Good News, Moving Forward

July 23rd, 2008

Like most people I can over think some things. I might be doing that with today’s banner headline in the Trib over the twinned stories of the City’s reorganization under the new Mayor and Duluth’s recent high bond ratings. (Its not in the online Tribune) I’m struck by the second phrase: “moving forward” which is by chance or otherwise the catch phrase of Red Plan Supporters.

Is the use of this particular phrase a subtle promotion of the Red Plan? If so, is this a phrase that the City Council and Mayor, most of whom despise the Red Plan and/or its conception, will enjoy having applied to them?

Or am I making a mountain out of a mole hill?

Punishing politicians who will not tax

July 22nd, 2008

The good news, as the News Tribune puts it, is that Duluth’s finances and tax capacity are in good enough shape to guarantee an excellent bond rating for the City. This is how both Moody’s and Standard & Poor’s evaluated Duluth as it puts its biggest ever bond into effect - a $40 million behemoth to finance the DECC expansion. Keep in mind, of course, that this will mostly be paid for by tourists at our hotels and restaurants. Also keep in mind that it is dwarfed by the $293 million in bonding for the School District’s Red Plan which will be paid entirely by local residents.

What the advisors at Moody’s know is important. Government can raise taxes to pay off their debts and the taxpayers can do little about it. That’s why we will all be on the hook if the Federal Government guarantees Fannie Mae and Freddie Mac for encouraging so many sub prime loans. That’s why we will all be on the hook if the Duluth School Board gets away with the Red Plan.

To that point I found this quote from the rating’s agencies interesting:

“However, if city leaders lacked ‘political will’ to use that money — required by a 7/9 vote of the City Council — it ‘could shift our analytic conclusions regarding overall operating liquidity.’”

In other words, If the voters of Duluth lean on their politicians not to raise taxes the bonding community will punish Duluth. Its nice to have friends.

Eat PB&J’s and Save the World

July 22nd, 2008

For well over a year until about six months ago I was helping save the world and didn’t even know it. I was simply trying to limit my calories by eating Peanut Butter and Jelly sandwiches for most weekday lunches. There is now a campaign to encourage everybody to eat PBJ’s.

The payoff?

“Each time you have a plant-based lunch like a PB&J you’ll reduce your carbon footprint by the equivalent of 2.5 pounds of carbon dioxide emissions over an average animal-based lunch like a hamburger, a tuna sandwich, grilled cheese, or chicken nuggets. For dinner you save 2.8 pounds and for breakfast 2.0 pounds of emissions.

Those 2.5 pounds of emissions at lunch are about forty percent of the greenhouse gas emissions you’d save driving around for the day in a hybrid instead of a standard sedan.”

Reviewing Doty

July 21st, 2008

I spent an afternoon looking up Ralph Doty’s caustic attack on me and Gary Glass. In reviewing it a half a year later I’m struck with how close my initial reaction to it was. Its careless and wrongheaded and unnecessearily vicious.

Fees!

July 18th, 2008

Public schools are prevented by law from charging for educating students. That’s why students can’t be required to pay for their text books although they can be fined for damaging or losing then or school library books. SAme with equipment. My old chemistry teacher used to tell all his classes that I had attained the highest equipment breakage fee in the history of his class. I think it was thirteen bucks. (I forget what it was but I burned some durable piece of equipment to smithereens. It was an an accomplishment that he seemed truly in awe of.)

And, of course, schools can charge for extracurriculars. That’s why poor folks don’t let their kids play hockey. The gear and clothes are too expensive to change each year as the player grows from Termite to Alpha……Isn’t that what the age groups are called?

But with the City of Duluth contemplating this in its dire financial need…..Thank you Red Plan…..Who knows what sort of pain the School Board will prepared to inflict on its students next year.

Bad apples

July 17th, 2008

I do think laws were bent and or skated past to adopt the Red Plan but I’ve never said that JCI was acting with criminial intent. Although I’ve used words like mislead, greed and the like I’ve been pretty cautious describing JCI’s activities. That did not stop Ralph Doty from writing a column days before the last election vilifying me for criticising JCI. He said the company should sue me for slander. Doty explained that he called an aquaintance at his old place of employment to inquire about JCI’s success with a project in Ohio. The report was favorable so Doty simple mindedly applied this singular success to all JCI projects world wide including the Red Plan.

If a singular example is now the standard of judgement then any evidence of scandal should cast doubt on all JCI projects. Using Doty’s line of reasoning I now offer proof that every JCI project is corrupt with the singular example of their work in pre Katrina New Orleans.

Here’s how the Times Picayune editorialized about New Orleans’ JCI scandal.

“Indeed, the breadth of the graft and greed alleged in the indictment is breathtaking, even by the standards of a city inured to public corruption.”

So, is JCI a barrel of rotten apples or does it simply have a few bad apples?

Energy Savings?

July 17th, 2008

The Trib’s reporter on JCI made it clear to me that the School Board’s contract with JCI was not a “performance contract.” Apparently Sarah was well aware of the criticism leveled at such contracts. They guarantee the purchaser energy savings after the installation of energy saving and monitoring equipment.

Even though the Red Plan is not an energy savings plan it has been sold to the public as an energy saving plan. Many of the first millions of dollars spent this summer are being spent on energy equipment at Stowe and Lakewood. Consequently the effect of the Red Plan is very similar to an energy performance contract. Thus what the GAO (the Goverment Accounting Office) has to say about such contracts is worth pondering. This comes from a Wikepedia entry on ESCOs.

“In June of 2005, the GAO released a report, “Energy Savings: Performance Contracts Offer Benefits, But Vigilance Is Needed To Protect Government Interests.” The Office of the Under Secretary of Defense for Technology, Acquisition, and Logistics agreed with the GAO findings. “While these complicated contracts are structured to ensure that savings will exceed costs,” the DOD noted, “we recognize that our measurement and verification procedures must be improved to confirm estimates with actual data.” Unverified savings, often stipulated rather than proven, do not put more oil in the ground, take CO2 out of the air or reduce operating budgets

The GAO ESPC study brings into question whether or not there is sufficient data to prove that the gains delivered by ESCOs are sustainable over time. The study further questions the practice of having ESCOs monitoring and validating the performance of their own projects.

In fact, most buildings and facilities exhibit the same basic limitations with respect to energy conservation and optimum maintenance. US Federal studies show that major and minor building systems routinely fail to meet performance expectations, and these faults often go unnoticed over time. The functions of a building, the number of tenants, and the configuration of the space change over time in unanticipated manners that adversely affect the systems that control building performance.

Surprisingly, almost all buildings, building complexes, and systems inside buildings still operate in a disconnected, stand-alone manner. Proprietary systems result in buildings that needlesly waste energy. Recent studies have found that as many as 30% of LEED platinium buildings perform no beter than conventional buildings. It is ultimately difficult or impossible for customers to construct a single integrated picture that correlates energy usage and maintenance costs to control system performance, space usage, conservation measures, and the behavior of those using the facility space.”

So, can Duluth believe all of the JCI hype?

Don’t tell Gary Glass anything

July 16th, 2008

Apparently no one in the District is authorized to tell Board member Gary Glass about who is getting contracts for Red Plan construction.

The JCI representative was sitting next to Kerry Leider’s assistant, Dave Spooner during a School Board meeting to answer questions directed at them by the School Board. Glass asked them if there were any JCI subcontractors being awarded contracts for this summer’s Stowe or Lakewood projects. Dave Spooner responded for the panel, and answered “No.” The JCI representative sitting next to Spooner said nothing to contradict Spooner.

Later Gary went to the City and asked about building permits granted for the Stowe Project. He learned that JCI had awarded itself $2,666,000 of the Stowe building permits. The Trib’s reporter was told this before the Trib’s two-part story on JCI. It was not mentioned in her story.

Its time for Campaigning

July 16th, 2008

JibJab on the Presidential campaign to Dylan’s tune The Times They are a Changin.

When size finally matters

July 16th, 2008

Kent Worley sent me an email today after reading the School Board’s discussion of the proposed Western Middle School and Piedmont Elementary. Kent has vociferously and vainly been pointing out for over a year that the new Ordean High School site will have barely half the 55 acres recommended for a high school. While this complaint has been dismissed by the District as of no great consequence the Trib’s article reported:

“Duluth Superintendent Keith Dixon said the school district would need to acquire the 55 acres north of Wheeler Field off Grand Avenue for the western middle school.”

Says Kent:

“Now, all of a sudden, site size is key criteria in selecting school sites. It’s wonderful to see the district responding to these very important considerations finally. Now, with this finally recognized factor, it is time to re-think what the plan for the Ordean site will do … and reconsider alternatives.”

To which I say, Don’t hold your breath Kent.

Nada for Tim

July 15th, 2008

Tonight’s Duluth School Board meeting shows how futile it has been for Tim Grover to play team player after going off Dr. Dixon’s Reservation.

Tim has been one of the most parochial board members for years. Shortly after he was first elected to the Board in the early 90’s he broke a campaign promise to fight to keep Central High School open when several senior board members pressured him to do so. He and his family caught such unmitigated hell that Tim made it his mission to put his district’s interest above all others. For all his efforts tonight he lost his District’s middle school at Lincoln. He lost having it kept at the Central site. His Nettleton school will be grafted onto the Grant school on the periphery of his District. The only bone tossed Tim’s way was the District’s intention to keep an elementary school in Piedmont. Of course, with Proctor sending busses into Piedmont and Hermantown discussing the possible expansion of its own schools to accommodate unhappy Duluth parents it may already be too late for Piedmont.

Tim’s downfall began when he got involved with Let Duluth Vote and its fight to have a referendum on the Red Plan. Dr. Dixon only rewards yes men so it was futile for Tim to abandon Let Duluth Vote and run back to the Superintendent in a bid to save his District’s remaining schools.

Tim should have seen the writing on the wall after I encouraged him to run for the Chairmanship of the Board where he could promote compromise. When Dr. Dixon got wind of Tim’s plans he pulled out the stops to defeat him.

At Dixon’s direction Board Chair Ann Wasson told newly elected Board member and Tim Grover supporter, Gary Glass, that there would be a highly irregular change in the date of the vote for School Board officers. The scheduled vote would be postponed until Dixonite Nancy Nilsen returned from a trip to China. Nilsen was Dixon’s candidate for Chair and her absence would have made winning four votes out of seven very tough.

When it became apparent that changing the day of the vote was legally questionable Dr. Dixon began making arrangements to have Nancy participate in the vote for Chairman from China by attending the meeting through interactive television. That became unnecessary when Mary Cameron, who had promised to vote for Tim, changed her mind after Dr. Dixon had a long talk with her. (Despite our close relationship Mary did the same thing to me when I ran for chairman in 1997) But, horror of horrors, newly elected Dixonite, Judy Seliga-Punyko was also going to be out of town on the day of the vote and would find it very difficult to return to the meeting in time to cast a vote. To make matters worse a blizzard blew up on the day Judy had to return making a trip back to Duluth iffy. Not to worry. JCI sent a car to have her chauffeured to Duluth in time for the meeting. Checkmate Dixon.

After bending over backward to deny Tim any chance of being the Board Chair and seeking compromise the Superintendent wasn’t about to reward Tim. Tim’s defection from Let Duluth Vote to rush back into Dr. Dixon’s arms just got Tim a whole lot of nuthin for the Third District.

Our Old House

July 15th, 2008

A sneak peak at my Reader Weekly column for this week.

http://www.snowbizz.com/images/personalphotos/Coaldelivery.jpg

Red Plan vis a vis Freddie Mac and Fannie Mae

July 14th, 2008

Even more than Freddie Mac and Fannie Mae the backers of the Red Plan have deep pockets which will guarantee that te Red Plan is paid for unless voters find a way to scuttle it. Those deep pokets belong to the taxpayer.

The Federally sponsored Home Mortgage behemoths, Freddy Mac and Fannie Mae, have no such guarantee. If they fail the Federal Goverment has no legal obligation to back their foolish policies. They may get backing because their collapse would be so calamitous but there is no guarantee. If the Red Plan is calamitous taxpayers will pay no matter what.

The Virtue of an extinct breed - the Housing crisis foretold

July 14th, 2008

I found this comment about one of my favorite Congressmen, Iowa’s Jim Leach, in a piece by a long time critic of the Federal Government’s inattention to the looming Housing Crises. Of course, sensible Repubicans like Jim were largely hounded out of the Republican Party.

Jim Leach, a Republican former representative from Iowa, … argued two decades ago in Congress that the government-chartered mortgage companies, Fannie Mae and Freddie Mac, were unfairly insulated from the real world.

They were not subject to the same financial standards and tax burdens as their competitors, he warned, and if they ran into trouble, an implicit government guarantee to back them up meant taxpayers would be left with the losses.

“There are times in public policy making that one can feel like Don Quixote,” Mr. Leach said of his repeated legislative battles to rein in the two companies’ growth.

On both hands

July 14th, 2008

Harry Truman said once that he wanted a one-handed economist because they were always saying, “on the other hand.” N. Gregory Mankiw writes in the New York Times about what most economists seem to agree on. It turns out that agree with most economists.

A fit story for a Lincoln Democrat

July 9th, 2008

I liked this story of art and politics in Boston.

http://cache.boston.com/resize/bonzai-fba/Globe_Photo/2008/07/08/lincoln_obama__1215497970

Reaction to the JCI story

July 7th, 2008

Not many folks have written in because this page was put up late.

JCI Continued

July 7th, 2008

The second half of the JCI story is a great disappointment but not a surprise.

The important question isn’t whether JCI can handle the managment of the Red Plan. Rather it is should have been whether Duluth should have swallowed the worm on JCI’s hook. Oh, pardon me, whether four school board members have swallowed it for us.

I’m reminded of the unpleasant reputation of Bible salesmen who were imfamous for using people’s fear of God to sell them fancy, high priced Bibles they couldn’t afford. Prove you love God…was the sales pitch….Kind of like Dr. Dixon’s pitch…..prove you love your children.

I’m also reminded of companies like Prudential Insurance also a biggie which has many reputable employees but which also scammed tens of thousands of customers with shady insurance policies.

Other communities may have benefited from JCI’s work but not Duluth. When JCI discovered that it could sell four school board members without bothering with a referendum it realized that the sky was the limit.

But that’s not the story the Trib covered. Oh well, When the operational levy fails this November there will be plenty of opportunities for hind sight. I hear its 20 - 20.

Way past 2%

July 6th, 2008

The Trib has finally publishing an in depth story about JCI’s compensation for the Red Plan. This is Part 1 which extensively quotes all of JCI’s backers. When the Trib last left this story a year ago it left readers with the impression that Gary Glass didn’t know what he was talking about claiming that JCI could earn as much as $33 million dollars on the Red Plan. Why no, according to the story, JCI would only earn 2% or about $4.5 million.

We learn that JCI will earn 7% of $2.9 million cost of its initial Stowe and Lakewood projects being constructed this year. That’s $203,000. That would be over twenty million for the entire Red Plan, however, as the story points out JCI is also winning bids on the equipment that is being installed. No prices for that were mentioned in the story nor were the additional costs of having JCI service its equipment - a gift that keeps on giving.

About 15 percent of the total $2.9 million construction budget at Lakewood, or about $203,000, will initially go to Johnson Controls to cover professional service fees.

Representatives from school districts including Deer River, Brainerd and Grand Rapids, and Kyte, the executive director for the Minnesota Association of School Administrators, said standard professional service fees generally fall between 10 percent and 20 percent of the total construction cost.

For this particular project, Johnson Controls hired local architects and engineers but is using its own employees to cover commissioning and construction management services. For that work, including its program management fee, Johnson Controls will receive a little less than half of the $442,000, or about 7 percent of the total $2.9 million construction cost. That money will remain with Johnson Controls; the rest will flow through the company to pay design professionals.

Johnson Controls also stands to make a profit by bidding on air controls system under the company’s systems division. It already has been awarded contracts for that work at Lakewood and Stowe elementary schools.

Part 2 hasn’t come out so it would be premature of me to opine about the whole we have yet to read. A number of the Red Plan’s critics spent time talking with Sarah Horner about our concerns, We’ll soon see how the critics are treated. You can read many of them on this blog or on the Let Duluth Vote website. Check out the link to “know the facts.”

I draw this conclusion from today’s installment. JCI will earn at a minimum four times more than the Trib reported a year ago and that doesn’t count equipment sales. (nor does it count the arm twisting that led to the possible divulgence of a JCI competitor’s bids)

It will be interesting to see if the story, which portrays JCI as a corporate good guy, (They sold a thermostat to our old Adams School a century ago) goes any deeper.

Whether it does or not its not likely to delve into a most curious question. How could the folks who stand to make 7% or 15% plus equipment sales have been the ones to set the minimum price for any plan at a quarter of a billion dollars?

How we got to be idiots

July 5th, 2008

Some of us think history can help explain idiot decisions. Here’s former School Board member Tony Stauber’s brief history explaining how we got to the Red Plan. It was published in today’s Budgeteer.

Here’s the key passage:

“The district was short-sighted to demand the consultants, in the development of the long-range plan, use only the middle school configuration of K-5, 6-8 and 9-12, whereas a K-6, 7-9 and 10-12 configuration would have allowed remodeling of present buildings, negating the need for most new construction — and costing about one-third of the Red Plan. Few homes would go under eminent domain, and parking in congested sites would be handled with a policy change at no cost.”