Corruption and Poor Ethics "Unavoidable" in Central Falls

Amazing. If you need any better illustration of the mindset of certain individuals (read: not all) in Rhode Island government, this article from W. Zachary Malinowski at the Providence Journal yesterday is about as clear as you can get.

Moreau’s brother, Frank, said the coziness of small-city politics led the ex-mayor astray.
“People that got jobs or other opportunities to earn money through Central Falls were connected to Chuck,” he wrote. “It was unavoidable.”

Yes, unavoidable. Impossible to ignore. Never mind that you're the mayor, the highest ranking official in town, but engaging in these activities were "unavoidable" for the mayor. Never mind that he was elected to act in the best interests of the citizens of Central Falls. Screwing them over was apparently "unavoidable." Good to know.

A former captain in the Central Falls Fire Department talked about how Moreau and Bouthillette’s program to board up vacant and abandoned buildings — the activity for which they were charged — protected city residents. “To me, the safety of boarding up those houses to keep me and other public servants and the residents of the City of Central Falls safe was priceless!” he wrote.

Priceless? Priceless makes for some good Mastercard commercials but the boarding up of houses in Central Falls was not priceless. Not even public safety is priceless. Everything has a price. One question I'd love to ask this former police captain about the value of "priceless" is if he sees this safety being priceless, what value does he put on his own life? Is his own life also "priceless"? We can determine what value he has put on his own life by seeing how much life insurance he has bought. Yes, everything has a price, even our own lives. So please spare me the "public safety is priceless" talk. Even Moreau and Bouthilette had a price, albeit a grossly inflated one.

Additionally, the article talked about the letters that were submitted on the defendants' behalf, to the judge, to talk about the character of each. Not surprisingly, lawyers for the defendants opposed the release of those letters to the public. Moreau's lawyer, William J. Murphy (why is that name familiar?) wrote in his opposition:

The letters, he wrote, have “no bearing on the public’s assessment of the sentence imposed … “and would only serve to embarrass (Moreau) and his family.”

No, you know what's embarrassing? Being elected to serve the people of a town and then screwing them over. That's embarrassing.

Lastly, in the letter from Moreau's wife, she wrote:

she and her husband have struggled to provide “security and stability,” for their sons — ages 8 and 4. She said that his departure for prison, on March 4, will create a void in the boys’ lives.
“For them, their father is their world,” she wrote. “It is Dad that they want to tuck them in at night, it is Dad who reads them books, and makes them breakfast in the morning. His sons come first, more importantly they know they come first.”

Struggled to provide? If the mayor's job doesn't pay what they need to support their children, then why is he running for the seat? Well, the answer is obvious, but the assumption is that he'll be ethical and not corrupt. Or was the intent from day one to be corrupt and take from your own citizens?

I do feel sad for Moreau's sons. It is a tragedy any time a parent is taken away from children, for any reason. But he brought this on himself. This is not the out of work, bankrupt father stealing a loaf of bread from the grocery store to feed his starving children. This was greed, pure and simple. Fortunately for the boys, Moreau will only be spending two years in a "federally funded gated community" to coin a Buddy Cianci term.

How Much Are Central Falls' Dilettante Officials Costing Taxpayers?

It was very tempting, indeed, to title this post: "Seriously, are certain Central Falls officials anticipating a commission from the Receiver's legal fees?" Presumably, the answer is, no, they are not.

However, as the "stand-off" between state officials and certain C.F. council members now moves, ludicrously, to mediation, an observer can be forgiven for wondering about the motives of those councilors.

Certainly, many of us opposed, and still oppose, Rhode Island's municipality receivership law. Having a higher level of government reach down, take over power from the locally elected government and impose its will, unaccountable to the voters/taxpayers, is an unacceptable and undemocratic option.

Isn't there a point, however, at which it is necessary to defer to reality? The receivership has happened. Past tense. U.S. Bankruptcy Court officially concluded the receivership in October.

The city, however, does not yet control its own fiscal situation. The state has oversight until FY 2017. Three council members (all but Councilor Robert Ferri) are miffed about this, contending that the state was supposed to have bowed out in July. The councilors are huffily refusing to attend workshops set up by the state to ensure that city officials fully understand

how the city will operate under a debt-reduction plan that was approved by a federal bankruptcy judge.

Meanwhile, as the three councilors refuse to do their homework so that they can carry out the court's orders, the receiver remains camped at C.F. City Hall. And - pay close attention here, Honorable Council Members - he ain't working for free.

The dispute carries a heavy price tag — about $9,400 a week for McJennett and his two-member staff to remain in City Hall.

To review, the receivership has come and gone. By court order, the city's budget remains under control of the state until 2017. So the only accomplishment of the three prima donna councilors is to artificially boost the billable hours of the Receiver.

But why should they care? This invoice accrues to someone else's account, not theirs. In short, someone else is picking up the tab for their childish and irresponsible actions.

Flanders Out as Central Fall Receiver

According to Associated Press reporter Erika Niedowski, Robert Flanders has been replaced as Central Falls receiver...

The state-appointed receiver in Central Falls who has overseen the city's bankruptcy proceedings is being replaced in what the governor's office says is a "new phase" of its recovery.

John McJennett III is replacing Robert Flanders Jr. as of Friday. There will be a period of overlap.

Gov. Lincoln Chafee says Flanders has led the city through a challenging time and that Central Falls is now "stronger and more viable."

Moving Forward in Central Falls

According to the AP's Erika Niedowski, Robert Flanders has been removed from his position as the receiver in Central Falls. However, he has been replaced by a new receiver, John McJennett.

Governor Chafee mentioned that Central Falls is ready for a "new phase", which I guess is just a nice way of saying that he got tired of hearing people like Senator Betty Crowley complaining about Flanders and everything he's doing to her city. It has been interesting to see all the scorn that Central Falls legislators have had for Flanders, yet you don't hear much of their opinion on the previous mayor, Charles Moreau or the City Council that led the city to bankruptcy.

McJennett will issue a five-year plan for the city to continue its recovery and according to the AP story, Central Falls could emerge from bankruptcy as soon as this summer or fall.

Here's to hoping that the people of the city don't ever want to be handed the medicine of a receiver ever again and make wise choices when they are able to select their own leadership once again.

Undoing the Central Falls Settlement with Some Last Minute Legislation?

Can't talk about the bill, it's still in committee...
Can't talk about the bill, it's still in committee...
Can't talk about the bill, it's still in committee...
Why do you want to talk about that bill? Everything important about it was decided in committee.

Justin Katz of the Ocean State Current (and Anchor Rising too) has a report on what looks to be the first salvo in the hurry-up final phase of the legislative session. Senator Elizabeth Crowley of Central Falls has submitted a bill, apparently at the request of the RI Department of Revenue, that would allow any municipality under state oversight and running a local pension system to move into the MERS system. In part, this bill is a follow through on a promise that was made as part of the Central Falls bankruptcy settlement, where the Governor agreed to help Central Falls transition to MERS.

But there may be more to the promise -- or, as pols have become fond of saying these days, perhaps the promise has evolved. In addition to facilitating a move to MERS, the Governor's office has also been advocating for a $2 million to $2.6 million so-called "transition fund", designed to temporarily soften the effects (for a period of five years) of the bankruptcy agreement which reduces the benefits that will be paid to Central Falls pensioners. As a Projo staff report from the end of April mentioned, the creation of the "transition fund" also serves the purpose of helping to convince some people impacted by pension changes not to pursue a lawsuit.

Meanwhile, Senator Crowley's bill is separate from the transition fund. She told the Current that its intent is to "return [Central Falls] pensions to 75% of the payments that they had been receiving before the receiver and a bankruptcy judge reduced them". Though such a provision is not explicit in the current Senate bill, a reference to a "base retirement allowance" of not less than 75% of the pre-settlement benefit for Central Falls retirees is written into the House version of the bill, introduced by Representative James McLaughlin.

If the "transition funds" are approved, and if a floor on benefit adjustments is set at 75% of pre-settlement value, either directly in law or through an amendment to the settlement agreement, and taking effect immediately after the transition period has ended, then it is very possible that the much publicized 55% benefit cut in Central Falls will never occur.

Is this all a good idea? As far as the transition funds are concerned, the question (though not the answer) is straightforward -- should there be a state bailout of the Central Falls pension system, so that the cuts needed to restore solvency aren't quite as deep, at least in the early years. As regards the longer term issues involved in the Crowley/McLaughlin bills, some basic information is needed by both legislators and the public, which the authors and sponsors of the bills should provide with all due speed:

1. Is this proposal revenue neutral, with respect to the existing Central Falls settlement agreement, and...
2. ...if not, where's the extra money coming from to pay for it: a) higher taxes on Central Falls, b) directly appropriated state subsidies, similar to the "transition funds" and/or c) some kind of Rube Goldberg financing via the working of the state pension system.

With recent events in West Warwick, to name just one community, the transition fund proposal and the Crowley/McLaughlin bills also raise the question of whether other communities would be in line to get the same bailout that Central Falls might.

Bankruptcy Judge Rules that Central Falls' School District is Separate from the City

Federal Bankruptcy Judge Frank J. Bailey has issued a preliminary ruling that the Central Falls School District is not part of the City of Central Falls. The Projo has the complete ruling available here.

Specifically, Judge Bailey rejected a request from Central Falls receiver Robert Flanders to issue a declaration "that the School District is part of the City and therefore, ipso facto, the collective bargaining process is within the Bankruptcy Court’s subject matter jurisdiction".

Judge Bailey's reasoning is that...

1. School committees are parts of local government...
2. ...to which the state legislature, under its Constitutional grant of authority for education, has "vested" "the entire care, control, and management of all public school interests in the several cities and towns".
3. However, in a 2007 referendum, the people of Central Falls approved changes to their City Charter which eliminated their school committee...
4. ...meaning that they eliminated the organ of their municipal government authorized to exercise local jurisdiction over the schools...
5. ...through the process specified in Home Rule Article of the State Constitution for making permanent changes to local forms of government...
6. ...and that this act, when combined with the laws that placed the Central Falls school system under the control of a Board of Trustees appointed by the State Education Board of Regents and "not mentioned in the City’s charter [or] answerable to City authorities"...
7. ...fully separated the Central Falls school district from the City of Central Falls.

The judge also goes through a list of factors which he deems irrelevant to this determination, including issues like Central Falls receiving almost all of its education funding from the state, and the school department and the city maintaining separate bank accounts.

Though I am not predisposed to favor the outcome, I have to say that Judge Bailey's reasoning is pretty solid, given the Constitutional structure of Rhode Island government and the laws that have been passed under it. This ruling also strongly suggests that it is only Central Falls' school district that is part of the state, at least until such time as other municipalities begin holding local referenda to wipe out their school committees (though I'm not sure how the regional districts cleanly fit in to all of this).

There are still some process hurdles to be cleared, but where this is likely leading to the bankruptcy court also rejecting a second item that Receiver Flanders asked for a ruling on, "that the Receiver has the power under the Fiscal Stability Act to act on behalf of the City relative to collective bargaining with the Union".

Imagine Reevaluation of Political Philosophies...

... It may be more difficult than it seems.
If dislike of dictators
Is contingent on progressive dreams

Over on the Current, I express restrained hope that some noise on the Left about Central Falls' receiver will spur reconsideration of liberals' long-running centralization project.

I note, too, that Anchor Rising's unease with the entire municipal receivership program goes back to a May 2010 post by Andrew.

Give 'Em What They Want

Former Central Falls Mayor Thomas Lazieh has asked State Receiver Robert Flanders to leave his post in the city. State lawmakers have submitted a bill that will attempt to limit what a receiver can actually do.

City Council member Patrick J. Szlashta thanked citizens and elected officials for turning out Friday for a discussion of the city’s receivership and bankruptcy, then summed up why the council, which no longer has any power, was meeting:
“We’re trying to give the city back to you.”
About 40 people, some of them former city employees, such as former Police Chief Joseph Moran, filled the council chamber, lined the walls and stood in the back to support each other in calling on Governor Chafee to investigate receiver Robert G. Flanders and his chief of staff, Gayle Corrigan.

All the powers that be in the city, are now really pushing to have Flanders leave and let them self-govern yet again. Even state legislators are getting in on the act and doing what they can.

Sen. Elizabeth Crowley, D-Central Falls, said she would be willing to camp out at the door of the governor’s office if it would help the people of Central Falls get their city back.

This is all an interesting turn of events, especially since:

In 2010, the city's mayor, Charles Moreau, requested the state appoint a receiver to assist with returning the municipality to financial viability

Let me see if I have this straight. The city was mismanaged for years. The city already doesn't pay for it's own school department, the taxpayers of the other 38 cities and towns assist in paying for that. The city, through its mayor, asked for the state to take over, but now they don't like the decisions being made and want the city back and run it themselves. Is that about it?

Great. Give it to them. Let them have their city and let them run it. Give them their school department back, give them an amount of school funding that any other town would get with their demographics. Give them the same amount of state aid as any other town with their population and let them go. Let them continue on making the same decisions as they have in the past and electing the same people. But if they run the city into the ground again, let 'em go. Let people like Moreau, Crowley, Silva and McLaughlin sort it all out.

Crowley said she has heard other state senators say they’re “not going to give Central Falls another penny,”

Amen.

Robert Flanders' Answers to Questions on Receivership

Central Falls Receiver Robert Flanders certainly cannot be faulted for not responding to inquiries in a timely fashion...

Q1: You have been quoted on the Buddy Cianci radio show as saying that some sitting Rhode Island Mayors should approach the state government and ask to become the receivers for their cities. Is this indeed a course of action that you advocate?

Central Falls Receiver Robert Flanders: It depends on a number of factors, including whether the State (i.e., the Governor's office and legislative leadership) would be likely to have some measure of confidence that that particular sitting mayor would be able to and willing to take the sometimes politically unpalatable actions that might be needed to restore the City to fiscal solvency and whether the mayor in question has the credibility, capacity, political will, and respect needed to accomplish such a goal and to work cooperatively with the Director of Revenue, the Governor, and other stakeholders to do so.

Q2: Conflicting accounts of the rescinding of the recent parking ban in Central Falls have been presented to the public. Most recently, W. Zachary Malinowski of the Providence Journal attributed the rescinding of the ban to the Governor of Rhode Island and not the Office of the Central Falls receiver (February 4 Providence Journal, "The next day, Governor Chafee, reacting to a public outcry, suspended the parking ban"). Could you clarify the process by which the parking ban was rescinded?

RF: The Receiver suspended enforcement of the parking ban, after obtaining input from the Governor's office, local elected officials, and a number of Central Falls residents.

Q3: In Federalist 47, Montesquieu was quoted by James Madison: "There can be no liberty where the legislative and executive powers are united in the same person, or body of magistrates". Do you believe it is a wise course of action to tell the people of Central Falls, of Rhode Island, of the United States and of the world that fiscal crises justify restructuring of government in a way that removes what some of the great thinkers of the Western political tradition believe to be an essential safeguard to liberty?

RF: To my knowledge, no one associated with the Receivership is telling people that or saying that, nor have they said that. Rather, what state policy makers decided when they enacted the Fiscal Stability Act (providing for the appointment of various levels of state fiscal oversight when a city or town experiences extreme financial difficulty) is that fiscal emergencies call for extraordinary temporary measures to correct a problem that threatens to cause a City or Town to default on its obligations and/or to run out of cash. When the emergency and crisis ends, then the temporary and extraordinary measures used to deal with that situation also end. The Rhode Island Supreme Court recently upheld the constitutionality of this statute in the teeth of arguments such as those that your question adopts, expressly rejecting them as legally unsound. A corollary to the quote in your question is that there can be no liberty when the executive and legislative branches of a state are powerless to prevent a city or town (and therefore the residents who depend on its viability) from experiencing utter financial ruin.

Receivership as a Way for Mayors to Grab Total Control of City Government?

Yesterday was the second consecutive day on which Buddy Cianci, during his WPRO (630AM) radio show, referenced an earlier interview with Central Falls Receiver Robert Flanders, where Receiver Flanders had apparently suggested that Rhode Island Mayors could deal with their fiscal problems by approaching the state and having themselves appointed receivers of their own communities. I'd be very surprised if state legislators had this kind of process in mind when they passed the "fiscal stabilization" law in 2010.

(Under the fiscal stabilization law, the state can move to immediately suspend municipal democracy in a community, without first passing through an "overseer" or a "budget commission" process first)...

In the event the director of revenue determines, in consultation with the auditor general, that a city or town is facing a fiscal emergency and that circumstances do not allow for appointment of a fiscal overseer or a budget commission prior to the appointment of a receiver, the director of revenue may appoint a receiver without having first appointed a fiscal overseer or a budget commission.

I didn't hear the original interview and haven't been able to find it on the WPRO website, so based on Mayor Cianci's account, I've put the following set of questions via email to Central Falls Receiver Flanders' office:

---

1. You have been quoted on the Buddy Cianci radio show as having said that some sitting Rhode Island Mayors should approach the state government and ask to become the receivers for their cities. Is this indeed a course of action that you advocate?

2. Conflicting accounts of the rescinding of the recent parking ban in Central Falls have been presented to the public. Most recently, W. Zachary Malinowski of the Providence Journal attributed the rescinding of the ban to the Governor of Rhode Island and not the Office of the Central Falls receiver (February 4 Providence Journal, "The next day, Governor Chafee, reacting to a public outcry, suspended the parking ban"). Could you clarify the process by which the parking ban was rescinded?

3. In Federalist 47, Montesquieu was quoted by James Madison: "There can be no liberty where the legislative and executive powers are united in the same person, or body of magistrates". Do you believe it is a wise course of action to tell the people of Central Falls, of Rhode Island, of the United States and of the world that fiscal crises justify restructuring of government in a way that removes what some of the great thinkers of the Western political tradition believe to be an essential safeguard to liberty?

Does the Mayor of Central Falls Live in Lincoln?

I guess he's just following the leader. Remember before the election two years ago, GoLocalProv.com broke the story about then-candidate Lincoln Chafee being accused of having car registrations in East Greenwich, taking a homestead exemption in Providence and being a registered voter in Warwick? For those unaware, property owners can only get a homestead exemption for their primary residence. But I guess we should just "Trust Chafee."

Based on that precedent, I guess it would only stand to reason that the mayor of Central Falls would register a vehicle in Lincoln, where the taxes on that vehicle are cheaper.

The next year, 2010, when Mayor Moreau declared the city insolvent and petitioned Central Falls into state receivership, the couple found a better car tax deal. He transferred the registration to Lincoln where he and his wife own a home in Serenity Acres, a woodsy development at 1906 Old Louisquisset Pike. There, the Moreaus took advantage of a lower car tax rate and a $3,000 exemption the town provides on vehicle assessments, which allowed them to save about $450. They paid Lincoln $528.89 in vehicle taxes.

Some might be led to question whether he is still the mayor as Robert Flanders is the current state appointed receiver for the city, but as Flanders said:

“It bothers me that we are giving him a salary of $26,000 when he’s doing little or nothing as mayor,” he said. “It’s discouraging to see the mayor depriving the city of revenue when it’s in a time of need."

Moreau is receiving a salary to be Central Fall's mayor in name only, yet he owns a property in Lincoln where he has registered a vehicle.

Additionally, according to the ProJo

The City Charter requires the mayor to live in Central Falls.

To be completely fair here though, the ProJo article might have inadvertently explained this.

A review of tax records from each community shows that in 2009 the sport utility vehicle was registered to Moreau’s wife, Kristen

If the vehicle is the mayor's wife's, there's no law that says she can't live in Lincoln and register a vehicle there. She's not the mayor and doesn't have any residency requirement. As for further figuring out exactly where they live, there's this:

The Moreaus in October sold their house at 141 Jenks Ave., where they had been registered to vote, and are now registered to vote at 150 Jenks Ave., the home of Jonathan and Sharon Kelly, according to the Board of Canvassers.

But unless Mrs. Moreau has voted in Central Falls since registering the car in Lincoln, I don't know that we have a problem here. Maybe it is her car, maybe she lives in Lincoln and just hasn't gotten around to registering to vote in Lincoln yet. I guess it is possible. Right?

As for Chafee, the explanation once again seems to be that the cars and home in question aren't in his name, but instead are his wife's or belong to a trust. To quote Dana Carvey as the Church Lady, "Well, isn't that conveeeenient?"

Gotta love Rhode Island politicians.

Who's Running Central Falls?

I ask, because it's really hard to tell from the way the issue of the overnight parking ban played out.

In December, Central Falls Receiver Robert Flanders "approved" an ordinance imposing a fine for overnight parking in Central Falls scheduled to take effect this month (though Senator Agostinho Silva's press releases on the matter have continually referred to the receiver having "endorsed" the ordinance).

After a lively public comment session on Monday with the receiver's chief-of-staff in attendance (AP reporter Erika Niedowski's report via WJAR-TV available here), the receiver announced the next day that the ordinance was being "suspended" (WJAR-TV's report available here)...

"I'm going to suspend the enforcement of the ordinance until we can get more information about what alternatives might be possible," he said

Whatever you think of parking policy, it's not a great day for the rule of law when the one man who is empowered to both make and enforce the laws for a community decides not to enforce the laws he has made.

Or maybe Receiver Flanders didn't reach his decision on his own.

On Wednesday, Senator Silva put out a a press release thanking Rhode Island Governor Lincoln Chafee for "his decision to rescind the controversial on-street parking ban", with several General Assembly members praising the Governor for his "swift intervention".

Were the "rescinding" and the "suspension" the same act? And were General Assembly members Agostinho Silva, James McLaughlin, and Elizabeth Crowley thanking Governor Chafee for directly rescinding the ordinance, for ordering receiver Robert Flanders to rescind the ordinance, or just for having the foresight to appoint a receiver willing to not enforce his own ordinances?

The Dogs That Didn't Bite in Pension Reform

Two aspects of this Monday editorial in the Providence Journal, lauding Central Falls Superintendent Fran Gallo for progress in her school district are interesting.

For one, multiple Projo columnists have compared Democrat General Treasurer Gina Raimondo favorable with Republican reformers in other states, like Wisconsin Governor Scott Walker and Ohio Governor John Kasick, on the grounds that union intransigence illustrates that the Republicans' method of reform wasn't sufficiently collaborative. Yet, here we have Gallo receiving the full union-thug treatment (short of physical violence, which even the thugs must have seen to be a losing proposition against a diminutive older woman), and the editors hailing the "cooperative efforts."

More pointedly, the editors detail some union-friendly legislators' efforts to bully Gallo in order "to disrupt public-spirited efforts to improve Central Falls High School." The essay also mention's last year's conspicuously high absenteeism among teachers. It ought also to have mentioned the aggressive campaign of threatening nastiness that Gallo experienced when things were at their roughest.

What's interesting about that is how it compares with the relatively light touch of the unions and their members during the supposedly radical pension reform. Sure, they held a fun evening rally one warm evening. Sure, some paid union leaders made some silly statements and issued threats of electoral defeat. But where was the real heat?

Reform was necessary for both Central Falls schools and for the state pension system. In both cases that was and is impossible to deny. In both cases, union deals had to be pushed back. Yet, there's a marked difference in the tone of the response, with the smaller of the two skirmishes sparking a higher degree of venom. What could account for that?

Local Bailouts

I think I need to ask Justin to add a new category of "Wait, what?!" as it seems every day there's a new headline that just makes me shake me head and double check to see if I'm actually reading The Onion.

Today's is the Breaking News headline on the Providence Journal:

Chafee to ask RI General Assembly for $2.6-million Central Falls bailout for CF retirees

Ok, first of all, I understand the plight of the CF retirees and I understand the lack of fairness in this issue to them. Losing half your pension income without doing anything wrong was to put it mildly, harsh. But that's not the issue here. The issue is the thought of RI bailing out the retirees.

The article describes the deal as:

The agreement would give each retiree an average of $5,000 annually for five years.

So my questions from then are, how does the "average" work? And, after five years, then what? Will we hear then about how their pensions are getting cut again, because they're losing that $5,000? Plus, if there's no COLA involved in that five-year span, that same $5,000 won't go as far in 2017 as it did in 2012. The retirees will likely be looking for more than the $5,000.

This is the state looking to bail out a local mistake. If municipalities want autonomy, then they need to live with both sides of it. Otherwise, let's just dissolve all the borders and go with one big city, "Rhode Island".

This sets an interesting precedent. However, it would appear that this very same thing has already been done recently, under the guise of "a loan". Right Providence and ProCAP? That's what we're calling it?

I also wonder about the funding. Where is that coming from? Is the General Assembly able to just whip up $2.6M out of thin air, especially when it wasn't ever budgeted? If they're capable of doing that, then we may have more questions.

What would this do for the authority and credibility of the receiver, Robert Flanders? Flanders cut the pension and now Chafee is working to restore at least a portion of it. So in the future, who do people in the town work with and negotiate with, Flanders or Chafee?

Where was this idea a few months back when Flanders first cut the pensions? Especially at a time when the state's budget was still being drafted and this could have been vetted and written in. Or is this yet another attempt by the Chafee administration to run around the General Assembly and simply bypass their authority? Why was all the pain and anger and frustration allowed to happen if it was going to be fixed this simply? Why wasn't this option brought up earlier? Did Chafee and the retirees think they'd simply call Flanders' bluff and he'd never cut the pensions?

Another issue with this is here:

Neither Flanders or Chafee's office would comment on the details of the agreement, saying that a confidentiality agreement prohibits them from discussing the deal until it's approved by the retirees.

I don't understand why anyone in the government is allowed to potentially spend, or at least negotiate with, taxpayer money without the taxpayers being able to see what's being negotiated before it's signed. We require transparency with our Open Meetings laws, where we don't even allow three members of the same committee to meet over coffee and discuss things without public notice, but here the Governor could be setting quite the precedent and spending millions of taxpayer dollars, we can't find out all the details before the contract is signed?

To quote a former US Speaker of the House:

We have to pass the bill so that you can find out what is in it

Usurpation Cannot Be Challenged in Central Falls

This ruling is worth highlighting before it slips in the vast mire of news about Rhode Island's fatally ill civic structure:

The state-appointed receiver running Central Falls can go after Mayor Charles D. Moreau and the City Council to recoup legal fees spent defending the receivership law from Moreau’s unsuccessful state Supreme Court challenge, a special federal bankruptcy court judge ruled Friday.

Look, it stinks that a struggling city would have to pay for both sides in this legal battle, but there's a clear value to ensuring that a law that completely removes local democratic control is at the very least vetted in a court of law. Compare that with, say, Tiverton, where taxpayers are paying the school committee's legal council to argue against the town solicitor, for whom the taxpayers are also paying, over $367,000 that the town treasurer removed from the school committee's earmark on the grounds that it exceeded the local appropriation approved by the financial town meeting and that represented a surplus for the schools, anyway. In that case, the lawyers' bills must fund the process through the education commissioner and the Board of Regents before it even gets to a court of law. (Not surprisingly, the commissioner in charge of the school system found in favor of the schools.)

The controversy in Central Falls reads like a tale out of some third-world backwater trying to fake representative democracy:

The receivership law gave the first state receiver, Mark A. Pfeiffer, and then Flanders the powers of every elected and appointed official in city government. Pfeiffer had specifically refused to authorize the lawsuit and told Moreau and the council not to contest the law. They did anyway.

In the effort to recover the expenses from the appeals, Flanders' lawyer, Theodore Orson, has argued — and a Superior Court judge agreed — that because Moreau and the council disregarded Pfeiffer's orders, they can't claim the suit was part of their official duties.

Well, duh. After a coup, the elected officials have no "official duties," and the usurper will never be likely to grant permission for a legal challenge. Apparently, the judicial system in Rhode Island buys the logic of tyranny (which should be too surprising, considering that the American judiciary has been imposing policy and amending the Constitution via lawsuit shortcut for decades).

When the Municipal Dictator Has a Political Boss

Apparently, when a municipal dictator (i.e., a "receiver") deals with those who previously held power locally, it's one thing when that power derived from the voting public, but it's another when it derives from an organization that's politically connected at the state level:

Frank Flynn, president of the Rhode Island Federation of Teachers, which represents Central Falls, said he had appealed to Governor Chafee.

"We haven't met with the receiver, but we have spoken to the staff of the governor and we told them it was our intention to go to court and get a temporary restraining order," Flynn said. "The governor's office, through the receiver, asserted his authority to intervene."

And since the teachers' unions have such sway in the state:

Receiver Robert G. Flanders Jr., who is overseeing the bankruptcy filing of the state's smallest and poorest city, notified Gallo Friday afternoon that her authority to negotiate with the union was being revoked. He also revoked her plan to unilaterally impose new terms on the school district's 330 teachers on Sept. 1.

The district's negotiation team, which included Central Falls Board of Trustees Chairwoman Anna Cano-Morales and two parents, is also no longer included in the negotiating process.

Instead, Flanders or his designee and Deputy Education Commissioner David V. Abbott will participate in the talks. ...

"I asked him if the teachers' union negotiating team was also being replaced and he said no, they would remain," Gallo said.

Unless Flanders moves to impose new contract terms that are more harsh than Gallo's, the entire process will have further proven the bone-deep corruption of Rhode Island's political system. Voters across the state ought to be concerned at the ease with which democratic processes are being swept aside for the benefit of particular parties. And public-safety retirees from Central Falls ought to be livid.

S&P's Lesser Noticed Statement "Starring" a Certain Rhode Island Town

In the perfectly justified consternation and alarm Friday following upon Standard and Poor's downgrading of the United States' credit rating, let's not miss the other statement issued on the same day by S&P which hits a little closer to home. [Although the ramification of the first statement may not be remote at all.] From Reuters.

Even an anti-default state law might not prevent Central Falls, the tiny Rhode Island city forced into bankruptcy by ballooning pension costs, from defaulting on some debt, credit agency Standard & Poor's warned Friday.

Quoting S&P directly:

Given the Chapter 9 bankruptcy filing, the prospect of full and timely payments on the General Obligation debt is uncertain, notwithstanding that, pursuant to the recently amended Rhode Island General Laws in Chapter 45-12-1, a first lien on ad valorem taxes and general fund revenues secures the bonds.

Municipal Bankruptcy is a Tenth Amendment Issue

The initial Projo report on today's announcement that the receiver for Central Falls will file for bankruptcy highlights one of the many high-level policy, political and legal issues that municipal bankruptcy is going to involve…

In a commercial bankruptcy, the judge has the authority to order the sale of assets, even the closing of the business, to pay the creditors. But a government can't be sold off.

A Chapter 9 judge can approve or reject a receiver's settlement proposal, but he or she can't order the sale of assets because of the Tenth Amendment to the United States Constitution, which states that any powers not specifically given to the federal government by the Constitution belong to the states, meaning a federal bankruptcy court can't tell the city how to run its affairs, like selling assets.

An Interesting Whisper from the Governor to the Receiver

This one nearly slipped through the cracks, inasmuch as I haven't noticed its being developed into a larger story:

The overseer of deficit-plagued Central Falls could be replaced just five months after he was appointed to steer the city through its dire fiscal straits.

Governor Chafee told public radio station WRNI that he is considering replacing the current state receiver with someone who has experience in municipal administration. Chafee appointed retired Supreme Court Justice Robert G. Flanders Jr. to manage Central Falls' finances in February.

You'll recall that Chafee bumped Flanders into the Central Falls dictator role as part of his overhaul of the previously reform-minded Board of Regents for the state's public schools. Interesting that the governor would let this little bird fly just a couple of weeks before Flanders was to bring down the big hammer on the public sector workers retired from the city that he's now running.

This Is Consolidation

The Providence Journal editorial board highlights a piece of legislation that, while unlikely to become law, illustrates the potential consequences of consolidation for the sake of efficiency and ease:

... Sen. John Tassoni (D.-Smithfield) — a member of the state's AFL-CIO executive board, former business agent for the state's largest public-employees union, AFSCME Council 94, and the publisher of a union newspaper — wants to use his public power to oust Ms. Gallo. He also wants to replace the Board of Trustees that voted to fire those teachers. ...

Clearly, [Tassoni's rhetoric] can be taken with a grain of salt, given that he had not bothered to discuss his concerns with Ms. Gallo, and he has an obvious huge conflict of interest as a union official, elected to public office with the strong financial backing of government unions to promote their economic interests.

Hey, if the state can insert a municipal dictator (popularly known as a "receiver") to oust the elected mayor and make the elected city council less than an advisory body, then why shouldn't it also pass judgment on superintendents and school boards? That's consolidation.

The lesson extends even to less brazen steps. The farther governance moves from voters, as from local development of school policies among neighbors to regional and statewide implementation of policies, the more incentive special interests (notably unions) will have to fill elected positions with the likes of Tassoni. As the Projo editors note, Governor Chafee has already "removed several of the student-focused reformers... from the state Board of Regents," even though large segments of the state did not vote for this governor's election.

C.F. Principal: Ho Hum, Now That I've Enjoyed Seven Months Paid Leave, Guess I'll Ask Why I was Taken Off the Job

Presumably, the Central Falls school administration messed up by placing Ms. Legault on leave and then forgetting (or ???) that they did so. And it goes without saying that it would be a rare occurance, indeed, for private sector resources to be squandered in this way.

Elizabeth Legault started out the year as co-principal at the [Central Falls] Calcutt Middle School but was put on administrative leave in October 2010. She has been on leave since then, all the while collecting her full $105,500 salary.

It wasn’t until earlier this month, on May 5, that the school district issued her a formal reprimand letter. Now, since she wasn’t put on suspension or received another more serious punishment, Legault is wondering why she is not being allowed to return to work, according to her attorney, Jeff Sowa. Since the district has not provided a reason, Sowa has filed an injunction in Providence County Superior Court requiring that the district let her back into Calcutt Middle School.

Funny, though, how the co-principal carefully did not ask why she had been placed on leave until AFTER she had enjoyed a seven month vacation funded by the taxpayer. You have to wonder where the pride in professionalism is here. Will Ms. Legault place this seven month leave on her resume? If she does, how will she explain it? The only honest answer - "No one was watching the till so I helped myself" - presumably would not play well, even in an interview for a public sector job.

Give Them Time... and Money

Although writing from Michigan, Kyle Olson has it right when it comes to his perspective on education happenings in Central Falls:

Central Falls students deserve a high-quality education. But instead, families are told to be patient as administrators and the teachers union hold meetings and create 45-page reform plans. And now the federal government gives the district a big check, which simply buys the defenders of the status quo more time.

At the School Committee meeting in Tiverton, this Tuesday, the committee and administrators turned part of their budget discussion into a plea that they lack the resources for early interventions that might improve results, particularly standardized test results, for students down the line. They talked about revenue sources that Portsmouth has that Tiverton doesn't; they speculated as to why Portsmouth's per-student cost might be lower, including the possibility that the town has fewer special education students. (Some quick research that I did online while they talked showed that a good portion of the difference is specifically in instruction, meaning the cost of teachers.)

As far as I'm concerned, that's all beside the point. Each town and city has the tax base that it has and the student population that it has. The principle studiously ignored during such discussions is that organizations must be built to do the work that must be done with the resources that they actually have. If that means that a particular district must pay teachers significantly less in order to hire math coaches or whatever else might be needed, then so be it.

The approach to labor and salary that has become part of public school culture begins with the premise that teachers should make roughly the same wherever they work, and the unions manipulate politics and local budget processes in order to prevent any real systemic balance of price, resources, and value. Pouring more money — whether local, state, or federal — into the equation causes the price of educators to go up and when the flow of revenue ebbs, programs and services go on the chopping block so that salaries never have to adjust downward.

Deflate the Bubble — There's Only One Way

John Kostrzewa sees municipal deficits as "the next big bubble," specifically related to municipal bonds. If cities and towns begin to default, then investors will stop considering them so safe and, per those who support public debt, the sky would fall.

In outlining options for Central Falls, Mark Pfeiffer, the state receiver, said bankruptcy should be a last resort because a filing in federal court would ripple across the country, sending a message that Rhode Island is a risky place to do business. Investors would demand more interest on any municipal bonds sold here, or they could pull out and not buy at all.

Investors would also be spooked because the federal courts could change the terms of bond sales, leaving investors with more uncertainty and less safety about what they had purchased.

I say, "good, let it happen." It's time that financially incompetent politicians learned to stop treating debt as a revenue source. Those playing with public dollars ought to be the most financially conservative; saving up for investments and improvements, rather than passing bond issues in political blasts and obligating future taxpayers to cover the expense.

Watching the Slow-Motion Crash of the Regionalization Train

It may not add up to a silver lining, but hopefully folks are beginning to see why Anchor Rising contributors have been very suspicious of calls to regionalize or centralize government and its services:

[League of Cities and Towns Executive Director Dan Beardsley] also spoke of new limits on municipal contracts to ban: automatic renewals for expired agreements; retirement benefits that exceed the statewide standard, should one be adopted,and provisions such as minimum manning rules that limit municipalities' ability to close or reorganize departments.

Beardsley said those changes were needed to undo years of bad laws and, in his opinion, excessive arbitration decisions that had unreasonably increased municipal benefits such as pay for unused sick time.

[AFL-CIO President George] Nee said the contracts were the result of both sides agreeing to the terms, and it was disingenuous for municipal officials to blame unions for the deals they signed themselves.

Frankly, Nee's right. The people whom Rhode Islanders have allowed to operate local governments have acceded to union demands much too enthusiastically. Moreover, they haven't adequately pushed back against mandates and statutes at the state level that have tilted the game board in the direction of unions and other special interests. Only when things begin to fall apart do they begin to strike poses of complaint.

But note, in that process, that the state has not been the source of reason. The larger, superseding government and its officials have been drawing municipalities in the harmful direction, not striving to hold them back. What on Earth makes folks think that giving them more direct control — as with statewide teacher contracts, more say on healthcare programs, and a stronger position in local affairs — will be to the better?

Even just a few paragraphs away, we get this:

John C. Simmons, executive director of the Rhode Island Public Expenditure Council, said while proposals in the report for a city merger or for a regionalization of services were interesting, other options might be considered, too, such as the state simply taking over all city services in Central Falls.

All that means, it seems to me, is that the unreasonable costs of Central Falls' agreements will be spread across the entire state. Hiding those costs and deflating accountability is clearly not the way to bring the city or the state toward the practice of better decision making.

Call in the Gov

This'll be a useful test case for Governor-elect Chafee:

On the snowy steps of the high school, Frank Flynn, president of the Rhode Island Federation of Teachers, said he had called Chafee Tuesday morning and asked him to convene a group of teachers, school and district administrators, union leaders and state education officials to "move this school forward, because the students of Central Falls deserve nothing less."

The governor-elect indicated he would help, Flynn said, although no details have been settled yet.

The image comes to mind of Chafee in a vintage campy Batman costume running to a special phone in his office. It will be interesting to see how quickly the new governor implements the union-friendly changes that we're all expecting.

Step one, most likely, will be for him to step forward and bring everybody "to the table" in a one-sided equivalence that turns the notion of transforming Rhode Island's school system right around. The question is how quickly those intransigent bureaucrats and administrators who insist that reform must mean reform will be pushed out of their seats.

Continuing to Define Democracy Down in Central Falls

Over on the municipal side in Central Falls, lawyers for Receiver Mark Pfeiffer have made their latest arguments explaining how the suspension of municipal democracy in CF is constitutional. Here is the most thoroughly unconvincing one, from John Hill's report in today's Projo...

Pfeiffer’s lawyers disputed the usurpation argument, saying that in May, before Pfeiffer’s appointment, Moreau and the City Council went to court and asked for and got a court-appointed receiver with much the same powers that Pfeiffer has now. Pfeifer’s brief also said that the council in June passed a resolution that endorsed the state receivership law that called for a state-appointed receiver — eventually Pfeiffer — to replace the one chosen by the courts.

Presenting a theory of government that cannot seriously be called democratic, Receiver Pfeiffer is arguing that a city's Mayor and council have a legitimate power to give away the people's right to democratic government, in consultation with another organ of government, but without the consent of the governed. This is not correct. Democratic systems are not systems that have some optional democratic features that can be done away with when some (OK, in the case of Central Falls, when many) bad decisions create problems. Democratic systems are systems where the people are sovereign over the government, where government cannot sever itself from accountability to the governed without sacrificing its legitimacy.

I ask to the readership here -- and especially to those who think this is just a Central Falls or an urban core issue -- are you truly comfortable with creating a precedent in Rhode Island where your mayor and/or city or town council is granted the power to give away your right to democratic governance, in order to "solve" an issue in your municipality -- keeping in mind that, as we head into what could be a very tumultuous period of public financing decisions in Rhode Island (and elsewhere), Central Falls is probably not the only place where the upper echelons of Rhode Island's political culture would like, if given the chance, to move democracy out of the way of the exercise of governmental power.

Setting Up the Failure

Although the majority of the teachers probably just wanted to keep their jobs, observers with a cynical (I would say "realistic") opinion of labor unions likely foresaw the Central Falls teacher absences issue back when Superintendent Fran Gallo unfired the high school faculty back in May. There is no way union organizers want the transformation model of reforming the school (or any model, really) to work, particularly as it's been initiated from the education commissioner down, and I'd suggest that the employee attendance record at the school proves that enough teachers are willing to pull the union rope to cause problems:

The high rate of teacher absenteeism has sparked a new wave of outrage and fed the ongoing debate about how to improve the nation’s worst-performing schools.

Bitterness remains over the mass firing of all the school’s teachers in February, jobs that were eventually won back through a compromise agreement in May. In exchange for their jobs, the teachers agreed to a list of changes administrators said were necessary to turn around the school, which has among the lowest test scores and graduation rates in the state.

Some teachers resent the new requirements, which include tutoring and eating lunch with students each week, attending after-school training sessions and being observed by third-party evaluators. In all, about 15 teachers resigned between June and November; two others retired. One position remains unfilled, according to school officials.

As you may recall, the other alternative was the "turnaround model," by which the entire teaching staff would have been fired, and no more than 50% could have been rehired. One suspects substantial overlap among three groups:

• The retirements and absentees
• Teachers who look to the union playbook for ensuring the failure of reform
• Central Falls High employees who would not have been rehired under the turnaround model

The lesson for Rhode Island administrators and commissioners is clear: Making those who oppose reform integral to it is not likely part of a formula for success.

ADDENDUM:

And let's not allow the issue to slip into the background without marveling at this deal:

According to the contract, teachers receive 15 sick days a year at full pay and are allowed to accumulate up to 185 sick days — which takes slightly more than 12 years of service to accrue. They also receive two personal days each year.

Veteran teachers with at least six years of service are also entitled to 40 days of extended sick leave at full pay; teachers with 15 or more years are entitled to 50 days, also at full pay.

If I'm reading that right, in a (give or take) 180-day school year, a Central Falls teacher can theoretically have 237 available paid days off. Presumably, there are procedures in place to review extended sick leave, but by the numbers, a teacher could work just six weeks a year for two years.

Receiver: Merge Central Falls/Pawtucket

Former Judge Mark A. Pfeiffer, appointed as receiver for troubled Central Falls, has come out with his recommendation (PDF): merge Central Falls with Pawtucket (via 7to7).

"The problems are so severe that they cannot be solved solely through efficiencies and additional revenue at the city level," he wrote. " ... state action is required if the city is to avoid fiscal collapse in its immediate future."

The major problem is the city, with an annual operating budget of about $16 million, is facing about $48 million in pension and after-retirement obligations, he said. Essentially, the city spent years giving out pension and retirement benefits without figuring out how to pay for them, he said.

That mistake was exacerbated by municipal officials who didn't notice or appreciate the problems, he said, ignoring them when they were manageable and only reacting when it was too late.

A merger with Pawtucket would put Central Falls in a municipality with similar demographics and issues, Pfeiffer said....The lower income population of Central Falls would make it easier for Pawtucket to attract government grants, he said, and the increased population would make the new combined entity the second biggest city in the state, enhancing its legislative clout.

Pfeiffer outlined a plan, which, interestingly enough, would basically involve statewide reform. It includes:

1) Consolidating pension funds across the state and modifying the current system (ie; increase retirement age, payouts, etc.)
2) Implementing a statewide health insurance plan for government employees at the state/municipal level.
3) Reforms to how Collective Bargaining Agreements are constituted, including a "zero-baseline" re-negotiation mandate every 10 years to account for changes in fiscal situation of the municipality.

From Receiver to Totalitarian

Curiously, giving somebody total power over a municipality seems likely to do nothing so much as expand the scope of "total":

The state-appointed receiver who assumed Mayor Charles D. Moreau's powers in July announced Tuesday that he was appointing a three-member advisory council to act in place of the five-member elected City Council.

A mayor's role is administrative, so it's not surprising (although it's still objectionable) that a state-appointed receiver would assume the mayor's responsibilities. But what's a city council do?

Pfeiffer's advisory council will review business licenses, zoning and other matters that normally go before the City Council.

This is character-of-the-town stuff. This is the heart of self-governance. And the single-person-receiver, accountable, ultimately, to the state Department of Administration and the governor has now handed it off to yet another layer of unelected officials, accountable to him. The explanation of this usurpation of the democratic process offers no comfort. The elected council rejected a demand from receiver Mark Pfeiffer:

[Council President William] Benson said the council voted to reject the policy plan because it believed that October's court ruling had already put it in an advisory role and approving a policy could have exceeded that role and possibly put the council in contempt of court.

The policies included requirements that Pfeiffer be informed of agenda items three days ahead of a council meeting, that he had the right to strike or add agenda items and that he be provided with copies of materials the council received during its meetings.

One needn't know anything about the day-to-day issues that face the Central Falls City Council to see danger in this development and to believe that Governor Don Carcieri should rein in his appointed dictator. Unfortunately, insinuation into town operations isn't the only direction in which the receivership idea is expanding:

Pawtucket's finances have drawn the attention of state officials. Rosemary Booth Gallogly, the state Department of Revenue director, sent a letter to Doyle focused on the city's deficits, saying that "savings haven't materialized" despite a deficit-reduction meeting held with Pawtucket officials.

"The state reserves its rights to examine the city's finances," Gallogly's Sept. 29 letter said, in part. The letter also referred to a new law that lets the state intervene in a financially distressed municipality, as it did in Central Falls where a receiver is in charge. However, Amy Kempe, a state Department of Administration spokeswoman, said last month that the state does not at this point expect to intervene in Pawtucket.

In passing, note that Ms. Kempe is also cited repeatedly as spokeswoman for the Central Falls receiver. Whether the state currently has plans to take over Pawtucket, as well, the power of the threat is the matter of concern, because threats tend to grow and eventually must spill into action.

Nonetheless, right-leaning reformers in the state might be tempted to accept the bad with the good, in the case of the government's new right of receivership. After all, the threatening letter in Pawtucket has inspired the mayor to push the School Committee to pressure the teachers' union to begin talking, at least, about financial easing of contractual requirements. Consider, though, that in mere months, the person who will ultimately appoint any new receivers will not be Don Carcieri, but Lincoln Chafee — he with the left-wing head of the state National Education Association branch on his transition team.

Towns Serving at the State's Pleasure

Ted Nesi reports that Superior Court Justice Michael Silverstein has found the Central Falls receivership to be constitutional:

As I mentioned back in July, the big constitutional question here was whether or not putting a city or town into receivership represented a permanent change in a municipality's form of government. Administration lawyers and Pfeiffer argued it does not, and therefore the new law would withstand judicial review under a 1994 R.I. Supreme Court precedent. Central Falls Mayor Charles Moreau and four out of five City Council members argued the opposite, and lost.

Permanence, by Silverstein's lights, appears to mean that municipal voters will be able to return to a representative form of government... someday. Moreover, the justification for the law remains broad:

The judge also noted that cities and towns' right to self-government "is not unfettered," because matters of statewide concern remain in the General Assembly's hands even if they affect municipalities. With that in mind, he agreed with the administration that an individual community's financial collapse would be a matter of statewide concern because of the cascade effect it would have on other places' finances.

In a state the size of Rhode Island, there's very little that a city or town can do that doesn't affect the others. Consider even the union strategy of leapfrogging benefits from town to town — with each district's local pointing to increases elsewhere in the state as a reason for increases. Or, to pick a topic of current interest, consider whether a wind farm controlled by a handful of municipalities that dumps energy into the grid will long be free of the state's groping fingers.

Basically, municipalities are subdivisions of the state, permitted autonomy and democracy only insofar as it's convenient to the powers in the statehouse. Of course, local leaders have been at the head of the herd in promoting that notion — especially around budget time — so it's hardly a one-way affront.

If I Were a Betting Man, I'd Bet On Judge Michael Silverstein Throwing Out the New Receivership Law...

...or at least significant chunks of it. I opine this after reading John Hill's report in today's Projo which highlighted a particular line of questioning asked during yesterday's oral arguments on the constitutionality of the municipal receivership law, to the lawyer for Central Falls receiver Mark Pfeiffer...

[Judge Silverstein] pressed [lawyer Theodore Orson] on the lack of a specific term for the receiver several times. Orson said the receiver’s tenure was not indefinite because the law allowed him to be removed once the conditions that led to his appointment were resolved.

This questioning by Judge Silverstein is very likely related to a precedent established in Marran v. Baird, the 1994 West Warwick case where the RI Supreme Court ruled that the state was not prohibited by the home-rule provision of the state constitution from creating of a "budget commision" to oversee an individual municipality's financial decision-making, as long as it was for the limted duration that was specified in the law at that time...

The plaintiffs also maintain that by enabling the commission to impose a budget upon the town of West Warwick, 45-9-3 bypasses West Warwick's financial town meeting and, thus, impermissibly alters the town's form of government. We disagree.

45-9-3 does not expressly alter the structure or form of West Warwick's municipal government. Indeed, any effect it may have on a local government is contained, delineated, and temporary, lasting no longer than the end of the fiscal year...

Obviously, the appointment of a commission that adopts and maintains a balanced budget for West Warwick has a temporary impact on West Warwick's budgetary process. The commission's role, however, lasts no longer than "the end of the fiscal year." Accordingly, 45-9-3's effect on the structure of West Warwick's government is at most incidental and temporary. The provision does not, therefore, affect the form of government of any city or town and consequently does not violate article 13.

Personally, I don't find the logic of it's only a temporary change in form government, so it doesn't count as a change in the form of government to make much sense. But from a legal perspective, what is most important to the present case is that the new receivership law, because of its open-endedness, may be found to violate the Constitutional provisions prohibiting state-imposed changes to municipal forms-of-government under the loose standards already established by the Rhode Island Supreme Court and without contradicting any existing precedents.

How Central Falls's Property Tax Rate Nearly Doubled Year Over Year

There's been some question, in the comments sections, about differing tax rates reported for property in Central Falls. John Hill explains what happened:

Last year, the total value of residential, commercial and industrial real estate in the city was just under $685 million. The new valuation, based on sales figures from the past year, was $411.6 million, a loss of $273 million, or 40 percent.

The drop in the value of taxable real estate meant the city had to increase the 2010-2011 tax rate just to generate the same amount of revenue as last year. Last year, the property-tax rate was $10.78 per thousand of assessed value; this year it went to $19.22 per thousand.

State receiver Mark A. Pfeiffer, who oversees the city's municipal finances, announced last week a 10-percent increase on top of that, to $21.14.

This is one of those ambiguities of taxation that comes up from time to time. Is the amount that you are taxed, for your property, better thought of in context of the rate or of the amount? Most RI towns treat your property essentially as a share in the government's cost and tax you according to your share more than directly according to the value of the asset that they're taxing. Personally, I think that slyly saddles homeowners with all of the risk for local property values, insulating municipal governments from the effects that their own policies can have thereon. But given all of the other things wrong with the way government operates in this state, it's not really worthy of a crusade.

Fighting Tyranny Inherently Breaks the Rules

I've been meaning to comment on the latest development in the governance of Central Falls: the city council's decision to hire an independent lawyer, apparently without knowing how it will pay the bill if Receiver-King Mark Pfeiffer, appointed by the state, refuses to allow it.

The move by the council is a reaction to state-appointed receiver Mark A. Pfeiffer's announcement last week that to close a $2.1-million deficit in last year's budget and a projected $6.3-million hole in the current year, he will need to raise the tax rate by 10 percent. For homeowners, that will mean the rate per $1,000 of assessed value will go from $19.22 to $21.14. There are different rates for commercial and industrial buildings.

On the limited matter of whether the council should be spending scarce resources on such a thing, it's difficult to argue with Amy Kempe, here:

[The council's prospective lawyer, Lawrence] Goldberg said the council needed its own lawyer in cases where it disagreed with Pfeiffer. Pfeiffer has told the council to use the city solicitors, but Goldberg said they now answer to Pfeiffer.

"They have divided loyalties," Goldberg said.

Amy P. Kempe, spokeswoman for Pfeiffer, said Tuesday night that Pfeiffer wouldn't approve a new lawyer.

"They should utilize the services of the solicitor's office so as not to add extra expense to the city of Central Falls," Kempe said.

But this is the problem with dictatorship. People lose trust in the process for addressing grievances or (rightly) conclude that the route is unduly long and complicated. To resolve differences with the receiver, the people of Central Falls would have to change enough state officeholders to halt a targeted law. Otherwise, they'd have to argue to a judge that the law or the actions being taken in its name are illegal. To expect city solicitors to take on their own boss in the name of residents, through their elected council, is little more than a banana republic pretense toward representative democracy.

Of course, beneath all of these fine procedural points, we can only shake our heads at the capacity of the state government of Rhode Island to come up with a way to make the mayor and city council of Central Falls look like victims.

You're All Missing the Point on Central Falls

I don't know if it's a Rhode Island municipality v. municipality thing or massive frustration with the insider v. outsider structure of our civic culture, in this state, but the commenters to my Central Falls post are marching all around the point. Patrick writes:

... I understand the point that you're making, but I think it's quite a leap to think that Cumberland, Lincoln, Coventry, North Kingstown is going to receivership anytime soon. If a city goes into receivership, it means it has been so badly managed that this is what it deserves. Clearly the voters don't want good representation, they don't know what's good for them.

This is true under normal circumstances, but the trampling on principle that the General Assembly has done in Central Falls is at least somewhat likely to start wheels turning in different directions. That brings us to commenter riborn:

You are missing the first costly misstep that was taken down this path Central Falls now finds itself on - the filing of the receivership. At some point the question has to be asked why receivership in the state court and not bankruptcy in the federal court. The estimated fees of Savage and Larisa may shed light on that decision. Do you have any inkling of the fees they would have reaped had they terminated union contracts and battled it out in state court? Do you think either of them cared if they won or lost that battle? It's about the money - nine lawyers and five staffers, and a firm spokesperson, all being paid by those CF taxpayers you are so concerned with now. In receivership Savage and Larisa would get paid whether they won or lost that battle with the unions, whether they benefited CF or not. And while it presented an interesting intellectual exercise to keep nine lawyers busy for a good long time and many billable hours - who decided it was a good move on behalf of CF? Did the elected officials have any idea of the costs that were going to be incurred in that exercise? In RI, receivership is primarily a money making business for a small group of receivers/lawyers.

Yes, the GA absolutely protected their main constituents, the unions, in drafting and passing the Pfeiffer appointment bill, what is the news in that? It was begging to be done when CF was advised to seek and then filed for state court receivership. And Mr. Savage, who can't seem to speak to the media now and must hide behind a spokesperson, was front and center on the TV and ProJo front page telling everyone he was going to terminate union contracts. Did the elected officials think that was a good strategy? This is RI, who didn't know the GA would come in and save the unions?

So far there appears to be one "winner" in the CF receivershp debacle - after 60 days the $191,000 prize goes to Mr. Savage. Second prize to Mr. Larisa, who probably never made $54,000 in two months in his life.

Patrick's point only holds if receivership is an unattractive end of the line for badly run town and city governments. But as riborn highlights, the General Assembly's version has plus sides for important constituencies. With the judicial receivership, the power brokers of a municipality are rolling the dice that the self interest of the lawyers involved won't turn against them. With the new legislative receivership, unions and their elected and appointed government pals are protected, giving the decision a strong plus for a powerful constituency.

There is now, in short, a safety net for the union–municipal-government scam. Don't be surprised should the next example fall far short of Central Fall's degree of mismanagement.

ADDENDUM:

Contra riborn, I think the first costly misstep was allowing Central Falls to be so thoroughly state subsidized in the first place — at least without some pain involved. Had the state funds come with the requirement that Central Falls must match the highest tax rate in Rhode Island, the locals might have had reason to put more competent people in office.

The People of Central Falls Should Fire Their Receiver

... only they can't, because the people who govern Rhode Island have decided that bond ratings justify a sort of economic martial law. They simply don't believe that democracy works. So, bond rating agencies' threat to devalue Rhode Island's ability to borrow more money (which it shouldn't be doing, anyway) has given a single man, retired judge Mark Pfeiffer, the right to do this without recourse for those subject to his dictats:

City taxpayers can expect a 10-percent property tax increase and higher taxes on the cars they own as the receiver appointed to reorganize the city’s troubled finances tries to close a $2.1-million deficit in last year’s city budget and a $6.3-million hole in the current one, the state receiver running the city’s finances announced Wednesday.

Anyone inclined to object that Central Falls is already at its 4.5% tax cap needn't worry, because:

The 10-percent supplemental bill is legal, Pfeiffer said, because the taxation cap legislation allows a municipality to exceed it if the governing council votes to ask the state for permission and if the state allows it.

Pfeiffer said the receivership state law gives him the power to act as the council, and he would do that when he asks the state Division of Municipal Finance to approve the increase.

Of course, the tax cap law — naively presuming that a "governing body" isn't a single man — requires a 4/5 vote of that body. Such is the distortion of language that one gets when the rules are suspended.

That suspension of rules, by the way, seems conspicuously to benefit a particular group. Note this tidbit from a sidebar to the current story:

[Judicially appointed receiver Jonathan] Savage was appointed May 19 after the city went to court for the state-law version of federal bankruptcy. Savage was replaced July 16 after a new state law put municipal receiverships under the Department of Revenue. [Spokesman Bill] Fischer said that was a mistake because under the old system Savage could have imposed new contracts on the city’s unions. The new law forbids that.

[Gubernatorial Spokeswoman Amy] Kempe disputed that, saying the law wasn't clear and had Savage tried to change contracts, it would have led to a months-long court battle.

So, before, Savage could have addressed unreasonable expenditures on and promises to labor — much like East Providence's School Committee did — and taken the likelihood of a lawsuit into consideration. The actions of the state government, however, have taken that off the table, so it's an historic tax increase without representation one of the poorest communities in Rhode Island at the behest of a very well paid dictator.

Because Once You Suspend Democracy and Make a Single Public Official Into an All-Powerful Governor-General with the Power to Spend Money Any Way He Sees Fit, What Could Possibly Go Wrong?

Will John Hill's reporting in today's Projo help convince people that suspending democratic governance really doesn't address the source of the fiscal problems we have here in Rhode Island...

The court-appointed law firm that oversaw [Central Falls'] finances from May to July has advised the state the bill for its two months of work and other related services will be about $306,400, state official said.

Amy Kempe, spokeswoman for the state-appointed receiver, Mark A. Pfeiffer, said state officials were "dumbfounded" by the figure.

"It’s staggering to us that the cost of the tenure of the judicial receiver would exceed $300,000," Kempe said. "That’s close to 15 percent of the city’s 2009 deficit."

More to come on this subject, in the near future...

Turnaround Dictator Comes with Big Bucks

If there are going to be public-sector pensions, then judges should receive reasonable ones, and somebody being paid to turn around a failing municipality should be compensated well for undertaking the responsibility, but state Senator William Walaska (D, Warwick) has a point about the amounts involved in Central Falls:

I was outraged when I read that retired Superior Court Judge Mark S. Pfeiffer would accept payment of $200 an hour, up to a cap of $164,000, as the receiver for Central Falls, on top of his $123,490-a-year state pension (Journal: "Retired judge steps in to run finances," July 17). His wife is District Court Judge Pamela Woodcock Pfeiffer, who is paid $148,900 a year. This doesn't even count the money that Judge Pfeiffer is making as an arbitrator.

Unseated mayor Charles Moreau, you might recall, was receiving the healthy sum of $71,736 in salary (plus plenty of perks, no doubt). Why the receiver — who already has much for which to be grateful to the State of Rhode Island — requires twice the mayor's old pay must be (let's just say) above my pay grade to understand.

Concerns About Process in Central Falls

The city of Central Falls is surely better off without Mayor Charles Moreau in office, and many of us likely share the opinion (from afar) that he'd best serve the state by taking this opportunity to quietly exit public service (which phrase I type with some difficulty, in this context). But let's take a moment to phrase in frank terms what has happened: The state has appointed a person, unaccountable to voters except through the multiple steps from him to the Department of Revenue to the governor, who has stripped an elected official of everything except the title of his office and some entry-level pay on the premise that "you can't have two leaders." If he so chooses, that appointee, retired Superior Court Judge Mark Pfeiffer," could do the same to the City Council.

On a personal level, the outcome for Moreau is probably just, but the bare facts of the case ought to give us pause.

Slow Improvement, or Spinning Wheels?

Little by little, we appear to be moving Rhode Island's political structure in the right direction:

A new law championed by East Providence officials has changed how its candidates and Central Falls' election contenders collected voters' signatures.

A provision in each of the communities' charters said voters could sign only one candidate's nomination papers. The candidate who submitted his or her papers first essentially owned every voter who signed his or her petition documents. ...

The matter was worse in East Providence because the charter also called for those seeking local office — such as School Committee and City Council — to get 200 signatures, four times the state requirement of 50.

It all seems so wonkish, but when these sorts of restrictions mount, they do create a significant disincentive to participation. The two questions, though, are:

1. Are other instances of such policies being reinserted through the window as we shove these out the door?
2. Are the changes happening quickly enough to pull Rhode Island out of the rut between balancing the budget and losing productive residents?

I'm afraid I'd have to offer the gut answers of: "probably" and "no even close," respectively. Although, it is possible that reform will accelerate from baby steps to a full sprint...

Backing off of the Receiver (Not a Post About Ellis Hobbs)

In the last couple of Projo stories on the Central Falls receivership situation, no references have been made, in the voice of the omniscient news narrator, to the power of the receiver to either raise taxes or fire city employees. For example, today's news staff story about the city's bond rating being cut to a junk rating says that...

The court-appointed temporary receiver has the power to go over the municipality's finances, approve or reject purchases and payments and, if the court approves, change contracts with unions and vendors.

I'm going to speculate that this is more than just an edit for space, and that some of the early descriptions of the receiver's formal powers were overstated.

However, in Steve Peoples and John Hill's story on the statewide reaction, North Providence Mayor Charles Lombardi is quoted as equating receivership with a town government giving up control of its tax rate...

North Providence Mayor Charles A. Lombardi, already working with the state to shape his city's $10.5-million deficit-reduction bond plan, said the contract-busting aspect of a receivership may be tempting, but would cede control of the town's finances, particularly its tax rate.

...so there's still some room for clarification on this.

What is Municipal Receivership III

I am becoming increasingly uneasy with the scope of the powers being attributed to a "municipal receiver" in Rhode Island. John Hill's story in today's Projo on the situation in Central Falls describes a broad range of executive and taxation authority being suddenly transferred to one man, perhaps working in tandem with the court system (I guess that would be two men)...

The court-appointed receiver has the power to approve or reject purchases and payments and, if the court approves, change contracts with unions and vendors and hire and fire municipal employees.

[Jonathan N. Savage], who said he'd be paid between $100 and $375 an hour for his work as receiver, said it was too soon to predict what he might ask the court to do, from imposing new contract terms or increasing taxes, until he'd had a chance to examine the city's books and consult with all the parties who might be affected.

Granted, the foundational legal issues regarding non-delegation of government authority are not as clear cut in the case of municipal governments as they are in the case of state governments. Since states are the fundamental units in the American system of government, and states create city and town governments and establish the scope of their powers, states can presumably reserve the power to make changes to municipal government at a future time.

But just because they can reserve their powers doesn't mean that they do. Article XIII of the Rhode Island Constitution spells out some very clear limitations on the state's power to change the governance of established cities and towns, Section 4 being the most relevant to the situation in Central Falls...

The general assembly shall have the power to act in relation to the property, affairs and government of any city or town by general laws which shall apply alike to all cities and towns, but which shall not affect the form of government of any city or town. The general assembly shall also have the power to act in relation to the property, affairs and government of a particular city or town provided that such legislative action shall become effective only upon approval by a majority of the qualified electors of the said city or town voting at a general or special election, except that in the case of acts involving the imposition of a tax or the expenditure of money by a town the same shall provide for the submission thereof to those electors in said town qualified to vote upon a proposition to impose a tax or for the expenditure of money.

This makes pretty clear, for example, that the state couldn't decide to remove the mayor of a city in mid-term and replace him or her with a state-appointed "governor-general" -- at least not without the approval of the voters via a referendum. Nor is there any provision allowing a governor-general to be appointed, again in the absence of a referendum, just because a City Council asks for one. Nor would appointing a governor-general become legitimate by re-titling the position to be the "receiver-general" or something similar.

It's important to understand what the maximum allowed scope for receivership at the outset -- and whether it needs to be challenged -- because the citizens of Rhode Island cannot assume the Central Falls will be the only place where residents may be told that someone who has not been elected is being put in charge of the local government, to make the decisions that elected officials have been trying to avoid. If we don't question what is happening in Central Falls right now, Central Falls may become an overly expansive precedent for the future.

• Previous: Where Does Legal Authority for a Municipal Receiver Come From?
• Previous: Accountability and Municipal Receivership

What is Municipal Receivership II

Here is one aspect of the aforementioned exploration.

Receivership usually means that an organization, as it has been, is going away. A city itself, of course, can't actually go away solely due to fiscal problems. And only in the most extreme of circumstances could a city government go away, or even change very quickly, because of money troubles, in the same way that a private organization might.

So if municipal government is still going to be around after a receivership, albeit with a different cost structure, but with fundamentally the same organizational structure, then what municipal receivership mostly means is that city officials are going to get somebody else to make the tough choices, and then have the full authority of their official positions returned with very little in the way of direct consequences. This is a problem in terms of accountability.

So if units of municipal government are allowed to treat their fiscal problems with a concept like receivership which isn't entirely compatible with the nature of governmental organizations, shouldn't a city council and mayor submit their resignations along with a receivership petition, to show they really have exhausted any options they have to offer, and that no parts of their organization are off-limits to radical change?

What is Municipal Receivership?

Pardon me for asking what might be a silly question here, but what does a municipal receivership of the kind being undergone by Central Falls actually mean?

I've looked through the Rhode Island General Laws, and there is no mention of municipal receivership there that I am able to find.

There's something in Federal law called "Chapter 9 bankruptcy" that relates to local governments. According to a Richard Dujardin Projo article from April 23 of this year, the Central Falls City Council had "voted to ask the General Assembly to enact legislation allowing Central Falls and other municipalities to file for bankruptcy protection", but I can't find any evidence that the legislature acted in response.

The resolution passed last evening by the Central Falls City Council asking for a receiver to be appointed (available via the Projo's website) cites no legal authority; its content is mostly a bunch of different variations on the theme of "we're broke and we want to give up".

And the order issued by Superior Court Judge Michael Silverstein placing Central Falls into receivership (also available via the Projo's website) makes mention of only one legal authority, State Supreme Court Executive Order 95-01, but no specific, full-fledged law.

Given that other Rhode Island municipalities in addition to Central Falls could conceivably pursue this course of action, I think we need to explore the meaning and consequences of municipal receivership a little more...

Central Falls: Tomorrow's News Today

The press releases are coming out concerning an administration-union deal in Central Falls. First in the emailbox was the union's take:

The Central Falls Teachers Union and the Central Falls School District reached a tentative agreement Saturday to implement a transformation plan for Central Falls High School for the 2010-11 school year in a way that involves all stakeholders—administrators, teachers, students and parents—to create a pathway toward excellence for everyone at the school.

Both the school district and the union agree that while this has been a difficult process for everyone involved, the negotiations resulted in a newfound appreciation for shared responsibility, and a solid commitment to bring lasting solutions that will improve teaching and learning at Central Falls High School.

As part of that agreement, which is pending ratification, the current staff will return to the school without having to reapply for their jobs. Teachers will need to recommit to their jobs and interview with the new principal. The agreed upon plan would also incorporate important changes designed to increase student achievement. These include a longer school day, more after-school tutoring, a new evaluation system designed to inform teaching and learning, and targeted and embedded professional development, among other changes. Details of the agreement will be released following a ratification vote by Central Falls teachers at a meeting Monday. A press conference is scheduled at the high school at 3:30 p.m.

Followed, just now, by two cents from Education Commissioner Deborah Gist:

I am really pleased that the Central Falls School Department, under Dr. Frances Gallo’s leadership, and the Central Falls Teachers Union have come to a tentative agreement about a plan to transform Central Falls High School, and that they will do that work together. The ideal situation is when we can do this important work collaboratively, and that's why this agreement is so promising. ...

From the outset, I have said that my one commitment is to ensure that we provide the best possible education for the students of Central Falls High School. The tentative agreement reached today is evidence that all parties can put aside their differences and work in the best interest of our students. Now it's time to move forward and work together to make Central Falls High School one of the best schools in Rhode Island.

We'll see who got what, but I have to think that the teachers have become increasingly nervous as the applicant pool to replace them has approached the 1,000 mark.

One Emergency Begets Another: Guess Who's Representing the Mayor ?

In today's Providence Journal, Mike Stanton and W. Zachary Malinowski do a thorough follow up investigation into the story, originally broken by the Hummel Report's Jim Hummel, about outrageous board-up fees which were facilitated by the official action of that city's mayor. In it, we learn that Mayor Charles D. Moreau has hired counsel.

Moreau’s lawyer, state Representative and former House Speaker William J. Murphy, did not return calls seeking comment.

Hey, when you're in the soup, ya gotta get the best! Or at least, the guy who, until recently, was the most powerful person in the state ...

Other enraging interesting details emerge from the Projo story. It turns out that, due to the action of Mayor Moreau, the board-up "emergency" in Central Falls went on for an incredible fifteen months. All the while, the mayor's friend and solely authorized board-up vendor cleaned up, in more ways than one, as the mayor deliberately and unnecessarily exposed property owners in his city to obscene board-up fees by refusing to put the work out to public bid.

By the way, to the gross abuse of mayoral power of an absurdly long "emergency" period, you can add the improper placement of municipal liens. All of the liens that the city placed for the mayor's friend and his absurdly high board-up fees were illegal. Municipal liens pertain to unpaid municipal bills (water, sewer, real estate taxes, etc.). Intercity Maintenance, which held the highly lucrative board-up monopoly in Central Falls for those fifteen months, is a private contractor and, as such, was well within its right to file a Mechanic's Lien against a property for any unpaid works. Inexplicably, the mayor chose to once again step in on behalf of his friend and make them all municipal liens. In doing so, he has for a second time exposed the city he purportedly represents to financial liability, this one in the form of potential counter suits by property owners compelled to pay exhorbitant board-up fees to remove what turned out to be an illegal lien on their property.

The Projo article offers a modicum of comfort to these abuses and injustices in the form of a new occupant installed at Central Falls City Hall.

Detectives from the [Rhode Island State Police] financial crimes unit, led by Lt. John D. Lemont, set up shop early this year in a third-floor conference room at City Hall, examining records and questioning city employees.

“We went in on the boarded-up houses, but the investigation has gone beyond that,” said Col. Brendan P. Doherty, state police superintendent. “We’ll be there for quite some time.”

Take your time, boys. Take your time.

Retired and Rehired in Central Falls: "Terribly inappropriate" but legal

Ok, vent over this:

The police chief of Central Falls is drawing criticism for collecting a $43,000-per-year pension while also continuing to work and draw an annual salary of $72,000....Moran "retired" two weeks ago, then signed a five-year contract under a deal approved by the city retirement board, city lawyer, and mayor....Moran says he made the move so he would be eligible to receive approximately $35,000 for unused sick days. He says his deal actually saves the city money in the long run.

Former city Finance Director Edna Poulin said the arrangement, although legal, looks "terribly inappropriate."

More here. Oh, and he's 47.

The Dangling President

Let's order things clearly: It was objectionable for a Central Falls high school teacher to dangle an Obama doll upside down with a sign saying "Fire CF Teachers," because it involved the students in a union dispute. Talk of its being a hate crime is utterly outlandish:

To Clifford Montiero, president of the Providence branch of the NAACP, the effigy represents a lynching of a black man, and brings back painful memories of decades of injustices.

"In my mind, this is a hate crime, and the teacher should be charged," Montiero said. "This teacher feels he can demean the president of the United States, an African-American who has overcome all this hatred. It is wrong. And when you take a nonviolent environment like a classroom, and introduce violence and hatred into it, you have crossed the line."

Even calling the thing an "effigy," as the Providence Journal does, goes a bit far. I look at the picture and I think Laugh In, not Mississippi Burning, with the President popping out to offer a one liner.

Confusion over Gallo Accepting Union Offer

It seems there is some confusion over the latest page in the Central Falls High School story. The ProJo headline reads, "School chief, teachers agree to resume talks." There is mention of both "sides" returning to "the table," which is some of the common parlance used when it comes to contract negotiations. In the ProJo story, Gallo is quoted as saying:

“My heart skipped a beat,” Gallo said after reading Sessums’ proposal. “I thought, ‘They are basically saying they want what we want for the first time, with the kind of assurances I need.’ … This brings the union back with us, in the conversation about meaningful reform. It’s where they should be."

Further, as Supt. Gallo made clear this morning on WPRO's John DePetro Show (podcast), she's not talking about contract negotiations. The “table” the teachers are being invited back to is not a negotiating table but the one at which the reforms needed at the school will be discussed.

Additionally, it appears Supt. Gallo is not going to rescind her “fire” order until she’s sure the teachers are all in when it comes to reforming the school. She made clear in a radio interview this morning that she is holding out from rescinding her “fire” order until after the teachers take part in the planning process necessary to chart the path for fixing the school. She hopes to have that done in early May. After that, according to Gallo, then it will be up to the Board of Trustees of Central Falls to decide if they want to rescind the “fire” order.

Rhode Island Statewide Coalition Winter Meeting Table of Contents

Anchor Rising's complete coverage of the Rhode Island Statewide Coalition's winter meeting:

• My on-the-scene liveblog
• Video: RISC Chairman Harry Staley's opening remarks
• Video: 630AM/99.7FM Host John DePetro
• Video: Central Falls Superintendent Frances Gallo
• Video: RISC President James Beale and Business Network Organizer Jeff Deckman
• Video: Rhode Island Governor Don Carcieri
• Video: Board of Regents Member Angus Davis

Board of Regents Member Angus Davis at RISC's Winter Meeting

NOTE: Any members of the media who couldn't make it to the meeting and rely on this video for future reports are encouraged to do so, but a brief note of the video's source would be appreciated.

---

Rhode Island Board of Regents member Angus Davis came out with guns blazing in a surprise speech at the Winter meeting of the Rhode Island Statewide Coalition, as described in my liveblog of the event. (More video in the extended entry.)

Davis was especially animated when discussing an email from gubernatorial candidate Linc Chafee at the beginning of this clip.

Yesterday, I received an email from Senator Chafee. In this email, Senator Chafee asked for clarification on whether or not teachers had really been offered 100% job security, describing it as, quote, the basic question that must be settled, unquote. He said he does not want to, quote, inherit the labor mess, unquote, as he works to build a more prosperous Rhode Island as governor.

What kind of leadership thinks the basic question about a school in which only half of children graduate and 90% can't do basic math — what kind of leadership thinks that the basic question involves job security for its adults rather than the educational outcomes for its children?

Continue reading "Board of Regents Member Angus Davis at RISC's Winter Meeting"

Central Falls Superintendent Frances Gallo at RISC's Winter Meeting

NOTE: Any members of the media who couldn't make it to the meeting and rely on this video for future reports are encouraged to do so, but a brief note of the video's source would be appreciated.

---

Herewith, the video of the speech given by Central Falls Superintendent Frances Gallo at the Winter meeting of the Rhode Island Statewide Coalition, as described in my liveblog of the event. (More video in the extended entry.)

Although the entire speech is notable as the most comprehensive statement of Supt. Gallo's position that I've seen (and I don't claim to have searched high and low), the beginning of this segment may be a new news item:

I'll answer now, although I was never asked by anyone: No. We can't mediate now. I'll say it clearly, and I mean no offense to anyone, but those ads continue. What kind of an effort at true desire for change when you keep those ads.

Continue reading "Central Falls Superintendent Frances Gallo at RISC's Winter Meeting"

Yorke Airs Both Sides of Central Falls Debate

Dan Yorke spoke with both Central Falls Superintendent Francis Gallo (podcast link) and Central Falls High School Guidance Counselor George McLaughlin (podcast link) on his show yesterday. Supt. Gallo explained that she was stymied by the union in trying to work out a solution based on the "transformation model." But first she wanted assurances on as first step on transformation model:

1) increase length of school day by around 20 minutes
2) formalize committment by teachers to tutor 1 hr a week to ascertain its impact / effectiveness
3) have lunch with students once a week as an informal way to get-to-know each other, not as a lunch duty
4) two weeks of curriculum work in the summer at $30/hr
5) 90 minutes a week for teacher team meetings (common planning) @ $30/hr
6) 3rd party evaluation that could lead to teacher firings as necessary

As Yorke later elaborated, the only difference between these assurances and the "turnaround model" is that #6 is a termination of all teachers and a maximum re-hiring of 50% of the current teaching staff. Related to the evaluation/firings (#6), Gallo explained that she had started discussions thinking that 80% of the teachers would be retained but eventually told the union that she would not fire any teachers if they would go along with the rest of her plan. According to Gallo, the union leadership was unresponsive. (And she took the extra step of detailing this final proposal in a letter to CF Teacher union leadership).

During his time, McLaughlin explained that all he wanted was for the parties to go to the table and work something out. He gave his perspective as someone in the school and reiterated that the problem wasn't about money but about job security. When Yorke explained that Gallo had taken teacher firings off the table (as just described) and had a letter to prove it, McLaughlin said it was incumbent upon Gallo to show the letter. To this, Yorke made the counter-point that McLaughlin could just as easily go to Gallo (or union leadership) and check it himself.

McLaughlin also tried to score debate points by saying Gallo was inconsistent regarding the lunch period (item #3) because she had removed the teachers from lunch duty in the first place. (Here, it's worth contrasting this with what Gallo said: it seems she was addressing this potential contention by emphasizing that the new lunch hour request was explicitly to spend time with kids, not as a "duty"--I wonder if she's heard this "talking point" before?). But, as Yorke pointed out, the only reason she had removed the teachers from lunch duty was because the union wanted a time concession somewhere to make up for previous requests (from prior years) that Gallo had made concerning common planning time and the like. In short, McLaughlin accused Gallo of telling only half the story....while only telling half the story. (McLaughlin is obviously a guy who genuinely cares for his school, the kids and his colleagues...he's just got a lot of years in the education industrial cocoon, which informs his perspective).

UPDATE: Today, Yorke has posted the letter from Gallo to the union. The key excerpt:

I need to re-emphasize that the Transformation Model is the only model in which it is possible for the majority of teachers and administrators at the school to retain their jobs.

Unfortunately, to date we have been unable to reach agreement with you regarding the implementation of key elements of the Transformation Model, specifically including the following:

1. Increase the length of the high school day so that the student day is 8AM – 3 PM
2. Formalize the high school teacher commitment of weekly tutoring for one hour outside of school time
3. Each teacher will partake of a communal lunch with students one day each week
4. Agree to continue paid professional development for two weeks outside of the typical school calendar
5. Agree to meet for 90 minutes each week in order to look at student work, assess data, plan units of study and seek continuous improvement in professional practice
6. Acknowledge that third party evaluators will begin evaluation of all high school teachers on March 1, 2010.

Please note that these six elements listed above are what I view as the core elements of my being able to inform the Commissioner that Transformation is a viable option for our high school. For your convenience, I have attached (Attachment 1) all elements of both the Transformation and Turnaround models directly from the Protocol.

With your agreement to move forward, I will notify the Commissioner that Central Falls has selected the Transformation School Reform Model. Without your agreement, since the Closure and Restart models are not viable options at this time, it will be incumbent upon me to either choose the Turnaround School Reform Model for Central Falls or inform Commissioner Gist that we have collectively failed to select an intervention model for the high school and cannot begin planning for implementation. Pursuant to the Protocol, that latter option “shall be cause to trigger the reconstitution authorities granted” to the Board of Regents to Reconstitute Central Falls High School. In the case of either Turnaround or Reconstitution, I cannot provide any assurances to any faculty member or administrator at the high school that they will remain employed at the start of the next school year.

It is my sincere desire that we find a way to work together to implement Transformation, which I firmly believe is in the best interests of the students of the high school, as well as the members of the Central Falls Teachers Union.

As Gallo stated, though the letter doesn't explicitly state that there will be no job loss, point #6 mentions an evaluation process and does not mention any teacher firings, such as an 80/20 (retention/let go) formula. The clear implication is that the transformational model, which Gallo was trying to get the teachers to go with, was the best chance for the most teachers to have security in the future.

The Cause of the Firings

Every working Rhode Islander, and all of those looking for work, can see the disconnection of Central Falls union rhetoric:

"We still hold that this termination of the entire faculty is a violation of the contract and contrary to state law and federal law as well," [teachers union President Jane] Sessums said. "This is a termination of the entire faculty without cause, we believe."

You want cause?

• Only 4% of students proficient in math in 2008-2009, up from 3% the year before, with 75% "substantially below proficient."
• Only 45% proficient in reading.
• Only 29% proficient in writing.
• Only 17% proficient in science.
• A 48% graduation rate.
• A 50% failure rate for the current school year.

As a body — and it is the teachers' decision to be handled as a collective union — the teachers are failing. Every year, every day, students are deprived of a successful educational experience. That must change, and since the union's been blocking the avenue for change that doesn't entail a mass firing, a drastic step must be taken.

Learning to Hear the Union

Mike at Assigned Reading is dead on that the Newsmakers head-to-head between Central Falls union representative Jim Parisi and Superintendent Frances Gallo is very revealing about the two sides' priorities. Perhaps the most crystallized example of unions' determination to spin rather than inform — because everything's "negotiable" — comes at approximately 9: in the video:

Asked about the extra tasks that the administration is requesting from teachers, Parisi says:

What people aren't informed of is that Central Falls teachers already have more common planning time and professional time than any other public school district in the state, because we were a willing partner to make that happen. How come the union and its teachers don't get the credit for something like that?

Sounds like a reasonable statement, no? The teachers are already working hard, compromising, so that they can accomplish as much as possible for their students. Well, the spin unravels when Gallo explains:

That time is taken out of the school day — out of the instructional school day. We're trying to add the time to the after school time so that the instructional day remains such. We actually have an instructional day of just over four hours.

In other words, that state-leading planning and sit-down time was negotiated as time away from the most difficult part of the job: interacting with the students. A union will brag about helping its clients to lower their blood pressure — leaving out, of course, that it does so with a knife.

The Union Chooses Firings

Anybody who's surprised that the teachers' union in Central Falls has chosen to stare down mass firings and do battle rather than submit to some eminently reasonable additional responsibilities should think through the future scenarios of the game.

With administrators now standing firm on key planks that were previously popular political catch phrases, the unions are going to challenge authority way up to the top — to Education Commissioner Deborah Gist and beyond. Their secondary strategy will be to delay significant changes until they have an opportunity to change the players. They've lost no ground in the General Assembly, either in recent elections or in the selection of the new speaker of the house, and they've an opportunity to affect the governor's office, this year, which means access to the Board of Regents, from which the commissioner ultimately derives her authority.

If the unions can delay the mass firings, through friendly labor review authorities and the courts, for even just one year, they'll have time to re-rig the game entirely in their favor. If they lose on questions of authority, they'll use their political clout to turn the top-down model to their favor. In other words, when voters, school committees, and district administrators seek localized, bottom-up reforms, the newly enhanced authority of the state and the education commissioner will be used to squelch the movements before they can begin.

Consider the thoughts of the only Central Falls teacher whom I've seen offer public comment outside of the union channel:

Sheila Lawless-Burke, an English-as-a-Second Language teacher, said teachers are not opposed to working harder — or longer; they simply want the opportunity to negotiate the details of their contract, not have it imposed from above.

"It's all about the politics," she said, "about making Fran Gallo look good. The issue is having the right to negotiate. Once we allow the superintendent to get her foot in the door, where will it stop?"

Even under circumstances of dire failure, the unionists want to assert their rights to drive up costs and usurp management authority. What Lawless-Burke ignores is that politics is the game of figuring out "where it will stop" when differences of opinion negate a hard rule. It will stop when the public decides that the superintendent has exceeded her mandate. That's how politics work.

It's also the reason that local administrations and the state education bureaucracy should devote some of their attention to fostering community-level involvement of additional players. I mean not only extending some budgetary authority for the schools to town councils and mayors, but also opening channels of communication and cooperation from taxpayer groups and the like.

The top-down reforms, in other words, require a complementary bottom-up foundation, not only to solidify local support from the folks who ultimately pay the bills, but also to rope in stakeholders who will cry out when the unions attempt to manipulate the game at the top. The unions may succeed in reversing Commissioner Gist's reform efforts such that the options offered to failing districts all entail additional benefits for union members, but they'll find it much more difficult to silence constituencies who've been allowed into the decision-making process.

Good for Students Versus Good for the Public Education Industry

Tom Ward writes on the success of Democracy Prep Blackstone Valley charter school in Cumberland, noting:

"My concern, as the [Lincoln] superintendent (Georgia Fortunato), is that if they move into Fairlawn, Democracy Prep, people are going to think they are part of the Lincoln School Department and I think we are going to lose a lot more children," said Fortunato. "It could be very devastating for the school district."

Devastating - as in "We lose $8,000 per child" - for the school district. And perhaps the best single thing that will ever happen to the children. How did we get to this place, where what's best for the school district and what's best for the child are two very different things?

Mike, at Assigned Reading, follows up:

Fortunato's complaint that Democracy Prep hurts Lincoln's bottom line will fall on deaf ears; parents won't consider the financial impact when they decide who can provide the best education for their children. It also doesn't help that, last week, Fortunato was arguing for $31,000 in next year's budget to paint and recarpet the administration building. Considering there are no children in this building, is this the best way to spend education funds in these tough economic times? Really.

For those of us with young children, the Rhode Island Way of doing public education is a matter of urgency. That's part of the reason that I found Dan Yorke's interview with Education Commissioner Deborah Gist, focusing on Central Falls, so encouraging. I did, however, have to remind myself that, even if Gist is so successful as to justify many times her salary, the forces that have brought Rhode Island to its current low will not go away. And as quickly as she may advance the state's education system, relatively small changes in the political winds could turn around the turnaround using the interventionist precedents that she's setting.

A Clash of Realities in Central Falls

You'd think some higher-up planner in the teachers' union would begin advising members that it's time to back off for a while for the purpose of public-impression rehabilitation. Apart from the wholly inappropriate imagery of using a candle-light vigil for a union action, the particulars of the circumstances in Central Falls are absolutely certain to elicit a response of "are you kidding me" from any Rhode Islander not in the thrall (or payroll) of the union.

First there's the performance of the high school (news report and Dept. of Ed. PDF):

• Only 4% of students proficient in math in 2008-2009, up from 3% the year before, with 75% "substantially below proficient."
• Only 45% proficient in reading.
• Only 29% proficient in writing.
• Only 17% proficient in science.
• A 48% graduation rate.
• A 50% failure rate for the current school year.

Then there are the salaries:

The average teacher's salary at the high school ranges between $72,000 and $78,000 a year, because most are at the district's top step, Gallo said.

That's without incorporating benefits and all of the other perks of being a public school teacher. Then there are the demands for doing what any professional should be expected to do when collectively performing so abysmally:

Gallo said she offered to pay teachers $30 an hour for two additional weeks of training in the summer. Gallo also said she would try to find grant money to pay teachers for 90 minutes a week of after-school planning time, also at $30 an hour.

But she says she has no extra money to pay for other changes she is pushing for, including lengthening the instructional day by 25 minutes, so teachers work 8 a.m. to 3 p.m. instead of 7:50 a.m. to 2:25 p.m. She wants teachers to formalize a rotating tutoring schedule, so a teacher is available to help students for an hour before or after school, and she wants teachers to have lunch with students one day a week.

"Right now, they have no duties," Gallo said. "But I don't want them to see lunch as a duty. I want them to establish true relationships with not a few students, but all students." ...

Union officials have been pushing for $90 per hour and want the district to pay for more of the additional responsibilities.

Then there is the transparent mealy-mouthedness from the union, with this on the one hand:

James Parisi, a field representative of the Rhode Island Federation of Teachers and Allied Health Professionals, said that Gallo had asked teachers to work a longer school day, attend after-school training and set aside two weeks in the summer for professional development. Parisi said the union balked because the district wasn't willing to pay teachers enough for the additional time and work.

And this on the other:

"We've been supportive of the transformational model, we think it's the right path," [Central Falls Teachers' Union President Jane] Sessums said. "But we need more details. We've never been opposed to the additional time that is needed. Our concern is that we really get an opportunity to understand what is necessary."

It's time for those teachers who've retained a modicum of professional integrity to step forward and tell the union to back off. They've a responsibility to improve the school in which they work without proclaiming that poor performance should justify even more reward.