, and Ann Arbor agreed to consolidate. Now this may be a different term of privatization, but we decided to consolidate the transportation services basically to protect our current employees, who were the bus drivers. We turned that over to the Washtenaw Intermediate School District. And the thought there was to protect, again, the bus drivers, our current employees, so that they wouldn't lose their retirement program. They still remained state employees and so they could have their retirement pensions. Let me say, it was interesting. We thought we were protecting them, but they have a 40% turnover rate. And so I would question how many of those employees that we were trying to look for are still there. And I can address questions regarding that later.
• [00:50:56.01] Journeyman HVAC. That was contracted out just recently. We hired a company, DM Burr, for 2,000 hours of Journeyman services. Think about big boilers. I'm not technical in that area, but think about the heating and the air conditioning units. That instead of adding to a position to our current bargaining unit, the district decided to enter into what I call a multi-purpose company. If you look into this company, they do everything from soup to nuts. Clerical, school security, janitorial, everything. And this was our first relationship with them regarding the Journeyman.
• [00:51:34.96] U of M parking project at Pioneer, you're probably all aware of that. That we outsourced to a company-- an environmental company-- Great Lakes Environmental. They manage the parking for all the events at Pioneer and we get, again, there is a percentage that we get, they get. So they've been doing that. We have worked with Great Lakes Environmental in the past removing asbestos and stuff like that and somehow they got into parking and we gave them a contract there. The Scarlett-Mitchell, University of Michigan partnership is my favorite. It was presented to us formally in 2010. It's a collaboration-- again, this is one of the partnership definitions-- regarding a mutual learning environment for both our students and the students at the University of Michigan. And I have some real hope for that being a part of us long term.
• [00:52:26.02] Now the future opportunities I've listed here, and there are probably many more. Custodial services. Again, with our full time regular custodial services, they bargained a great-- again, I use that quotation marks-- they gave up a lot. They sacrificed in order to stay as regular employees. But again, there's always that thought that we could look to privatize the whole kit and caboodle. The maintenance, again, we think of plumbing, electrical carpentry, HVAC. Clerical services, again, there's this company called DM Burr that's saying, we're here, we can offer you everything. So your school's secretary may be a contracted employee in the future. Think hall monitors or even security at our school football games, that's a possible area. Child care employees, we do offer before and after school care and so that's another area. As well as human services, our human relations-- HR.
• [00:53:26.15] SABRA BRIERE: Human resources.
• [00:53:27.04] SUSAN BASKETT: Thank you. Human resources. Different companies call it different things. That's a potential area as well. And I don't know if you're aware, there is a bill that's being passed through our legislation to outsource the hiring of teachers. So that's there. Thank you, I'm done. Thank you so much.
• [00:53:47.31] SUSAN GREENBERG: We wish to thank all of the panelists who are here this evening.
• [00:53:52.02] [APPLAUSE]
• [00:53:56.76] And we're going to open up the floor for questions from the audience. It could be directed to a specific person or a general question. And please use the microphone in the central aisle there. Just walk back to the microphone and pose your question, please. Yeah, just go back there.
• [00:54:32.39] SPEAKER 1: Thank you to all the panelists for a very interesting and informative discussion. I learned a lot from hearing you all. I noted that from what each of you said the crisis that precipitated this current move towards privatization in Ann Arbor and Ypsilanti started happening mostly around 2008, 2009, 2010. And that suggests that the economic crisis, the recession had a lot of a role to play, I would imagine. That leads me to think that many of the problems that are being discussed here are actually larger problems beyond this community, and in order address them that would need to be addressed quickly.
• [00:55:18.53] Mention a few things, a huge amount of money-- trillions of money-- are being spent on war. Imagine what would have happened if that money had been invested in communities. The foreclosure crisis was brought about by greed and maybe some would say structural problems within capitalism, so that, again, is something that's worth thinking about. I remember that the honorable school board member from Ypsilanti, whose name I missed, mentioned that we perhaps don't know the answer to this problem and we might have to ask others and he mentioned maybe we should have to ask a congressman. I would like to suggest to you that, no, instead of asking congresspeople maybe we should ask the people on the ground. There are movements going on in this country like Occupy Ann Arbor, Occupy Ypsilanti who are thinking about this problem, maybe they are the people that you need to ask.
• [00:56:07.61] SUSAN GREENBERG: Sir, do you have a specific question?
• [00:56:10.04] SPEAKER 1: No, I do not. I only have a comment to make and I am utilizing this opportunity to register my comment, not to ask any question.
• [00:56:17.69] SUSAN GREENBERG: OK well, thank you very much for your comments. Question?
• [00:56:22.39] SPEAKER 2: Yes, I have comments more than a question. I am a retired corrections officer with the state of Michigan, and I have some knowledge about the privatization of corrections, which is also a movement in America to privatize correctional services. And one example I like to use is in southern Ohio, there was a minimum security prison that was privatized. And what happened is the local community made sure that there were certain guarantees-- the state would guarantee certain things and it would remain a minimum security prison and not become a high level security prison, changing the constituency of the prison and the security threat to the area.
• [00:57:01.01] What happened is a private corporation started bringing in maximum security prisoners, not from Ohio, but from all over the country. Bringing them into this local prison. Several people were murdered, it became a dangerous environment, it created a hazard to the community, resulting in the community had to get together with the prisoners in the prisons in a joint lawsuit to appeal to the courts for redress of a grievance. So things administrators should think about that is how would that change your cost picture if you had to greatly increase your level of police services to back up the institution in the event of difficulty.
• [00:57:40.08] SUSAN GREENBERG: Thank you, sir. Are there questions to be asked of the panelists?
• [00:57:45.90] SPEAKER 2: Actually, I'd like to say one more thing. I'd like to just say as a comment-wise is that I think we need to take a look at the erosion in the middle class, which is what I think privatization is really about. Do we really have an interest in losing our middle class existence?
• [00:57:59.03] SUSAN GREENBERG: Thank you.
• [00:57:59.73] BOB GUENZEL: Susan could I comment on that? I think cheaper is not always better. We know that, but I think your point is when we look at privatization or contracting out we need to look at the full cost of it. And not just what it's going to save in the short run, what are the potential consequences long term risk. Now some of those risks may not come to bear, but I think your example shows that you need to think those things through.
• [00:58:35.55] SABRA BRIERE: And since we're allowing ourselves the luxury of commenting, what happens when you're the person who has to make policy as opposed to the person has to recommend policy, is that you rely on the recommendation of staff or you argue with it. And it's very difficult to get competing accurate information when the staff recommends something. Your gut reaction can be, I think this is a really bad idea. But you have a hard time as a policymaker unless you're as knowledgeable or more knowledgeable than staff to begin to say why it's a bad idea and confront it. The staff, in turn, are trying to please the policymakers, but they can be trying to please policymakers who were making those policies a decade ago because it can take that long for something to reach fruition.
• [00:59:38.83] There's no way for me to suggest that privatization is good. In my view, government is a service organization and service organizations are people heavy. You have to pay the wages, you have to pay the benefits, you have to pay the retirement. And the more you ask of your service organization to give you, the higher the fee for that service organization. And I don't care if that's your gym, or it's your government. You want clean showers, you have to pay somebody to clean them. You want clean swimming pools, you have to pay somebody to clean them. And you want somebody who you know who'll take your case and talk to you about their grandchildren, you have to provide reliable pay. And unfortunately government doesn't pay as well as it used to. There just isn't as much money to go around.
• [01:00:37.30] SUSAN GREENBERG: Other comments from the panelists?
• [01:00:39.15] ANDY FANTA: Just briefly. I go back and try to anchor some things in the great sweep of history and look, let's be honest, since 1980 and the election of Ronald Reagan, which many, many of us, dare I say, with a triple digit IQ tend to scoff at from time to time. But it was as revolutionary in terms of its lasting impact for this country than was the election of FDR.
• [01:01:09.47] Or Abraham Lincoln.
• [01:01:11.47] ANDY FANTA: Or Abraham Lincoln, fine. But what we've had since 1980 has been the steady dissemination of the issue that government is the problem. That government doesn't work. And although, obviously, this crowd is immune to much of that-- and I do know a few friendly faces out there. Nevertheless, it's made its point. And that has set the stage for where we are now talking about these kinds of issues.
• [01:01:48.88] And so I go back to the question by saying, what are our measures? Are we measuring efficiency? Are we measuring output? Are we measuring cost? Are we measuring consumer services or whatever? Those are self-contained issues in a much smaller universe. And I think the dialogue has to be, what is our government going to be? What do we want our government to do for us?
• [01:02:22.00] And I'll go back to the civil rights issue that before we could get the government to take action, a political network, a nexus had to be made that came right down to the moral and ethical fiber of this country. And that was not privatized, that wasn't like, well, we'll give these kids a good education. We'll set up a charter school for these kids. No, no, no. The issue was, you know what? This is a right for all kids to have. And then the government reacted. And some can say it reacted effectively in some areas, and ineffectively in other areas. We know the story of that. So what I'm suggesting right now is privatization is just the tip of the iceberg. And to discuss that in isolation of what surrounds us, what envelops us in our culture is an act of futility, and late night meetings, and pocket calculators running numbers. And it's not an effective way to carry the dialogue forward.
• [01:03:32.54] SUSAN GREENBERG: Thank you. Let us get back to our audience. We have some people who would like to ask questions of the panelists.
• [01:03:40.11] SPEAKER 3: I wanted to ask about Chartwells. I actually come from Arkansas and our university uses Chartwells and I know it's all across the country. And we did this study there, and I found that our sewer was run by this huge, huge company-- 30,000 people-- we didn't even know it. And somehow when you negotiate if you came in under what was needed for your budget, they get to take some money home. Now is that what Chartwells is doing? How do you get that money from Chartwells?
• [01:04:15.51] SUSAN BASKETT: I don't know.
• [01:04:17.26] SPEAKER 3: I think that's a very interesting question.
• [01:04:19.11] SUSAN BASKETT: Yes, it is and we talked about that writing the terms of the contract. I don't want to get into-- I mean, I'll take your question back-- but I don't want to even profess to be the expert. Now, I do have a colleague here, Glenn Nelson, who may be better to address that. But they are a profit making business, let's be very clear about it, OK. Let's not fool ourselves.
• [01:04:42.50] The issue I thought you were going to ask about is evaluation of Chartwells and others, and that's where I'll go back to a little bit of what Sabra said earlier. The evaluation can't come from in-house. I have learned the hard way trying to evaluate contracts that we have put out there and then try to-- the answers you'll get are basically what staff or the company think you want to hear. I really do think it takes a third party to really. Truly evaluate it. But your question then is regarding how do they have the money, if they get to keep money, I'm sure they do. They're for-profit, but I will try to--
• [01:05:23.31] AUDIENCE: [INAUDIBLE]
• [01:05:23.97] SUSAN BASKETT: Yes. Yes. Yes. I hear that.
• [01:05:29.13] SUSAN GREENBERG: OK. We have one other person who-- OK. One other person and then--
• [01:05:37.82] JEANINE DELAY: Jeanine DeLay, I'm from the League of Women Voters. Thank you very much for your informative comments. My question is I believe that government does many things very, very well. And so my question is really devoted to ways in which you can give examples of sharing of government services in the county, in the city and so on. If you could give us more specific examples of the direction of that, because that to me is one way in which we might resolve some of the issue of government not doing some things well and moving toward government doing several things very well. So I'm wondering if you could address the sharing of services.
• [01:06:27.21] SABRA BRIERE: Could I take this one?
• [01:06:28.35] SUSAN GREENBERG: Sure.
• [01:06:29.93] SABRA BRIERE: One of the things Mr. Guenzel mentioned-- he mentioned a couple of things. One, the benefits that we offer in human services, and the other is the shared dispatch for police and all over the-- well, it's a countywide dispatch service. And both of these are shared governmental tasks. They're not Ann Arbor having its own and the county having its own. When you talk about sharing governmental tasks, you actually talk about saving money to do the same thing. But at the same time you're talking about triage. How much are we going to spend on human services? And if that's how much we're going to spend, we can either spend this much money on staff doing parallel jobs or we can reduce the number of staff doing those jobs and spend the money on providing the services.
• [01:07:39.81] The same is true with police dispatch. In Ann Arbor, we're challenged by a budget where looking at it last year we said to each other, we may have to eliminate police officer positions two years running and we've already lost enough police officers that we feel the police department isn't as effective as they want to be or as we need them to be. How do we afford all the police officers we need? How do we rehire people and keep the same services? For us economically the answer was we can consolidate dispatch.
• [01:08:19.79] ANDY FANTA: I could take a strand from what you just said. I don't know the answer to those things, but I know if we all got in our automobiles and drove to Detroit on-- took the scenic route-- Interstate 94. We would probably go through, I think it's 15 separate political subdivisions. Because you go through Ypsi, Ypsi Township, Van Buren Township, Belleville, Romulus, and on and on it goes to Melvindale, Allen Park, whatever, Dearborn, Dearborn Heights.
• [01:08:51.08] So I live in a section of the county where Ypsilanti Township and the city of Ypsi can't seem to get together. Our number one fire station in the city is right there on Michigan Avenue, and I was talking to Fire Chief Johnny Ichesco and I said, where are your-- he said, 85% of our runs are into Pittsfield Township or Ypsi Township. So the trucks go out and they had west on Michigan Avenue. And I think there's a lot that can be done there.
• [01:09:26.08] I don't think Ann Arbor needs three district court judges. I'm speaking to you as an attorney, they haven't since I arrived here in 1970. What we do need in our county is for a flexible, mobile judiciary. A circuit court. You know where the derivation of the word "circuit" is-- northern counties. The circuit court judge will hold court in three or four counties because of a lack of population base. So I think there's an integration of services there. Now my marker point on that is-- and I think that should be encouraged, very definitely. My marker point is where you cease to have a community contact as a result of consolidating those services. Because then that chips away at who we all are in our community.
• [01:10:22.71] My second oldest daughter lives in Boston. I go up there, I drive around. I love the town and I'm riding with her one day and I said, hey, I said, every time we go down a street and there's a hole and somebody's digging there's a cop there. And it's exactly true. Boston police officers have good taste, he's usually holding a Starbucks. And she said, that's just something that is there in terms of the union contract. And Boston is a very expensive city, but any time there's any kind of a construction there's a police officer there. And it doesn't have to be going on, it would mean when we exited this lovely building and walked across the street to the parking lot there would be a cruiser there with a blue light going on. Because it's a hole in the street or whatever the status of it is I'm unsure of. So I think there's a lot of stuff that we can do there that just makes an enormous amount of sense.
• [01:11:23.30] I think where we've dropped the ball in my realm of public service, education, and as a school board member-- I am simply aghast when I go to my school board meetings and I find out we're hiring somebody to come in and provide curriculum services. Or we're hiring somebody to come in and do that. And I go back and talk to my wife, who is a mathematician, and I say, I don't understand this. Isn't this something the director of curriculum should be doing? And you start multiplying that out and that's an aspect of privatization we haven't discussed, which is us as public bodies in a sense not doing our job and fobbing it off to somebody.
• [01:12:10.90] SUSAN GREENBERG: OK, let us entertain some more questions, please.
• [01:12:15.78] SUSAN BASKETT: Susan, can I get into real quickly an answer to that, because she wanted to know what seems to be working and-- real quickly.
• [01:12:22.83] SUSAN GREENBERG: Quickly
• [01:12:23.39] SUSAN BASKETT: Real quickly. I think the substitute teacher company, PESG, does seem to be working as I talk to my fellow board members. And, real quickly, a board member from Willow Run said, it's easier for us to get substitutes now. Because when our HR person called and said, do you want to substitute in Ann Arbor, or Ypsilanti, or Willow Run, it's like, eh, I'll wait and see if Ann Arbor calls. Because, I mean, they choose and so that seems to be working. Andy agrees.
• [01:12:53.38] Real quickly, the International Baccalaureate school that we have, that seems to be working very well. Where we have seats at this wonderful school that offers this very prestigious, very rigorous program and school districts from around the county can come and so that seems to be working as far as services. There's still opportunity, and I'll pause and tell you where I think there's more opportunity for shared services.
• [01:13:14.85] SUSAN GREENBERG: OK, we have--
• [01:13:15.97] LOIS RICHARDSON: Let me, Susan, if I may.
• [01:13:17.61] SUSAN GREENBERG: Oh, sure.
• [01:13:18.39] LOIS RICHARDSON: Ypsilanti has been working on sharing services for a number of years. Back in the early 2000s we began to cut back on some things, but we also began to reach out to share. And we do have a reciprocal agreement with the fire departments around our area so that it's almost like whoever's the closest to the fire will respond. We also have worked closely with-- and shared some services with-- Eastern Michigan University. We do not share as many now as we did when President Kilpatrick was there, he was the one that initiated the Town and Gown and the working together. And we shared many services then, and it was really working well. But there are some purchase agreements that we make with Eastern, which works very well and is a cost saving measure for us.
• [01:14:22.99] SUSAN GREENBERG: Thank you. We have-- yes, you may go ahead and ask your question.
• [01:14:27.43] SPEAKER 4: Thank you, I'd like to thank you for your comments, also. I wanted to respond to Chartwell. I just retired from teaching in Ann Arbor in June. I can tell you about Chartwell. Chartwell came in, displaced the cafeteria people we had, the food service people. Wonderful people, lived in the community, dedicated to the job, loved the kids. Chartwell came in, hired people who didn't know what they were doing, didn't last long. We were constantly getting different people to come in to serve lunches.
• [01:15:09.44] When kids bought lunches and didn't pay for the lunches, we were told as teachers to collect the money, call the parents, try to get the money from the parents so that bill could be paid. And if the deal didn't get paid for those kids, it came from the school's budget. It came from the school's budget. So when Chartwell gave their report to the school board, I guess they came out looking good. But we in the schools were the ones trying to collect the money, and some of us paid the money for children whose parents couldn't pay for their lunches. But we wanted the children to have a decent lunch. And we didn't want the children to feel badly because they couldn't have the lunch that was being served or they had to have some other cheese sandwich while everyone else was eating a hot lunch.
• [01:16:13.33] So these kinds of things did go on with Chartwell. Whale For the custodians, that was a mess. Complete mess. When you privatize you are saying to the citizens who live in the community, we do not value you. We are all about the money, not about the people. So those people who come in, they come in and have to do the job. People who loved the kids, talk to the kids, these are people that they see, they live in their communities. They do the job.
• [01:16:59.45] Let's talk about substitute teachers. We have written up quite a few of them. I have to have all kind of certification to walk into the classroom. You have to know whether or not I'm highly qualified to teach your kid. These subs that come in there, all they have to do is have put in 90 hours somewhere and they're in there teaching your kids. We have written these people up. And said, I not going to send these people back here anymore. You need to know who's standing in front of your kids when the regular teacher is not there. You would be surprised.
• [01:17:38.87] SUSAN GREENBERG: Ma'am?
• [01:17:39.24] SPEAKER 4: You would be surprised. Here's my question and my comment.
• [01:17:42.14] [LAUGHTER]
• [01:17:43.61] I can talk about it some more. What is the impact of Proposal A? What has been the impact of Proposal A on you?
• [01:17:50.74] SUSAN GREENBERG: OK, thank you.
• [01:17:52.41] SUSAN BASKETT: I don't know if we have enough time.
• [01:17:53.78] [LAUGHTER] Briefly, is Proposal A a school proposal?
• [01:18:00.39] SUSAN BASKETT: Go ahead, Andy, say the--
• [01:18:01.51] ANDY FANTA: I was just going to say, disaster, one word.
• [01:18:04.04] SUSAN GREENBERG: OK, that's fine.
• [01:18:05.41] ANDY FANTA: Disaster.
• [01:18:05.82] SUSAN GREENBERG: Good answer. Susan, do--
• [01:18:08.10] SUSAN BASKETT: No, I would ditto that. I mean, there really isn't enough time to really get into all of the details, but it's leaving us short.
• [01:18:13.86] SUSAN GREENBERG: Well, we may have to have another discussion somewhere along the line. I know we have--
• [01:18:18.97] ANDY FANTA: In a word what it's done is it's prohibited us-- the good citizens of Ypsi cannot raise money to support their schools. So our hands are tied. I am not an ancient board member, but I've been on the board since 1998. When I assumed my seat in 1998 our share of the retirement costs were under 5%. It looks like this next year it's going to be maybe-- this is talk-- going as high as 37% So that is a cost we have no control over. No control. And the citizens of Ypsi, if they could vote to pay that additional cost as well as-- they would. They've always supported us. But there's just no way we can do it.
• [01:19:11.91] SUSAN GREENBERG: Thank you. I know we have a question.
• [01:19:14.49] GLENN NELSON: I'm Glenn Nelson, a colleague of Susan's on the board, struggling with issues. As Susan very accurately pointed out, the unfunded liability of public pension funds, in our case the school fund, is an enormous problem. That rate is very high and it's going up very fast. That's because the state is choosing to handle the unfunded liability caused by past generations to have current employees pay up. So my comment is I think the League of Women Voters in dealing with this issue is going to probably have to get into, so how should we deal with the unfunded liabilities of public pension funds? My question to the panel is, what do you want the League of Women Voters to say about that?
• [01:20:15.08] SUSAN GREENBERG: I don't know if we have enough time.
• [01:20:17.10] [LAUGHTER]
• [01:20:19.96] To get these answers and perhaps they could be written out for us. I think we have five minutes left before we must leave or start to close up. One more question. Sir, are you in line to ask a question?
• [01:20:40.55] SPEAKER 5: I want to ask a question.
• [01:20:42.01] SUSAN GREENBERG: OK.
• [01:20:44.58] SPEAKER 5: You was talking about attorney for Washtenaw County?
• [01:20:49.79] BOB GUENZEL: Yes, yes.
• [01:20:51.05] SPEAKER 5: I want to ask you a question. If you're being an attorney for Washtenaw County, do you all look over the contract of these contractors who handle the contract and employees in Washtenaw County? Or do you all have any legal procedures when these people doesn't do their jobs? Like say, they got the contract. And if they supposed to be earning those contracts--
• [01:21:18.96] BOB GUENZEL: Absolutely.
• [01:21:19.74] SPEAKER 5: And if they doesn't honor the contract, you go through the procedures and if they doesn't want to honor that contract and the employee and the contractor get together, and you got to take them to court. Sometimes the employee got to take them to court because they don't have no other alternative to go too. I wanted to, since you said you was a Washtenaw County attorney, I wanted to ask you a question. Because stuff like this is like-- I was going through some things like that and then what was really shocking was everybody just talking about the problem with the government.
• [01:21:59.49] I was surprised when the University voted with the affirmative action. We had some stable things going where you felt like you had a chance to your rights-- your constitutional rights. But when the University did that thing with affirmative action, I think it really hurt the whole of Michigan. It just rippled. And far as the foundation of the contractors and stuff like that-- in Michigan when that happened I was at work at the University and the contractor didn't care. They did what they wanted to do. And I'm not trying to talk about anybody, but the idea is we talking about all this other stuff. But look what happened right here in Washtenaw County.
• [01:22:55.18] SUSAN GREENBERG: Sir, do you have a specific question?
• [01:22:57.74] SPEAKER 5: Yeah, my specific question is who controls the contractor and what is the fundamentals that they have to represent when they don't follow that contract?
• [01:23:16.68] BOB GUENZEL: And I think I can speak for the entire panel, I think all of our governmental units have the type of administrators and attorneys that will make sure the contracts are as tight as they can be, and they call for termination. Again, your point's well taken, that's not always easy or quick to do. And it's tough sometimes to terminate a contract and have to turn around and rebid it. But I think if you do an RFP, and you make the contract as tight as possible you're doing the best you can. That doesn't solve attitude problems, other issues that come up that are much more, in my mind, about soft skills and how you treat folks. But I think we know how to make the contracts as tight as they are, whether that will--
• [01:24:07.05] SPEAKER 5: It's not the contract being tight, it's the people that doesn't want to honor the contract.
• [01:24:12.94] SUSAN GREENBERG: Well, I think-- sir, just a moment, please. We really do have to vacate this room very shortly. So perhaps you could find somebody to talk with right outside when--
• [01:24:26.29] SPEAKER 5: I'd like to talk to him.
• [01:24:26.79] SUSAN GREENBERG: OK. I really wish to thank the panelists for being with us tonight.
• [01:24:32.15] [APPLAUSE]
• [01:24:37.23] And thank you all for coming. I think it's wonderful being hosted by the Ann Arbor District Library. Thank you again.