Trustees for the two city of Detroit pension funds have globe-trotted to the tune of $380,000 in the past year, the Detroit Free Press reports today.
The trustees “often traveling in packs, with virtually no limitation on where they went or how often they traveled.
Trustee Ronald Gracia spent the most time on the road -- billing the General Retirement System for $105,000 in travel, including three trips to Singapore and $18,600 on travel to Hong Kong, according to records provided by the pension funds,” the Freep reports. To gather records for the story, the newspaper was forced to sue the two retirement systems, which charged over $3,000 for the sought after records.
“The Free Press sought additional travel and other documents in late 2008 but was told those records would cost more than $41,000.
In its suit, the Free Press said the fees violate the law and are "unconscionable. As such, they constitute a constructive denial of the Detroit Free Press' FOIA requests."
Pension fund lawyers have described the Free Press' case as "entirely frivolous." They agreed in May to turn over some records as part of the litigation.”
Most of the trustees and their lawyer did not return calls to the Freep, but one, Garcia, did defend himself in an email, stating that his further education in ways to invest pension money required his travel.
The pension funds and their administration have been questioned before, most recently in May as the Freep tried to obtain records.
In 2003, two audits were scheduled of the $2.2 billion fund after the discovery that board trustees had racked up $586.269 in travel costs between 1999 and 2002. Third Circuit Court Judge John Gillis Jr., barred board members from taking some scheduled trips -- to destinations including Arizona, California and Florida -- for pension business.
Also that year, “the pension board sued Mayor Kwame Kilpatrick and [city CFO Sean] Werdlow, alleging Werdlow was interfering with trustees' ability to perform pension board duties by demanding accountability for time spent conducting pension business on city time,” according to a story in Crain’s Detroit Business.
In 2004, Werdlow tried to impose some kind of oversight on the trustees but nothing came of it. Werdlow today is at Siebert Brandford Shank, a securities brokerage. Would have loved to seen his comment in the Freep story, which does a fine job detailing the unfettered abuse of the public trust in a city with a deficit of over $300 million.
Showing posts with label Detroit Free Press. Show all posts
Showing posts with label Detroit Free Press. Show all posts
Sunday, June 14, 2009
Tuesday, May 19, 2009
Stimlus $$ in Michigan - Readers Get Good Choices to Decipher
The difference between the mainstream media and a part-time site devoted to Michigan business and transparency is easy. We had this on March 2.
The Frep has this today outlined the funds like this.
With one, you get some opinion, true. With the other, you get a good overview but little context. There is room for both. That’s where we are today, the best of all worlds, whether you agree with the opinion or not.
The Frep has this today outlined the funds like this.
With one, you get some opinion, true. With the other, you get a good overview but little context. There is room for both. That’s where we are today, the best of all worlds, whether you agree with the opinion or not.
Sunday, May 17, 2009
Tax Breaks Handed Out by Board With No Dissent, Few Questions
The Freep today does an excellent job on reporting the efficacy of tax breaks that are handed out in exchange for the promise of job “creation.” (we still struggle with that term – Nixon had it right in noting that sound business policy presents “job opportunities.”)
The story states, “...A six-month examination of the Michigan Economic Growth Authority tax credit program -- once described by Granholm as "the flagship of Michigan's economic development efforts" -- uncovered trends that raise questions about the incentives' effectiveness.
* A large percentage of the tax credits has gone to companies that later couldn't meet the job creation requirements.
When the Free Press tracked what happened to 195 of these tax breaks awarded by the state from 1999 through 2005, it found that 51% of these incentives had either never been used or were not used in recent years.
* Despite Michigan's efforts to diversify its economy, the auto industry has been a big recipient of the tax credits. Auto suppliers and automakers received 45% of the 195 tax breaks awarded by the state from 1999 through 2005.
* About 90% of the 491 total tax breaks granted since the incentive program began have gone to Michigan companies planning expansions rather than to out-of-state firms.
* In recent years, the state has expanded the incentive program by enabling more companies, particularly smaller tech firms, to qualify for the tax credits, primarily by lowering the job-creation requirements.”
FreeMichigan has discussed the Michigan Economic Growth Authority on several occasions, and we are happy to see our mainstream brethren checking things out. Reporter Katherine Yung did a terrific job.
This board is a rubber stamp for tax breaks. Review of its minutes for meetings since last June, which is as far back as the posted minutes go, shows not a single no vote with regard to any business before board.
This is not a system of checks and balance. Instead the board is packed with yes-men who apparently lack the instinct or courage to even question a petitioner’s request. Minutes also show that the governor periodically stops by the meetings to encourage and thank them.
We also note that Douglas Buckler, executive secretary/treasurer of the Michigan Regional Council of Carpenters and Millwrights (MRCC), serves on the board. As a union leader, we find this wholly inappropriate. Do you think that Buckler was simply the best choice for the board, despite what one could easily claim is a fealty to special interests, i.e. organized labor? In case anyone cares, Buckler in 2007 pulled in a salary/benefit package of $418,198, which included an expense account of $25,940, per the union's 990 tax form. Someone who is so beholden to an interest as such cannot perform what is demanded of a body dealing with our money.
Finally, let’s go back to November 2001, when the state and Pfizer announced the drug maker had received at least $70 million in state and local tax credits for expansion. It had threatened to leave Michigan unless it was given these breaks.
One news account reported, “The deal increases the odds that the company, Ann Arbor's largest private employer and largest taxpayer, will stay put and continue to have a significant impact on the state's economy.
The Pfizer expansion is the largest new economic development project announced in Michigan this year. State officials say it would pump more than $89 million and 988 jobs into the economy in the next 20 years.
At a news conference Tuesday in Ann Arbor, Gov. John Engler praised the Pfizer deal as a "welcome confirmation that Michigan is attracting the important companies and investments that will make the Life Sciences Corridor vision a reality."
The Michigan Economic Development Corp. on Tuesday granted Pfizer a 20-year single business tax credit worth an estimated $25.8 million. It also granted a 12-year, 6-mill abatement of the state education tax, valued at $10.7 million.”
Pfizer announced in 2007 that it would close its facilities in Michigan.
There is something very suspect about a board that operates with no opposition, no voice of dissent. But that is exactly what MEGA is doing. Is anyone going to do something about it?
The story states, “...A six-month examination of the Michigan Economic Growth Authority tax credit program -- once described by Granholm as "the flagship of Michigan's economic development efforts" -- uncovered trends that raise questions about the incentives' effectiveness.
* A large percentage of the tax credits has gone to companies that later couldn't meet the job creation requirements.
When the Free Press tracked what happened to 195 of these tax breaks awarded by the state from 1999 through 2005, it found that 51% of these incentives had either never been used or were not used in recent years.
* Despite Michigan's efforts to diversify its economy, the auto industry has been a big recipient of the tax credits. Auto suppliers and automakers received 45% of the 195 tax breaks awarded by the state from 1999 through 2005.
* About 90% of the 491 total tax breaks granted since the incentive program began have gone to Michigan companies planning expansions rather than to out-of-state firms.
* In recent years, the state has expanded the incentive program by enabling more companies, particularly smaller tech firms, to qualify for the tax credits, primarily by lowering the job-creation requirements.”
FreeMichigan has discussed the Michigan Economic Growth Authority on several occasions, and we are happy to see our mainstream brethren checking things out. Reporter Katherine Yung did a terrific job.
This board is a rubber stamp for tax breaks. Review of its minutes for meetings since last June, which is as far back as the posted minutes go, shows not a single no vote with regard to any business before board.
This is not a system of checks and balance. Instead the board is packed with yes-men who apparently lack the instinct or courage to even question a petitioner’s request. Minutes also show that the governor periodically stops by the meetings to encourage and thank them.
We also note that Douglas Buckler, executive secretary/treasurer of the Michigan Regional Council of Carpenters and Millwrights (MRCC), serves on the board. As a union leader, we find this wholly inappropriate. Do you think that Buckler was simply the best choice for the board, despite what one could easily claim is a fealty to special interests, i.e. organized labor? In case anyone cares, Buckler in 2007 pulled in a salary/benefit package of $418,198, which included an expense account of $25,940, per the union's 990 tax form. Someone who is so beholden to an interest as such cannot perform what is demanded of a body dealing with our money.
Finally, let’s go back to November 2001, when the state and Pfizer announced the drug maker had received at least $70 million in state and local tax credits for expansion. It had threatened to leave Michigan unless it was given these breaks.
One news account reported, “The deal increases the odds that the company, Ann Arbor's largest private employer and largest taxpayer, will stay put and continue to have a significant impact on the state's economy.
The Pfizer expansion is the largest new economic development project announced in Michigan this year. State officials say it would pump more than $89 million and 988 jobs into the economy in the next 20 years.
At a news conference Tuesday in Ann Arbor, Gov. John Engler praised the Pfizer deal as a "welcome confirmation that Michigan is attracting the important companies and investments that will make the Life Sciences Corridor vision a reality."
The Michigan Economic Development Corp. on Tuesday granted Pfizer a 20-year single business tax credit worth an estimated $25.8 million. It also granted a 12-year, 6-mill abatement of the state education tax, valued at $10.7 million.”
Pfizer announced in 2007 that it would close its facilities in Michigan.
There is something very suspect about a board that operates with no opposition, no voice of dissent. But that is exactly what MEGA is doing. Is anyone going to do something about it?
Tuesday, April 21, 2009
Freep Pulitzer: A Triumph of Great Reporting and Open Records
Pulitzer congrats to the Detroit Free Press’ Jim Schaefer, M.L. Elrick, as well as the rest of the staff involved with the reporting on the scandal of Mayor Kwame Kilpatrick.
After obtaining text messages between the two, the Freep team faced some formidable opposition in its work to uncover evidence that the former mayor and his aide, Christine Beatty, conspired to cover up city government malfeasance. Kilpatrick and Beatty were charged in March 2008 with perjury, misconduct and obstruction of justice. Kilpatrick was ousted as mayor after he pleaded guilty to two counts of obstruction of justice and no contest to assault.
Getting the text messages was the first step, and the newspaper has never revealed its source.
Special mention should be made of Herschel Fink, who assists journalists statewide in breaking through the smoke screen that many are presented with when seeking access to public records. Fink played a key role in the Kilpatrick case. Here's hoping he keeps kicking.
Subscribe to:
Posts (Atom)
Posts
