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Gordie Brenne, vice president of the Montgomery County Taxpayers League, had his letter to the editor published in The Montgomery Gazette of August 27, 2014:
Congratulations! You’re using less water than ever due to improved conservation and appliance efficiency. Your reward is higher charges! Recently WSSC laid out plans for higher fees in a Council hearing. This is on top of rate increases every year for the last eight years of 5-8 percent.
WSSC management says the problem is unstable revenues in the face of all your conservation. The real problem is weak cost controls, as operating and capital improvement costs continue to increase. WSSC is huge, with 1,700 employees and annual budget of $1.3 billion.
Are costs difficult to control because WSSC is too large, or is it because there are no incentives to lower costs when rate increases are routinely approved? Maybe it’s because WSSC is jointly managed by Montgomery and Prince George’s County’s, and this divided oversight is too lenient?
WSSC water rates are 80-146 percent higher than nearby Fairfax and Howard County’s. Why? How does the productivity of WSSC employees compare? Are WSSC methods for water treatment, distribution, and sewage treatment as efficient? We asked WSSC Managing Director Jerry Johnson in a May meeting about the unbilled water rate. He said WSSCs current unbilled water rate is 16 percent, placing WSSC in the lowest quartile of U.S. operators, and is due to “a system that is not tight enough.” That’s $200 million a year not being collected.
We recommend that the County Council commission an independent study of WSSC costs and controls before any more rate or fee increases are approved. This study should also look at the feasibility of splitting up WSSC by separating the two county operations, as well as privatization and outsourcing of some or all of WSSC operations.
From the The Washington Post of August 18, 2014:
“Not the case in Maryland, which suffered the second most job losses in the country in July — shedding 9,000 positions (second only to Ohio) — and watched its unemployment rate jump from 5.8 percent to 6.1 percent. ”
Read the full story at The Post.
The Montgomery Gazette published a letter June 6, 2014, from MCTL President Joan Fidler calling for an Inspector General for the Montgomery County Public Schools (MCPS):
“State auditors reported in 2009 that MCPS governance was inadequate because the board had no control over internal audit for studies or analysis, no fraud or abuse hot line, no whistle blower protections. It’s time for MCPS — like the County Government — to have an independent Inspector General. A budget of over $2 billion and the future of our kids require no less.”
Read her whole letter in The Gazette.
On page 22 of “2014 Roll Call”, a publication of Maryland Business for Responsive Government, is a table showing how all 24 Montgomery County delegates voted on 17 bills affecting business. These 17 proposals led to 261 floor votes by all 24 Delegates. Here are the numbers:
All proposals affecting business (excluding 8 “not voting”):
Yes No Total
49 204 253
This means that for all 17 measures first proposed in the House our 24 Delegates voted for business 49 times and against business 204 times (81% against). It appears that our anti-business label is well-earned.
Questions sent to both speakers in advance of the meeting of June 12, 2014:
Topic: “Should Montgomery County be in the Liquor Business”?
1. There are many reasons for and against privatizing the liquor business in Montgomery County? Loss of a major revenue stream is most often cited as the main reason. What is the net revenue gained through county control of liquor and how much revenue would privatization bring in?
2. There is a perception that the preservation of 350 union jobs is a major obstacle to privatizing distribution and sales? If privatized, how many of these jobs would be moved to the private sector and would they belong to the same union?
3. Is the public control of liquor an asset or a detriment to the restaurant business? Would privatizing liquor sales help or hurt the restaurant business?
4. How do you explain the fact that Montgomery County is dead last in the state for liquor and beer per capita sales? Is the current method of distribution and retailing sending residents to neighboring jurisdictions for their purchases? How would privatizing the liquor business improve these numbers?
5. The state of Washington recently privatized the liquor business. What are the lessons learned from this switch to privatization?
6. Some would argue that underage drinking is not a major problem in Montgomery County due to county/state control of sale of liquor. Is this true? How would privatizing the liquor business impact underage drinking?
7. How do you avoid the appearance of a conflict of interest when the Department of Liquor Control is both the regulator and distributor of liquor? Would privatizing the liquor business solve this problem?
8. How often is there an outside independent audit of the Department of Liquor Control? Has there ever been a management audit of the department? How much overtime is paid in the Department of Liquor Control.
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Questions sent to Mr. Johnson in advance of the meeting of May 29, 2014:
Speaker: Jerry Johnson, General Manager, Washington Suburban Sanitary Commission
1. WSSC has an annual operating and capital budget of $1.3 billion. How does this compare with other jurisdictions in the area? With recent rate increases, WSSC residential water rate of $4.05/1,000 gal is higher than Fairfax ($2.42/1,000) and Howard ($1.77/1,000) counties. What do we get for this additional cost?
2. A few years ago WSSC had one of the highest unbilled water rates in the country- 20%. WSSC blamed old meters in older buildings and NIH for not paying their bills. What is the unbilled rate now, and how do we compare with Fairfax and Howard counties?
3. Many county residents have been receiving increases in their WSSC bills 100% and sometimes 1000% over prior bills. What accounts for these huge increases?
4. The WSSC has known about the age of water pipes it mains for years and also that their failure rate would increase with age. Do you have a plan for replacing them and what is the cost?
5. What is WSSC’s position on the placement of large water mains especially in residential communities where a rupture can be hazardous. A few years ago a rupture of such line in western Montgomery County made national news when a woman in a car was trapped and nearly drowned. Have you considered using multiple smaller diameter pipes, spaced apart, operating parallel to each other, designed so that the failure of one pipe does not impair flow through the others. Is there a financial reason for this?
6. It was reported in the news recently that the huge $164 million installation by WSSC of a bi-county water pipeline 160 feet underground is coming in under budget and ahead of schedule. How were you able to accomplish that and are there lessons to be learned for large projects in Montgomery County?
Isn’t it ironic that 11,000 of our school children obtain their education operating out of portable classrooms? We are the largest jurisdiction in the state with the greatest number of students without whom Maryland public schools would not rank number one in the country. And yet our 32-member delegation to Annapolis has failed in securing us the state construction funding we need.
Last May every voting member of our delegation voted to guarantee Baltimore City schools $20 million a year for 30 years for school construction. This special allocation was in addition to the normal allocation of state funds to all the state’s 24 school systems.
Baltimore has about 84,000 students while we have 151,000 – and growing. Baltimore has nearly 200 school buildings while we have 188. Baltimore City covers 81 square miles while Montgomery County covers 507. Perhaps Baltimore needs to consolidate its schools but the political leaders don’t feel the need to do so. Why should they? They have been guaranteed $20 million a year for 30 years.
So while our delegation can find all that money to give to Baltimore, they can’t find enough state money to get our 11,000 students out of portable classrooms. Yes, they did try this election year – but failed. Why? Do they not have enough clout in Annapolis? Is Montgomery County seen as the ATM for Baltimore City and the state? Do our delegates interests coincide with the residents of Montgomery County? Just asking.
– Joan Fidler, President
On Wednesday, April 16, 2014, a debate was held at the Rockville Library among the four candidates for County Executive. The Democratic candidates were Phil Andrews, Doug Duncan and Ike Leggett. The Republican candidate was Jim Shalleck. The moderator was Andrea McCarren of WUSA channel 9. The debate was co-sponsored by the Montgomery County Taxpayers League, The Parents’ Coalition and The Montgomery County Civic Federation . The video of the two-hour debate is now available.
At the hearing in the County Council hearing room Joan Fidler, President of MCTL, gave this testimony April 9, 2014:
Montgomery County Council FY 2015 Budget Testimony
Joan Fidler – MCPS Budget, April 9, 2014
I am Joan Fidler, president of the Montgomery County Taxpayers League. Here are our comments on the proposed FY 2015 budget.
First, we find untenable the unsustainable pay raises ranging from 6.75% – 9.75% for county workers. Yes, they are deserving of a pay raise but these somewhat wild leaps do not make sense. Is the private sector in the county quite as generous? Is the federal government? Yes, we did support pay raises for you and the County Executive and we stand by them. 10 people with a pay raise who have responsibilities greater than those of the rest of the county government will not break the budget. 9,600 people are another matter. Reduce their pay raises by half. You will save $10 million.
Next, the energy tax that is now looked on as a permanent stream of revenue – a tax that we were promised was a temporary tax meant for extraordinary times. It should have faded into the sunset but continues to glow in the east. Yes, you did reduce it by 10 percent in each of the last 2 years. We suggest that you decrease it by another 20%.
And now to the $26 million increase for the school system which is above and beyond the Maintenance of Effort funding level. This punitive law, which favors education over every other service offered by the county, a law which was fought for by the unions and the entire educational establishment – well, we should give them what they so valiantly sought – funding at the Maintenance of Effort level. The $26 million increase will rebase per pupil funding upward – permanently. Please do not pander to the educational establishment. Unlike county workers, they receive better health benefits. Unlike county workers, they are not furloughed. Unlike county workers, they get an additional 2% supplement towards their pensions – the only county in Maryland that is so generous. Just heed Seneca’s words of several centuries ago: “Qui multum habet, plus cupit” (he who has much desires more). Do not go over the MoE level. You will save $26 million.
Further, we are not convinced that the $2.3 billion budget of the public schools has any objective oversight. An organization as large, expensive and complex as the MCPS needs and deserves an Inspector General reporting directly to the Board of Education. We urge you to make that happen. The MoE law does nothing to incentivize efficiencies or avoid waste; an Inspector General would.
Also we are alarmed that we have 2 classes of tax-supported workers in the county – those that work for the school system and those that work for the county government. We urge you to suggest to the school system that all new workers pay the same share of their health premiums as do county government workers. It will be a small step towards equity and would save the school system close to $2 million in the first year alone.
So what could you do with all the savings we’ve suggested? The opportunities are endless. Create jobs. Lower property taxes. Improve infrastructure. And do not forget the “the least of our brethren” – the homeless, the unemployed, the poor, the hungry, and the developmentally disabled.
Budgets are a matter of choices. You have the power- and the ability- to make good ones.
At the hearing in the County Council hearing room Gordie Brenne, Vice-Presdinet of MCTL, gave this testimony April 9, 2014:
Montgomery County Council FY 2015 Budget Testimony
Gordie Brenne – MCPS Budget, April 9, 2014
My name is Gordie Brenne, and I’m an accountant and VP of the Montgomery County Taxpayers League, testifying as an individual. Thank you once again for the opportunity to testify about the MCPS budget, which I base on my red zone experience as a PTA VP for school improvement.
10%, 46%, 15%, and 4%. What do these numbers have in common? MCPS worst practices. Here’s four examples using these percentages to explain why better management, not more money is needed:
Would you buy a car from a manufacturer who has a 10% failure rate? You’re being asked to. The drop-out rate for Blacks and Hispanics in red zone high schools is 10% and is largely unchanged.
Would you build a house with a developer that has a 46% overhead rate, under a cost plus contract that automatically passes on inefficiencies? You’re being asked to. 46% of what MCPS spends is for non-instructional activities and the cost plus contract is known as Maintenance of Effort. A 2009 State Audit found that MCPS facility and transportation costs are high and this remains unresolved. Enormous base spending, leaves less incremental money for interventions.
Would you invest in a business that doesn’t have concrete objectives? You’re being asked to. No targets have been set for lowering the achievement gap, one year after the Board was tasked to do this for so called “innovation” schools. My analysis found that only 15% of the budget could be linked to academic strategies. MCPS’s own analysis could only link 25% of its proposed budget increases to strategies (Table 1A).
Would you spend more of your family’s budget on half of your kids who already exceed national averages, but less on the other half that the latest OLO Consortium report shows are substandard? You’re being asked to. Red Zone elementary teachers are paid on average 4% less. A stop gap proposal in the new budget to reward 250 “exemplary” red zone teachers leaves substandard teachers in place. Worse, this does nothing to stem the “free agency” practice that encourages exemplary teachers to transfer to the green zone for shorter work days and fewer class room interruptions.
The issue is better management, not more spending. I renew the Taxpayer League’s recommendation for an independent study of MCPS plans to lower the achievement gap. Also, every year the Council and Executive increase supplemental spending by other County agencies for educational activities. This has grown to $75 million (excluding debt service on construction and retiree benefits), and should be included in the independent study. We recommend that no increases in spending above the Maintenance of Effort minimum be approved. Thank you.