Ludington City Council Meeting October 22, 2018: Costumed-Tax Party

[XLFD]

The last Ludington City Council meeting before Halloween was replete with a couple of scary issues of public policy and an even scarier bit of crazy talk from Third Ward Councilor Les Johnson at the very end showing a frightening lack of intelligence on his part.  Those two issues were a raising of three rental inspection fees and a vote to show the City's intention of considering entering into a lease agreement with the Harbor View Marina-- where the previous leaseholder escaped without penalty over five years before their lease expired because expenses were destined to overrun their revenues for the foreseeable future.

If our city leaders cannot understand basic economics like the vacating Harbor View LLC, how can they be expected to figure out why money coming from the State's Waterways Fund is money coming from taxpayers?   Can't they see that under that mask of free money gifted by the state's grant faeries is money actually taken from taxpayers who can't say "no" without risk of imprisonment?  But let's review the whole meeting before going there first.

After the usual routines that come at the beginning of the meeting, public comment started off and finished with a trio of older gentlemen commenting on the rental inspection fee increase.  This began with Tom Tyron: (2:45 into the video below) 

"As you know all the low cost housing, subsidized housing, is exempt from your fees, and the only one that get your fees are the independent landlords, of which I am one.  And I consider the only reason you are raising this fee probably is because Scottville is getting more than you are.  You're probably jealous, so you have no need to do this, it's just passed on to the tenants; it's just a needless expense.  Thank you."

Even the Michigan Municipal League, the friend of city hall, notes that a fee is actually a tax when it is not a user fee, but rather a revenue-raising involuntary payment forced on the public.   I followed with a closer look at the program, and how a closer look was not only denied to the public, but also to the councilors.

October 22nd, 2018 Ludington City Council meeting from Mason County District Library on Vimeo.

XLFD:  "The council is expected to pass a resolution tonight that would increase two rental tax rates by 100% for a program that was set up to be revenue neutral. They offer nothing to justify the increase in their packet other than the resolution itself that "the revenue produced at the current rates is not sufficient to cover the costs of the program". It seems counterintuitive when one thinks that the second time through, re-inspecting units that have already been certified for occupancy would be cheaper.
Michigan law states that a city with a rental inspection program must provide a complete accounting of the previous years expenses and revenues of such a program when it is requested. Under the concept of transparency, why isn't the rental inspection team not providing the city council with this data for the three years this program has been in existence so this council can make an informed decision on this doubling of rates? It's not in the packets, there is no indication that the B&L Committee members were given this accounting of the program at their meeting on the 18th.
So what is the rationale of doubling these tax rates? At the committee meeting, which does not follow many facets of the Open Meetings Act, it was noted that three landlords for whatever reason did not allow the City to inspect their rental units. These gentlemen respect the rights established by the Fourth Amendment in the Bill of Rights for their tenants, our city leaders do not. It was noted at the meeting that "Funds have been allocated in the Rental Inspection budget to cover attorney fees that will be required to follow up with those property owners who will not cooperate with the inspection process."
Provided that these three statesmen related that their tenants denied their consent for the city's agents to invade their home, the City has no cause of action against them, and the money used, from the City's rental inspection fund would be misused to do so. By state law, the City cannot hold a landlord accountable if a tenant does not grant consent. Likewise, the City shouldn’t penalize the sheepish landlords who have cooperated by raising their taxes in order to needlessly persecute their peers.
City protocol prohibits the inspector from contacting tenants directly, so if Carter, Doug or Ben are unreasonably prosecuted for respecting their tenant's rights, our legal team will need a lot more revenue from the rental inspection fund to get themselves squared away. I thought if these intrusions were denied, the City would just run to the magistrate to get administrative warrants? I think it's rather unethical for the City to double landlords fee rates, just so we can make the City's [Mayor invoked the three minute rule before I could get in the last part of my sentence]  ...attorneys rich at the expense of our small business owners."

Chuck Sobanski followed, expressing the hope that the fee raises would not be an annual occurrence, and asked whether the two rental units going up [at the bowling alley block and the Depot] would face these fees/taxes.  The local paper noted three citizens spoke up about the rate increase, but only quoted Sobanski's hope and question.  Neither the councilors or the City of Ludington Daily News (COLDNews) would answer the question or alleviate the hopefulness.

Before that, the city council unanimously approved resolutions between the City and the Lake Michigan Carferry and between the City and City of Manitowoc that would allow the FASTLANE grants to be implemented for dock repairs on both sides of the lake, pending Governor Snyder's approval, as explained by the city attorney.  It would allow up to $50,000 to be reimbursed back to the City, primarily for the city attorney and grant writer, Heather Tykoski to feast off of.  

At around 17:40, the second big issue of the night was discussed where we hear Interim City Manager Steve Brock "We will make certain that no taxpayer money goes into it, either the existing marina or [Harbor View] marina, if we ever do get to a point where we enter into some sort of lease..."  Consider that statement, it preceded the resolution to show intent to enter into discussions with the DNR and investigate the aspects of such a lease arrangement, which was passed unanimously. 

At 22:20 in, the Tree Inventory was discussed and a presentation was given by Lee Mueller of the Davey Resource Group which performed a tree census over trees in the City of Ludington found either in parks or in the street right-of-way.  All for the low price of over $20,000, you can decide for yourself whether this was a waste of taxpayers' money (unless you view, like Steve Brock and Les Johnson, that state grants coming from taxes are not from taxpayers).  The presentation showed graphics found in the city council packet beginning on page 26.   

Shortly thereafter, succeeding the police activity report, the rental inspection [tax] rate increase was read and passed without discussion, explanation or answers to the concerns of either of the three citizens who spoke.  A lot of unverified figures were thrown around, all left out of the councilor packets for the other councilors to make an informed choice.

Then came the second comment period succeeded Brock saying again at 44:15:  "...there are no tax dollars in [the West End Project] either, it's all been grant money raised, and so we're trying to raise more grant money for that.  As for the buzz in the community that we're wasting taxpayer money in the West End, we don't need that... there's no tax money in it."

The major part of the West End Project, $300,000, is funded by a MI DNR Trust Fund Grant.  Technically, this fund is mostly royalties collected by the state by granting use of public property to private interests (usually mining interests).  It's debatable, but mining royalties operate much in the same way as taxes.  This is without debate, it is money taken from private taxpayers that is more than a user fee and that has all the aspects of a tax.  That set up my last public comment at 45:00 in, the only public comment at this time.

XLFD:  "Harbor View's impending transition is a perfect example of why government should stay away from the private sector. The state spent millions and millions building harbor view marina and then let a private firm reap the benefits for nearly twenty years. The LLC is now pulling out because it is in their best financial interest to do so, and so we the taxpayers are effectively stuck with an unsustainable public marina that much less than 1% of us use.

City leaders embrace the concept of leasing this marina despite the blatant fact that loads of public money will need to be put into maintaining it, more than what will be returned at least in the short term by its operation, despite it's negligible utility to the public it will supposedly serve. The City is trusting that the state's taxpayers will fund this needed maintenance, but this is by no means assured, or should it be.

In my estimation, building and running a public marina is a form of corporate welfare, where the wealthy few who can afford nice watercraft and slips are able to benefit from a huge outlay of public funds that never gets recouped. Yet, as it has been since the inception of the city marina, Ludington has plenty of private marinas to fulfill the needs of our locals and our tourists, and has expanded through history to meet that need without using any public funds. In fact, they have expanded the tax base unlike the soon-to-be two city marinas that return zero in tax revenue, and spend a lot more in operation and maintenance than they take in. Harbor View currently brings in over $70,000 in property taxes alone, for now.

The two public marinas would be failed business models if they actually operated in the private sector, where you can't rely on a never-ending supply of taxpayer money to keep you afloat after you make asinine business decisions."

After a couple of FYIs followed, Councilor Les Johnson made a declaration about my lack of intelligence.  

"I would just like to reiterate that these marinas are not using taxpayer money.  I don't know how many times we have to say that.  They're not using taxpayer money, in fact, they have put money back into the community, more so than what any taxpayer has put into it, so I would just like to make sure that you realize that, Mr. Rotta."

Johnson is wrong on all counts. First off, here is the municipal marina fund expenses for the City marina  CityMarinaFundExpenses and CMFE2.  Is there any money given back to the community you can find there in those six years?  I just see money used for paying employees their wages, coupled with supplies and maintenance for the City Marina.  Nothing to the community, not a cent of property taxes to the City at all.

And even though the marina is to be ran like an enterprise fund, where they should be self-supporting on the services they provide, they have proven they cannot do so without taxpayer money coming from the State Waterway Fund via Waterway Program Grants.  See this source:

As the MSWF rely primarily on gas taxes and a watercraft registration fee (which inarguably is a tax, an enforced financial charge exacted by a government for the support of its various functions, imposed on watercraft buyers). See also this link where the State is looking to put this tax on small watercraft, but is being challenged by residents and legislators as another 'money grab' by an avaricious DNR.  

So when the City marina applies for grants from the State Waterways Commission for the million dollars plus they want to fix their docks, many hundreds of thousands they want for transient docks, dredging and bathhouses, and tens of thousands for fish cleaning stations and other sundry improvements, they are utilizing taxpayer money, albeit, they steal it from all portions of the state.  A private marina does not have that resource, because a private marina is not a drain on the state, it is a source of income for the state.  

Thus when Brock guarantees us that no taxpayer money will ever go into a city-leased Harbor View Marina, just like none has ever went into the existing marina, he is blowing smoke.  We all pay for these public marinas and they give nothing back other than a summer job for a city official's son or daughter.  The scary mask is removed, and it reveals an even worse monster.

[John Doe Jr]

No taxpayer money will be collected to pay for the West End Project. But, plenty of taxpayers money will be spent after every storm that passes through Ludington. Thanks for ruining the my Welcome Home View!

[XLFD]

And it's the same deal with the city marina, and likely the next city marina at Harbor View.  The marina board has been seeking taxpayer handouts from the City after getting nada from the State to fix their docks through taxpayer-funded grants.  If you look closely, the city marina uses a lot of city resources (including the DPW manpower and equipment, the CDD for grants, the city manager and attorney, etc.) over the course of the year, resources that the City never extends to the private marinas.

Tax, royalty, or fee, it is all money going to a public pot which should be spent with wisdom and with deference to the common good and common desires.  The same DNR that's wasting money on the West End will throw good money after bad in tossing over a million in getting the city marina docks replaced and millions in renovating Harbor View, while private marinas get nothing but a sizable tax bill in summer and winter from their governments so that the State and City can drive their businesses into the ground.  They have to see their docks grow old because they assuredly cannot afford to keep up with competition that our government would likely declare monopolistic-- if our government didn't own it, and set up the uneven playing field.  It's despicable.

[Freedom Seeker]

Truly despicable.  Of all potential city servants, you, X, have compassion for those marina owners who have been neglected, lied to and dragged over the hot coals in the Fourth Ward.  Wish you would run for council.  Oh wait, you did and Shay bound you in Workplace Safety chains to brutally end your campaign and try to silence you. 

[Freedom Seeker]

Exactly, John.  It's not just the cost to the taxpayer (someone has to pay for the maintenance, hence, add more city employees to an already over bloated DPW, and parks staff and budget), but it's that the people had no say, no vote, even though city charter calls for a vote when creating a park).  It's like all this was decided in the secret chambers of the DDA by people who don't want public input.  Who is it for?  The downtown businesses because the parks are so overcrowded by tourists already, the locals can't take part.  I think the west end an idea John Henderson, pushed through by his henchmen Shay.  With John Henderson chairing the DDA, he still pushes what he "and his team" want without public input.  The DDA is on egosteroids, evidenced by the recent violation of OMA by Jen Tooman sending emails to DDA members.  How many times have these violations taken place?

[Freedom Seeker]

We may never know the depths of the violations until XLFD gets his 7000th FOIA or city personnel start following the OMA.  Thanks again X, for your courage to enlighten the public.  You are more of a true public servant than some who are paid big bucks to blind the public.  I think that a lot of city staff and councilors are ignorant of the Open Meetings Act, others are sneaky and shouldn't be public servants.  You'd think by now that a good manager would educate the staff.  The MML and Michigan State extension (for whom Krauch worked, ironically) give public lectures on OMA.

[Willy]

The more I hear from Brock the dumber he appears. Either that or he is a pathological liar trying to B.S. the good citizens of Ludington. Then I remember who the brainless midgets are who keep  hiring these mental defects. And what can be said about Johnson who should not be allowed to participate in anything more complicated than a game of fish.

Excellent report X.

[Freedom Seeker]

Kind of blunt and rude, but very succinctly put, Willy.  Sadly, look at who is and had been chairing our finance committee.

[AQUAMAN]

The Tree Planning guy took up most of the mtg., and for what? Why was this a necessary expenditure of $20 Grand to do, and why now? I just don't get that at all. Meanwhile the Copeyan Park fishing dock overpriced repairs at $15 Grand remains undone, and never does in 2 years now. Then the mindset of most, esp. Les Johnson is despicable and convoluted at best. Where in the Hell does he think ALL public money comes from, whether grants or taxation? Les, wake up, and quit lying to everyone again. ALL GRANTS and other taxation is from We the People, not you, and not just the mints where it's printed either. He is certainly much more naive and unintelligent than I ever gave him credit for, by far! Making 100 lies to the public certainly doesn't equate to even 1 truth sir, you are ignorant! I also can't give any praise to the Mayor for saying "enough" to X, while he was already done with his second comment, starting to walk away, shameful and discourteous at best also. You ma'am, are again going to go out on a LOW NOTE, proud? No, just a Narcissist that needs psychological treatment asap.

[AQUAMAN]

Also, concerning HV Marina, Les and Brock are again grossly exaggerating the fact NO Taxpayers monies will repair or operate it. Where are they going to get free repairs and labor for operations? This is another gross Lie, to deceive taxpayers and locals that don't even go there. The HV operation has also hired many people, kids, to clean the customer's boats of coal dust from LMC that have ruined many canvased boats for the last 20 years, and that's an ongoing problem every summer. We've got some seriously sick city council people that aren't up for election right now, but definitely need replacement, their thinking is totally warped! And the locally rejected West End Project, is also a definite joke when it comes to outsiders bidding the contract, why not ask and offer local contractors to bid on this? And keep the money here in Mason County. There is just so much idiocy going on, it's hard to even keep up with it! Great report and analysis again X, thanks.

[Freedom Seeker]

True, Aquaman.  I was going to say I could understand Les Johnson's reiteration (confusion) that really no local/city taxes pay for the city marina, but let's look at it this way ... Who pays the city personnel who operate and maintain the marina  (DPW, marina manager, and who else?)  Does the income from slip rentals pay all these wages/benefits?  Do we have a separate income/output balanced budget for the city marina or are the monies co-mingled into the General fund and does the city tax pay at least some of the marina operation expense like it also does for the DDA and Shop-with-a-Cop for that matter?  Intermingling these funds makes no separate department, marina or charity responsible to balance their own budget.  The local taxpayer pays whatever isn't balanced.  

 Bold job XLFD for again having the courage to stand before a hostile council on another issue that will most likely not be good for our ever-increasing city debt (like where are we now? Somewhere near  $50 million over 40 years?).  Who cares about the year 2058?

 Notice Wilson in the video more concerned about cleaning his glasses while you speak.  Maybe if he takes the speck off his glasses, he will more clearly see the log.  And Brock annoyingly turning and rocking in his chair.  He seems to be just happy as a kid in a new rocker with half-year John Shay's salary, going along with the gang until he can take his money to Florida.

 I agree, it oozes with disrespect, when Kaye Holman said "ENOUGH" to Tom Rotta.  Couldn't she at least utter, "I'm so sorry your time is up" like she does to some of the others who speak?  

[XLFD]

Good overall review, FS.  I'm afraid in my last four regular meetings with Mayor Kaye that the best I'll likely get is "I'm so sorry, your time to shut up."

Just think if I was explicitly talking about the City's potential Harbor View acquisition adding onto the debt, rather than the use of tax dollars, that Johnson would say something equally silly such as:

"I would just like to reiterate that these marinas are not going to be operating in the red. I don't know how many times we have to say that. They're not going to be operating in the red, in fact, they have put credit back into the community, more so than what any of our other deficit-spending has put into it, so I would just like to make sure that you realize that, Mr. Rotta."

If one seriously denies the City using taxpayer money for maintaining the marina(s), they should be able to seriously deny our monstrous pension and bond debt.

[XLFD]

I honestly think that Les believe the big lie, most of them do.  Brock is too smart to not understand that the city is going to be going through a lot of state tax, fee, and royalty money for projects of dubious value to the public.  These people seem to think that if they hire a lot more employees at Harbor View, as they do at the city marina, that more boaters will do business there.  Maybe, but they will definitely have more expenses that likely won't be covered by a few more slip fees.