The Past Four Years, and the Future

Four years ago, when I was running for City Council I identified six issues I thought would be of importance to Owosso during my tenure.  Now, as my term has come to an end, I would like to revisit those issues (economy, taxes, housing, quality of life, recycling, and communications) as well as discuss three more (infrastructure, history, and regulation) that I believe are important to the future of our community.  While I am proud of the achievements of the last four years, I can only take a small share of credit:  I have served with four other members of of the City Council for four years and four other councilmembers for two years each, and they have been supportive, or beneficially challenging, of several of these initiatives.  Finally, the City of Owosso is served by excellent professional staff who have provided the analysis, and the hard work, to both carry out the City's current responsibilities while also making policy and program improvements for the future.  Thank you too to the citizens who provided input and support for these changes.

Economic Growth:  The creation of jobs was, and remains, the most important policy goal of the City.  Of course, local policies only play a small role given the power of an international economy that is driven largely by private sector decisions.  Still, the City has been an active supporter of economic development.  While jobs are still needed, for the first time in many decades the unemployment rate in Shiawassee County is below that of the State average.  I am particularly proud that the City Council wrote a first-ever policy for granting tax abatements that favored the creation of higher paying jobs by both new and existing companies.  This policy, and other City efforts, have aided several local employers in their expansions.  In addition, the City doubled its investment, to about $30,000 annually, to the Shiawassee Economic Development Partnership, the prime mover behind efforts to promote job growth in our community.

The Future:  The City needs to continue to partner with the private sector and other entities to promote economic growth and development.  Next steps need to include support for small businesses and entrepreneurs.  Efforts need to be continued and expanded to creat a vibrant and appealing downtown for retail business starts.  The region is also growing short on space for new industrial development and quality office space, and the City should be supportive of efforts to help create these opportunities for growth.  Expansion of the Southeast Industrial Park, support for redevelopment of the Armory, and targeted brownfield redevelopments should all be undertaken.

Tax Efficiency:  The City's budget has been the most difficult challenge of the last four years.  The City's primary source of revenues is property taxes, and following the housing finance crisis and economic collapse in 2008, the tax base of the City has declined more than 30%.  State aid and grant funds have also dropped off.  To cope with this budget shortfall, the City has trimmed close to a million dollars from its budget and cut the number of employees from over 100 to about 80.  You can read more about the details of the budget picture from my post this past May.  The drop in property values has caused a decline in the taxes paid by most property owners, even though the City raised its tax rate slightly to pay for leaf pick-up (see Recyling below). While it receives little press coverage, City employees--top to bottom--have done a commendable job of tackling budget issues and doing much more with less.

The Future:  the City's budget woes will likely continue for at least a few more years, as property values will not likely recover as fast as the general economy.  Deferred maintenance on infrastructure, aging equipment, and continued demand for services will likely create difficult decisions for the next Council. One hopeful path is to encourage new real estate development and investments in property, residential and commercial, as this will increase help increase City revenues. Particular attention needs to be paid to the City's pension funding, where a declining number of contributing employees and an increasing number of retirees will likely mean either further contributions from taxpayers or difficult choices about retirement benefits and programs.

Housing: the homes in Owosso are one of its greatest assets: some are historic, many are affordable, and all of them help create unique neighborhoods which attract and support families, newcomers, the elderly, and others.  At the same time, our aging housing stock (75% of our homes are more than 50 years old) presents a challenge to the City to ensure that homes are adequately maintained and don't deteriorate to the detriment of the neighborhood.   Unfortunatley, some homes had already been abandoned and had decayed to the point that they needed to be demolished.  In the last four years, the City has initiated rental housing inspections, expanded programs to assist homeowners make repairs, and instituted a program to register and monitor vacant homes resulting from foreclosure or speculation.  These programs have helped eliminate unsafe housing conditions and maintain the quality of our neighborhoods.  While the real estate market still suffers, one only look to parts of neighboring Genessee County to see that things could be much worse.

The Future:  the City needs to keep its commitment to maintaining the housing stock, working with property owners to ensure its rules and programs are administered in the most effective, least costly way.  There is a need, and the opportunity, to expand efforts to rehabilitate housing, both through State and City efforts as well as in partnership with community groups and volunteers.  The Mayor and others have organized a "Helping Hands" group and this is a great first step; more can and should be done.  In addition, the City should continue its efforts to help downtown property owners access state funding to create new downtown apartments, as well as look at ways to encourage new senior housing, as is  proposed for the former Lincoln School property.  Finally, as the housing market continues to improve, the City needs to revisit plans for the Osburn Lakes area as well as the new land on the southeast side of town to identify new residential development opportunities.

Quality of Life:  many things make up a positive quality of life: access to jobs and shopping, good schools, cultural amenities, and recreational opportunities.  Improving City parks has been one of the success in Owosso the last four years, despite budget difficulties.  A new parks plan was adopted, and a new sledding hill, new bathrooms and concession stand at the Little League baseball fields, and significant improvements at Bentley Park were some of the things accomplished.  Sadly, the final death of Holman Pool occurred, and while there was insufficient funds to rebuild it, a new splash pad has been added as an aquatic play feature.  The City played the role of planner and coordinator, and provided some partial funding, but it was the energy of citizens, private donations, and successful grant-writing that made improvements possible.  Similar congratulations to community effort can be given to the rebuilding of the fire-ravaged Lebowsky Center; a new Shiawassee Performing Arts Center is slated to open next spring.

The Future: in addition to support for parks, two other quality of life efforts need to be continued.  One is the development of new bike trails and walkways, and the other is a renewed attention to the Shiawasee River as a recreational amenity.  The City has an important role in defining more bike routes and make the City even more accessible to, and safer for, walkers and bikers of all ages. The existing James Miner Trail to Corunna is in need of upgrades and a better connection needs to be made to the new Clinton-Ionia-Shiawassee (CIS) Trail.  These efforts will require inter-governmental cooperation, something that should be pursued to make other park improvements possible as well.  The Shiawassee River is increasingly attracting not only people who fish and walk along its banks, but kayakers and canoers who enjoy paddling the River.    The lesson of the  last four years to me is how important citizen groups, like the Owosso Community Players and the Friends of the Shiawassee River, are to making improvements.  The City needs to develop and strengthen partnerships with local nonprofits as well as the service clubs who have long volunteered to make things happen.  Personally, this is where I plan to spend my time after I leave the City Council.

Recycling:  four years ago, burning was a contentious issue in Owosso.  Even though burning is still allowed under limited situations, the problem has greatly diminished.  This is due to increased enforcement by the City against illegal burning, new State laws, and curbside brush pickup instituted in 2010.  This program has proven to be quite popular and, along with a drop-off site for brush, the need for burning has diminished.  Unfortunately, because of its financial challenges the City had to raise a 1 mil property tax to pay for this service as well as the annual fall clean-up of leaves.  The end result, however, has been a decrease in air pollution.

The Future: perhaps my biggest disappointment as a City Councilmember has been that we were not able to institute a curbside recycling program for paper, glass, plastics, and other recyclables.  This is a qualify of life issue for many residents who wish to diminish the energy and resource impact they have on the environment.  While in the big picture, recycling saves costs, the near term reality is that it would cost something to institute recycling at the local level.  The cost might be diminished by working with a community group, and/or the costs might be absorbed by providing trash and recycling as a municipal service.  However, this would probably necessitate a city-wide contract with one company, which several local businesses have concerns with.  Still, reducing waste, and reducing the number of large trucks that drive on, and damage, our residential streets make it worth pursuing this opportunity.

Infrastructure:  I have been interested in the seemingly mundane issues of road, pipes, and drains since high school, and I am proud that the Council took a hard look at the City's water infrastructure. We faced the facts and made a decision to make modest increases in water rates to ensure the long-term viability of the system and avoid more expensive costs later.  You can read my earlier blog post for the details.  In order to support economic growth and an attractive quality of life for the long term, the City needs to invest in its infrastructure.  With regard to streets, the City has spent considerable time coming up with the data and the programs to ensure the most cost-effective way to maintain our transportation system.  The decision by voters to reject a street bond will challenge the new Council to find ways to finance street repairs.  Also, there will be difficult decisions about replacing the aging wastewater treatment plant and making investments to reduce sewage overflows into the Shiawassee River.  None of these topics are easy or fun, but they need to be addressed.

Historic Preservation: one of the first accomplishments I worked on at City Council was the creation of a downtown historic district. The work done to establish the district has helped spark a renewed awareness and appreciation for the architecture that makes Owosso a special place.  Importantly, the establishment of the historic district has also helped private property owners (including the Lebowsky Rebuild) qualify for state and federal assistance for building rehabilitation; six new facades are now underway.  In addition, the City has helped support a renewed effort by the Owosso Historic Commission to care for Curwood Castle and other historic properties.  The revived fall historic home tour has sparked wider interest in visiting Owosso and shows how historic preservation and promotion are part of rebuilding our economy.

Planning and Regulation:  I was trained as a professional city planner, so I am particularly proud that the City of Owosso adopted its first, true comprehensive master plan during my tenure.  It provides the basis for guiding future growth and helping future City Council's make development decisions that are in the best long-term interest of Owosso.  The City has long primarily pursued planning objectives by working with the private sector and public funding programs to support new development.  This should continue in the future, but development can also be guided by zoning, design standards, and other land use regulations.  When regulation is done without planning, the results can be detrimental to the private sector.  However, when done sensitively and in cooperation with developers and property owners, regulations are effective tools for protecting neighborhoods and encouraging growth.  Owosso has had land regulations for over 50 years, but changes have been made to make them serve new community goals.  Owosso does a great job developing and applying its zoning and other rules in a balanced manner, and the next Council should continue to work with staff and the citizens on the Planning Commission to ensure Owosso's future quality of life.

Communication:  When I ran for office four years ago, I pledged to be open and active in communicating with constituents and have done so through this blog, a facebook page, and with an email update sent after every Council meeting.  During the same time, the Council supported the updating of the City's website to make information more readily available to the community.  If you have not checked it out, you should.  In particular, look here to find agenda, minutes, and a synopsis of every City Council meeting that is posted shortly after the meeting.  My email updates have come to an end, but the City has talked about providing such a service.  You may want to encourage your City Council representative to support or initiate such a communications effort.

The Future:  Owosso has a great history, and a future of great potential. I hope the citizens of Owosso continue to be engaged in local government, especially with regards to these and other substantive policy issues.  Sometimes the topics are complex, the solutions difficult, and the noise around the deliberations unpleasant.  But I am a believer in local democracy as the best way to tackle our nation's problems.  I agree with those who are suspicious of federal government interventions, but I also agree with those who think we have a responsibility, even a moral obligation, to attend to the needs of people in our community.  However, to do so requires people of good intent to be involved in the process of government as elected officials, volunteers on committees, voters, and citizens engaged in making our community better.  I am appreciative of those elected officials who have served with me, and I respect highly those who make their profession one of working in local government.  Forward!  and Thank you for your support and involvement.

Public Servants as Scapegoats

The Shiawassee County Administrator has taken a new job in Isabella County.  This follows several months of public attacks, criticism through various social media channels, and a formal consideration by the County Board of Supervisors to eliminate her position or terminate her contract.  Many people are pleased with her departure.  I am worried by it.  I don't know the particulars about this situation, or the content of her job reviews, so I cannot comment on whether her departure is warranted or not. However, I am worried because the pattern of her hiring and then exit follows a path we have seen too often in Shiawassee County; and these journeys have not led our community to a good place. While each experience is unique, and thus perhaps understandable when taken by itself, these unfortunate stories, when taken as a whole, are troubling.

               

The Rise and Fall of a CEO.   The story usually begins with a board of local residents, whether they be elected to a public entity like a school board, or volunteer on a nonprofit organization that serves the community.  In either case, the board faces the task of filling the chief executive position and conducts a wide search for the best candidate.  There is perhaps no greater responsibility of a board than this one.

Sometimes an organization is working through a crisis and needs a new leader to right the ship.  Other times, the board seeks to replace a long-time, well-respected executive who has retired.  In either case, the board and its constituents recognize that the task is an important one, and people get committed to the organization and put in hours and thought to find the right person.  Sometimes they go to the expense of hiring a search firm, or of traveling to interview candidates, or to conduct public surveys. There are inevitably a lot of meetings.  In the end, someone is hired with great acclaim and big hopes for the future.

Then the Honeymoon Ends.  When a new chief executive is hired, too often board members or the community feel like they can step back from their involvement.  After all, the job of the top employee is to run the organization, and good board members know they shouldn't micromanage.  There is often too a honeymoon period in which constituents want the new person to succeed, so they hesitate to pay close attention to the issues, engage in policy decisions, or provide much feedback.  And of course, board members change and the personal history of the hiring of a CEO is lost.

Eventually mistakes are made, by either the executive and/or the governing board.  No one is perfect and even the best ship's captain sometimes rocks the boat.  It's hard being a public official in a place and time of economic challenge.  Tough choices have to be made and sometimes the pain caused by a hard decision is too much to bear: angry people show up at a meeting, a critical letter to the editor is published, harsh comments are made on Facebook or at the breakfast club. Then comes the moment of truth for a board member, or employee, or other stakeholder:  do you stand by the chief executive or do you side with the critics?

Of course, there have been instances of incompetence, even malfeasance, in the top positions in our community, and in those instances a board must act quickly and firmly to make a leadership change.  However, at other times, there is an impatient public that lacks all the facts, or a group of mean-spirited critics driven by personal gain, or idealogical warriors on a campaign for visibility.  And most of the time, the situation is somewhere in between, and a board member has to listen hard through a lot of noise to really comprehend the situation and make the right decision.

Scapegoating.  Those people we hire to run our local governments, our schools, or our visible community organizations are in a precarious place.  On the one hand, they have to answer both to a board and to a variety of constituents; on the other hand, they are expected--and paid--to be highly competent professionals balancing a strained budget, complying with a myriad set of laws and regulations, and supervising a staff of other professionals.  It is never easy, and sometimes the task defeats the person in charge.  Too often, we have expected Superman, or Wonder Woman, and we turn on our leader when they turn out to be mortal.

We have a bad habit in our community of throwing our chief executives under the bus when the going gets tough.  Maybe some of them made mistakes so severe they deserved it, or maybe at some point the controversy is so intense that a change needs to be made. When you think about any one departure, you can see it in several ways, and a post-mortem can be a good learning experience.  But when you step back and think about this repeated pattern of rise and fall, it looks like we as a community choose to address our problems by blaming a staff person.  Rather than take on the tough task of analyzing the true causes of a crisis, or stand against the mob, we tend to join the revolt and execute the leader at the top.  Why?

What's Wrong With Us?  I think we have replaced policy debates with personal and partisan conflicts.  In Washington and Lansing, we seem to favor political defeats of the other side rather than compromises which offer a legislative solution. At the local level, we resort to personal attacks rather than problem solving.  Perhaps the challenges we face are too big or too complex; perhaps people have lost the patience to work through tough choices; perhaps we are too insecure to accept change.  I don't know, but it seemingly has become easier to blame a hired person for our difficulties than it is to face the hard truths of declining revenues, competitive economics, changing demographics, or new state or federal requirements.

The cost is high with such a system:  not only do we put decent men and women, and their families, through hell in order to effect change, we also do damage to our local institutions.  When there are attacks against, then a replacement of, the chief executive, employee morale suffers and the ability to move ahead with even routine activities is hampered.  The reputation of a school, a city, or a community institution takes a hit when there is a messy leadership change.  And, as board members come to find out, it can be very difficult in hiring a successor following a high-profile firing. The news accounts of attacks on the CEO, which seemed so righteous at the time, just read as organizational dysfunction to the next person looking to take the lead job.

Advice to the Board.  It will be interesting to see what the Shiawassee County Board of Supervisors does in replacing their much-maligned primary staff person. The County has not yet decided whether it wants its board to be elected officers carrying out executive functions (like a Township Supervisor) or delegate its authority to a professional manager (like every city in Shiawassee County).  This indecision further complicates the jobs of almost every person who gets a paycheck from the County.  The County Administrator's job is, for this reason, perhaps the most difficult job in our community.  Whatever is decided for Shiawassee County, I have some advice for any public board charged with the task of hiring a chief executive:

1. Be transparent in your process, publicly adopt a job description, and be clear about your criteria for the job.  The public is going to be very interested in who you hire, and you should be open about what type of person you want before you ever talk about specific candidates. Even if you have a strong inside candidate (and hopefully you done some succession planning and cultivated some internal leaders), the hiring process needs to take place in the full light of day so that the public, and everyone involved, can feel a part of the outcome.
2. Get a unanimous vote for your hire. If the board can't agree on one candidate, postpone the decision and go back to the drawing board.  If your preferred candidate is not the top choice, you need to be able to work with whoever is hired. To be successful, a chief executive needs the public support of every board member; they should start with it, and they should maintain it, even through difficult times.  
3. Make it about policies, not the person.  It is a board member's job to adopt policies, oversee programs, allocate financial resources, and provide a critical eye to the operations of an organization.  But keep your focus on the outcomes, not the people doing the job. If you don't like what is happening, or if your constituents have complaints, be specific with your concerns and suggest the policy or program changes necessary.  Ask questions, do your homework, and think through your opposition; too many board members just criticize the chief executive.
4. Criticize in private, praise in public.  If you do have complaints about the behavior or actions of your chief executive, deliver it in person, one-on-one.  While someone on Facebook may be happy, or the room applauds, when you attack the chief executive in public, you undermine the credibility and effectiveness of the organization you serve.  The storyline should be about a difficult budget debate, or the pros and cons of two policy choices, not the fireworks between a board member and the chief executive.
5. Communicate, Communicate, Communicate.  Unfortunately, the public is not as interested in the issues that you as a board member are.  Investing in new infrastructure, overhauling information systems to improve efficiency, squeezing a few more dollars out of the budget, or adopting a new policy or program can be very rewarding to those of us engaged in the day-to-day mission of an organization.  Unfortunately, the press and the trolls of social media are much more interested in reporting on personalities and conflicts.  Unless you make a continued and vigorous effort to provide information to your constituents, your good stories won't get told.  And when times are tough, and the problems complex (as they usually are), attention may get diverted to an argument or heated words, rather than to policy options or potential solutions.
6. Stand by your man, or woman.  It's not easy to be an elected official or serve on a nonprofit board, and many of the decisions you have to make are between unpopular options.  It is appropriate to have your chief executive be the spokesperson or on point, but you have to back them up.  Don't leave your leader out there alone; even worse, don't put the blame on your chief executive for the challenges facing your organization.  If you don't like the policy proposal, or the budget cut, direct your comments to the specifics, and the alternatives, not the person who has the job of implementing them.

As a member of the public, I don't know--and sometimes can't know--all of the many challenges that face our County, our cities and townships, our schools, and our community organizations.  But I respect the leaders--volunteer and paid--who put in the time and step up to the responsibilities of their positions.  I take notice when leaders share the facts and realities of their jobs, listen more than speak, and actively seek out my, and other's, opinions.  I appreciate most of all when leaders are transparent and give it to me straight when there are problems, difficult decisions, or even a crisis.  None of us alone is as smart, or as capable, as all of us together.  We need to stop blaming and attacking one another; the cause of our problems are usually bigger than any one person.  When the ship starts to leak, we need to stop blaming the person at the tiller.  We need to stop punching holes in our ship, and pitch in with one another to bail out the ship and get us back on course.

The Last Five Years

Owosso has a budget problem, and has had one for the last five years.  Good management, tough policy decisions, and sacrifices by residents and employees have made it possible for the City to get through the last half decade.  However, unless we make some further difficult choices and structural reforms, things will not get easier in the years ahead, even if the economy recovers.

In 2007, the City was enjoying several years of modest growth, a healthy national economy spread some new investment our way, and rising property values translated into increasing revenues for the City.  In 2007, the long-time City Manager Gregg Guestschow was forced to resign, and changes were made in how City Hall was run.  In 2008, the economy was strong and a large new grant was secured to help make improvements in downtown.  Things were still looking good until the stock market collapsed on September 20.  

The ensuing economic downturn in 2009 has persisted to the present day, and while the national economy is recovering, and employment and incomes are up, property values--the primary driver of City revenues--have continued to fall.  In addition, state revenue sharing has suffered significant cuts and government grants have dried up.  The City responded in three ways:  1) aggressive cuts in City spending, primarily by reducing the number of employees and the benefits of remaining workers; 2) a modest 1 mil increase in taxes to pay for City-provided services; and 3) renewed efforts at economic development and neighborhood improvement in an attempt to increase, or at least maintain, property values.  The table below paints the picture.

The most difficult number is the first one, the SEV, or State Equalized Value, or the collective worth of all property values in Owosso:  it has declined 30% in the last five years.  Not surprisingly, the tax revenues the City receives have also dropped, by $200,000 in the same five years and another projected $100,000 this budget cycle.  The drop would have been even greater but for the fact that the City Council in 2010 approved a tax rate hike from 13.7 mils (tax dollars per $1,000 assessed value) to 14.7 mils (the decimal changes in the table reflect small changes up, and down, due to bond and other obligations).

Retirement Funding.  One significant cost not shown in the above table is the increasing cost of meeting the City's obligations to its retirees.  In 2005, the City Council approved changes in the retirement benefits it offers to employees.  Now, more recent employees have access to a defined contribution plan (as opposed to a defined benefit plan) that shifts responsibility and risk for retirement planning to employees; it is also easier to make a budget around.  However, for public safety workers, the many long-term employees of the City, and those who have already retired, the City has an ongoing financial responsibility.  

It has been difficult to get accurate, long-term figures for retirement costs, but they are significant.  In the current year, an estimated $829,038 contribution is being made to the City's retirement plan; in the next year, the budget estimates costs will increase almost $100,000.  By some measures, these costs have doubled in the last five years.  It becomes difficult to manage, much less plan, for these large expenditures, which vary based on changing actuarial estimates and the rise and fall of the investments that underpin the retirement fund.  The City has a legal--as well as moral--obligation to support its retirees, but attention needs to be paid to the fiscal management of retirement funds and how it impacts the City's budget.

Budget Cutting has been the primary pre-occupation in City Hall for the last five years. The number of employees has dropped from over 100 to around 80 now, with some difficult lay-offs and early retirements part of the solution.  As well, staff have seen their benefits reduced and they have stepped up to higher contributions to their health care.  The management team has also negotiated cost-saving contract renewals with our represented employees. Overall, close to $900,000 in spending was cut from the budget.

Making these cuts without drastic reductions in services is to the great credit of talented administration and hard-working employees. There was not a lot of fat available to cut.  Prior to 2007, City Councils and City Manager Guetschow had been very careful spenders, keeping the lid on employment costs, not indulging in any big park improvements, and always seeking limited and efficient delivery of services.  Fortunately, they also left the City with a healthy Fund Reserve and very little debt.  

Are Taxes Going Up? While the decline in property values has hit the City's budget hard, it has provided some relief to taxpayers in Owosso.  The average tax bill paid by a homeowner has declined from $506 in 2007 to $473 last year, and this occurred despite the 1.0 mil increase in City property taxes adopted in 2010.  For the coming fiscal year, the City Manager has proposed a small increase in the tax rate of about 0.2 mils to support economic development activities and promotion of the City's three historic structures (Curwood Castle, Comstock Cabin, and the Gould House).  Even with this increase in the tax rate, the actual tax paid by most homeowners will actually decline because of the continuing slide of property values.

What to Do?  The City faces both an immediate short-term budget crisis and a long-term challenge in ensuring sufficient revenues to operate the City and maintain its infrastructure.  For the coming budget year (which begins July 1) the City has only a few options, or combination of these options to address the short-term budget issues:

• reduce labor costs through cuts in services: management and labor have probably squeezed as much efficiency and made as many sacrifices as possible; to reduce the cost of government further, cuts in services are probably necessary (i.e. fewer police and fire employees, less maintenance of roads or parks, etc.).
• delay further equipment purchases:  the City has postponed for five years the purchase of new trucks, a streetsweeper, a new ambulance, fire station upgrades, and audio-visual equipment for the City Council chambers.  There can be a delay in the purchase of these and other items, but at some point the cost of maintaining old equipment becomes prohibitive.
• increase fees and the property tax rate: neither of these revenue-generating options is desirable, nor will they offer that much help in balancing the budget, but the political pain probably exceeds the economic pain.
• tap into the City's reserve funds:  through prudent management and a wise policy to not use reserve funds to balance the budget, the City's fiscal health is sound.  This makes it possible to borrow money more easily and cheaply; tapping into reserves may set a dangerous precedent. 

None of these choices are pleasant, and the Council has been seeking alternatives, professional advice, and public input on how to balance the 2013-14 budget.  Several workshops, public hearings, and difficult conversations have moved along the budget process.  

Whatever happens with this year's budget, the challenges will likely persist in future years.  Even if the real estate market recovers in the coming year and property values rebound, property tax revenues will not rise quickly because the provisions of the 1994 Proposition A limit the rise in assessed values to the rate of inflation with a cap of 5 percent (see my earlier post "Budget Challenges Are Here to Stay").  As we are experiencing almost no inflation, even if property values rise 10 percent in 203-14, the City's revenues are likely to rise only 1 or 2 percent.  Meanwhile, deferred maintenance in equipment and our infrastructure (roads, sewers, parks) will catch up with the City and increase the cost of operations.  As well, the City's retirement fund, which will likely have fewer employees making contributions, may also require additional public investment.

Options to address the long-term budget challenge include the following:

1. restructuring of local government to either further scale back services or implement more radical cost-efficiencies like contracting out public services, combining delivery of services with surrounding jurisdictions, or fee-for-service provisions.
2. asking non-profit entities which are exempt from property taxes like healthcare providers and private educational institutions to make payments in lieu of taxes
3. increasing revenues through new taxes on cable television, local businesses, or residents; or having voters approve new property taxes for specific services and public investment like roads, parks, or public safety
4. have the State of Michigan provide some relief or assistance to local governments through revenue-sharing, increased grants, or revisions to the provisions of Proposition A
5. spur economic development and new investment in commercial and residential properties that will increase the tax base of the City.

None of the first three choices are desirbable, the fourth option is politically difficult, and the fifth requires persistence, wisdom, and commitment over time.  

What advice do you have for your elected representatives?

We are in a Lifeboat

Owosso, like most of Michigan and other parts of the country, have had a rough time since the economic downturn in 2008-09.  In addition to the financial suffering and human pain in businesses and families, local government has been tested as well.  Three years ago, I wrote about the then three year decline in property values and its negative impact on our local budget (read it here).  The most recent news from our assessor, shows that property values--and thus City revenues--have continued to decline.  Our challenges are not over with.

I am optimistic however.  The Michigan economy has turned around and some good things are happening in Owosso:

• A local auto parts manufacturer have gained more work, and with help from the City and the Shiawassee Economic Development Partnership (SEDP) have opened a new plant; this is but one of several economic success stories.
• Our downtown theater, burned six years ago in a fire, is now being restored as the Shiawassee Performing Arts Center, with lots of local effort and state assistance (one of the last state tax credit deals); other downtown buildings are being renovated.
• New parks and recreation facilities have been built through the initiative of local citizens and with some small amount of state aid (one of the first local grants from the Passport program).

In thinking about the last few years, a story came to mind.  While I wrote it about Owosso, it could apply to other communities and the State of Michigan as well.

We are in a lifeboat. A little over four years ago we were struck by a storm and we were forced to take refuge. Our boat is sturdy, but old: the frame is solid, a few of the fittings are missing, and there have been some leaks, but the craft is seaworthy. After the storm, we were adrift and uncertain about what to do. We gathered the survivors, assessed our supplies, regained some of our strength, and waited for rescue; it didn't come. 

Some of the passengers gave up, and swam off on their own. Some found flotsam to which they clung, others were rescued by a passing cruise ship, and some, sadly, were lost. It has been a hard time, and many of the survivors are hurting; to the extent possible, we have tended to their needs. 

After rescue did not come, we discussed our predicament. Some among us wanted to wait, and a few flares were sent up in search of help.  Others wanted to take action. Couldn't we find an island and seek a new beginning? Or at least move into a shipping lane and hope to be discovered? Fortunately, a few professional sailors survived, and their knowledge of charts and the elements enabled us to consider some options.  

There was, of course, more than one place we might seek safety. Some were well known to some of us, others we had heard rumors of, and some were foreign and appeared dangerous. We consulted all of the passengers and crew, and after some debate, decided on a plan of action.

To reach our destination we needed everyone to volunteer to help.  Most able-bodlied passengers took up oars, but we were in disarray; someone provided instruction, and another a cadence so the rowing could be coordinated and efficient.  The sailor took readings from the sun and stars.  We also needed someone to take the tiller, and by vote we chose a few from among us who seemed to have the most experience, clearest vision, and a firm hand.

Most everyone found a task: some took account of our precious food, others bailed or made repairs, and a few ingenious folks designed a method to collect water from rain that still fell on us. We all took turns caring for the weak and injured, but some were more able to extend sympathy than others.  

We all came to appreciate those who provided a kind word to the tired or encouraged those at the oars to move us forward. Thank God for those who remembered their prayers, hymns, and sea shanties to inspire and entertain us.

It has been some time now that we have been at sea, and some among us are discouraged or doubting the wisdom of our plan. Mistakes have been made along the way. Some grumbling has been heard amidship. The sailor assures us we are on course. Others think they see land on the horizon, but it is still cloudy and our vision remains obscured.  

Our captain is optimistic. We are almost there. If we can stay the course, work together, and keep looking forward, then we will escape the storm.

This is how I see Owosso.  We have been on a critical journey for the last several years, and have accomplished much.  We have not yet arrived, and the effort has been hard on all of us.  I believe we are on the right course. Thank you for the part you have played to keep us afloat and sailing forward.