Social Media, Social Capital

Is the internet good for society? For those of us who work to build up a particular place, should we be online or on the streets? Owosso has a new online social network designed to specifically strengthen community, and it seems off to a promising start.

Social Capital. Owosso, like most small towns, works as a community because of the many personal connections and relationships that underlie almost any business, governmental, or nonprofit endeavor. Things happen because people trust one another, or at least they know one another, and thus they know who to call on when they want to get something done. This basic aspect of community has been called "social capital." And just as a place can be evaluated by its economic capital (i.e. monetary wealth) and physical capital (i.e. buildings and infrastructure), we can measure the health of a community by the number and strength of personal connections that exist.

Historically, Owosso's social capital was built almost exclusively on personal encounters that occurred in coffee shops, on downtown sidewalks, and across backyard fences. Read Thomas Mallon's excellent novel "Dewey Defeats Truman," set in Owosso in 1948, to get a feel for how the casual gatherings in peoples homes, face-to-face business transactions, and political rallies in front of City Hall all helped citizens make new connections or deepen existing relationships. Today, we still run into one another in the supermarket parking lot, but people seem so busy and self-absorbed that sometimes weeks go by before I run into certain colleagues or friends.

Electronic Media: Good or Bad? Is the celphone, email, and the World Wide Web to blame for us being isolated from one another? Robert Putnam wrote a book called "Bowling Alone: The Collapse and Revival of American Community" that noted the decline in social capital. The title comes from the odd statistical fact that the number of people who go bowling has increased over the last several decades, but the number of people who bowl in leagues has declined. His book recounts how the number of, and participation in, service clubs, organized social functions, and civic events have decreased. Our social capital seems to be eroding.

Among several causes he identifies, one is the rise in electronic communication avenues. He writes, "No sector of American society will have more influence on the future state of our social capital than the electronic mass media and especially the internet." He is not alone in decrying the potential isolating forces of the personal computer. We have a vision of the reclusive geek surfing, alone, through the waves of information and images provided by the internet. Of course, it does put limitless knowledge and worldwide connections on our desktop and now on our smartphones. But, as we participate in chat rooms about our favorite TV shows (or whatever), or conduct business in Asia (or wherever), are we losing connection with our neighbors? Do we know more about what is going on with Grammy Awards (the #1 trending issue on Twitter as I write) than we do with our own community?

CommonPlace. A new effort to use the internet to help people in a place-based community connect with one another has been started by some socially-minded entrepreneurs. Called CommonPlace (you can find our local version at www.ourcommonplace.com/OwossoCorunna), this initiative is now underway in several communities in the US to provide an internet tool for local residents and organizations to share information. Interactions include postings about lost dogs, parade announcements, new business openings, and formation of a community flute choir. Participants have used the service to find someone to practice sign language with, get rid of old equipment, and raise donations for a food pantry.

The idea is to replicate online the social sharing that occurs person-to-person in a community where people see one another regularly. "CommonPlace is designed to encourage users to engage with their neighbors," says organizer Heather Rivard, an Owosso native who returned home after graduating from college and took on the job of initiating this service. CommonPlace financially supported her work along with that of another community organizer. They have in 10 weeks worked signed up more than 900 participants.

Avoiding the Flames. CommonPlace is not unlike other social networks such as Facebook, the comment section of the online newspaper, or email services in that it provides a forum for sharing of information and events. However, it has avoided the negative comments, personal attacks, and rumor-mongering that sometimes dominates online systems. A positive tone has been maintained due to monitoring of posts, the clear delineation of the various forums on CommonPlace, and by limiting users to actual residents of Owosso and Corunna. One is required to provide a street address to sign up, although it is never listed online. This not only diminishes spam and other internet junk, it helps neighborhood posts to be targeted to geographically defined areas.

Social Media and Civic Life. CommonPlace serves primarily to connect neighbors to neighbors, using electronic rather than face-to-face communication. As a City Council representative, I have used it as another platform to provide information to constituents. For more than two years I have been providing a bi-weekly email to several hundred people with news from every Council meeting (if you would like to receive these updates you can sign up here). I have started to post a copy of this update on CommonPlace as a way to further dialogue. It is unclear yet whether this is reaching a new audience or otherwise facilitating the civic life in Owosso.

The City of Owosso, like other local governments, is trying to use the internet and social media as a way to engage citizens. With a limited budget, the City has yet to re-design its official website, but it still provides a static way to disseminate information. Recently, the City established a Facebook presence, something our neighbor Corunna has successfully promoted. In addition, Owosso has made use of online survey tools to garner citizen opinion on street light designs, park improvements, and the updating of its Master Plan. Still, a recent broad survey using both online and hard-copy options discovered that most residents still prefer something they can touch and write on as a way to exchange information and opinions.

Social Media, Social Capital. CommonPlace seems to be an interesting and positive step forward in building social capital in our community. If you have not joined, I would urge you to do so. If you do belong, then you need to not only read the daily updates that are sent out, but also post news, ask questions, or otherwise create opportunities for interaction. The internet is a tool, and it can be used for good or ill, but if it is not used to build community connections it will isolate us further. "Using social media without changing how we think about social change will create only more noise," says Allison Fine in her book "Momentum: Igniting Social Change in the Connected Age." Interestingly, this 2005 book does not mention Facebook, a sign that the electronic landscape changes rapidly around us.

Recommendations for using social media to build social capital:

1. Get online, but use the tools that work for you. CommonPlace is intriguing, but you may find Facebook, Twitter, or other tools a great way to get connected. Don't feel it necessary to use them all, but try something out.

2. Use social media to reinforce, not replace personal interactions. It's extremely efficient to share information online, but take advantage of the tool to say thank you for the coffee just shared, or to post photos from a community gathering, or to organize another face-to-face meeting.

3. Be nice, be responsible. It seems that the disembodied voice a keyboard provides encourages people to say/write/post some mean things. Likewise, sometimes we are quick to read into someone else's 140 character a bad intention that may not be there. Don't type out anything you wouldn't say in person to someone, and seek to clarify what others say before you react. Realize whatever you write online can show up somewhere other than you may have intended. Be transparent.

4. Invite others to join in. A frequent criticism of small towns is that while friendly at first, they are not always open to those who didn't grow up in the place. Social media can be a good way to reach out and create groups and gatherings that are welcoming to newcomers.

Books Mentioned:

Thomas Mallon, "Dewey Defeats Truman"

Robert Putnam, "Bowling Alone"

Allison Fine "Momentum"

Stay the Course: Four for City Council

City Council of Owosso accepts recognition as a "Tree City."

Left to right: Gary Martenis, DNR rep, Mayor Ben Frederick, Tom Cook, Joni Forster, Cindy Popovitch, and Chris Eveleth.

On November 8, voters in Owosso will conduct a performance review of City government. If they like the work being done, they will return Ben Frederick and Chris Eveleth to the City Council. I believe we should stay the course of progress that has been set the past two years. In addition, two newcomers will be added to the Council. Personally, I know Lori Bailey and Richard Crutts well and I believe they will be effective additions to local government. Other candidates bring other strengths and I believe they have good intentions in running for City Council; I pledge to work with whomever is elected.

Much has been accomplished in the last two years since the last election, and I believe Owosso can make further improvements if we continue with the policies and programs now underway. Owosso's unique City Charter allows for a majority turnover in the Council, as occurred in 2010. The top three vote-getters in the election (Cindy Popovitch, Mike Erfourth and myself in 2010) are elected to four year terms (and thus we are not up for election at this time); the fourth place finisher (Chris Eveleth) is elected to a two-year term, and must run for re-election again. By having an election every two years, voters are able to create change, but the staggered terms also provide for a continuity in experience. I would argue that the experience that Ben Frederick and Chris Eveleth have gained is too valuable to lose from the City at this time of fiscal challenges and growth opportunity.

Here are five important accomplishments of the last two years:

1. New City Manager and Community Development Director. The City Council sets policies, adopts a budget, and passes local ordinances; it is the City Manager's responsibility to run local government. Hiring a City Manager is arguably the most important decision a Council makes, and I believe the current Council carried out both a responsible process and made an excellent decision in hiring Don Crawford. In turn, Don hired Adam Zettel, a professional city planner. Along with several other existing talented staff, they have made much progress in improved budgeting, cost-cutting and fiscal management, and development of Owosso. Importantly, the Council has been clear in setting goals for the work of the City Manager and for the first time in my knowledge, has incorporated these goals into the performance evaluation of his work.
2. Economic Development has been the top priority of the City Council, and continuing this direction is probably the best reason to stay the course. Early on we adopted a new policy on tax abatements that has not only supported new economic development (e.g. the expansion of Machine Tool & Gear, the renovation of the old Owosso Dry Cleaners as a home for a new employer), it has ensured that the policy is carried out equitably, and with an emphasis on the creation of good-paying jobs; existing companies and those who hire local people also get extra incentives. In addition, the City has built a strong working relationship with the Shiawassee Economic Development Partnership.
3. Housing Improvement has been a personal point of emphasis for Mayor Frederick, and the Council has supported his initiatives to continue with the registering and inspection of rental housing. In addition, the City has secured several state/federal grant and loan programs to support housing rehabilitation. These efforts both improve the quality of life for those who live in our community and help protect neighborhood property values. Given foreclosures and the poor economy, much more work needs to be done; we need to not only stay the course, but also expand our partnerships with property owners.
4. Downtown Development was begun several years ago with the receipt of several grants, but the current City Council has continued to emphasize downtown improvements. Most notably, the Council adopted a historic district in the downtown and this has financially aided the redevelopment and expansion of several downtown businesses (for example, Freddie's and Hankerd's Sportwear). Importantly, the historic district has enabled the rehabilitation of the Lebowsky Center. One of the reasons I ran two years ago was because the previous Council was antagonistic to this effort (Mike Cline, currently running for office, called for its demolition). The creation of the new Shiawassee Performing Arts Center is not yet complete, and its important to have a supportive Council. Both Ben (Owosso Community Players) and Chris (Main Street Glow Parade) have volunteered their personal time to promote downtown.
5. Parks and Recreation are still a significant need in Owosso, and our financial picture has slowed progress. But for the first time in some years, the City has actually appropriated funds to match volunteer efforts to make capital improvements we will see in the spring (Kiwanis baseball fields and Bentley Park). In addition, the update of the City's Parks Plan as a step in the adoption of a new Master Plan has the potential to further enhance the quality of life in Owosso. The City Council will miss the advocacy that retiring councilmembers Gary Martenis and Joni Forster have brought to our parks; I hope the newly elected council members will carry on this work

There are several other accomplishments that I could cite, but the list above shows that the current Council has been a productive governing body. I believe it would be unfortunate to reverse course on any of these initiatives, and I am voting for the two incumbents on the Council to help ensure we continue to move forward in these areas.

Newcomers. In addition to Ben Frederick and Chris Eveleth, there are several other people running for the City Council. To me, it's important that the electorate choose two people with the experience and temperament to contribute to the current work of the City. Several of the candidates have served on the Council in the past, including Richard Crutts, who served during the Gregg Guetschow era, a time when several wise fiscal decisions were made. I personally know Dick and have confidence that he will serve with the best of intentions, be responsive to residents, and be open-minded in Council discussions. Of the newcomers, I worked with Lori Bailey when she was principal of Central School. She has a first-hand knowledge of the importance of Owosso as a place for families, and currently works doing small business promotion with the Chamber of Commerce. Both of these perspectives will be useful on the Council.

Cooperation and Leadership. Beyond the issues, the ability to get along with members of the public, City staff, and the other Councilmembers is a critical quality to consider when deciding whom to vote for. In our hyper-partisan political climate, we seem to think that our elected leaders should be at the head of protests, loudly pushing their ideology, and denigrating points of view that are not their own. Sadly, that attitude seems to creep into local government, even though City Council is a non-partisan office. The old-time small town rumor mill, and the new electronic forums of the internet, seem to feed off such controversy.

I think some members of the Owosso electorate perceive a lack of personal pyrotechnics as a sign of weak leadership or slow progress. But just because we are not calling each other names, or attacking City employees in public, does not mean that the current Council is not vigorously engaged in the issues. Attendance at a City Council meeting would reveal that we do not all agree with each other, and a close reading of Council minutes shows that our votes are often 5-2 or 4-3. However, we do not attack each other and while this leaves less for the media to cover, it does enable us to work together on the next issue, and the issue after that. It is important that the new members of the City Council contribute to such a positive working atmosphere.

A word about the leadership of our Mayor, Ben Frederick. The Mayor is elected to this post by the Council, and even though I was nominated for this post, I am happy that I voted for his selection as Mayor two years ago. Ben and I do not agree on all political issues, but we agree on the importance of effective local democracy. I have come to be quite impressed with his commitment and skill at having the Council work together, to honor the efforts of public servants, and to invite public participation. To achieve these aims, I have seen him subvert his own goals to support the common effort. Many times he could have grandstanded or obstructed the process to score political points; he has chosen instead to champion the democratic process. To me, this is the true definition of leadership: to bring together diverse points of view to work toward common goals.

For the reasons outline above, to continue the positive attitude of our local government, and to stay the course toward further economic growth in the City of Owosso, I am supporting Lori Bailey, Richard Crutts, Chris Eveleth and Ben Frederick for City Council on November 8.

I welcome your comments and your arguments in support of these or other candidates. Again, I am strong believer in the power of local democracy and am committed to working with whomever the electorate chooses to represent them.

Bike City

To guide the work of the City of Owosso, the City Council has adopted goals for 2011-12. One of them is to make our community a Bike City: “Make Owosso a center for bicycle activity with new bike trails and other actions to promote biking in the community.” Bicycling is an important recreational activity that increases transportation options, improves the health of local residents, and makes our community a more attractive place to live for people of all ages.

On Friday, June 17, eighteen people gathered at Owosso City Hall to share information about current and potential initiatives to promote biking in the greater Owosso area. Although there may be other efforts also going on, twelve projects have been identified:

1. Bike Racks – the Design Committee of Owosso Main Street has identified eleven locations for new bike racks in downtown. These will have unique designs that replicate historic bicycles; they are being produced locally through Baker College. To learn more or be involved contact Dave Acton: dacton@chartermi.net

2. City of Owosso Master Plan – the City is in the process of putting together a new plan to guide development. It will reflect a recently adopted City Council resolution on Complete Streets, and will contain plans for new bike paths and routes, including a connection to the CIS Trail (see below), one end of which will be a few miles west of Owosso. In addition, the City is updating its Park and Recreation Plan. To provide input contact Community Development Director Adam Zettel at adam.zettel@ci.owosso.mi.us

3. The Live Healthy Coalition is a partnership of 14 organizations headed up by the Shiawassee Family Y, who is the recipient of a Robert Wood Johnson Foundation. The goal is to make policy, systems, and design changes to promote active lifestyles. For more information contact Dawn Reha at dreha@shiawasseeymca.org

4. SATA Bike Racks – the Shiawassee Area Transportation Agency has installed bike racks on the front of its busses and is now providing rides to those who want to bring a bike, either for short trips upon reaching their destination or to provide for a one-way bike trip. For more information contact sata@tir.com

5. Tuesday night bike rides leave from the Shiawassee Family Y at around 6:15. This is one of several informally organized community bicycling opportunities. For more information contact Rick Morris at houseofwheelsinc@gmail.com

6. Shiawassee CVB (Convention and Visitors Bureau) is always looking to do more to promote tourism in Owosso and Shiawassee. They are looking into putting together a website to outline biking routes and otherwise promote organized and individual bike visits to the community. Contact Kim Springsdorf at kspringsdorf@shiawassee.org

7. CIS Trail (Clinton-Ionia-Shiawassee) hopes to begin formal development next year on a trail that will run from just west of Owosso to Ionia through St. Johns. The right of way is secure and in conjunction with the Michigan DNR, Meijer Foundation, and others improvements will be made. Fundraising is currently underway with the receipt of a $15,000 grant from the DALMAC group. To become involved contact Avery Weaver at adweaver@charter.net

8. Mountain Biking at Collamer Park is being promoted with the development of trails and the recent hosting of the Curwood Fat Tire Race. For more information contact Jason Roka at rojas613@yahoo.com

9. The James Miner Trail continues to provide positive biking opportunities between Owosso and Corunna, though there is a need to improve and maintain the trail and provide better signage. To express your interest contact Owosso City Council member Joni Forster at joni.forster@ci.owosso.mi.us

10. BMX Park for bicycles is nearing completion by the City of Owosso along South Gould Street. Dirt is needed. Please contact Adam Zettel at adam.zettel@ci.owosso.mi.us

11. Share the Road signs are being offered through the Shiawassee-Owosso Kiwanis Club. This is part of an overall effort to provide education and support to bikers and drivers to respect the use of public roads by both forms of transportation. To seek a sign for installation contact Doug Cornell at mailto:doug@cornelltech.net

12. Owosso Bike Fest on August 14 brings a number of enthusiasts out to share their antique and specialty bicycles in the City parking lot in Westown (between Bradley and Cedar). For more information, contact Rick Morris at houseofwheelsinc@gmail.com

Shiawassee Bike City Network. It was agreed to establish an internet-based system to connect and inform bicycle supporters throughout the communities of Shiawassee County. Another meeting will be held in about six months to again share information. To become part of this network, or for more information, contact Owosso City Council member Tom Cook at citycouncilcook@gmail.com

Words Matter

Talk may be cheap, but good communication supports healthy relationships in our families, effective workplaces, successful community organizations, and our democratic form of government. Sadly, when words are chosen poorly, or misused, or even abused, we all suffer.

When is it OK to call local officials criminals?

Recently, an online posting asked this question: "is destruction without vote to historic Owosso landmark a crime?" and went on to suggest that local officials acted illegally in allowing for the demolition of Holman Pool. Now, my purpose here is not to review the demise of this 50 year old recreational facility that was no longer financially viable to operate, maintain, or even renovate. Nor do I want to discuss the profound nature of a legal designation on the National Register of Historic Places (e.g Curwood Castle) and the unsupportable assertion that an old pool is such a landmark. Nor do I want to enter into a long explanation of the legislative role of the City Council versus the administrative role of the City Manager (the former is responsible for policy and budget, the latter for operations; in this case the budget clearly calls for pool demolition). Nor do I want to discredit any community member that has worked hard to provide for aquatic recreation in Owosso, for I hope they continue their efforts.

Rather, I want to make a point about public discourse in the process of government at all levels. Democracy depends on getting the best information, hearing the best policy proposals, and seeking the best solutions. Being open to public input, and allowing for public debate including vigorous argument, are essential to this process. I would go so far as to say that we need criticism, at least when founded on fact or an honest difference on policy direction. However, political debate at the national, state, and sadly even the local level has degenerated to name calling, the negative painting of an opponent's view, and harsh criticism of difficult decisions. Labeling someone a criminal (or a Communist, or a Nazi) is not likely to lead to reasonable debate and effective problem solving.

Complex Problems Require Trust to Resolve

It's not that such personal attacks sting, the issue of concern is what ad hominem arguments do to the ability of deliberative bodies to solve problems. Despite how the media and some political operatives behave, many of the problems facing representative government bodies cannot be reduced to a simple black-and-white, right-or-wrong definition. Issues like Holman Pool involve difficult fiscal decisions, regulatory requirements, and strong personal attachments. Other issues have unclear legal boundaries (e.g. medical marijuana) , or involve people's interpretation of their personal rights and responsibilities to neighbors (e.g. burning). Sorting through these complex issues requires a public body like the City Council to ask questions, try out potential solutions, and listen with an open-mind to various viewpoints. When someone has been calling you names, it is hard to engage in the give and take required to identify a solution that accommodates all points of view.

When faced with complex issues, as an elected official I have to trust that my fellow councilmembers, the media, and the public are willing to listen to a variety of ideas, fairly praise or criticize them, and suggest alternatives. However, solutions to complex problems tend to be complex as well, and opponents now quickly find a narrow angle of attack and exploit it. Take Holman Pool, rather than accepting the work of engineers and the careful recommendation of two different citizen committees headed up by a pool champion (Gary Martenis), opponents prefer to say the Council is anti-children and that City staff are engaging in illegal actions. Such attacks gain more comments on an online forum than a discussion of the decay of pipes or a cost-benefit analysis of aquatic recreation options, but they don't help democratic bodies make good decisions.

As an elected official criticized in this fashion, one can either fight back (and this makes you look combative and mean) or you can choose not to respond (and then appear snobbish or dismissive). What you would like to do is engage in a discussion, share some mutual education, and seek out common ground solutions. However, to do so, you have to trust you won't be attacked or called names. Without this trust, you can't communicate. If you can't communicate, you can't understand other viewpoints. If you can't understand, you can't change.

A Local, State, and National Problem

Perhaps I shouldn't complain, because the local attacks are minor compared to what occurs on the state and federal level. During the national health care debate, some opponents of the President's proposals were quick to label him a socialist, even though his plan depends on the private health care industry. It is valid to oppose to President Obama's initiative, but unfair and unhelpful to depict him as Adolph Hitler. Likewise at the state level, when Governor Rick Snyder supported new provisions to strengthen the role of Emergency Financial Managers he came under fierce personal attack. One law professor (!) even compared our popularly elected Governor with the despot King George III. Maybe such attacks garner media attention and campaign donations (or why else do they persist?), but it sure makes it hard for differing political parties to come together on the next difficult policy issues (witness the current name-calling and fear-mongering on Medicare reform).

Words Matter

Perhaps our democratic system is broken, though I hope not. Perhaps people feel so disenfranchised that they feel they have nothing to lose, or can't get any attention, unless they resort to screaming, derogatory personal comments, or outrageous claims. Fortunately, my experience in Owosso is that most people want to trust one another, find the good, and support solutions to the problems facing the community. However, one or two misplaced words can turn a conversation into an argument, corrode public trust, and lead to democratic paralysis. On the other hand, starting conversations with a question, listening to the full answer, and saying a few words of respect or even kindness can strengthen the relationships we all depend on.

Tree City

If we make Owosso a pleasant place to live, we will attract talented entrepreneurs, retain engaged families, and spur investments in both homes and businesses. Quality of life is a key economic development strategy for the future of our community. And perhaps nothing says quality of life for a community than trees. Last year, we took steps to have Owosso designated a Tree City, USA and we were just recognized with this award for the second year.

On Saturday, April 30, Arbor Day was recognized in Owosso with the planting of a white swamp oak tree on the banks of the Shiawassee River (if you look closely in this picture you can see Mayor Ben Frederick working with kids to complete the planting of this native species after he read the Arbor Day proclamation). This ceremony kicked off the second annual Green Up Clean Up organized by the Owosso Main Street program and the Friends of the Shiawassee River. This year, flowers were planted downtown, trash was picked up along the James Miner Walkway, and other community improvements were undertaken. In addition, a number of trees were planted along the Loop Trail, including several catalpa trees grown from seeds from the champion catalpa on the grounds of the State Capitol in Lansing. Catalpas are a large leaf southern tree, but Owosso is within the northern range of this species. The Shiawassee River environment is home to an overlap of southern trees like the catalpa, sycamore and Kentucky coffee tree along with northern species such as white pine and hemlock.

In addition to being pleasant to look at, trees provide several tangible benefits:

1. They reduce cooling costs by providing shade;

2. They filter pollutants from the air and help moderate climate change;

3. They prevent erosion and help keep the Shiawassee River cool;

4. They provide important habitat for birds and other wildlife.

All of these benefits add up to a better quality of life in our community. One of the goals of the City is to make Owosso a green community and trees play a large part in this effort. To become a Tree City USA, Owosso meets four requirements: it has a City Arborist with knowledge of tree care, it has a tree care ordinance, engages in a systematic tree planting program, and recognizes Arbor Day annually.

Look at Owosso from the air (or on Google Earth) and our city's residential areas look forested. Tree lined streets with sidewalks and historic homes are a large part of the character of Owosso that continues to attract and retain those people who will contribute to our economic future. Being a Tree City is not a costly investment for the City, but it is an important statement about the values we hold. John Rosenow, founder of the Arbor Day Foundation said "we commend Owosso's elected officials, volunteers and citizens for providing vital care for its urban forest. We applaud communities that make planting and caring of trees a top priority."

The State Budget and Owosso

As Michigan crawls its way out of the recession, the State faces difficult budget decisions. Owosso too is trying to find its way forward economically, and how the details of the State's budget are worked out could make our community a partner in--or a victim of--the State's recovery plan. Governor Rick Snyder proposes a major overhaul of fiscal planning at the State level, and several weeks ago introduced his new budget. Job growth is his primary goal, and to achieve this objective he proposes major cuts and restructuring of taxes on businesses. He also proposes significant reductions in several areas of State expenditures. According to the official budget document (click here), "the financial models of our state and local governments are unsustainable. Service duplication, debt, public employee compensation and unfunded retirement obligations are impacting the long-term fiscal health of state and local governments. Governor Snyder believes Michigan and its public institutions must correct course, stop spending money they don’t have, and implement pragmatic solutions to the economic and fiscal problems that exist." How will this budget effect Owosso?

Revenue Sharing. First and foremost to the City of Owosso, the Governor proposes a reduction in statutory revenue sharing. If approved by the Legislature, this will result in about a $461,000 cut in the City's revenues (which were budgetted at $6.7 million for this year). Untouched, because it is written into the State Constitution, is over $1 million in state aid the City receives. Revenue sharing was implemented to compensate local governments for not imposing local sales taxes. In other states, many cities have their own sales tax or receive a set percentage of sales tax revenues. In Michigan, statutory revenue sharing favors older cities with higher populations of lower-income residents.

For Owosso to weather the (estimated) seven percent (7.0%) cut in its revenues, it will likely be necessary to reduce labor costs, either through the elimination of positions or the reduction in pay and benefits. Governor Snyder's budget message suggests that the benefits municipal workers, as a whole statewide, receive are out of line with the private sector. While City spending on infrastructure improvements like sidewalks are sometimes identified as a source for budget cuts, these have generally paid for through state or federal grants, or specific local assessments. The City's unrestricted revenues are mostly dedicated to labor costs. There is little else to cut in the City's budget.

The Governor has proposed to restore in the State budget about two-thirds of the statutory revenue sharing, but distribute the funds through a new incentive program that would reward cities and townships for "best practices" which may include funding for regional cooperation. The specific details of this program have not yet been announced, nor is it clear whether local governments will be rewarded for existing, or future, best practices. The details of this program will determine how big a financial hit the City of Owosso takes. If we are recognized for existing regional cooperation (e.g. water), or given the opportunity to combine services (e.g. public safety), then perhaps we will thrive under this new program. If the program is designed primarily for urban and suburban communities that occupy one metropolitan area, then Owosso may not recover much or any of its lost revenue sharing dollars. Given the goal of job creation in the State, I would favor incentives that reward local governments that participate in robust economic development efforts (for instance, the City has committed at least $15,000 annually to the Shiawassee Economic Development Partnership for several years).

Job Growth through Tax Cuts is the primary goal of the budget, and the Governor proposes to do away with the complicated Michigan Business Tax (MBT) and replace it with a flat six percent tax on corporations. Those businesses organized as partnerships and other limited owner structures will be exempt from most State taxes. This promises to be a boon to small and new businesses, and the Governor believes that "economic gardening" will result in broad and deep job growth. He also proposes to do away with targeted tax credits that are given to specific companies in exchange for commitments to create new jobs. This past approach of "picking winners and losers" benefitted our area with several expansions of manufacturing plants and other businesses that bring in dollars to our community. It is unclear whether these new jobs would have been created locally without these tax incentives, and it is unclear whether the proposed tax reforms will attract or spur equal or greater job growth. What is clear is that the changes would favor many locally-owned businesses and improve the economics for the creation of new jobs. To fully capture the benefits of the tax changes, we (the City and its many partners) will need to emphasize assistance to entrepreneurs and small businesses.

Loss of Development Incentives. In the debates about taxes and spending, much less attention has been given to the potential loss of specific tax credits that have been key to new growth in Owosso. We have been fortunate in recent years to have several new projects built in Owosso, including the Comstock Inn, Woodward Station, and the under-construction Lebowsky Center. All of these projects have been made possible by the Brownfield Tax Credit, which the Governor's budget proposes to eliminate. Going forward, redevelopment of the downtown will depend on not only the Brownfield Tax Credit, but also the State's Historic District Tax Credit. Owosso went through considerable effort last year to put into place a historic district in its downtown, and in response we have already seen several property owners move forward with new storefronts or major reconstructions. Much of this private investment is made possible by the presence of the tax credits, which provide equity investment and improve the opportunities for financing (which has become quite difficult in the last few years). Loss of these development incentives would hurt Owosso's efforts to spur economic development.

The argument against "picking winners and losers" does not apply to these two tax credits, as they are available to any business who develops in certain areas. The Brownfield Tax Credit was put in place to encourage revitalization of downtowns and urban areas, many of which were contaminated in the past and for which there are extensive clean-up costs (this was especially true at the site of the Comstock Inn). Without this tax credit, there would be more empty, blighted lots in Owosso and throughout the state. Without this credit, state policy would push new development out into "green" fields with attendant environmental impacts. The Historic Tax Credit is even more limited in its area of application, but helps developers offset the higher costs of restoring older buildings. Both tax credits are major tools in helping cities like Owosso rebuild its tax base. If we lose revenue sharing dollars from the State, it becomes even more important to increase our tax base through redevelopment.

Summary. The Governor has called for "shared sacrifice" to put Michigan's fiscal house in order, and it would be unrealistic and unfair for Owosso not to do its part (there are also other impacts of the budget on education, health care, and other sectors of our community). And the Governor has the right primary goal in encouraging job growth. If successful, the changes in taxes and spending will restore Michigan's economy and that will do more for Owosso than any particular job program or new development. However, it is important that State adopt a plan that makes Owosso a partner in economic recovery. I believe our greatest contributions can come through creating a vibrant community that provides a platform for entrepreneurs. This platform would consist of a support system for small businesses and manufacturers, a growing downtown, and a community with a high quality of life. Owosso is building this platform for growth, and it seems appropriate to ask our Governor, and our legislative representatives, to adopt a budget--and accompanying policies--that allows us to be partners in, and not victims of, the State's recovery plans.

Regional Cooperation

The City of Owosso and its neighbors have taken some important steps to improve regional co-operation, and the timing could not have been better. Two weeks ago the City Council approved an agreement with Owosso Township that puts in place a process for sharing the benefits and costs of a municipal water system. The next night, Governor Rick Snyder, in his state of the state speech, proposed that local governments consolidate services with their neighbors to reduce the cost of government. He also proposed to use State revenue sharing as an incentive to spur such coordination.

The Governor's proposal has yet to be defined, and yet to be approved by the Legislature, but the idea of regional cooperation among cities, townships, villages, counties, school systems and other units of local government has been gaining more attention and credibility in recent years. Of course, Governor Granholm proposed something similar during her time in office, and the idea never went anywhere. Additionally, there is much concern over the decline in the funds the State allocates to local governments. Revenue sharing was implemented some time ago as part of an agreement whereby the State restricted the ability of locals to levy sales and other taxes. In many states, a portion of sales tax revenues go directly to the jurisdiction in which the sale took place; revenue sharing in Michigan was supposed to be a more equitable alternative. The system worked well until the State started cutting back the payments to local governments. Now, many local officials resist any attempt by the State to further reduce or restrict these funds.

In Shiawassee County, there have been both failures and successes in regional cooperation. The recent water agreement came after decades of controversy and debate. There will now be a water system that encompasses all of Owosso and Corunna and the more developed portions of Owosso and Caledonia Townships. This will accompany the well-functioning Mid-County inter-governmental system that coordinates wastewater collection and treatment. And there have been specific cooperative actions to support new development as well as mutual aid agreements for public safety services througout the region.

Can, and should, there be more regional cooperation, or even consolidation, of governmental services among neighboring jurisdictions in Shiawassee County? The arguments in favor of the idea include the opportunity for cost savings in infrastructure, equipment, and staff. As well, regional cooperation might bring better planning and coordination of governmental activities that improve the quality of life and promote economic development. A decade ago, Team 21, championed by George Hoddy, made these arguments. On the other hand, there are concerns about giving up control and accountability of governmental services. Would a City Council be able to direct its staff and services in ways that would best serve the residents of the community?

What seems to be spurring the discussion of regional cooperation now is the opportunity to reduce the cost of government. There seems to be little interest in raising taxes at the state or local level, and with the economy sputtering, state and local revenues have declined. Even with signs of a slight economic recovery showing, revenues will lag for some time (see this earlier blog post). It's clear that costs need to be cut, and the opportunity for sharing services potentially offers a way to maintain services while cutting costs. However, local governments may need some statutory push or financial pulll to inspire local officials to reach across municipal boundaries. At the local level, careful attention needs to be paid to ensure that any cooperative agreement benefits all parties, is open to public scrutiny, and truly allows for more to be done with less. Nonetheless, regional cooperation will be a goal for 2011.

Owosso and its neighboring jurisdictions of Corunna and Caledonia and Owosso Townships have in place several working regional partnerships; the recent water agreement strengthens these relationships. Hopefully these will be recognized in any state budget or legislative change that seeks to reformulate revenue sharing. In any case, the recent work of local officials to increase trust and communication will put the mid-county region in a better place to pursue effective regional cooperation in the near future.

I was honored to be State Representative Ben Glardon's guest at Gov. Rick Snyder's State of the State address. Said Glardon "This is a truly historic time in Michigan, and the governor's business-style approach is exactly what our state needs to get back on solid footing. The governor talked about specific goals with expected results. With huge state budget deficits that seem to continue year after year, we must find new ways to properly budget taxpayer dollars, and Snyder's emphasis on value for our dollars is spot on."