Citizen Recommendations for Improvement
What Bloomfield Township elected officials are failing to tell you. There is fat in the budget that can be cut. Here are 31 areas where cuts/reporting improvements should be evaluated:
- Set 401k(a) contributions to 5%, the industry standard, not the 10% – 14% that is being paid now except for binding arbitration contracts.
- Eliminate cars (as part of compensation) for all employees except those that are required by law.
- Increase employee and retiree contributions to health care costs. Quit "opting out" of the state law that says employees must pay 20% of premium. Savings of about $1.2M/year could be gleaned.
- Require employees to work more than 25 years to obtain full benefits and increase the number of years to receive partial benefits.
- Reduce the excessive use of consultants. Make the need and hiring of consultants part of the Board's Agenda so Trustees have a voice.
- Make better decisions on union contracts and water billing to reduce legal fees and avoid more lawsuits. The water law suit alone is $9M and growing against the Township.
- Review results and cut costs of legal firms representing the Township. Costs are high.
- End longevity pay. This should not exist for any employee. Work should be compensated on performance only.
- Right size the number of employees per department – 240+ employees for a community of 41,500 is high.
- Right size the number of fire stations based on need, not legacy.
- Reduce the purchases of new trucks and other equipment. Report to whom old vehicles were sold and the price.
- Require all contracts to be competitively bid and explain differences if the awards are different than the published information.
- Share more services with other communities and ensure that payments covers the true cost of the service including pension and healthcare benefits.
- Cross train more employees for other roles so that seasonal variations do not require new hires. Stop seasonal hires of employee's children.
- Outsource more services wisely. Why did the Township outsourced street sweeping for a six-year contract, after buying a new street sweeper? 40 communities outsource assessing to Oakland County including Birmingham, Franklin, Beverly Hills and Rochester.
- Improve investment returns with strong providers and a better selection of investments. Why are our providers under-performing benchmarks and competitors? Provide better statements and transparency of all accounts.
- Stop transferring general fund money to departments that receive millage (i.e. Public Safety received $6.66M and Roads received nearly $2M in this year's fiscal year budget)
- Renegotiate the paltry ($775k) road department contract with the county or end the contract when the current road millage expires.
- Evaluate the cost effectiveness of a roads department within the Township given the high cost of operation - 98% staff; 2% materials. Consider outsourcing road maintenance entirely. There is a reason no other community in Michigan has their own department.
- Go back to five day work week to provide service, accommodate residents and to reduce some overtime pay.
- Eliminate donations to 501c organizations.
- End the purchase of hams for employees.
- Reduce or eliminate education payments from contracts.
- Reduce or end special events with large expenses while benefiting only a small portion of residents.
- Improve financial controls on "petty cash" payments to employees or others. Trustees have no idea why they get that money and why are employees out of the office buying things?
- Improve reporting of "payroll and vouchers" with allocation to specific departments, project attribution, comparison to budget and full tracability on approvals.
- End the gypsy moth program... going on for over 30 years at annual cost around $177K.
- Make all non-primary elections timed for November to save on the $60-$70K cost of a May or August date.
- End the ability for the Supervisor to hire outside counsel for pet projects. All outside counsel hires must be approved by the Board of Trustees.
- Enforce the rules on spending approval by the Supervisor such that all significant expenditures are reviewed by Trustees.
- Deliver information packets to all Trustees well in advance of meetings to approve projects and spending.
Seven Solutions to Fiscal Mismanagement of Bloomfield Township
Bloomfield Township has incurred a multimillion-dollar budget deficit in pension funding. With taxes at the highest levels allowed by state law, and the maximum amount of millages already levied, the administration must find a way to plug the hole. After years of ignoring the pension shortfall, our elected leaders are scrambling to solve the problem without addressing spending. Rather than simply trimming costs from a bloated budget, Savoie says the only option is to tax all property owners with a “Special Assessment District” or SAD.
How did we get to this point? Questionable business practices, mischarging fees, lack of competitive bidding, rich perks, over-spending and a “pay as you go” philosophy on retiree benefits that ignored the future caused the problem -- just to name a few things. More on the key issues below….
Why now? A new rule forces local government to report their full pension debt on their balance sheets (ours is about $164 million) and to fund a portion of the total each year. Many people (including Trustees Buckley and Walsh) requested that our elected officials both address the pension shortfall and control spending over the years, but they chose to kick the can down the road.
What is the size of the immediate issue? Starting this year, the Township has to fund between two and three million dollars annually for the shortfall in retiree benefits (also called Other Post Employee Benefits or OPEB.) On a total annual Township budget of approximately $50 million, the amount that must be funded this year is not huge and probably achievable by belt-tightening. However, there is a funding shortfall of a few million dollars already forecast in the normal budget for this year. Additionally, the Township may have to pay approximately $9 million for overcharging residents on Water and Sewer, according to an Oakland County Court judgment which is being finalized soon. Other lawsuits pending could add to the deficit. So, the fiscal blunders are adding up. (It is also important to note that the OPEB shortfall will be an annually-recurring problem until we catch up with the full underfunding.)
Isn’t this a more complicated situation? Like the Water and Sewer overcharging, this issue has been deliberately convoluted. If you wade through the details, it is not all that complex but it is far-reaching. To summarize: We are short on money because the Township was not managed prudently.
What is the proposed fix? We are experiencing the “Savoie Spin” in response to this deficit. The Supervisor proposed a “Special Assessment District” (SAD), a means of funding usually applied to pay for a new road or sewer for a specific group of properties. The proposal will levy a SAD on the entire Township, justifying it by saying that public safety employees comprise a significant portion of the budget so it’s okay to use a SAD for pension benefits. There is also talk of a possible “administrative” levy on all residents.
What’s a better approach? The Township should start implementing the cost cutting measures already outlined in a study that was delivered to them by a public accounting firm. Then, they should correct the unusual financial and business practices employed by the Township for years which citizens have often questioned. The Township must fix the fundamental flaws which led to our budget deficit BEFORE any assessment is considered. Immediate cost savings can contribute to fixing the OPEB shortfall and responsible management can eliminate ongoing problems.
Where should the changes in financial and business practices start? In the opinion of those who pay attention to Township management, below are the “seven deadly sins” in the Township and suggested solutions which should be pursued immediately.
1. Purchasing and contracting are undisciplined, and the Township has no policies for guidance. The Township does not triple bid most service contracts! This means that a huge portion of Township spending is awarded based on relationships and gut feel, rather than through a documented bid process. Proposal review is fragmented with limited oversight, with no progress reporting on spending, and no public accounting of money spent compared to the budgeted amount.
Solution: Immediately institute strict purchasing policies and rebid all service contracts (legal, engineering, etc.) with outside oversight on the process which will achieve immediate cost savings.
2. Conflicts of interest are common, also with no governing policies. Board members do not routinely declare conflicts and vote some on issues even when they have a conflict (e.g.: more than one Township official voted to award a contract to a campaign donor.) Some who serve on boards are also vendors. Three top Bloomfield Township executives are all actively engaged in outside businesses which is prohibited in many other organizations.
Solution: All conflicts must be declared and eliminated immediately according to a clear-cut policy, which will deliver future cost savings.
3. Spending management is lax and methods violate common-sense practices. Payments are approved each month at Trustee meetings without any discussion about them at all, much less how they line up to the budget, or how payments add up in total. There is rarely a public discussion of what is missing from the budget (e.g. retiree health care funding was brought up by citizens years ago but pushed aside by leadership). Many accounting entries are blurred by grouping them into a single line item so that only the person keeping track of balances knows the sources and uses of funds. All Trustees are not given full income statement and balance sheet views of all of the numbers.
Solutions: Revamp the entire financial oversight and reporting approach to provide complete visibility into spending vs. budget. Provide the information in writing well in advance of meetings to all (including the public) on a monthly basis. Drive basic professionalism in the management of our finances. Together, these actions should deliver considerable spending reductions.
4. Large categories of expenditure are not adequately controlled. There has been no reasonable basis for fees resulting in years of overcharging for Water and Sewer (An Oakland County judge ruled in favor of the citizens on the 2018 lawsuit, recommending that residents deal with our officials at in ballot box because financial practices were so bad.) Consulting studies are paid for with no results published. Equipment purchases are often hidden in the budget rather than being voted on by Trustees. Company cars are granted to many people without usage or cost transparency. Rather than outsourcing, Bloomfield is the only Township in Michigan with its own Road Department (millage is inadequate to cover services.) There is no financial statement that consolidates the Township operations and all departments (like Water and Sewer) so it is impossible to assess the totality of revenue and spending.
Solutions: Document the justification for fees. Outsource the Road Department and vehicle management. Eliminate the “company car” perk. Produce detailed, consolidated financial statements that include ALL departments. Require a written report be published for every “study” that is commissioned, with follow up on the results one year later. Immediate cost savings will result.
5. Sweetheart deals are common in the Township. The examples in this category are many so just a small sample will be mentioned here. Development approvals vary considerably by the party involved (e.g. A club was allowed to turn residential lots into parking in violation of Township ordinances with involvement of an elected official who is the past-president of the club.) Some developments are fast-tracked without public hearings and motions, and others wait months on nit-pick items. Yet others are approved which obviously provide benefit to a specific party (e.g. A Township official owned a land-locked property and through a huge re-zoning and development deal, was given the prime corner lot in exchange for his parcel.) There are several examples where sewers were not funded by special assessments on those that benefited, but rather were charged to all citizens through the overall fund. Two similar subdivisions were both repaved but there was a significant difference in the cost to the taxpayers with no explanation for the differential. The Township selectively put aside basic rules (such as curb cuts, adequate parking and special land use conditions) for some developments.
Solutions: Stop granting favors and go back to the “Wilma Cotton” approach in the Building Department -- make every development follow the rules. If exceptions to ordinances are absolutely justified and required, declare them publicly with full transparency. Keep a running list of who is being granted the exceptions and what the relationships of those beneficiaries are to Township officials. Provide complete and current information on costs for every project and how they are funded.
6. There are many employee and labor-related issues. The Township does not routinely publish job openings to ensure transparent and impartial hiring. Only the police department has an anti-nepotism policy. No financial justification is given for new positions (e.g. during a recent three-year period, the Township added over $ 1 M to payroll by adding 14 new employees.) Across-the-board 2% raises for all employees were granted every year from 2013 to 2020. The Township operates on a four-day work week which is customer-unfriendly, an unmatched job perk, and never delivered the promised energy savings.
Solutions: Return to a five-day work week, authorize an outside study on the organization (tasks, levels, and spans) and institute common HR policies around hiring and raises. All contracts expire in 2020 so contracts must be reviewed and negotiated now with commitment to deliver cost reductions.
7. The Township lacks basic transparency and documentation. Citizens are now prohibited from asking questions after each agenda item, and inquiries are often waved off without response (e.g.: when a citizen asked about duplicate payments in the same month to the same vendor for the same amount of over $100k each, she was ignored two months in a row.) Reports to Trustees by Township managers usually lack written documentation and verbal presentations are accepted as factual without supporting detail. Most public meetings (Zoning Board of Appeals, Planning Commission, Design Review Board, Wetlands and Special Study Sessions) are not video recorded or audio archived. Meeting minutes are short on details.
Solutions: Allow citizen questions on each Board item, video record and archive all meetings, require written reports, and respond in writing to every question on an online platform that is accessible to the public and allows public comment. Full transparency is essential to identify cost savings in this organization.
Go to the next Trustee meeting and demand change. Use the three minutes you are granted to call for immediate cost cutting and implementation of the policy safeguards to restrict overspending going forward. Or, pick an issue noted above and highlight it as a priority. Demand budget reductions. Insist that an independent group of experienced citizens be impaneled to help drive and ensure that changes are made.
Also, continue to pay attention to what is happening. (Attend future meetings or at least watch Trustee meetings on cable.) Send emails, letters and phone calls to our Supervisor, Treasurer and Clerk. Our elected officials have landed us here because we did not call them to account for poor management practices. We must continue to watch and put pressure on them to act responsibly.
Bloomfield Township has incurred a multimillion-dollar budget deficit in pension funding. With taxes at the highest levels allowed by state law, and the maximum amount of millages already levied, the administration must find a way to plug the hole. After years of ignoring the pension shortfall, our elected leaders are scrambling to solve the problem without addressing spending. Rather than simply trimming costs from a bloated budget, Savoie says the only option is to tax all property owners with a “Special Assessment District” or SAD.
How did we get to this point? Questionable business practices, mischarging fees, lack of competitive bidding, rich perks, over-spending and a “pay as you go” philosophy on retiree benefits that ignored the future caused the problem -- just to name a few things. More on the key issues below….
Why now? A new rule forces local government to report their full pension debt on their balance sheets (ours is about $164 million) and to fund a portion of the total each year. Many people (including Trustees Buckley and Walsh) requested that our elected officials both address the pension shortfall and control spending over the years, but they chose to kick the can down the road.
What is the size of the immediate issue? Starting this year, the Township has to fund between two and three million dollars annually for the shortfall in retiree benefits (also called Other Post Employee Benefits or OPEB.) On a total annual Township budget of approximately $50 million, the amount that must be funded this year is not huge and probably achievable by belt-tightening. However, there is a funding shortfall of a few million dollars already forecast in the normal budget for this year. Additionally, the Township may have to pay approximately $9 million for overcharging residents on Water and Sewer, according to an Oakland County Court judgment which is being finalized soon. Other lawsuits pending could add to the deficit. So, the fiscal blunders are adding up. (It is also important to note that the OPEB shortfall will be an annually-recurring problem until we catch up with the full underfunding.)
Isn’t this a more complicated situation? Like the Water and Sewer overcharging, this issue has been deliberately convoluted. If you wade through the details, it is not all that complex but it is far-reaching. To summarize: We are short on money because the Township was not managed prudently.
What is the proposed fix? We are experiencing the “Savoie Spin” in response to this deficit. The Supervisor proposed a “Special Assessment District” (SAD), a means of funding usually applied to pay for a new road or sewer for a specific group of properties. The proposal will levy a SAD on the entire Township, justifying it by saying that public safety employees comprise a significant portion of the budget so it’s okay to use a SAD for pension benefits. There is also talk of a possible “administrative” levy on all residents.
What’s a better approach? The Township should start implementing the cost cutting measures already outlined in a study that was delivered to them by a public accounting firm. Then, they should correct the unusual financial and business practices employed by the Township for years which citizens have often questioned. The Township must fix the fundamental flaws which led to our budget deficit BEFORE any assessment is considered. Immediate cost savings can contribute to fixing the OPEB shortfall and responsible management can eliminate ongoing problems.
Where should the changes in financial and business practices start? In the opinion of those who pay attention to Township management, below are the “seven deadly sins” in the Township and suggested solutions which should be pursued immediately.
1. Purchasing and contracting are undisciplined, and the Township has no policies for guidance. The Township does not triple bid most service contracts! This means that a huge portion of Township spending is awarded based on relationships and gut feel, rather than through a documented bid process. Proposal review is fragmented with limited oversight, with no progress reporting on spending, and no public accounting of money spent compared to the budgeted amount.
Solution: Immediately institute strict purchasing policies and rebid all service contracts (legal, engineering, etc.) with outside oversight on the process which will achieve immediate cost savings.
2. Conflicts of interest are common, also with no governing policies. Board members do not routinely declare conflicts and vote some on issues even when they have a conflict (e.g.: more than one Township official voted to award a contract to a campaign donor.) Some who serve on boards are also vendors. Three top Bloomfield Township executives are all actively engaged in outside businesses which is prohibited in many other organizations.
Solution: All conflicts must be declared and eliminated immediately according to a clear-cut policy, which will deliver future cost savings.
3. Spending management is lax and methods violate common-sense practices. Payments are approved each month at Trustee meetings without any discussion about them at all, much less how they line up to the budget, or how payments add up in total. There is rarely a public discussion of what is missing from the budget (e.g. retiree health care funding was brought up by citizens years ago but pushed aside by leadership). Many accounting entries are blurred by grouping them into a single line item so that only the person keeping track of balances knows the sources and uses of funds. All Trustees are not given full income statement and balance sheet views of all of the numbers.
Solutions: Revamp the entire financial oversight and reporting approach to provide complete visibility into spending vs. budget. Provide the information in writing well in advance of meetings to all (including the public) on a monthly basis. Drive basic professionalism in the management of our finances. Together, these actions should deliver considerable spending reductions.
4. Large categories of expenditure are not adequately controlled. There has been no reasonable basis for fees resulting in years of overcharging for Water and Sewer (An Oakland County judge ruled in favor of the citizens on the 2018 lawsuit, recommending that residents deal with our officials at in ballot box because financial practices were so bad.) Consulting studies are paid for with no results published. Equipment purchases are often hidden in the budget rather than being voted on by Trustees. Company cars are granted to many people without usage or cost transparency. Rather than outsourcing, Bloomfield is the only Township in Michigan with its own Road Department (millage is inadequate to cover services.) There is no financial statement that consolidates the Township operations and all departments (like Water and Sewer) so it is impossible to assess the totality of revenue and spending.
Solutions: Document the justification for fees. Outsource the Road Department and vehicle management. Eliminate the “company car” perk. Produce detailed, consolidated financial statements that include ALL departments. Require a written report be published for every “study” that is commissioned, with follow up on the results one year later. Immediate cost savings will result.
5. Sweetheart deals are common in the Township. The examples in this category are many so just a small sample will be mentioned here. Development approvals vary considerably by the party involved (e.g. A club was allowed to turn residential lots into parking in violation of Township ordinances with involvement of an elected official who is the past-president of the club.) Some developments are fast-tracked without public hearings and motions, and others wait months on nit-pick items. Yet others are approved which obviously provide benefit to a specific party (e.g. A Township official owned a land-locked property and through a huge re-zoning and development deal, was given the prime corner lot in exchange for his parcel.) There are several examples where sewers were not funded by special assessments on those that benefited, but rather were charged to all citizens through the overall fund. Two similar subdivisions were both repaved but there was a significant difference in the cost to the taxpayers with no explanation for the differential. The Township selectively put aside basic rules (such as curb cuts, adequate parking and special land use conditions) for some developments.
Solutions: Stop granting favors and go back to the “Wilma Cotton” approach in the Building Department -- make every development follow the rules. If exceptions to ordinances are absolutely justified and required, declare them publicly with full transparency. Keep a running list of who is being granted the exceptions and what the relationships of those beneficiaries are to Township officials. Provide complete and current information on costs for every project and how they are funded.
6. There are many employee and labor-related issues. The Township does not routinely publish job openings to ensure transparent and impartial hiring. Only the police department has an anti-nepotism policy. No financial justification is given for new positions (e.g. during a recent three-year period, the Township added over $ 1 M to payroll by adding 14 new employees.) Across-the-board 2% raises for all employees were granted every year from 2013 to 2020. The Township operates on a four-day work week which is customer-unfriendly, an unmatched job perk, and never delivered the promised energy savings.
Solutions: Return to a five-day work week, authorize an outside study on the organization (tasks, levels, and spans) and institute common HR policies around hiring and raises. All contracts expire in 2020 so contracts must be reviewed and negotiated now with commitment to deliver cost reductions.
7. The Township lacks basic transparency and documentation. Citizens are now prohibited from asking questions after each agenda item, and inquiries are often waved off without response (e.g.: when a citizen asked about duplicate payments in the same month to the same vendor for the same amount of over $100k each, she was ignored two months in a row.) Reports to Trustees by Township managers usually lack written documentation and verbal presentations are accepted as factual without supporting detail. Most public meetings (Zoning Board of Appeals, Planning Commission, Design Review Board, Wetlands and Special Study Sessions) are not video recorded or audio archived. Meeting minutes are short on details.
Solutions: Allow citizen questions on each Board item, video record and archive all meetings, require written reports, and respond in writing to every question on an online platform that is accessible to the public and allows public comment. Full transparency is essential to identify cost savings in this organization.
Go to the next Trustee meeting and demand change. Use the three minutes you are granted to call for immediate cost cutting and implementation of the policy safeguards to restrict overspending going forward. Or, pick an issue noted above and highlight it as a priority. Demand budget reductions. Insist that an independent group of experienced citizens be impaneled to help drive and ensure that changes are made.
Also, continue to pay attention to what is happening. (Attend future meetings or at least watch Trustee meetings on cable.) Send emails, letters and phone calls to our Supervisor, Treasurer and Clerk. Our elected officials have landed us here because we did not call them to account for poor management practices. We must continue to watch and put pressure on them to act responsibly.