At Monday night’s council meeting, we saw first hand a consequence of the Teapublican Caucus’s1 obstructionism. It was time to face the music and pay the piper2. This is what the take home message from the October 21, 2013 Ann Arbor City Council meeting was. It is the perfect term for what had occurred. Here is the definition:
Pay the piper 2– to bear the unfavorable consequences of one’s action.
City staff was asking for approval of $280k that will be needed to replace the rusted out light poles on Main Street. The poles are rotting from the inside out and two have previously toppled over from storm winds.3 Back in May during city budget negotiations, a compromise was reached at council that asked the DDA to re-budget a portion of the TIF funds they had planned to use for replacement light poles and directed those fund be placed into the housing fund.
However, the Teapublican Caucus1 decided to “pretend” that they knew nothing of the forced arrangement that they imposed upon the Downtown Development Authority (DDA). They criticized the DDA for not doing its job. The feigned outrage over the DDA not paying for the badly, needed light poles on Main Street displays the true character of these Teapublican councilmembers. It was like they were auditioning for Fox news. Ultimately, the vote for the approval for the funding failed. The end result being that we won’t be replacing the light polls on Main Street. You might need to duck and cover when walking downtown in a wind storm.
For some additional background information about the DDA and the importance of TIF and the proposed ordinance revisions, please see my previous post “The Tiff over TIF” (Tax Increment Financing).
To completely understand what went on here, we must start at the beginning. I know it is long, but bear with me and try and follow the time line. In isolation, each event might not seem so manipulative, but altogether you see the trend.
Lets start at the beginning, back in March 2013. Only then will you see the pattern that shows the Teapublicans true intent of destroying our DDA. You will also see how often they were warned about the consequences that would occur from not only the Mayor and the DDA, but also the public.
March 18, 2013 4,5
At the March 18 council meeting, Kunselman proposed the idea about reforming the DDA. He wanted to refund a large portion of the DDA TIF revenue to the City of Ann Arbor as well as to the other contributing tax entities. All of this was proposed under the guise of fiscal management.
Kunselman said, “And as we go through the effort, the DDA’s budget is to remain whole is my intent,” he added. “We’re not trying to hamstring the DDA’s ability to pay their bills.”
Hieftje warned back in March, “My concerns about this aren’t the financial impact to the DDA,” he said. “Its more the financial impact to the city’s general fund, which I believe could be negative were we to take this action.
Kunselman did not care that the city general fund would now have to bear the cost of whatever projects the DDA could no longer afford. He was well aware that any action could have an effect on the city’s general fund. There was some discussion, but action was postponed.
April 1, 2013 6
At the April 1 council meeting, the issue of reforming the DDA TIF revenue was discussed more in-depth. The Mayor and DDA Director Susan Pollay said in no uncertain terms that if the TIF money was refunded, that the DDA might not be able to afford all the projects that it wants to fund or is planning to fund. If the DDA does not fund certain necessary projects, then the city will have to fund them from its general fund. The streetlights actually came up at this meeting as an example of just such an expense. The DDA is planning to fund the full replacement cost for these replacement light poles. If the TIF money was refunded to the other tax entities because of the ordinance revisions, the DDA might not be able to do that project. Other examples were also given at this time such as the DDA grant for the police/courts building; the DDA might not be able to afford the continuation of the grant to the city.
Hieftje said, “I’m not sure why we started down this road other than for political reasons,” Hieftje said, calling the proposed ordinance changes “ill-considered” and suggesting they could deal at least a $231,000 blow to the city’s general fund, which pays for police and fire protection. (This was another warning about an effect on the general fund.)
Kunselman just considered any argument in favor of the DDA as a threat. He was hell bent on taking money from the DDA, no matter the consequence. The city ordinance changes passed on first reading by a vote of 7-3.
April 5, 20137
On Friday, April 5 there was an article in the Ann Arbor News that questioned the Teapublican group’s intent. Kunselman’s motivations are called into action. Some councilmembers are wondering why he is proposing this at all; it is not good for the DDA and won’t be good for the city’s general fund.
I believe that it has to do with political ideology, and his hatred for the Mayor and the DDA. See my previous post “The Tiff over TIF” (Tax Increment Financing) for more on this.
April 15, 2013 8,9
A pre-meeting report in the Ann Arbor news, reports on the many supporters of the DDA. The Ann Arbor/Ypsilanti Regional Chamber as well as six other groups sent a joint letter to the City Council, urging council members to vote against placing new restrictions on the DDA. Kunselman and Kailasapathy lead the charge to limit the DDA and take nearly $1 million in tax revenues away next year alone because they believe they are undeserving of an increase in their budget.
One of the best quotes in this news article was from Rene Greff which sums up many of the supporters’ viewpoint:
Rene Greff, co-owner of Arbor Brewing Co. in downtown Ann Arbor, also entered the debate over the DDA this past weekend, sending a lengthy email to council members. Greff, a former DDA board member, argued the TIF funding mechanism is a “very good deal” for the city — and any attempt to limit it is at best “ill-informed and short-sighted,” and at worst “self-serving and reckless.”
“I have to say that I have seen a lot of ugly and petty politics (along with a lot of careful consideration and political courage) over the past decade and a half that I have followed council, but Councilman Kunselman’s most recent move to curry political favor by attacking the DDA may be the worst yet.”
“It would be bad enough if this transparent power-play were just ill-conceived and self-serving, but the fact that it also does economic damage to the city makes it completely unconscionable.”
At the council meeting that night, the public showed up in mass. There was a 3-hour public hearing on the issue about reforming the DDA. The public spoke to many issues that they felt would be cut if the TIF money was refunded. Light poles were brought up in public commentary by some speakers, but the predominate issue was clearly affordable housing. The meeting went until 3am with no final action taken. The meeting agenda was adjourned until the May 6, 2013 meeting.
May 6, 2013 10
This is a continuation of the April 15 agenda. This is where Kunselman tried to appease all the affordable housing folks by stating at the beginning of the meeting that he was pursuing a change to his DDA ordinance proposal. Now he wants to include public housing trust funds as a recipient of the reimbursement from the cut to the DDA’s TIF funds.
(I am not sure if that is even possible or legal, but I can’t say for sure. His original proposal was to refund some TIF money that was captured from the other tax entities. So how can you then give part of the refund to a group that was not an initial contributor? I must be missing something.)
Obviously this is a response to all the people who came out at the previous meeting complaining that if you restrict the DDA’s TIF revenue, then the DDA won’t be able to give to the Ann Arbor housing fund. The DDA has been generous over the years with grants and such for affordable housing.
Due to the heavy agenda the discussion regarding the DDA ordinance changes in regards to the TIF reimbursement was postponed until September so that questions could be answered before continued discussion.
May 20, 201311
Now it is city budget time. The council has to approve their budget for the next fiscal year. In doing that they need to approve the DDA budget, which included an extra $550k-$600K to be budgeted. The DDA had previously held a special meeting to decide how to spend this extra $550-600k and came up with a plan. During the budget meetings they informed the council on what they would like to spend the funds on. I will tell much of this story through the use of short video clips.
(The following videos will include the counter underneath the video so that you can go back to the original video and play any context surrounding the video. I will also include the length of the video so that you can see if you have time to watch it through. Here is the link to the video that covers the entire council meeting.)
Here is the video of Susan Pollay, Director of the DDA, explaining what the DDA considered to fund. She says that the DDA’s plan is based on the council priorities with the most immediate in need being the light poles followed by affordable housing and economic development. Extra dollars would be spent on those priorities. (~2 minutes)
The Teapublicans led by Kunselman were insisting on revising the proposed DDA budget and wanted them to allot the entire $550k-$600k to the DDA housing fund. They did not appear to care about the urgent need to fix the light poles even though it was repeated multiple times during this meeting and at previous meetings.
Here is where it gets very interesting. Watch this video to see the Mayor ask Craig Hupey, Public Services Administrator for the City of Ann Arbor, if the DDA does not pay for the light poles then would the cost fall on the general fund? Mr. Hupy says, yes, that light poles are a general fund expense. Towards the end of the video you hear Kunselman ask if the light poles are in the (DDA) capital plan (budgeted) and Mr. Hupy says no they are not. (~2 minutes)
Kunselman and all the other council members KNEW that the light poles were not budgeted and had no funding other than the amount the DDA proposed to use from the extra $550k. They knew that the light poles were an urgent need.
Discussion continues with Kunselman and the other Teapublican councilmembers pushing for the entire extra $550k-$600k in the DDA budget to go towards the DDA housing fund. CM Higgins and Mayor Hieftje, both brought up the fact that it made more sense, “ that is was actually more honest”, to have the DDA pay 100 % for the light poles and have the city put some general fund money into the city’s affordable housing fund if that council priority was imperative. However, the Teapublicans would not support that. (Why is beyond logic to me)
Sensing that there would never be an end to the discussion, Mayor Hieftje then lays out a compromise. He wants to get the lights fixed. He suggests that the DDA contribute 300k for the replacement light poles with the city having to use general fund money to pay for the remaining light poles and 300k into the DDA housing fund. (Yes, 300+300 does not equal $550. There was discussion about the DDA using some other inconsequential monies that I won’t describe here) The Teapublican Caucus finally agreed. Watch Hieftje explain the compromise here: (<3 minutes)
Now, I remember this meeting distinctively because I thought this was unbelievably ridiculous. I thought it made much more sense to have the DDA pay for the light poles because light poles are downtown infrastructure that is unarguably under the DDA’s purview. I even mentioned this scenario regarding the general fund being used to pay for the light poles in a footnote in the post “The Tiff over TIF” (Tax Increment Financing). Kunselman and the Teapublican Caucus were steadfast in destroying the DDA anyway they could. They wanted their DDA ordinance changes (that were postponed until September) to pass without upsetting the affordable housing crowd. They made this compromise thinking they would appease the loudest group that was criticizing them for these changes. They did not even care that the general fund will most likely be used to cover the additional funds for the light poles. I thought it could not get more ridiculous than this.
Until………the October 21 City Council meeting.
October 21, 2013 12
Staff is now asking the council to approve the remaining $280k for the replacement light poles. The light poles were estimated to be ~$580, the DDA was told to budget only $300K even though they wanted to budget all $580K.
This is where the Teapublican Caucus showed their conformity to their Teaparty friends in Washington DC. They refused to acknowledge that the compromise and vote taken in May actually happened the way it did. Kunselman actually claimed that the discussion in May had to do with what to do with “new money” and that the light poles were already budgeted somewhere else. In other words…. HE LIED! He knew the DDA had not officially budgeted for the light pole replacement costs; they had just estimated their cost and had discussions about the funding sources as shown in the videos form the May 20, 2913 meeting videos above. Watch Kunselman try and spin his lack of support for the light poles here: (~2 minutes)
Cm Kailasapathy, Anglin and Peterson, all gave equally as ridiculous comments about how the DDA should be covering the costs and how dare they not! Kailasapathy actually said that the grant that the DDA gave to the County for their county building should have been used for light poles instead.
Eh…Cm Kailasapathy you forget, the county also contributes to TIF and therefore can be the recipient of the funds for a downtown use. How was the DDA supposed to know that you had no integrity and would renege on the deal you forced them into?
The Teapublicans “pretended” that none of it happened before. Too bad that videotape exists. I bet one of the Teapublicans will now move to defund CTN so that no visual record of their unethical lying can exist.
CMs Warpehowski, Taylor, Briere and Mayor Hieftje all respectfully corrected the record and stated as a matter of fact that the council agreed to cover the additional expense for the light poles and that council did this to themselves. Watch some of their statements here: (range from 1-3 minutes per video)
CM Warpehowski and Mayor Hieftje
(I do not know why this video is larger. It is not intentional. I am still looking into how to adjust it)
“This is the first hard cost of the pursuit of the DDA. This is the first hard cost that we are going to incur from the unwise practice of…. starving or interfering with the DDA …..A tangible cost to our bottom line. A $25 million dollar self-inflicted wound. And if we continue down this path, in the upcoming weeks and months, simple math, and our great known, and as these streetlights demonstrate, unknown needs for improved infrastructure downtown and economic development, make it certain that these hard cost to our bottom line will be the first of many.” – CM Taylor
Cm Briere said “ This is an issue of –we did this to ourselves. We walked into the discussion on the DDA budget and told them how to spend their money, and they, in return, did. (no video)
The motion to approve the funding for the replacement of the rusted out streetlights failed, 7-4, with Kunselman, Kailasapathy, Anglin and Peterson voting against it. Although Lumm did vote for the motion to fund the light poles, it was obviously a political vote only, because of her staunch stance back in May. Knowing that the motion needed 8 votes to pass she was able to vote for it while comfortably knowing that it would fail. She has an election in a couple weeks and can’t be seen voting against an infrastructure project so dire as the light poles. That could make her too Tea Party Like.
What this really shows
I was appalled at the behavior at the table in all of these meetings. Kunselman, Kailasapathy, Anglin, Peterson and Lumm showed no integrity and a lack of ethics that was unconscionable. They showed a blatant disregard for their elected duty in order to push through their agenda of eventually dissolving the DDA. The Teapublican Councilmembers believe that all that matters is winning the battle regardless of the consequence. The congressional Republican’s think that closing down the governement is ok in order to try and defund Obamacare. Our local Teapublicans think it’s ok to allow light poles to fall down on Main Street in order to try and defund the DDA. (They want the public to think that the DDA is not doing their job, when the exact opposite is true. The Teapublicans intentionally prevented the DDA from doing their job).
Kunselman said in the Ann Arbor new coverage of the May 20, 2013 meeting that, “Politics is the art of compromise”. 10 Obviously, not for them. When it is time to pay the piper1, they just refuse to admit there was any deal or compromise.
They don’t care about the health, safety and welfare of city residents. If they did, they wouldn’t refuse to fund the light poles that they intentionally forced the DDA to defund.
They don’t care about affordable housing. If they did they would have had the DDA pay for the light poles and the general fund donate to the affordable housing fund.
The Teapublican Caucus is in fact a Pied Piper12 itself, leading the residents into doom based on their ridiculous grudge against the DDA. They are trying to fool the residents of Ann Arbor into thinking that they have their best interest in mind, when obviously they don’t. They disguise their efforts to reform the DDA as fiscal management and that they want to control DDA spending, but their vote against the light poles makes their true motive transparent. So transparent that you should be able to see it in the dim lights along Main Street after some of the poles fall down and aren’t replaced.
Votes have consequences….at the council table and in elections.
We the residents of Ann Arbor need to pay more attention to who we vote for. We have an election coming up November 5. Make sure you vote for a candidate that cares about your health, safety and welfare.
1 The Ann Arbor City Council Teapublican Caucus is made up the following councilmemebrs: Mike Anglin, Stephen Kunselman, Sumi Kailasapathy, Jane Lumm, and Sally Peterson. (Based on his campaign platform and rhetoric, I assume Jack Eaton will be welcomed into this group once he takes office in November.)
2 Pay the piper – to bear the unfavorable consequences of one’s action
3Ryan Stanton, “Light poles on Ann Arbor’s iconic Main Street rusting from the inside out”, Ann Arbor News, July 7, 2013.
4 Ryan Stanton, “Tax-dollar tug of war: Proposed city ordinance changes would place new limits on Ann Arbor DDA”, Ann Arbor News, March 18, 2013.
5 Ryan Stanton, “Proposal to place new limits on Ann Arbor DDA postponed until April”, Ann Arbor News, March 19. 2013.
6 Ryan Stanton, “Ann Arbor mayor claims DDA ordinance changes could deal $231K blow to city’s general fund”, Ann Arbor News, April 2, 2013.
7 Ryan Stanton, “All about politics? Ann Arbor council member’s motivations called into question”, Ann Arbor News, April 5, 2013.
8 Ryan Stanton, “Debate continues as City Council prepares to take final vote on Ann Arbor DDA ordinance changes”, Ann Arbor News, April 15, 2013.
9 Ryan Stanton, “8-hour Ann Arbor council meeting ends with no action on DDA changes or high-rise project”, Ann Arbor News, April 16, 2013.
10 Ryan Stanton, “Action on proposed changes to Ann Arbor DDA pushed to September”, Ann Arbor News, Mat 7, 2013.
11 Ryan Stanton, “Ann Arbor City Council approves 2013-14 budget without increase in police staffing”, Ann Arbor News, May 21, 2013.
12 Ryan Stanton, “Main Street light pole replacements fail to win support from City Council”, Ann Arbor News, Oct 22, 2013.
13 Pied piper – a leader who entices people to follow (especially to their doom) One, such as a leader, who makes irresponsible promises.