Wednesday, March 16, 2011
Michigan Emergency Financial Managers
Emergency financial managers in Michigan are at work in Benton Harbor, Detroit Public Schools, Ecorse and Pontiac. The people are Robert Bobbs, EFM Detroit Public Schools (although his current appointment was to end February 28, 2011), Michael Stampfler in Pontiac, Joyce Parker in Ecorse, Joseph Harris in Benton Harbor. It's intriguing that EFM Joe Harris' previous job was as CFO and Auditor General, City of Detroit. An Analysis of Emergency Conditions by Eric Scorsone in 2010 discusses the previous public act that allowed EFMs to be appointed. The EFM does not have to be from, or live in, the jurisdiction and serves at the pleasure of the Local Emergency Assistance Loan Board (Michigan legislature). House bills 4214-4218 and 4246, approved in February, and this month's approval of MI Senate 153 expands the power of the EFM, as noted in the article regarding Robert Bobbs' proposal to turn 41 Detroit public schools into charter schools. He has not met his previously mandated goal to reduce the deficit as financial manager, yet with the new law he will also be empowered to make academic decisions. Here is the Benton Harbor 2010 Financial Plan. The City of Pontiac Amended Financial Plan is here. Both of these plans include laying off police and fire, and in Pontiac, to contract with the Oakland County Sheriff's Department for public safety. The Pontiac Police Department voted to dissolve their union contract, and within hours, Police Chief Val Gross, a 29 year veteran, was fired by Michael Stampfler. The Benton Harbor plan proposes eliminating 911 service, and privatizing the water department. I need to look for evidence that privatizing anything works to reduce costs. These cities are operating deficits, not solely due to lousy accounting practices, but because the money going out exceeds the money coming in. Property taxes in arrears won't be collected by knocking down houses, building new housing, outsourcing public safety, and tidying up the backoffice. We can all agree that cities are in serious trouble. So is the economy of the country. Layoffs won't fix the mess. Public works initiatives won't nudge the bottom line into the black. We need bigger thinkers. As Einstein said, "You cannot solve a problem from the same consciousness that created it. You must learn to see the world anew." Where's the new thinking here?