Author: citybaseblog

Concentration & The Zone

.Reading time 6 minutes.

One of my favorite stories is about the research scientist starting his work very early in the morning when the sky is still dark. He gets involved in his work – so deep in thought that he looks up to see the clock telling him it is a few minutes after 12:00. He had experienced no hunger pangs and was surprised. He puts on his coat and hat to walk to his favorite lunch spot – only to find that it was dark outside again.

Much of my analytical work involves concentration. I have a luxury that most people do not share. I have narrowed my consulting practice to just one thing: sales tax analysis work. This was deliberate. I rarely talk on the phone. Just the way I like it. I can often work in 2-4 hour blocks of time without being interrupted. Just about every day. My pauses are to stretch and read/respond to my email. Interestingly, I can communicate via email with several people throughout the day without a loss of concentration. One phone call, however, and I am ripped out of my quiet lab mindset.

My Zone.

There is another, deeper layer of concentration for me. It is My Zone. This is where the clock can really skip ahead for me. My Zone is when I have the purest moments of concentration. I am thinking the clearest at these times. There is no clutter. I make great progress when in My Zone. Also, I am the happiest. It has a feeling to it. Tranquility. Alertness. Creativity. Energy. Joy.

These moments of concentration dropping into My Zone are special. The biggest reason is that I never had these experiences when I worked in an organization or when I had my own small consulting firm. I can remember days of barely looking down before someone needed me. Well, that was my job. But I had to come in early or work late or on the weekends to even concentrate.

I Always Wondered.

What would happen if it was possible to do the unthinkable? Have three 2-hour time blocks per day when many employees could work without interruption? Twice a day, for an hour, would be designated for meetings, phone calls and email exchanges. I’m not naive, but please don’t miss my point. The six hours, or even a large fraction of those time blocks, could actually produce a full day of work as we know it now. Probably more than a full day.

I can recall spending many 8-10 hour days just trying to get one hour’s work done. That’s not very productive. I have seen groups of people working on a project spend 30-45 days trying to accomplish what could have been done in one or two solid days if the door had been locked and nobody could get involved in anything else until the task at hand was done. I once saw a one-month project “crammed” into over 18 months.

The Satisfaction of Work Being Accomplished.

There’s nothing like it – not just for me. For most of us, the satisfaction of getting work done is a remarkable sensation. To be caught up or even close to it is a foreign concept to most workers. Creativity is squeezed out when there is no time to be a free-thinker. Oh, I know, a crisis or impossible time crunch, can be the Mother of Invention. Sometimes.

But wait, many of my colleagues actually don’t know what I am talking about here. Either they have never experienced pure concentration and leaps in productivity or else it has been so long the faint memory is now completely gone. My topic is about the most productive streaks in your life – but without the tense neck. Without the caffeine-fed jitters. It’s about coming back from a conference full of ideas and not getting sucked in to the vortex of disjointed work, forgetting every good intention you had at the conference.

Give Concentration A Test Drive.

It has taken me many years to get situated so that I can concentrate and then to drop into the next level, My Zone. I doubt you could make it happen overnight. However, why not take one day a month and give it a try? Announce ahead of time. Library-quiet time for two full hours. Then twice in the same day. Four hours of silence. No meetings. Just pure uninterrupted work.

I know this idea won’t fit everybody. But if you have 200 employees who can be accommodated and could make them just 10% more productive by the environment that can be created, that’s the equivalent of 20 workers you may not have to hire in the future. You might get some of that needed extra productive just by having a happier employee. LFM

Who Speaks for This Deceased Child?

.Reading time 33 minutes.

Preface: Child Abuse: A Jury Foreman’s Perspective

We are just a couple of days away from April 1st or April Fool’s Day in some people’s minds. It is an anniversary for me, but not the kind I like to celebrate. It was on this date many years ago that I found myself on a criminal jury. Little did I know that I would be Jury Foreman seven days later. I had no clue that I was going to be sitting in judgment of a young mother who killed her child.

Most of you know that I tend to flood the electronic mail with as much uplifting information as I can – at least in my personal writings. I’ve been working hard to distribute more humor, because I think it is good to lighten up and not let my world or your world be overburdened with seriousness. Yet the jury and I pledged at the end of the trial that we would do what we could to cause the world to not forget a little girl named Gennifer Egans. We were determined to make every April 1 a day of reflection.

Child abuse is just about as ugly a subject as we can find in our society. Even since the trial, there have at least dozens of stories just as horrible presented in our local newspaper. I wrote a story about my experience and had hopes of getting it published in the Dallas Morning News. It got rejected because of its length, but it did get circulated around the state, ending up in some law classes. I do know that it got back to the prosecuting attorneys and even the judge presiding over the case.

The public servants and caregivers need our help. It is very hard to get a conviction in a child abuse case. The defense in our case tried everything they could to twist this case. A diligent paramedic ended up with the defense counsel trying to turn the table, suggesting he fell on the child in the ambulance on the way to the hospital. The attorneys deal with hundreds of cases like this every year, with many juries letting the abusing adult go free because of the difficulty of a jury believing a parent could hurt a child. How anyone who works in Child Protective Services can get a good night’s sleep, knowing what they have witnessed on any given day, is amazing to me.

To the college students who might hear my words, I hope that some of you will find a professional role someday that will be a part of protecting defenseless children. To all of us, I hope that we will give praise to the Lord that have been provided a better life, that we are shielded from an incredible world that sometimes is a manifestation of the Satan’s greatest works. But let our prayers include those children that have no clue what people are talking about when we speak of angels protecting us, intervening for us, comforting us.

I am enclosing my reflection from that experience. Many of you have received this essay in the past as I try to send the message around regularly. However, it has been over a decade  since I last raised the issue. I know that it is uncomfortable reading. But my fellow jurors promised each other that we would remember this life-changing event, perhaps in the hope that we would never get too comfortable with this sensitive subject.

What we did, we did out of duty during that long week. But we felt called to speak for Gennie Egans. We joined with the cadre of public servants who feel a duty to protect the defenseless, although we got no satisfaction from finding the mother guilty. April 1 is at my doorstep again. Neither I nor my fellow jurors intend to let this child be forgotten. God bless her. LFM.

Who Speaks for This Deceased Child?
By Lewis F. McLain, Jr.

I did not volunteer nor would I ever have volunteered for this burden of being a juror on a trial involving child abuse, which we later learned was murder. In fact, I was tempted to use a lame excuse like several other panelists who were put in the position of accepting our fate if we were selected. Somehow I knew I was going to be picked for the jury the minute I walked into the courtroom.

The Trial.

The way the story unfolded was interesting. We were told before the trial started that the charge was for injury to a child 14 years or younger. At first I only heard “14 years” and did not hear “or younger,” leaving me to think this woman being charged got into a fight with a teenager and blows were delivered. There were no opening arguments to give us an overview of the facts that were going to be presented. I’m not sure why, except that I realized later that it was probably greater assurance that we presumed this mother innocent until we heard the whole story.

But then the ugly story was revealed, all components not fully understood until after both sides rested their cases. This was about a child who had not reached 20 months of age, a great shock but not as shocking as when we learned that her weight averaged less than 1 pound for every month she had been on this earth. This child was born prematurely to a mother 21 years old. Even sadder, this child was the third child of four – the oldest being three years old and the youngest just a few months old.

The father of this child and the fourth child was the prosecution’s first witness, a father of eight children with five women. He had provided no assistance of any sort to this child nor to the fourth child. The woman’s first two children were obviously from another man, and there was never any mention of marriage involved with any of the four children. The first witness invoked some unintended sympathy for the defendant, but served a very important purpose – and that was to rule him out as a potential perpetrator and to establish the extreme dislike the father and mother of this deceased child had for each other – and the potential for this animosity to be transferred to the child. That alone was certainly not enough to sway us, but it was an important piece of the puzzle.

This child had been born prematurely, weighing only 2 pounds. She was not only small and fragile, making it only to 18 pounds in her short 596 days of life, but she was “slow” or “delayed” as the terms were used during the trial. These combined conditions, whether physical or mental or both were manifested in one of two major “misdeeds” in her life: she was slow to be potty trained in the view of the mother, and she was always wanting to be held. The fourth child, a newborn, apparently was the only privileged child to be allowed to wet her diaper as the first two children had been potty trained “before they were one year old” in the testimony of the mother.

The second misdeed of the child wanting to be held was told by neighbors and a day care worker as they described the mother rejecting the child’s motions to be held and the mother’s insistence that no one else hold the child. This rejection was rationalized by the mother as her way of making the child “catch up” with her older brother and sister and to be prepared to make it in this world.

The story that started out to be a 911 call for possible asthma was transformed to a diagnosis of “gross” internal bleeding suspected and discovered only after the child had gone into cardiopulmonary arrest and the observation of a distended stomach. There was a possibility but not a certainty that the child would have lived if the paramedics had been given a clue that this child had been beaten severely. They would have taken her to one of the best children’s hospitals in the world.

The attending physician in the hospital they did take her to would have started giving her blood immediately upon arrival. But only when fresh bruises appeared and announced the same message as the swelling stomach did any of the specialists (including the special team from the children’s hospital flown by helicopter) know that they were possibly dealing with child abuse. The mother had been quizzed but revealed only that the child, when called to come get a snack before bedtime, had become listless, slumped and had convulsion-like symptoms, including difficulty breathing.

Witnesses and evidence were introduced to compress the time frame between when the child could have sustained the injuries and her pronounced death. The last non-family person to see the mother and child was a ninth grade girl, an acquaintance who was at the one bedroom apartment to have the woman curl her hair. The little 18-month old child had wet her pants, was jerked by the arm, carried to the bathroom and hit extremely hard on the lower back as punishment. The ninth grader, a courageous and articulate witness, was very credible. No one was able to dispute that she was the only non-family person in the apartment within an hour or less of the call to 911.

The mother had been attending a beauty school while the four children were in a day care center – except the day of the child’s death the mother stayed home awaiting a phone call from a potential employer for a job in another field (even though she had Caller ID). A neighbor had taken her to pick up her children at the day care center in the afternoon when the mother learned that the child had wet her pants. The mother was heard saying, “You’re going to get it when we get home” and did not deny the words (only the tone) when she later took the stand.

When they arrived at the apartment, the 20-month-old child had to walk from the parking lot, located on the exterior of the apartment complex arranged generally in a square, to the apartment entrance located in the interior. The child stumbled and fell on a crack in the sidewalk. After being told by the neighboring friend that the child had tripped, the mother yelled for the child to “get your ass in this house.” The mother was then confronted by another neighbor observing the scene who told the mother to pick up her child. The mother fired back that the president of the United States can’t tell her what to do with her child.

Inside the apartment, the ninth grader heated a burrito for the children while the mother, over the course of the early evening, called the neighboring friend twice to ask about the neighbor’s 25-year-old brother. The mother had paged him twice, and he had not returned the call. It was apparent that this was yet another man in the mother’s life with whom she was either having a relationship or pursuing a relationship, and she was frustrated that the man had not called back.

After the spanking scene occurred, the ninth grader got her hair curled and then left the apartment. Nobody knows exactly what happened afterwards or just how it happened, we only know the results. Our first clue was from the attending physician who determined there was internal bleeding.

The real evidence came from the medical examiner. His testimony was extraordinary. The language was almost as graphic as the photographs from the autopsy. However, he was so good with his explanation and so clinical in his demeanor that it was as if I had personally snipped and scooped up the organs from the child myself without a queasy reaction. And I am an extremely queasy person.

If we had been told in advance what we were going to see, we would have spent hours of dread leading up to this moment: a liver lacerated in two places – big lacerations; a lacerated mesentery or shield attached to the intestines; and a bruised sigmoid colon, which is hard to do since this is the last section of the intestine that connects to the rectum. Ribs 10 and 11, the next to the last two lower ribs, were fractured.

The medical examiner stated with confidence that these kinds of damages could only have been inflicted by a blunt force delivered by either an automobile accident, a fall from a multi-story building or a hand, foot or other object delivered powerfully several times. The internal bleeding came from the liver, an organ which has a large volume of blood transported through it. The severity of the torn liver was such that the bleeding which preceding death could only have been from a few minutes to a couple of hours before death was pronounced at 10:41 p.m. The 911 call came around 8:30 p.m. The medical examiner’s official unequivocal conclusion: homicide.

The prosecution’s witnesses were almost flawless: their stories were consistent; the witnesses were all credible; the evidence was overwhelming. The defendant took the stand and offered contradictory testimony but was almost silly with her explanations – especially the one where she demonstrated the whack to the child’s behind that was witnessed by the ninth grader. Her example was a slap not much more than a slap at a mosquito on an arm. It was likely, though, that even the ninth grader probably did not witness the fatal blows that came sometime after the girl left the apartment.

Jury Deliberation.

Upon returning to the jury room for deliberation, a quick secret ballot was taken. Ten guilty ballots and two not sure. The discussion among the jurors was remarkable. The jurors were wonderfully fair people, already having demonstrated their goodness in the days before as you get hours to size up 11 others in a room with you through the exchange of conversation. There was a strong bias that this mother was innocent until the jury was shown otherwise. Allowing the story to unfold without knowledge of the details – even that there was a death involved – had made us weigh the cold evidence and draw a clear conclusion.

The two “not-sures” turned out to be precautionary, which I appreciated. Nobody believed the mother actually set out to kill the child, and there was no mention of hatred or disdain for the mother – but the results of the act were not questioned. A second vote made it unanimous. We were sure of our decision, but now the dread of sentencing was falling somberly across the room.

The punishment phase was left for us to mull over during a weekend, although the grandmother of the child took the stand to give testimony in support of probation. The sentence could be as little as probation and as long as 99 years. Oh, how unfair it is to place this burden on jurors. In just over 60 hours we had to decide a sentence yet we could not talk about it to anyone – just pray.

There were so many factors: this mother and the separation from her children; the safety of her children – a big factor; an even greater concern of mine was her future children who would have to be potty trained or may be “slow.” The defendant’s mother took the stand to talk about all of the family support that would be given to the defendant – should the defendant she get probation. But this was what bothered me the most.

Where was her mother when advice was needed on having sexual relationships with men who care nothing about the precious product? Where was her mother when she became involved with this irresponsible man who not only fathered the deceased child but the fourth child – even though it had to be clear to the defendant and her mother by then what the program was as far as this man was concerned?

If the defendant’s mother had failed her during her mid-teens, there was now a long and clear four year history of where this defendant’s life was heading. No grandfather of the deceased child surfaced in the trial, so one was left wondering about family support.

There was the concern about the cost of imprisonment for this mother. In fact, the staggering costs in a criminal court include a judge, a court coordinator, a court reporter, two bailiffs and the enormous facilities that serve these players. There were at least two and sometimes three district attorneys presenting this case and field investigators not seen. There were two court-appointed public defenders presenting the case and many people behind the scene.

This mother had been housed in a jail with a population of 10,000 inmates getting three meals every day and accommodations that come with enormous cost. The medical examiner and support staff are highly trained, expensive people. The child protective services personnel who supervised the remaining three children carry massive caseloads. The ambulance, hospital and police personnel that were involved in this case are all paid by us. The cost of the day care center that kept the mother’s children was some kind of government-funded program. There was grand jury time, and this petit jury put in at least 50 work days on this trial at a high cost through their employers or by loss of income for the self-employed.What were we to do?

Was there a chance that the other three children could be harmed if this mother lost her temper again? If she is capable of bearing children for 15 – 20 more years, how many more will she have who have to be potty trained – or worse, who may be born prematurely. Instead of being cradled and nurtured to healthy adulthood, would they be scolded and spanked into advancing their developmental clocks? Does confidence to make up a deficiency come from hugging a child to your bosom or from making an 18-pound child walk for great lengths and then get screamed at if she stumbles and falls?

Can’t kids just be kids for a few years? If they wet their pants or disturb a father watching a football game, do they deserve to die? If they are the center of a dispute between a man and a woman, should they be the ones to get executed? I don’t think so.

As a member of the jury that heard this case, child abuse came alive in a way that differed from my normal reaction. It has always been easy to just cringe and then go on when reading about child abuse with disbelief that one could move to a level of destruction that results in serious injury or death.

The jury came to a decision relatively fast: 40 years in prison and a $7,500 fine. We agonized over the plight of the young mother in prison and the protection of the children if she received probation. The prosecution had argued for life, which several of us would have gone for with ease. The prosecuting attorney painted a picture that most of us had already spent a considerable amount of time visualizing over the weekend. The last sights and sounds the dead child experienced were most likely yelling and screaming, the force of having brutal blows being delivered to her abdomen and other parts of the body. I felt the nauseating sensation of having her liver ripped apart allowing blood to fill the abdominal cavity.

What was going through the child’s mind? Confusion? Terror? Or even sadder, a normal reaction to not flee the mother, but to embrace her – a child’s way of apologizing for upsetting a parent?

When are we as a public going to address the root problem of child abuse and the myriad complications manifested in the symptoms we observe and treat – while ignoring the underlying causes? There was a father of this child who was guilty not of this crime, but one almost as bad. He was party to the creation of a life and then abandoned the child.

It was not just the mother who was left high and dry, but we the taxpayers footed the bulk of the financial bill. Where were the parents of this mother who needed to intervene and redirect? How many children with how many fathers would it take before someone held this young mother accountable for her actions and attempted to influence her judgment?

But then why bother? Public hospitals and other health programs covered part of her needs; other programs paid for the child care of multiple children while she piddled around with a job; and when she flew off the handle, dozens of tax supported people in the public safety and judicial system covered the cost of damages – which have already stretched into the hundreds of thousands of dollars. And that expenditure is just for one negligent person in one reckless moment of anger.

Jurors were not only inconvenienced but had to shoulder the burden of passing judgement on the guilt or innocence of a person under these repugnant circumstances. Do these criminals think we don’t feel the weight of our decision? After passing judgement on this mother, we learned from her defense attorney that she did, indeed, commit the crime – but that it was supposedly just an accident. We learned from the prosecutors that there was evidence of child abuse with her other children and that at least the three-year-old may have witnessed what really took place.

The prosecution had offered a plea bargain of 25 years and the defense had recommended she take it. But no, the mother decided to make a mockery out of the judicial system and burden 12 jurors for five days. It is hard to disguise my resentment when a mother smashes the body of her 18-pound child and then rolls the dice to see if a jury can be tricked into doubting whether or not she could have done it.

And yet, as jurors, we demonstrated compassion in ways that you would know only from being there. Where have parents failed when they raise children who turn into mothers without a sense of responsibility for their actions or remorse for bludgeoning a child?

The stories of not just child abuse but outright murdering of children are becoming so commonplace that we have become desensitized to the events. Virtually no one but a few family members came to this trial.

I am equally haunted by the medical reports and autopsy report presented as evidence at this trial. Upon reviewing them after we found the mother guilty, I was distraught to see the end of a life on paper. There were several pages of heart beats on magnetic strips that showed erratic patterns changing into flat lines up to the minute of death.

There was also the heartbreaking evidence in the autopsy report of the only crime committed by this 18-pound child: “The urinary bladder is devoid of urine.” The child was sentenced to death for wetting her pants. The mother escaped with only 40 years! When are we going to stop pretending that we don’t know the root problem of child abuse? We must deal with the breakdown of the family and the lack of basic training in the home before we can remedy the fruitless effort of dealing with the costly symptoms.

Will somebody help society to get on THIS side of the act of violence? The event is but a few seconds, but the stage is set months or years before. The caregivers, the public safety and the judiciary are crying for help. The prosecuting attorney called me after she received this essay to thank me. She also said that the district attorney had a mandatory rotation requirement. Nobody can get close to child abuse, real close, without having a physical, mental or spiritual breakdown. Yet many are called to serve in that arena. God bless them! LFM.

MISD: Give Us The Tax Rate Equivalent!

.Reading time 12 minutes.

I’ve been told by some MISD officials that I simply don’t understand the difference between an Operating & Maintenance Tax Rate (General Fund) and the Interest & Sinking Tax Rate (Debt Service Fund). After working with government financial information for over 43 years, I think I do. I’ve been told that I am ignorant or just making the decision on my own to disregard the facts. I don’t think I have. I think the MISD is doing just that.

I do know this: the audited financial statements available on the MISD Web site are very helpful, but they are also not easy to discern certain critical pieces of information. And the posted budget? It is simply horrible. High level and without the most critical pieces of data to assess certain trends, ratios and key factors, especially as it relates to debt. So where do you go to find that information?

The Bond Holder.

In general, the MISD Board is dependent on the story and the spin on the story provided by the professional staff. The bond holder is a quite different. If you think Jane & Joe Citizen have a stake in MISD because they pay taxes, what about those holding $485,660,000 in tax supported bonds? There are a few individuals holding these precious bonds, but mostly banks and insurance companies hold these bonds. Smart individuals. They don’t accept “trust me” as an answer. They know the vernacular, the concepts and the downright hard dollar issues. And they ask a lot of questions.

In fact, the there is an entire array of financial disclosures MISD makes to the bond holder. MISD is not only obligated to disclosure a lot of data, but they sign an agreement that they will continually update and disclosure key datasets. The Official Statements and obligatory Continuing Disclosure statements are rich with meaningful data. Especially for the MISD Board and Finance Committee. Since these documents are prepared for bondholders and their “representatives” such as the bond rating agencies, these documents are generally presented in very clear tables and footnotes.

What Can We Learn?

I would be happy to spend several blogs breaking down and analyzing the data that MISD discloses to the bond buying public yet probably not even to its own taxpayers. But let’s just pick a few points to answer the question that is not being addressed in the current discussion regarding the football stadium. Let’s start with the Continuing Disclosure statement filed by Jason Bird, MISD Chief Financial Officer, on December 17, 2015, exactly three months ago. That’s pretty fresh data!

The Taxable Assessed Valuation has increased from $8.787 billion to $11.555 billion from fiscal year 2012 through FY 2016 (the year we are in). That’s a nice improvement and gives the bond holder a nice sense of security with assurances there is the ability to repay them through the I&S Tax Rate of $0.50. The math is easy. The tax base x the tax rate per $100 results in a levy of $192.972 million at the full rate of $1.67 (the one my checkbook cares about), with $0.50 or $57.776 million going to the I&S Fund to be spent only on debt service.

So, is the Debt Service payments for FY 2016 $57.776 million? No, another schedule shows us that number to be $55.838 million. Why the difference? It should be closer, but it is usually because an allowance is made in case some taxes are not collected. Some taxes that are levied are not collected? Yes, but it is a small portion. We can find that MISD collects about 98.7% of the current levy plus past delinquent amounts that adds up to darn near 100%. MISD even collected more than 100% in one year.

We can also learn that Debt Service (DS) obligations drop off significantly unless more debt is issued. In FY 2017 the DS will drop to $48.388 million. Payment levels hold in that general range for three years and then drops to $43.854 million by FY 2020. Then the DS drops off in a rapid fashion.

So, that is how MISD is going to be able to sell more bonds in the $200 million election and not have to raise the tax rate – in fact even drop the I&S rate by 2-cents? That is correct. The MISD has been conservative (that’s a good thing!) in its debt issuance strategies to allow for future debt capacity.

So what’s the beef you have with the football stadium, Lewis?

The Intellectual Dishonesty: Tax Rate Equivalent (TRE)

There is one sure way to understand the magnitude of  local government and school spending. MISD already states much of the budget on a per pupil basis. What is missing is the perspective that gives the MISD Board and, in return, the public the ability to assess the fiscal impact of MISD decisions.

Somebody at MISD has a Debt Service payout schedule associated with the football stadium. In total, between the $50.3+ million to be voted on plus the $12.5 million authorized but unsold from the 2000 authorization, there is close to $63 million of debt likely to be issued. So the question that should be asked and answered is this: what is the Debt Service going to be on $63+/- million in new bonds just for the football stadium?

I am 100% positive that MISD has that debt schedule internally. To not have it would be reckless. In a bond election such as we have in front of us, it is likely they have several DS scenarios that vary to some degree based on the staging of the issues, interest rates and the length of the bond issue – likely to be 25 years. The bond committee and finance committee know the numbers. Again, for them not to have asked or for them not to be presented the numbers without having to ask for it is an oversight.

The Numerator & Denominator.

I am pretty sure I could get extremely close to the Debt Service number on my own. It is likely to be between $5-6 million in the first few years and then drop off, depending on how the payout is structured. That’s the numerator.

The denominator is the tax base. We already know the assessed valuation is currently $11.55 billion and is likely to increase in the near future. Not by double-digit levels as we saw in FY 2016. But for an average over the next few years, let’s use a generous $14 billion.

At $5 million of DS to cover with a $14 billion dollar base, we can get within a range of the tax rate impact equal to about $0.0357 for the football stadium. So, I believe I’m in safe territory saying the fiscal impact, the Tax Rate Equivalent of the football stadium is between 3 and 4 cents – and maybe as high as 5 cents.

There likely would be a stampede at the City of McKinney if the City Council even suggested a fraction of one penny TRE for something. Therefore, the range I am talking about (but MISD isn’t) is a gigantic taxpayer hit being disguised as no impact.

So, does that mean that if the football stadium is not built and the $60+/- million is not issued, that the increment of 3-5 cents could be reduced from the current $0.50 I&S tax rate? Yes, that is exactly what I am saying.

Bad-Faith Bundling.

I received the most interesting response from a knowledgeable MISD person after I sent my blog out on Tuesday. After going back and forth with him about my “errors and ignorance in my blog,” I was not told of anything specifically I said in error. Let me say now that I am always willing to stand ready to be corrected if I have goofed. But after pressing the person and not finding anything specific where I was wrong, I asked about the elephant in the room. He had not said anything about the biggest blast I had made.

He had not mentioned I was wrong about the Ballot Bundling where the MISD is planning to not separate the football stadium but rather to make it all or none bond proposition. If you want the HVAC to keep working, give us a football stadium! But then I was shocked with his response when pressed on this biggest issue of all:

“I realize you don’t like it, but if it is legal, then they (MISD) can use it as a mechanism.”

OMG, that was the opening line of my blog played back to me! How arrogant! How intellectually dishonest could one get? I suspect he was puppeting the very words of the MISD staff pumping up the bond committee in a bond speaking points pep rally.

Bottom Line:

Unbundle the football stadium and tell me it is the Tax Rate Equivalent of 3-5 cents (they know the exact number), and I will vote YES.

Deceive the public, and my grandchildren will not have the HVAC fixed in their schools. I won’t be blackmailed. LFM

Bond Disclosure Materials.

Go to http://www.emma.msrb.org. Type in McKinney TX, and you will get a list of the Official Statements for both the City of McKinney and McKinney ISD. Click on the 2014 bond issue. You can then download the Official Statement as well as the Continuing Disclosure statement. LFM

Cataracts & Health Tidbits

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Cataracts. It’s another 90 minutes before I have to show up for cataract surgery. One eye today and the other next Wednesday. I’m looking forward to getting it done. This is one of those things where thinking about it is probably worse than the event. It’s hell getting old.

Hand Rails. We had a hand rail installed in our shower this week. Linda and I don’t fall very often, but it happens often enough to be concerned. I’m not sure why we didn’t do this a long time ago. I am realizing that it’s more than just a safety thing. Without needing it for breaking a fall, the fact I know it is there reduces the risk of needing it at all. I notice I slightly touch the rail with my arm while showering. Comfort. Confidence. We are in the second class of Baby Boomers, so I highly recommend considering safety aids. Worth every penny. Cheaper than fixing a broken hip!

Hearing Aids. Okay, I’ve put it off long enough. They are a 2016 have-to. I’ve needed them for years. When I am in a group of people or in a loud restaurant like we were last night, I hear only noise. That is why I rarely attend receptions and things with people talking. Even with hearing aids, I will probably still prefer one-on-one conversations. But it’s now a necessity. Well, unless I can go throughout the rest of my life wearing my headphones and listening to Springsteen. Quit dreaming, Lewis.

Heart Stress Test. Way too long since the last one, but I finally went to a new cardiologist yesterday to start the process. But then I had to wait and wait. Most of my docs are not like that any longer. After 45 minutes I got to the first step with the nurse. After the preliminary stuff, including an EKG, the doc was supposed to be next. I asked how long? First it was going to be a short wait. Then after another 45 more minutes I put on my clothes and left. All they had to do at the beginning was to say the doctor is running way behind and give me a choice to wait or reschedule. I won’t be going back.

The Dentist. I don’t dread the dental chair like most people do. Yes, it is mostly due to the nice gas I get when the dental work is serious. However, I am still reeling from the cost of three implants and crowns a few years back. No excuse to take care of business now. But I’ve managed to put it off long enough that I’m sure the next visit will reveal needs that will take care of at least one dentist child’s college education.

Household. I’m up to snuff in this category. In the last 3-4 years we’ve gotten a new roof, gutters, both HVACs replaced and upgraded and a outside lighting system that is both great for security as well as appearance. Coming up: a HD camera security system. After that: a high-end generator that could run the house for days. I’m expecting a future with more than just brownouts. Too many things could put us in the dark. And Linda’s tolerance for being without an air conditioning is somewhere between 5 and 10 minutes.

Vacations. Our cruise a couple of weeks ago was our ninth. Linda got an infection in her legs by the time we started and basically kept us in the room for the entire trip with a few exceptions. That cruise may be our last – at least for a while. I can’t afford to get her in the middle of the ocean and away from docs and hospitals with her compromised immune system. We are talking about a driving trip to places we’ve never been right here in the USA. I need to see those California redwoods before Restland.

Blog Responses. I’ve got several blogs and responses to blogs in my head. I’m getting up between 4 and 5 am ready to go most mornings. My goal is to get them written and out before my workday starts. The McKinney ISD and Addison blogs generated mostly supportive comments but a few criticisms I will address. Never enough time. Thanks for your interest. LFM.

 

 

McKinney ISD is Intellectually Dishonest

.Reading time 12 minutes.

Introduction.

“We don’t legally have to do that.” Gee, I hate that response. There are reasons we have laws that make us do something. Usually these reasons include an abuse of power, a lack of transparency or flat out deceitfulness. Oh, and worse of all, when we take choices away from the taxpayer or voter. There are many examples. A daily blog for each one would fill most of my calendar year. But let’s talk about one.

For many years, cities and counties were allowed to choose how the ballot was fashioned for a bond election. Let’s think this through. If I were a city council or staff member and had some controversial items I wanted to see passed, what could I do? The logical and most honest way to be fair with the taxpayers is to separate the choices on the ballot. Almost never are bond ballot items given the same weight. Streets and Drainage are often top priorities. And for a good reason. They are used by everybody daily and create a hardship when they fall into disrepair.

But how about a library? I would give it a high priority, but would you? A new city hall? We might be split more evenly on that one, although I personally would push hard for the important image of the building that houses the seat of government and the public forum. Many would disagree and be perfectly happy in an ugly two story bank building that you can stand in front of and possibly miss. If we went down the list, there would be certain items that we might really bicker over. Something big and expensive used infrequently might be tough to get passed.

So, would a city place 4-8 separate items on the ballot and let the voter choose? Or would the city council lump the controversial items with sure-thing items and put the voters in an All-or-None situation?

Ballot Bundling used to be legally possible for cities to do in Texas. But then laws got changed to force a city to allow the voters to see the choices, make the choices and for the city to live with the outcome. So, Streets & Drainage are separated from Parks & Recreation. And even Parks & Recreation might be split so the voter can decide. A Natatorium would surely be separated.

When you think about it, while now a law, most citizens and city officials they elect would think of it as the insult of the grandest order if they were placed in an All-or-None situation. In other words, abuse came first, then a law, and now it would be considered an egregious act to force a voter into a corner and demand a ransom.

Now Comes McKinney ISD.

MISD is days away from calling a $200+ million bond election. It contains an expensive $50+ million football stadium. The remainder has to do with classrooms and other facilities that, on the surface, sound logical and needed. If anyone has been preaching to take care of aging infrastructure longer than I have, please step forward.

Silly ole me made the assumption the football stadium would be a separate ballot item.

Then a colleague told me that MISD was going to bundle the stadium with the core infrastructure items. I quickly corrected them that it would be illegal for a ballot to be designed that way. I was then told school districts could get away Ballot Bundling. As I am prone to do, I checked with some professionals and got put in my place. ISDs can do this – legally – and MISD plans to do so in just a couple of days.

Intellectual Dishonesty.

I am stunned! While anticipating that the bastions in search of truth, our educational institutions, are going to pop the “it’s legal” over the net, I’m ready for slam it back. This is the egregious abuse of power and deceitfulness and voter extortion that got the cities in trouble years back. How is it that ISDs can get away with this nonsense? Better lobbyist?

Whoa, Baby! Now you have my full attention. But as I get into this deal, I get more alarmed. Most of the people in McKinney ISD had not heard of these plans for a football stadium until June 2015 when a huge sign appeared in a field at a prominent location just off the Sam Rayburn Tollway. It’s prime commercial property to me, but that’s another issue. In McKinney we have two zoning designations: 1) Residential and 2) Commercial About To Be Rezoned to Residential.

There were several news stories at the time, most of them quoting school officials saying the football stadium conversation was just getting started.

So I go to the property rolls and learn that there are three large parcels of land that make up the stadium site. Two were bought in September 2011 and one in 2015. Sounds to me that the conversation started some time ago. Then I find a high-level sketch of the site and a rough cost estimate by an architectural firm working for the ISD. They may be working on other things, but they have been paid $2.3 million with the first payments on August 22, 2014. By the time the sign had been planted in the field, MISD had spent $1.277 million on them. Okay, this is getting a little more irritating to me.

No Tax Rate Increase???

But there is a bigger issue here. I am hearing that the stadium can be built without raising the property taxes. Now this is both heartbreaking and maddening at the same time. I was part of the group who voted for a 13-cent tax rate increase in 2013. The proposition passed but my little circle of friends thought I was crazy. However, I did my own number crunching back then (of course I did!).

Fortunately, I wrote an email to a colleague back at that time explaining my logic. In the email I also indicated that, according to my analysis, the MISD was asking for 3-4 cents more than they needed. I was actually okay with that. In my mind, a huge increase means you better not come back to the taxpayer for quite some time.

I also gave weight to my decision when I watched the video of the school superintendent at that time talking about how the MISD had taken so many steps to cut here and there before having to ask for the voters to fill the gap left by the mean ole state legislators.

Fool me once, shame on you. Fool me twice, shame on me. Dang! We have made a quick recovery. Three years after needing 13-cents, MISD can miraculously build a $50+ football stadium without raising taxes. Somehow I don’t hear the ISD explaining the converse: if we don’t build a new football stadium, we can cut the taxes by …

So what do we have now? Apparently a $50+ million stadium that to my knowledge was presented at the outset as a Cadillac model. Did the MISD board get a chance to see Chevy alternative? And not only do we get sold the Cadillac, but it may be bundled with the HVAC to keep our “keeds” warm or cool or to keep the roof from leaking on their heads. Take it or leave it!

Is The MISD Board on Planet Earth?

I tried to go online to see what I could learn about the MISD Board meetings. I can find agendas, but no minutes although the button says there are minutes. I tried to watch a video of a meeting. I can only find two video and neither of them had the audio working. I tried to look at check registers, and they are in PDF format and listed in an order that must have come from a random number generator.

Does the Board ask questions or rubber stamp everything? Do any of them have any kind of business sense? I would like to know if any of them have even looked at the budget and audited financial statements? Or the check registers?

As an aside, nobody seems to have taught the MISD B0ard and Administration about timing and perception. Allen ISD’s football stadium has nothing to do with this MISD decision. Or does it? The entire world gasped at the cost of the Allen ISD stadium ($60 million for 18,000 seats) as well as the problems they had. The construction company fixed the problem, we read, and the AISD was not out more money.

However, the construction company is McKinney-based and has built almost every school building in McKinney over the years. Their school buildings seem to enjoy a great reputation. MISD has paid them $138,938,096 since FY 2008, the largest cash outflow other than personnel costs and wire transfers for bond payments. And that doesn’t mean they are even going to bid on this proposed stadium nor does it mean MISD would select them. However, add a perception issue to everything else, and you just have to ask yourself what is the MISD Board thinking?

Oh my, I get the sense that the MISD is another entity that labels themselves as transparent. If you are smart enough to dig through their information and ask a lot of questions. And I mean a ton of questions! LFM

I Smell Fraud in Addison … In the Fraud Audit

.Reading time 5 minutes.

Maybe the Dallas Morning News got it wrong. They must think there’s a hot story here. The story came out March 11 with the headline: “Addison officials, former city manager debate credibility of report on town’s finances.” The same story in print this morning on the front page of the Metro section is headlined “Audit: Millions couldn’t be traced.”

Several things bother me about this story. A forensic auditor was paid $125,000 and did not investigate any fraud. And  did not find any fraud, apparently. I don’t know the billing rate, but it would take 625 hours at $200 to get to $125,000. That’s about 1/3 of a work year for a full-time person. But not just any person. This is a supposedly skilled, experienced, certified professional. How could you spend that many hours and not find any fraud, but whatever was found is purposed to be poor internal controls.

To me, poor internal controls says something might or could happen. Money that can’t be traced is a giant step beyond declaring less than ideal internal controls. One is left to believe something did happen. Did it or didn’t it? You don’t fool around with masquerading facts as suppositions.

If $millions couldn’t be traced, what was the level of effort to trace said $millions? My grandchildren could probably figure out that 95+% of all municipal spending is tied to payroll and benefits payments, debt service payments, construction contracts, professional contracts, insurance, utilities and a handful of other big-ticket items. There are thousands of small items like office supplies and travel that make up the remaining 5% or so. This story, if accurate, simply does not make sense to me.

If this is a professional auditor, then there should be a list of specific findings that have been reviewed by staff in order for them to respond. Did that happen? Are those in the report? Oh wait, not only the money paid for this report, but the enormous weight given to the report by the council and press led me to believe that surely said report would be posted on the  Town’s Web site. It’s not there. Or well hidden. I can find a silly, shallow newsletter by the Mayor that ends with “All is well in Addison.”

It is kind of humorous that the Mayor seems to be wanting to put the toothpaste back into the tube on this audit that he initiated from his comments to the newspaper. Not so fast, Mayor. The audit you commissioned that didn’t seem to find anything concrete has impugned two city managers and about that many finance directors. Not to mention a professional accounting firm that must have completely missed all of those squishy things alluded to by the forensic auditor. As they say in the courtroom, where I am guessing you may be heading eventually, you opened this door. I don’t own any of the Addison bonds, but somebody may be damaged here, too, Mr. Mayor.

I have asked for a copy of this seemingly forensic nebulo-audit in an Open Records Request. I can’t wait to read it. It better be filled with facts and findings that somebody can address. My ORR also includes a request to see the agreement and scope of work between the forensic auditor and the Town. I’m curious just exactly how this scope of work got set and how the need was described by the council. I would also like to know if the Town interviewed other forensic auditors or even had some kind of an RFP/RFQ to determine if the best choice was made.

Surely this was not a sole source or friend of the Council, I wonder? My ORR also includes Campaign Reports to make sure the forensic auditor hasn’t helped out with contributions to the Council.

This smells like a witch hunt. The headline makes for good theater as does the council forum here. But I wonder if the forensic audit should rather have been on the Council itself. I don’t live in Addison, but this stinks. If there was something done wrong intentionally or fraudulently, nail them. However, the entire municipal family is damaged if this is politically motivated as it seems to be. LFM

 

 

 

Bruce Springsteen Conducts a Leadership Workshop

.Reading time 6 minutes.

Written August 11, 2015
Updated March 13, 2016

Not many people would attempt to turn Bruce Springsteen into a leadership lesson. If any of my readers out there DON’T know what a fan I am of Bruce Springsteen, then I’ve failed in my communications over the past two decades. I listen to Bruce almost every day and have since the mid-1980s. I was slow to learn about Bruce. He is just a couple of years younger than I am and had already been playing for 10 years before I heard his music. In fact, he has been playing since a teenager. There is no doubt that I will have many blogs about Rock ‘n Roll in general and particularly Bruce and a few others. I can’t sing, and I can’t play. But I love to listen to music, especially with my headphones.

To test a blogging widget, you can see on http://www.citybaseblog.net that there is a countdown to his April 5, 2016 concert at the American Airlines Center in Dallas. I have only been to two other Springsteen concerts. They are legendary. The last one I attended in Houston, he played for three hours straight and only stopped because he would be fined $1,000 per minute after 10:00 p.m. He actually stopped right on the minute as the band left him to play acoustically for another half-hour with the decibels below the allowed level after 10:00 p.m.

He had rather play in Europe where he has been known to play 4-hours, 15 minutes to several hundred thousand fans and then come back the next night to do it again. In this last two-year tour, I think he played almost 200 separate songs. His catalogue is that big, and they say he has hundreds in the book never made public. In fact, many of his newly released songs were written years ago, pulled out, amped up and released. My wife Linda has been instructed to bury me in one of my Springsteen shirts. On my behalf, would you please hold her to it? The decision will be out of my control.

Bruce and the core E-Street Band have played together for many years. Still, he does not tell the band the songs or the order until just as the show starts. And his members say the list doesn’t matter much, because he almost always changes mid-stream. He is also prone to decide in the moment to play a different version of the intended song. He will do this on his own sometimes, like taking to the piano to play Independence Day as a solo in a hauntingly beautiful rendition of the song telling his dad he is leaving home as a teenager. But, as this link below will show you, he often throws in an unplanned song suggested by a fan to the band. This is where the leadership example comes in. I invite you to watch this video not just to pump up your day, but to literally count the number of leadership traits you can observe and learn.

There is risk involved as you will see. There is a spontaneity that doesn’t give anybody time to posture or second guess. The band is watching and waiting while preparing for an experience. They have probably played You Never Can Tell before, but this Chuck Berry classic is about to become a live product that they hear as they make it.

Note the showcasing of the band members, especially the horn section. They have not been with the E-Street Band very long compared to the core members. The young Jake Clemons on the saxophone is the nephew of the great Clarence Clemons who died from a stroke in 2012 after playing with the E Street Band since the beginning. There is no consulting about their readiness. Yet he pulls, not pushes.

Most of all, note that Springsteen and everybody else is simply having fun. It’s contagious. When I last saw Bruce and the band in Houston a couple of years ago, I especially watched them closely in the third hour. They never tired. In fact, a new energy drifted into the third hour as they clearly were just flat out having fun, feeding off each other. Like in this video, he often cranks up the band and then just rides with the momentum.

And finally, listen to his very last sentence at the fade out. It sums up teamwork. It is the embodiment of entrepreneurial ingenuity. It is the trophy for possessing the creative spirit and having a leader pull it out of a group of highly focused people. Use his last sentence to evaluate your own leadership skill set. LFM

Thinking About My Bro

.Reading time 8 minutes.

This was the eulogy I gave at my brother’s funeral December 19, 2015:

Bob

James Robert (Bob) McLain

James Robert McLain. The James is from our Uncle Jimmy. The Robert is from our Uncle Bob – Our Dad’s two brothers. And no, not once to my knowledge was he ever referred to as Jim Bob.

He was born on January 8, 1952, the day Elvis Presley turned 17. He passed away on December 14, 2015. We know these things because Bob’s birth and death certificates say so. And because family members were there to witness both events.

Humor. Bob would have appreciated these tidbits of information being highlighted at his funeral. If we could hear him right now, he would be ready to follow with at least three corny jokes – in his head. But only one he would have gotten out.

You see, BEFORE Bob told a single word of a joke he would start laughing. By the time he was 15 seconds into the joke, he would be wheezing at his own humor, as red in the face like an apple.

His jokes were best when he had a table or a knee to slap as he attempted to tell it. He added rhythm to his jokes in a sense.

I don’t remember a single joke out of the thousands in his repertoire. But I remember everybody in the room wheezing by the time he got through one. We know this because we all heard him and laughed with him.

You never had to guess what was in Bob’s head. That’s because he was unfiltered. Whatever he was thinking was seconds away from rolling out of his mouth. Bob was usually not politically correct. But that was part of his charm.

If you weren’t laughing with him, you sat there – (sometimes in fear, sometimes in awe) – of what he was about to say. We knew this about Bob by being in his presence.

Goodness. There are many words to describe Bob, and perhaps I gave you a glimpse, but I’m sure those of you who knew him have a pocketful of endearments for Bob. The one that dominates my thoughts right now was his GOODNESS. You can precede the entire vast inventory of Bob’s traits with “He was a good ______________.” Person, Son, Brother, Husband, Dad, Granddad, Uncle, Co-Worker … the list is endless.

But all can be wrapped in genuine, golden GOODNESS. To the core. Without reservation. He was the real deal. We knew that by being blessed by Bob.

Bob was the hardest working person I’ve ever known. Our Dad passed down the trait to us. Thank God for Blue Collar upbringings. Bob worked for me several years, most of the 1980s.

All I had to do is point to the work and step out of his way. Quickly. He picked up a set of skills largely on his own and by cook-booking my work. And then he turned it into something better, adding his own brand.

When he was a young teenager, I once visited him at a hamburger stand where he was working. He could talk, laugh and flip hamburgers with his hands moving faster than I could keep up with. The scene remains a Kodak moment in my mind.

He was a fantastic utility rate analyst and consultant. But the fact is – he loved work for the great value that comes with fulfilling, hard work of any type. Many of us knew that by bearing witness to his productivity.

Bob was a Christian. And more than in name, he had a true relationship with Christ. Knowing this eases the pain. It’s a huge factor in our acceptance of losing him!

You didn’t have to guess about Bob’s faith. He felt it. He showed it. He shared it.
It would be impossible for me to count the number of times he told me that he was praying for Linda and me. We felt Bob’s love.

There are wonderful analogies that help understand or at least accept the mysteries of death and beyond. For example, the Chaplain in the hospital said we walked Bob to the bridge, and then Jesus and the Angels walked him to the other side. I buy that.

Others I like (and now am stealing) include about Bob being in a quiet boat on a calm lake slowly drifting to the other side to be received into his heavenly home. I’ll take that one, too.

But the fascination I have is with the actual moment of his entry into Heaven. I wish Bob could tell me about it right now.

Was it like the peripheral views of the camera in the opening scene of Gone with the Wind going from the outside and swooping through the huge doors of the mansion and into the room full of music and dance?

Were there 10,000 Angels singing at that moment and even now? Oh, how wonderful! Did the sounds wash over you, Bob?

What is it like to be in the presence of Jesus, to hear His voice, to touch His hand? What does the Voice of God sound like to the ear?

Was there a warmth, an indescribable embrace? Did you fall on your knees in awe? After all these years of grasping and savoring the reality of a Savior, Bob, what did the Lord’s arms feel like?

We don’t know exactly yet, … but Bob does. Bob is there with full knowledge, complete benefits, totally absorbing the ultimate experience! We will miss him here, but it is hard to be totally sad knowing he’s There. Praise God for Bob!

Lest you think these thoughts were formed just to eulogize Bob, his son Jason found a love-poem I wrote Bob 25 years ago on his birthday recording about 80% of these thoughts and observations. Like I said, Bob was the real deal. And he knew it.

Big Brother. It dawned on me last night that for Bob’s 64 years I have been the big brother of sorts. Ahead of him in school, driving, college, marriage, parenting and career. But on December 14, 2015, Bob became MY big brother. I find solace in that thought. And that is how I will think of him until we meet again. LFM

On Pensions & Promises

.Reading time 13 minutes.

Introduction.

Today is when I make a lot of people mad. My preference would be just the opposite. I treasure my municipal family. I am also a taxpayer, as are we all. But mostly I’m a realist – or at least I try to be. In the end, however, I simply respect arithmetic.

From 1973 to 1980, I was an employee of local government, almost five years in the City of Garland and two years at Dallas County. While in Garland, I was part of the Texas Municipal Retirement System (TMRS). The last thing on my mind at that time was retirement. We received a printout each year of our projected retirement pay under TMRS. All I remember is how large the numbers were. To be honest, I didn’t believe them.

It would be years before I would be fully aware of the story behind those numbers. The Governmental Accounting Standards Board (GASB) imposed on governments the obligation to disclosure unfunded liabilities. GASB was formed in that era due to the great embarrassment when the bankruptcy of New York City got largely blamed on the accounting profession.

In recent years here in Texas, Bob Scott, ACM/CFO of the City of Carrollton dug into what everybody considered to be the most conservative and most secure pension fund of them all, TMRS. Bob found a number of things that did not make sense. He inquired, then challenged and before long he was the voice of truth in the eyes of his peers, the finance directors in Texas. However, he stepped on some toes. His city manager, Leonard Martin, was getting some calls from his peer level and some HR directors wanting Bob to keep his mouth shut. If you know Leonard and Bob, you know full well that was not going to happen.

Before long the executive director of TMRS was gone. And so were the actuaries that had been advising for a half-century.

The Arithmetic.

The concept behind the complicated actuarial math is not too hard to understand. Contribute money into a pot that can be invested in things that earn money. And then subtract the payouts to retirees based on the health of the fund. Lastly, stay whole. By that I mean stay up with the current value of those payouts.

Each city in TMRS has their own plan, and plans vary widely. So, let’s tinker with the City of Fiscal Bliss, my imaginary city I’ve used since I taught MPA classes at SMU back in the 1970s. None of the cities started out this way, but let’s assume that the Contribution side was the employee only. The payout wouldn’t be too impressive but, hey, any annuity at a decent earnings rate rolls up into a nice sum of money given several years of dollars contributed.

Now, let’s add a contribution from the city. Let’s start with a 1:1 match, then 1.5:1 match and round out with a 2:1 match. Whoa! Look at that payout. Put the payout on steroids by assuming the future investment rate of return is 5%, 7%, 9%. Hey, it will NEVER be less than 5%, so why not build a minimum guaranteed earnings rate into the plan? Wait, we can do better than that by adding a feature that says the payout will be automatically adjusted for big portion of CPI. And the payout will be until you die. Or your spouse dies.

Lastly, let’s take the retirement age and conditions down. Instead of being eligible after 25 years of service, let’s make that 20 years. No, let’s make vesting at 15 years, then 10 years! Let’s do better than that. Let’s be a little more generous on how we count the years with credit given for other kinds of service.

Now, why would anybody agree to all of those pension features?

First, many of those increases in benefits were vouched for by actuaries in financial models nobody but they understood.

Second, in tough times when a city can’t give pay raises, there are efforts to give something else – something that doesn’t reveal its full impact for years later. Even things like giving all employees an extra day off seem like it doesn’t cost much. However, taking the City of Dallas as an example, one extra day off is the equivalent of the loss of productive for 52 full-time employees! In this case, some benefits were motivated by trying to substitute for other compensation that wouldn’t fly politically.

A third reason involves faulty assumptions. When you promise a 5% investment earnings minimum when a bank CD yields more than that level, it sounds good. But what if the best and safest investment instruments earn virtually zero like they have for several years now? You might be tempted to invest in riskier things that could yield 10-15%. But they could lose by that same magnitude. Maybe even 100%! Also, what happens when you start to slow in population and city employment growth while the number of retirees continues to grow?

Where Are The Risky Pension Funds?

There are 8 State Plans in Texas with an Unfunded Liability of $47.9 billion covering 2.13 million employees or about $22,488 per employee. TMRS is at $20,636 per employee and has a high funded ratio of 85.79%. Also, they have a very good (short) Amortization Period of 17.10 years. The state, county and teachers retirement systems are also relatively under control. These aren’t likely to collapse.

The story is quite different with the 85 Local Plans. You can regularly read negative news stories about the biggest ones in this group. The Unfunded Liability for the Dallas Police & Fire Pension Plan is $213,712 per member and is only 63.80% funded. The Amortization Period is … get this … Infinite. I’ll let you review the spreadsheet recap on your own.

Red Flag. Red Flag. Red Flag.

Out of the 85 Local Plans, there are 12 called Title 109 Plans. They were created under a different state legislation than the other 73 Local Plans. Why is this important to know? Yesterday, the State Attorney General revealed a request for a formal opinion from the Chair of the Texas House of Representatives Committee on Ways and Means.

March 8, 2016

Dear General Paxton,

I am writing to request your formal opinion on a question related to those municipal retirement systems of which some or all of their pension plans have been put into state statute.

As of 2015, Texas has thirteen local retirement systems specifically enabled by state statute, with their provisions located in Article 6243, Vernon’s Civil Statutes (also known as Title 109). Local retirement systems established in Title 109 have “their contribution rates, benefit levels and the composition of their board of trustees set in state statute,” according to the Texas Pension Review Board.

Rising pension and healthcare costs, unpredictable revenues, aging infrastructure, high debt load, and increasing costs for the delivery of city services threaten municipalities’ ability to balance budgets and maintain strong credit ratings. When these challenges put municipalities at risk for defaulting, does the oversight role played by title State Legislature in these specific municipal retirement systems cause the State to assume some or all of the liability? Should one of these specific municipal retirement systems fail to meet its obligation, is the State responsible for ensuring that agreed upon payments are made?

With respect to the size of these pension systems and their impact on city budgets, and the role played by the State Legislature in their creation and maintenance, it is imperative that the Legislature have a clear understanding of the consequences of decisions made in regards to these municipal retirement systems.

Thank you in advance for your consideration of this matter. Please contact me if you need any additional information regarding this request.

Best regards,
Representative Jim Murphy

I could only find 12 of the 12 plans or funds mentioned in the letter to the AG. They are:

Austin Employees’ Retirement System
Austin Fire Fighters Relief & Retirement Fund
Austin Police Retirement System
Dallas Police & Fire Pension System
El Paso Firemen’s Pension Fund
El Paso Police Pension Fund
Fort Worth Employees’ Retirement Fund
Galveston Employees’ Retirement Plan for Police
Houston Firefighters’ Relief & Retirement Fund
Houston Municipal Employees Pension System
Houston Police Officers Pension System
San Antonio Fire & Police Pension Fund

What does this sound like to you? Good luck with cities trying to tell the state these bad boys are their fault. Or maybe it is the state hearing about what is coming and wanting to go ahead and knock out this legal path before the next legislative session.

In Closing.

One of the things I thought I would never see and hear in my career is the decision for a state or local government to declare bankruptcy. Now it is happening all over the country. In my mind, the last state that could possibly declare bankruptcy or to break a promise on a pension is Texas. Now here is what blows me away. We’ve got this Texas Swagger ad nauseam about how robust things are at the same time we FINALLY have some signs like this letter that somebody is trying to figure out how to get out of their financial problems. The City of Dallas recently lost the cherished AAA bond rating. Why? The pension funds. The CFO has lost her job (moved over to another position) and she isn’t even directly responsible for the pension funds.

The reality is that promises were made based on faulty arithmetic. And when confronted with correct math, those in charge of solving the problem are beneficiaries of the numbers that don’t work.

Ah, but the can has been kicked down the road for decades and has finally hit a wall. LFM

The Strong Know How to Surrender

.Reading time 9 minutes.

We have been taught to never surrender
And there are places where that makes sense.
But relationships you desire to engender
Require you to calculate the expense.

For to grasp two sides is a decision
One bravely intentionally makes.
The easy path is senseless collision
That at best leads to futile stalemates.

Surrendering steps must be inspected
And the forum carefully designed.
To yield means all sides are by choice respected
With pledges for sincere dialogue enshrined.

To surrender is a strength smeared as weakness;
The insult for efforts to go below the surface.
Yet to trade peacemaking clarity for obliqueness,
Leaders must calibrate a new compass.

The loose verse is intended to encapsulate a proposition. Please allow me to expand for I know of few messages more important than this one.

Already you may have your teeth clinched if you are thinking of military battle training or even the high school coach still screaming in your head. You see, that is part of the problem I’m addressing. It is instilled in us to never surrender. Otherwise, how would we ever get out of college much less win a football game? My blue-collar family background taught me that I will make it in life for a couple of reasons. I will do whatever it takes to provide for my family (yep, I’ve cleaned restrooms in my past), and I will also outwork 95 out of 100 people.

The Personal Level

That no-surrender mindset may work just fine until it affects critical relationships. The divorce rate in our communities speaks for itself, and we all know it mostly boils down to communication issues. Yes, the specific topics are God, money, intimacy, children and even in-laws. But it is the lack of communication that is the central issue. And if we go a level below that barrier we will usually find that the very core issue is the inability to surrender.

And so how is this battle of the wills created and sustained? I am guessing that it is mostly passed down from the parents to the child, and most of us are both. We have an acquaintance with two teenage sons. In the last eight years there has been a constant battle with nobody willing to give in. Grades are not worth much if you sacrifice a relationship. The result is that the oldest son joined the Army as soon as he got out of high school.

Sadly, the exact same thing is happening between the parents and the youngest son. If ever there was a roadmap for relationship disasters, this is it. And the replication confirms that the parents have no concept of the key aspect of relationships, and that is knowing how to balance being firm with an effort to enjoy the merits of finding a middle ground.

Organizations

I have always found it interesting that many times the higher up you look in an organization, the more personable and relaxed the interaction might be with the person at or near the top. Why is that? Could it be the more senior executive has learned about relationships? At a junior level, there are often egos and the competitive pressures to excel. Again, balance comes into play here. But climbing the ladder to reach a lofty position doesn’t mean you can keep it. Woe to the wicked, Sancho, if you cross a junior executive a little too anxious to conquer the world with no regard to relationships. And, equally, how interesting when there is a failure by that same junior due to immaturity, haste, plus the encounter with peers and even underlings who will help you fail.

We can all recount the stories of relationships between department heads. Interestingly, I have found that many city managers are clueless since department heads all put on a good face in the staff meeting or when talking one-on-one with the executive. But the wasted time is senseless when spent on making yourself look good, and someone else look bad, only understood by the unpublished underground org chart. How can it be that so many people can rise through the ranks through their technical excellence only to be newbies again when they reach a supervisory or managerial level? How can we miss the most vital ingredient in relationship management – learning how to surrender without the actions and words being construed as a weakness rather than a strength?

Politics

And then we move to the elected body where instead of one executive there is a group that must make decisions. Worse, and I think this is the most wrong-headed anointment of all, they have committed to fight for their territory with an abused excuse that it is out of duty and honor.

Whoa! So we have moved to the ugliest of motives for making decisions that affect the future of our communities. I’m here to win! I was elected to fight for my district. My method, sanctioned by my voters (all few hundred of them) is to take no prisoners. The adrenaline rush of power numbs the senses for building trusting relationships. So we form a few coalitions to get the needed minimum votes and take charge of the politics.

Questions & Considerations

Are we to live forever in an environment of stalemates and that be the best we can do? Is that all there is? Not for me, life is too short.

How can we move to an environment where the art of professional and personal surrendering is viewed as a strength? Somehow we have to set a standard to replace the argument that to win is everything at all costs and with no concern for relationships? Who taught us that mindset? How can we raise the bar and give key managers and leaders permission to operate on an adult-to-adult level? How can we teach that it is partly a skill to be learned and partly a decision you have to make to transform building better relationships into a top priority?

Is it possible that communication, trust and respect be made the hallmarks of an organization? Would it make a difference if we were to put the topic of successful surrendering in front of our organizations? Is this a skill that can be taught? Is this a potential cultural amendment to our corporate constitution? By that I mean genuine change that resets the organizational GPS for future decades.

I think it is possible, but it would take some leadership. LFM

Originally written and sent to the McKinney City Council August 31, 2014. Updated March 10, 2016.