Overtaxing, Overspending: 2010 Archives
The Chatham selectmen who decided not to rehire the Town Manager for a 13th year, but instead to search for a new manager in whom they could place their trust and confidence for the difficult years ahead describe the decision process.
The three -- Florence Seldin, Sean Summers and Tim Roper -- decided delaying the decision on a new town manager for a year made no sense. After months of negotiation on vacation pay, severance and the like the five selectmen and the Town Manager made and signed an agreement. It was subsequently ratified by a 5-0 vote in an open selectmen's meeting. That should have been the end of it.
Dissatisfaction with the Town Manager's performance has been increasing in recent years. His most recent performance evaluation by the selectmen (reported in February of 2010) was a D or C-, hardly a ringing endorsement. And that was before the horrific bungling of the start to the sewer piping work on Route 28. With virtually no notice and with no prior consultation with local businesses or residents, the Town Manager had the heavy equipment show up and disruption and hundreds of thousands of dollars if not millions in lost business followed. So a decision not to re-hire the Town Manager for another year but to go forward for a fresh start made eminent good sense.
After the public meeting to ratify the agreement reached by the five selectmen and the Town Manager, close friends of the Town Manager and some favored town employees (or their spouses) began an unprecedented recall effort to throw out of office the majority of the selectmen whose votes carried the decision not to rehire the Town Manager. Recall has never been used in Chatham. It is in the charter for extraordinary cases such as fraud, malfeasance and crimes, not for protesting a routine decision such as the hiring of a new town manager. It is like impeachment at the federal level.
The most disturbing aspect of the public meeting to ratify the agreement the five selectmen and the Town Manager had reached was the behavior of Chairman Sussman and Selectman Whitcomb. Even though they had signed the agreement with the Town Manager and publicly joined in voting for it 5-0, they publicly criticized the majority and applied pressure at the meeting in an effort to get one of the three to buckle. Sussman's effort was obviously directed at Florence Seldin, which was a despicable thing for him to do. To her credit, she let it be known she would not be intimidated. She had agonized over the decision for many days and made the decision in the best interests of the town. Sussman concluded his demagogic behavior by waving the town charter at the audience and urging a recall action.
See for yourself (click on the photo to get rolling):
There may be a slight glitch; if it stops move the little black dot on the line at the bottom slightly to the right and it should start up. There is about 3:40 of Chatham scenes for introduction which can be skipped by moving the black dot to the right.
You can also view directly on the town website. Click here.
Town Counsel as recently as last year ruled that selectmen who vote for a matter must then publicly support it, even though they had initially objected to it. The Town Manager in late October, 2008, right after the successive market collapses of August and October, signed a very rich three-year union contract calling for compensation increases ranging between 5-7%. This was done despite the fact that many if not most town residents had suffered massive losses in their life savings. At the selectmen's meeting to approve the contract, Selectman Summers voted against approval, but it was approved 3 to 1. Subsequently, when it was incorporated into the budget, Summers voted with the other selectmen to recommend the warrant question on the budget, but said he would speak against it at town meeting. Town Counsel ruled he could not undermine the affirmative vote he had cast.
The obligation of Sussman and Whitcomb is the same. They signed the agreement with the Town Manager. They joined in a unanimous public vote to approve it. Therefore, they appear to be in violation of the rule enunciated by Town Counsel, as well as policies of the selectmen, particularly 3(c) and 3(d), in attacking the agreement made in executive session and urging hostile action against the three selectmen, as they both did at the selectmen's meeting after the unanimous approval vote.
The recall effort quickly turned ugly with unfounded charges lodged against the majority selectmen in flyers, letters to the local papers and the recall petitions themselves.
Citizens going to a special town meeting on school regionalization were harassed to sign recall petitions. People entering the public Community Center this past Friday met a bullying crowd in the lobby seeking their signatures on recall petitions set up on the reception desk used by the town employee on duty. It looked as if the recall was officially sanctioned by the town employee in charge. Outrageous.
The Cape Cod Chronicle fed the flames (indeed, set them) with a headline "Hinchey Lynching?" The paper referred to the decision not to renew as the Town Manager being "ousted," which it clearly was not. The Town Manager will complete his current contract as agreed. The Chronicle said the Town Manager had not been reviewed since 2008, even though the Chronicle itself published a report of the most recent review (the D or C- review) on February 4, 2010.
Each selectman voting not to renew the Town Manager's employment had his or her own reasons. As with any such personnel decision in any business, details about the reasons for non-renewal were kept confidential. There can be no question that Florence Seldin, as well as the other selectmen, did what they concluded was best for the town. Seldin had been a tireless volunteer on many committees for years before becoming a selectman. She works hard, she digs for the facts, she is honest, fair and open. She votes too often for more spending than CCT likes, but she has our respect. Tim Roper said at the selectmen's meeting he had been a friend of the Town Manager for years, so his decision was not personal, but made to take the town in a more responsible spending direction. Sean Summers has served the town faithfully and well, being a lone voice calling for more attention to taxpayer concerns and ending overstaffing and overspending, for seven years.
Chatham Concerned Taxpayers certainly supports, indeed, applauds, the decision to seek a new town manager. The reign of the present town manager has been characterized by chronic overspending and steadily rising tax bills. The tax rate is meaningless. It's the result of Chatham's inflated property assessments (6th highest per capita in the state) and the fact that annually the town benefits from property tax windfalls paid by non-residents who impose minimal cost burdens on the town.
Proposition 2 1/2 in Massachusetts was meant to be a restraint on spending and the rise of property taxes in cities and towns. But in Chatham over the past decade the average spending increase each year has been about 6%, far above 21/2%. Indeed, according to state records, our neighbor Orleans, about the same size geographically and about the same in population, spends about 30% less per year than Chatham does. That's currently a difference of $9-$10 million per year. That gap will get larger as debt services charges for the enormously expensive sewer (CCT estimate: $450-$500 million) start hitting.
Chatham capital projects always seem to be bigger and more expensive than many thought they should be. To replace a 3,000 square foot community center for the children a 22,000 square foot project costing $10 million resulted. The children only use about 3,000 square feet. The rest of the building is underutilized. Some functions were added to use up the extra space, such as an exercise room for adults. Poor planning for children and adults: No locker rooms, no showers. Meeting rooms are empty most of the time since there is ample public meeting space elsewhere in town.
Nearing completion is a kind of second town hall to house the police and planning and permit issue people. At most about eight police will be on duty at any one time, we're told; nonetheless, they will have 19,000 square feet to luxuriate in. Despite the police having access to the exercise room at the community center, they will have their own gym in their new headquarters. As for the planning/permitting folks, they will rattle around in 20,000 square feet. The $17 million structure, dubbed the Taj Mahal by some, actually will cost more than that because it was built without a wastewater disposal system. Running piping up George Ryder Road from Route 28 will add at least a few hundred thousand if not more to the cost. Early plans for a new fire station also include a gym. And so it goes.
Readers can scroll through earlier entries on this website and find many, many reasons to be dismayed about the present Town Manager's years in office.
But, one may argue, aren't all these decisions made by the selectmen or town meeting?
In function, yes, in reality, no.
Why is the president of the United States limited to eight years? Because one administration over time acquires more and more power and controls more and more of the flow of information.
This is true in Chatham as well, but the administration in this town is the Town Manager.
This Town Manager has negotiated every contract establishing salaries and benefits for all unionized non-school employees. He has set the salary for almost every other non-school employee. He has hired many if not most of them. Needless to say, they are responsive to his wishes.
All information flows to and through the Town Manager. The Town Manager not only carries out the policies set by the selectmen, he is their principal advisor on setting policies, establishing budgets and proposing projects. It's no surprise that what he proposes usually gets rubber stamped by the board of selectmen and carried at town meeting. He says he doesn't set policy, only executes what the selectmen decide. Hogwash. He's in control.
Do the selectmen know about what they're voting for? Do they know all their options? Does town meeting? In many cases the answer is "No." From our close observation over the past two years, the Town Manager presents information to support his position and does his best (usually successfully) to keep contrary information from getting to the selectmen or town meeting or voters in general. At town meeting, town employees, their relatives and friends are a formidable bloc of votes and budgets with fat raises and increases in pension and health benefits always seem to get approved. The first town meeting spending plan after the October 2008 market collapse proposed by the Town Manager provided raises of 5-7% for all town employees. The public employee bloc vote prevailed over the objections of some 300 plus voters. Did the Warrant detail how rich the raises were? No.
Were Chatham voters, reeling from losses in their savings, told that they were voting compensation increases for public employees who already earned far more than most of the households in town are living on? No.
Mean household income in Chatham is $57,379 or less (2008 Census figures). CCT calculates that the average full-time town employee has total annual compensation in excess of $70,000.
In fact, the Town Manager's FY10 spending plan not only contained those rich increases in compensation, overall it exceeded expected FY10 revenues by more than $1 million. The Town Manager used off-budget money such as the emergency fund to fill the gap; how could there be an emergency when town employees are getting such handsome raises?
The FY10 spending plan deficit may have been closer to $2 million than $1 million since non-property tax revenues were in decline. How much they were down was not known because the Town Manager refused to provide that information to CCT and the Finance Committee despite repeated requests.
That FY10 deficit spending made for an unbalanced FY11 stuation, which the Town Manager "solved" by pushing as much as he could into FY12. "Cuts" in spending were minimal. The FY12 crisis is the culmination of years of overspending under the direction of this Town Manager made dramatically worse by the FY10 spending plan that was far, far in the red. At a time when CCT called for fiscal prudence, level spending with FY09 and deferral of all non-emergency capital projects until good economic times returned, the Town Manager imprudently continued his overspending ways.
As for how the Town Manager planned to and did ram the centralized sewer through town meeting without any vote on the overall plan or providing any honest information about taxpayer costs, please review our many entries on that. He wanted a hugely expensive 19th century centralized sewer for Chatham and he got it. Will it really improve Chatham's embayments as claimed? No one knows. That's why nine Cape towns are now discussing with the National Academy of Sciences a peer review of the state plan which Chatham alone forged ahead with. Before these towns spend hundreds of millions of dollars of their taxpayers' dollars, they want to know the science is good and what they're being told to do by the state will in fact make an improvement in their coastal waters. Was Chatham's Town Manager irresponsible in making Chatham the guinea pig of an unproven, untested state plan? We think so.
We hope the citizens of Chatham will show their good sense and that the recall actions will fail. It is astonishing that the Town Manager has not asked his friends and supporters to desist, but has allowed the poison to spread. He signed an agreement. He was not under duress. Even his two supporters on the board signed it, a clear indication that the agreement was acceptable to the Town Manager if not what he had hoped.
It's time to move on.
The seach process for a new town manager is beginning. Chatham is an attractive assignment and a host of qualified applicants is assured. We hope many folks will volunteer to serve on the five-person search committee being established by the Board of Selectmen.
The movement to get an authoritative peer review by the National Academy of Sciences (NAS) of the methodology created by the Department of Environmental Protection (DEP) and the Massachusetts Estuaries Project (MEP) has gained a lot of traction in the past few weeks.
First, the Town of Dennis signed on to the petition initiated by the Orleans Board of Selectmen, bringing the number of towns in support to nine (of 14, Provincetown doesn't have a nitrogen problem like the others).
A representative of the National Academy of Science met in Barnstable this past week with county leaders to discuss how this might work. The word is that the National Academy of Science is eager to do the peer review. It understands that some eight to ten billion dollars of Cape taxpayer dollars are riding on what the DEP/MEP methodology says should be done and no one wants to see money of that magnitude wasted.
As a consequence, county officials, who originally had decided not to support the Orleans initiative, reversed themselves and came out in support of the NAS peer review. The executive director of the CCC Paul Niedzwiecki told NAS representative Susan Roberts this:
"I would welcome the National Academy of Sciences to look at the science and some (treatment) implementations. I would love to have that sort of objectivity to be completely confident that we are headed in the right direction, and if we are not, I'd like to know that too."
So would all Cape taxpayers, including those in Chatham.
Also, State Representative Sarah Peake (whose district Chatham is in) pledged her support. She and the other three Cape state representatives are preparing a joint letter of support to be sent to the Cape's Congressman Bill Delahunt.
Six billion dollars have been poured into Chesapeake Bay to solve its nitrogen problem, but after years of effort the federal EPA has said it all has been a failure. No noticeable improvement has resulted. Cape taxpayers cannot afford a mistake like that. No doubt the NAS hopes what it learns in the Cape Cod review will be helpful for the Chesapeake Bay as well.
Before each Cape town commits to spending hundreds of millions of taxpayer dollars, it wants to know that the science, methodology and models are sound and that the proposed expenditures will in fact deliver the desired results in bay water improvements.
Chatham is the only town that has rushed ahead without questioning what the DEP/MEP has said it should do. The DEP/MEP program is untesed, unproven and has never been subjected to an independent third-party review. Chatham, in effect, is the DEP's guinea pig.
The Town Manager pushed the town into the implementation phase within weeks after the Comprehensive Wastewater Management Plan was finalized with no opportunity for taxpayers and other citizens to learn all the details of the plan, such as what it would do, what it would cost them, why the centralized sewer system proposed by the Town Manager was chosen and why lesser cost alternatives that EPA considers preferable were not chosen or at least to some extent integrated into the plan to save money.
Also, it was discovered later that the Town Manager's plan involved immediately building the wastewater treatment plant to its 20-year capacity to service, as CCT calculates it, some 55,000 people. CCT questioned why the plant was being overbuilt like that.
Engineers have told us that if the plant right now is built to that capacity, the town must go on and build out sewering to get that much wastewater or the plant won't function cost-effectively, efficiently or even do the job of removing contaminants such as nitrogen as required.
Taxpayers didn't know with their vote for some small expansion of the existing sewer system piping and an upgrade of the treatment plant they were being in effect forced to go forward with 20 more years of funding for sewering, whether they wanted to or not. Because of the way it was explained in the Warrant they had every reason to believe that the treatment plant would be concurrently upgraded as voters voted (if they did so) to add more sewering every two years for the next 20 years.
It's not too late to scale back the treatment plant right now to just service what's being added in sewering pursunat to the May 11, 2009 town meeting vote in addition to the existing small downtown area, so taxpayers will retain their choices and flexibility.
We might even, after the NAS peer review, get a fully informed town meeting to vote on a full plan that adequately takes into account the results of the NAS peer review and all options, including alternatives such as cluster systems and permeable reactive groundwater barriers that can reduce costs dramatically. We all want to make sure the money invested will do the job.
CCT asked the Chatham selectmen on July 6th to sign on to the peer review request, but they said no (3-2, Summers and Roper in favor), principally because at that time the Cape Cod Commission wasn't supporting it.
But that has now changed and the CCT has renewed its request that Chatham join with the other towns and the county in supporting the NAS peer review. Taxpayers in Chatham are no more interested in wasting money than other Cape towns. Read our letter to the selectmen sent August 23rd.
CCT in the letter also pointed out there is no urgency involved. The entire project ought to be put on hold till the answers come in from the National Academy of Sciences. (Under the Stearns & Wheler plan adopted by the Town Manager the town was warned by the DEP that it would take several years after the 20 years of construction before any water improvement might be seen, if then.)
A halt is urgently needed right now with respect to the sewering along Route 28 which caused substantial losses for businesses in the spring. The town should skip the fall sewering work on Route 28. Businesses were hit badly in the spring, but will suffer even more in September and October, which are normally much better months for revenues than the spring months Under its contracts the town has flexibility to terminate, suspend or reschedule work.
It is not too late for the town to do the right thing in protecting taxpayers. As the executive director of the Lewis Bay project said after meeting with the NAS, paraphrasing, "We know we have a problem. We need to forge a consensus about what has to be done. The NAS review will help attain that consensus." Chatham, as an environmental leader, should be part of forging that consensus.
Every Chatham citizen and taxpayer should tell the selectmen they want to know their money isn't being wasted on this centralized sewer project. Support the National Academy of Sciences review.
Do Chatham and other Cape Cod towns really need Big City Sewers for healthy coastal waters?
A study by a very qualified group of Orleans scientists and engineers of nitrogen contribution to Pleasant Bay shows that all the septic systems ringing the bay only contribute 1% to the total nitrogen in the bay. See the attached summary of the report, p. 8, in particular.
Spending hundreds of millions on centralized sewer systems in Orleans, Harwich and Chatham will therefore in all likelihood have no effect on Pleasant Bay water quality, but a devastating effect on town budgets. What if similar testing in other Cape embayments also show that the septic nitrogen contribution to total nitrogen is miniscule?
The easy assumption that too much nitrogen in coastal waters is the source of all the ills it is blamed for has never really been proven. It now also appears to be the case that septic nitrogen may be such a minor contributing factor that spending billions on the Cape for centralized sewer systems could be a massive waste of precious dollars, be they from property taxes or sewer fees.
Consequently, the Board of Selectmen of Orleans has now asked all Cape Cod towns to join it in asking the National Academy of Sciences to conduct an objective "peer review" of the science behind the findings and recommendations of the Massachusetts Estuaries Project (MEP) commissioned by the Department of Environmental Protection (DEP) and put forward by the DEP as the baseline of what is required of each town to make its waters healthy. Read the letter: Orleans selectmen letter for peer review.pdf
It is an amazing fact that this methodology, which may lead to expenditures of as much as ten billion dollars for Cape towns, has never been independently peer reviewed. The DEP so far has refused to allow that, but that position cannot stand. The towns and their taxpayers who will be responsible for paying the bills have a right to demand validation of what they are being told is what needs to be done.
So far, seven or eight of the 15 Cape towns have agreed to join with Orleans. Responses from others are being awaited, including Chatham.
Chatham Concerned Taxpayers has urged the Chatham selectmen to join with Orleans and the other towns. Click here to read our letter: CCT ChSel July 6 2010.pdf here
Chatham alone among Cape towns has embarked on a centralized sewer system plan developed by its Town Manager for all watersheds said to be contributing septic nitrogen to coastal waters. This was done without questioning the state numbers, without testing the state's conclusions first in at least one seemingly troubled area ("hot spot"), without evaluating alternative, modern technology that removes septic and groundwater nitrogen cheaper, faster and better, and without obtaining a town meeting vote on the Town Manager's plan, which could cost property taxpayers close to if not more than half a billion dollars, depressing all other spending for operations and capital projects for decades. " How could this have happened?", one might well ask.
Nonetheless, it is not too late for the Chatham selectmen to join in the request for a peer review. The best way to assure taxpayers that town officials aren't wasting their money is to get an objective review of the science behind the state's numbers.
Since the Town Manager's plan is to pipe all contributing watersheds in one coordinated effort (110 miles of sewer piping) over 20 years, it could be 25 years, according to Stearns & Wheler and DEP, before improvement, if any, would be seen.
Rather than spend half a billion dollars first and then find out the massive spending has done nothing to improve bay waters, it is, to say the least, prudent to get an objective review of the basis for the whole plan.
While the National Academy of Sciences is conducting the peer review, the town can conduct an objective evaluation of modern technology and systems that are now available that can remove nitrogen from septic systems and groundwater far more efficiently, far less expensively and with far quicker results (some immediate) than the centralized system the Town Manager has chosen. If the NAS confirms the MEP/DEP science, then a plan, taking into account all available technology options, including these modern, less expensive ones, can be voted on by a fully informed town meeting and implemented. And results will be known a lot sooner than 25 years from now.
Virginia's Governor Bob McDonald, speaking in Boston last night, had it right:
"There's a growing sentiment of the citizens of this country that the rate of spending, the rate of growth in spending at every level of government, is unsustainable."
The Obama administration seems intent on bankrupting our grandchildren and Massachusetts state government is chronically running deficits and raising taxes.
In Chatham the Town Manager lets public union compensation keep rising and apparently thinks overrides are the way to solve his overspending.
On top of that, the Town Manager has launched a massive capital spending program for a Big City Sewer that isn't needed to keep Chatham's coastal waters clean and healthy. The challenge could be met for half the cost and in a way that national environmental organizations such as Clean Water Action say is better environmentally. Not only that, these new systems do a better job of removing nitrogen and other contaminants from groundwater with permeable reactive barriers. Hinchey is committing taxpayers to spending about half a billion dollars for a Big City Sewer without (1) questioning the cost, (2) looking objectively at less expensive alternatives or (3) even questioning what the state's scientists say is needed to be done to keep Chatham's waters healthy. Other Cape Cod towns are seeking validation of what the state scientist have come up with through a "peer review" by the National Academy of Sciences (NAS). That's the basic question: What is it that we in fact have to do to make sure Chatham's waters are healthy? Chatham shoujld join with those other towns in the petition to the NAS. That's step one in fiscal prudence.
CCT has determined, based on a review of town records, that the strategy for this nitrogen removal project engineered by Town Manager Hinchey and Director of Health & Environment Duncanson had as a key component NEVER to put the full Comprehensive Wastewater Management Plan (CWMP) project calling for a big city centralized sewer system before a town meeting for a vote. Their decision to do this was no doubt because of the huge cost which they did not want taxpayers to focus on, to say nothing of the disruption caused over 20 years of construction. They wanted to avoid the question that would naturally arise, "Can't this problem be solved less expensively?"
Records of the Citizens Advisory Committee from 2007 had Duncanson telling CAC members that the full CWMP would never be put before a town meetng. CAC members had wondered whether such an expensive plan could get through town meeting. Apparently at least some CAC members questioned that strategy, so Nathan Weeks of Stearns & Wheler was brought into the next meeting to assure CAC members that some towns did it one way, some another, so the "piecemeal" approach would be just fine. So, innocuous-seeming bits and pieces would be put before successive town meetings (e.g., funds for determining the extent of nitrogen pollution and how much needed to be removed) until some key vote by an unknowing and uninformed town meeting, would become the point from which there would be no turning back.
Director of Health & Environment Duncanson considers the Article 14 vote at the 2009 Annual Town Meeting (ATM) to be that point of no return for proceeding with the entire CWMP that would cost taxpayers hundreds of millions of dollars. We know that because he told state bureaucrats that in an official document this year.
What voter knew that? If Duncanson is right, how were the voters tricked into in effect voting for the entire CWMP calling for expenditures of $240 million plus interest and inflation, 110 miles of sewer piping, 88 pump stations and more than a thousand seven-foot tall grinder pumps for the 4000+ properties to be sewered?
CCT's investigation has shown that false information was provided in the 2000 ATM Warrant and what the SEC calls "misrepresentation by omission" occurred. Material information that is important in decision-making was withheld from the Warrant.
Town officials did not disclose in the Warrant or in oral discussion (or in any official document CCT has seen) that their plan was immediately, in two years, to enlarge the capacity of the wastewater treatment plant to its 20-year capacity; what that means is for the plant to operate efficiently sewer piping of the entire planned area would have to be installed for it to operate efficiently and to remove the nitrogen from the wastewater it is supposed to. In other words, town meeting voters would be forced to vote for more sewer expansion at subsequent town meetings for the entire $240 million plan, whether they wanted to or not. So voters and taxpayers would be stuck. According to engineers with whom we have consulted, there could be no turning back without substantial additional cost to unwind much of the enlargement which had been done.
CCT formally called these misrepresentations to the attention of the Secretary of Energy and Environmental Affiars. The misrepresentation that everyone can see for himself is on pp. 105-106 of the Warrant. Charts provided to show projected debt service costs for the sewer in the nature of bar graphs understated the 2007 $240 million principal lcost estimate of Stearns & Wheler by one-third. In addition, no interest or inflation was included in the bar graphs for the decades of financing and repayment. At that time and now there is no such thing as zero interest loans.
As a consequence, the vertical bar graphs supposely showing the impact of sewer financing and repayment over decades should have been 2.7 times taller than were shown. These falsely short bar graphs were compared to bar graphs representing current debt service to make it appear that the sewer costs would not be too bad for taxpayers. In fact, they should have been almost three times as tall as was shown.
The Secretary stated that their regulatory process had been completed and that the misrepresentations at town meeting were outside their regulatory review process, even though the misrepresentations with respect to that town meeting vote were the single most important step in advancing the sewer project from the planning stage to implementation. In other words, the Secretary decided to ignore misrepresentations that, if deliberate, are fraudulent, even though they were the key step moving the CWMP from planning into implementation. Our conclusion is that the misrepresentation was deliberate.
UPDATE: Additional investigation has revealed that the same misrepresentation was made to the Board of Selectmen earlier at its meeting of March 17, 2009, thus strengthening the case for this being a deliberate understatement and therefore misrepresentation of the costs of the CWMP.
What this writer is saying about California public employee unions applies to Massachusetts and Chatham.
[V]oters turn resentful as they sense that:
-- They are underwriting, through their taxes, a level of salary and benefits for government employment that is better than what they and their families have.
-- Government services, from schools to the Department of Motor Vehicles, are not good enough - not for the citizen individually nor the public generally - to justify the high and escalating cost.
Chatham chronically overspends and taxes more than it needs to. It's because of fat public union contracts negotiated by the Town Manager. It's because of extravagant, costly projects pushed forward by the Town Manager, especially in the case of his massive, totally unnecessary centralized sewer system.
Cleaning up Chatham's waters could be done at a fraction of the cost of the Hinchey sewer, but voters never had a chance to consider these less expensive and environmentally preferable alternatives favored by the EPA. Only the Town Manager voted.
This disregard of taxpayers is what makes Chatham just about the most expensive community on Cape Cod. For example, our neighbor Orleans, about the same size as Chatham in population and geography, spends 30% less per person than Chatham does on government, excluding schools. That's about $10 million for this year alone that could have stayed in taxpayers' pockets.
Public unions are bleeding voters dry. Voters are waking up and they are angry. Fat pensions, elite health plans and compensation to town employees that is higher than what most of the people paying the bills have to live on are too much and need to be reined in.
Imagine, right after the stock market crash of 2008 the Town Manager of Chatham signed a union contract giving union employees a 7% raise which they are enjoying right now while townspeople are suffering from the economic collapse and fearing a double dip recession.
We need public officials who put the taxpayers first, not negotiate contracts like that.
We don't need to run up our debt ten fold to build monuments certain public officials fancy.
It's up to the Chatham selectmen to protect the taxpayers and put an end to these outrages.
Public employee unions on the defensive Peter Scheer San Francisco Chronicle Sunday, June 13, 2010
For public employee unions - those representing police, firefighters, teachers, prison guards and agency workers of all kinds at the state and local levels - these are the worst of times.
Despite record high membership and dues, and years of unparalleled clout in state capitols, public-sector unions find themselves on the defensive, desperately trying to hold onto past gains in the face of a skeptical press and angry voters. So far has the zeitgeist shifted against them that on one recent weekend, government employees were the butt of a "Saturday Night Live" skit, and the next day, a New York Times Magazine cover article proclaimed "The Teachers' Unions' Last Stand."
Public unions' traditional strength - the ability to finance their members' rising pay and benefits through tax increases - has become a liability. Although private-sector unions always have had to worry that consumers will resist rising prices for their goods, public sector unions have benefited from the fact that taxpayers can't choose - they are, in effect, "captive consumers."
At some point, however, voters turn resentful as they sense that:
-- They are underwriting, through their taxes, a level of salary and benefits for government employment that is better than what they and their families have.
-- Government services, from schools to the Department of Motor Vehicles, are not good enough - not for the citizen individually nor the public generally - to justify the high and escalating cost.
We are at that point.Continue reading "WHY IS CHATHAM SO EXPENSIVE?"
Things are downright scary. The nation is stalled in a deep recession and joblessness is growing. More people are fearing they will be worse off in the future than ever before.
Yet what is Chatham doing? Maintaining its growth in town spending but shoving what it couldn't fund this year into next year's budget, when the situation will be just as bad, but made worse by this doubling up of deferred costs. On top of that it has launched a 20-year sewer construction program that will drive the town's debt from about $30 million to over $300 million! is this the time for a debt explosion?
Does Chatham have to do the sewer now? No.
Is there a rush to clean up the waters? No. Under the town's program no improvements are expected till 25 years or so when the project is finished. Not only that, Chatham is a guinea pig for the state program's proposed solution for reducing nitrogen, which might not even show any improvement in coastal waters. For the Town Manager to embark upon a total plan for the town costing hundreds of millions of property tax dollars rather than by proceeding incrementally to test out the state's proposed solution in one or two hot spots first is inane.
Can any government agency force Chatham to act now? No. Since this is an unfunded mandate, no government agency can force Chatham to act against its interests.
Will the Conservation Law Foundation sue Chatham? No. Chatham is so far ahead of all other towns in its planning it's the last town CLF would sue.
Will Chatham wind up lagging behind other Cape towns in addressing the problem of excess nitrogen in bay waters? No. Chatham is years ahead of the 13 other Cape towns that have excess nitrogen problems. Some of them are exploring less expensive and better environmental alternatives, others are hoping for state or federal subsidy assistance and some just do not consider the problem a priority in light of their tight budgets and other demands.
More sensibly, Orleans and other towns first want to be satisifed that the plan developed by the state DEP with the scientists in Dartmouth will do the job. For years they've demanded a peer review of the science, which the state and the scientists have refused to allow. Now that demand is growing insistent. Why spend billions for something that might not do the job? It makes sense to make sure it works before committing to such massive expenditures.
When did Chatham town meeting vote to approve a sewer program costing $300-$400-$500 million? It never has. The town manager pushed a vote through town meeting in May 2009 for an upgrade of the treatment plant but didn't tell anybody the upgrade would build the treatment plant out to its planned 20-year capacity in just two years. Instead of just enlarging the treatment plant to handle the few hundred properties being added to the existing system, the Town Manager authoritzed an enlargement for ten times as much, enough to process all the presumably affected watersheds in town. As a consequence, any engineer will tell you taxpayers will be forced to fund the rest of the sewer pipe extension program or else have a malfunctioning, cost-inefficient and sub-performance treatment plant. To convince town meeting members the costs would not be too onerous, the town manager provided town meeting members with false numbers reflected in scaled down bar graphs which were supposed to show what the real costs would look like.
Should Chatham taxpayers be worried about what the economic bad news looks like for Chatham as well as the nation? Absolutely. Savings, dividends and interest payments for Chatham households are all down. Huge tax hikes at the federal level beginning next year are a certainty, so, no matter what, incomes will be slashed. States are cutting local aid and raising taxes as well. This is a time for caution.
What should Chatham do? Two major things need to be done to get the spending situation under control: First, renegotiate public union contracts to reflect the reality of the financial situation of Chatham homeowners. Automatic built-in increases should be a thing of the past. The Town Manager has refused to do this. Second, revise the capacity plans for the treatment plant expansion downward so it will handle efficiently and effectively the properties now on the system and those being added with the $20 million for piping voted at the May 2009 town meeting. Then stop and join Orleans and other Cape towns in demanding a peer review of the state's science. During that review period, objectively and fairly examine the alternatives to addressing the nitrogen removal (however it needs to be done) less expensively and hopefully less disruptively. (The EPA and national environmental organizations favor alternatives such as clusters as better environmental choices.) Following the peer review and its conclusions and the examination of less expensive and disruptive alternatives , the entire resulting plan should be put before a fully informed town meeting or a vote.
Here's a knowledgeable observer's pessimistic view of the next few years.
America’s jobless picture is alarmingly bleak
By Mort Zuckerman in Financial Times
June 7, 2010
We are drifting. We take comfort in bits of good news, but we are in dangerous waters; the Great Recession is being starkly revealed as a global crisis with the US, the traditional engine of recovery, sputtering on every cylinder. The US government responded with dramatic financial support by transferring money to the household sector. But outside of these transfers the personal income of Americans is still declining; the residential market remains stagnant at best; consumer growth is nominal. The only real energy in the economy has come from the cessation of inventory liquidation, which is now the main factor in rising industrial output and any modest improvement in the economy.Continue reading "CHATHAM'S MAD SPENDING BINGE"
Governor Chris Christie of New Jersey is the kind of official you need in office in tough times when the habit of overspending seems unbreakable -- whether it's in Washington, on Beacon Hill or in Chatham Town Hall,
Non-emergency projects should be postponed until better economic times return. Grandiose projects should be scaled down to what's needed and deferred if no emergency exists. Fat public union contracts have to end. New taxes, no way. Spending must be cut to avoid increasing taxes by overrides.
So listen to what Governor Christie has to say.
Tim Roper has won and was installed this morning as the newest Chatham selectman.
Let's hope that a new era of openness, civility and concern for taxpayers is about to begin.
The chronic overspending of town officials has to be reined in.
At last, the truth about the Town Manager's hugely expensive Big City Sewer project and its costs to taxpayers will come out.
It's not too late to downsize to solutions which can clean up Chatham's coastal waters at far less cost, with far less community disruption and in a way that the EPA and national environmental organizations agree is better for the environment. We should listen to what the EPA and national environmental organizations say, not Big City Sewer promoters like Stearns & Wheler, which grow rich on centralized sewers.
A centralized sewer for Chatham is a too expensive White Elephant inappropriate an unnecessary for a small, semi-rural town like Chatham.
And it's not too early to start working on fiscal 2012 spending. The idea that overrides are inevitable in fiscal 2012 must be rejected.
Chatham taxpayers took the first step at town meeting this past Monday by rejecting the Town Manager's plea for more taxes. The second step has now been taken, electing a selectman dedicated to fiscal restraint. The march to fiscal discipline has begun.
There has been a great deal of confusion about what the MINIMUM likely costs of the centralized sewer that Town Manager Hinchey has chosen for Chatham will be.
Most of the confusion was created by Mr. Hinchey's presentation of 47 PowerPoint slides at a selectmen's meeting on February 23rd and compounded by a "sewer cost calculator" put on the town website using the same misleading data. A great deal of irrelevant information was included in the slideshow which added to the confusion.
What taxpayers want to know is what costs we are being committed to. Mr. Hinchey did not answer that key question.
What numbers Mr. Hinchey' said the centralized sewer would cost are substantially less than what Chatham Concerned Taxpayers estimate the MINIMUM estimated taxpayer costs will be. The difference is almost $200 million. CCT has prepared a simple chart to show what costs Mr. Hinchey left out or got wrong. Click on the chart to enlarge it.
What do these staggering costs mean for property owners who are being sewered and those who are not?
Again, CCT has prepared an easy-to-read chart so any property owner can calculate what his MINIMUM costs are likely to be. Click on chart to enlarge.
We say MINIMUM projected costs because long-term projects such as these always run into "unforeseen" costs. Boston's Big Dig's costs grew from about $2 billion to about $20 billion, as our retired accounting expert warned us.
Sewer property taxes will rise steadily over the next 20 years, stay high for ten years and then begin a slow decline for the last 20 years of financing. They will be a burden on town budgets and needed capital projects for five decades.
The tragedy for Chatham taxpayers is that cleaning up Chatham's coastal waters of the excess nitrogen that is blamed for deteriorating water quality can be done for far less cost than the massive overkill of a Big City Sewer.
No less an authority than the federal Environmental Protection Agency says alternatives such as cluster systems can save taxpayers many, many tens of millions of dollars. Says the EPA:
Cluster systems can achieve significant economies of scale to provide high levels of treatment at costs significantly less (25 percent to 50 percent) than centralized sewer systems.
EPA also notes (p.6-7, EPA publication cited above) that cluster systems used with permeable reactive barriers (such as are now being proposed by Lombardo Associates in Falmouth and Mashpee) placed at water's edge to intercept groundwater plumes can reduce costs even more by removing nitrogen from all sources, including fertilizers and animal waste. Cluster systems also lend themselves to an incremental approach, to test out the state-supplied but untested solutions to see if indeed they work before investing hundreds of millions of dollars.
There is one taxpayer cost that is usually not mentioned, but is important. With a centralized sewer system, taxpayers' investments in acceptably functioning septic systems will be destroyed. Chatham homeowners collectively stand to "lose" more than $50 million they have already spent.
In Chatham's case, instead of a half billion project, it could be a $250 million project or less, still expensive but substantially less of a burden on town budgets and taxpayers over the next five decades. Cluster systems with permeable reactive barriers can do the job cheaper, better and faster without tearing up 110 miles of streets and installing 88 large pump stations and thousands of seven-foot high grinder pumps.
These other options are readily available to Chatham, but the Town Manager has been immovable in his opposition to considering them. Sadly for taxpayers, the selectmen have agreed to support the Town Manager's opposition, refusing even to conduct an objective evaluation of such alternatives as Falmouth and Mashpee are now doing.
The people who will pay for such intransigence are Chatham's taxpayers. The environment will suffer as well. Many fear that upping the flow of treated sewage from 100,000 gallons a day to 2 million gallons a day will overwhelm Cockle Cove Creek and result in serious damage to the marsh, Buck's Creek and Sulphur Springs.
Others fear that Chatham will become a hub for wastewater from Harwich, Orleans and Brewster as Dr. Duncanson envisioned at a selectmen's meeting in January.
Chatham is on the wrong track because it appears that Town Manager Hinchey decided years ago he wanted a regular, old-fashioned Big City Sewer in Chatham. Developments in nitrogen removal that are being evaluated and installed elsewhere in Barnstable County and in other coastal communities along the East Coast and the West Coast are being ignored.
Whether we like it or not, Chatham taxpayers seem destined to spend at least half a billion dollars for a centralized sewer that isn't needed to clean Chatham's waters and may well become to be seen as the White Elephant of Cape Cod.
Unfortunately, the White Elephant is now being railroaded into Chatham. The train is not departing.
The least we can do to acknowledge the contribution of Town Manager Hinchey is to call this "The Hinchey Memorial Sewer." We will remember him when he's gone for the costs he left behind....
A retired executive now living on the Cape but not in Chatham who spent years professionally concerned about municipal projects and their costs has sent us two warnings that we thought should be shared with you.
One warning came several weeks ago and one just a day or two ago after state bureaucrats defended their review process of this hugely expensive, wasteful, unnecessary, environmentally damaging centralized sewer project. Excess nitrogen that detracts from the health of Chatham's coastal waters can be removed at far less cost and in an environmentally superior manner by alternative means which are in common use throughout the United States and are preferred by the EPA, national environmental organizations such as Clean Water Action and the Clean Water Fund and the Massachusetts Conservation Law Foundation.
So what is our retired accounting executive warning Chatham taxpayers about? Here are the two messages we referred to:
I have been retired for several years but continue on as a consultant in the preparation of projected capital expenditure projects for government. After graduating from Yale University I accepted a position with one of the "big six" accounting firms in New York City. I spend a great deal of time in the field and can assure you that a project such as the one proposed is without doubt is an impossibility to fund through taxpayer contribution in a town such as the size of Chatham, or anywhere for that matter With five to six thousand property's sharing the potential cost in the billions, it is totally impossible through taxation without bankrupting every property owner. When towns such as Chatham propose to "sell" to taxpayers such a project, the figure they throw out is the START PRICE TAG as I often liked to say. What is meant by that is the price such as Chatham is purporting of $300 million is if the project started today and finished tomorrow. What officials don't want you to know is the projections of costs over years of long term capital expenditure projects. As an example, I followed a project a year ago which was a municipal water system funded in 2007 and the costs alone of piping and concrete had increased 44% in the course of one year as the result of the reconstruction of Iraq and materials were being shipped there and became a premium price here in America. The increases over a project with a duration of 20-25 years will increase several hundred percent, and that may be a conservative estimate in today's economy. The costs associated with material increase's, job order changes, unforeseen job problems, contractual labor costs, weather interruption costs, equipment costs, security and police details, interruption of business and industry, and the enormous costs associated with repaving streets and private property are only a few of the many considerations that go into the overall total project cost estimates. Another area monetarily is the interest on loans and notes which can run in the millions on a project such as this.
I would suggest you study the costs associated with the "Central Artery Project" also known as the "Big Dig." This has increased 1,000 % from 2.3 billion to at last count is projected at 23 billion.
There have been many of these same projects that have ended unfinished as the result of no more funds were available or taxation ran amuck and municipalities folded up the projects. The sad result was huge wasteful taxpayer spending that was literally flushed down the toilet.
It is my opinion that NO MUNICIPALITY today can undertake such a project at the cost of such HUGE TAXATION to support. Frankly, it is an impossibility.
Many of these projects are presented by overzealous, power hungry and in many cases for monetary gain by corrupt officials. Many are unwarranted with absolutely border line justification or no justification at all. Many are unscientifically proven to be needed and many are just pie in the sky outrageous spending of taxpayer money.
I only hope that this information is helpful in advising the taxpayers of Chatham of what exactly they are getting themselves into, and give them insight into the huge taxation required to fund. It also appears that this project has not been justified and alternatives are in the wings.
After the Secretary of Energy and Environmental Affairs (speaking through Ms. McDevitt) brushed aside CCT’s complaints about the faulty bureaucratic review process, he wrote CCT again:
To the good people of Chatham and its Concerned Taxpayer Group :
Don't abandon your fight to eliminate this wasteful spending and taxation.
The key now is to get the vote out and put your candidates in office, replace the town manager, file a class action suit against the woman whose final approval continued this project and repeal the town's decision at town meeting to stop this total waste of taxpayer money.
Mark your calendar and present tax bills to follow the money and severe increase in your tax bills over the duration of this outrageous unnecessary spending and taxation.
If not successful in putting a stop to this project, it will cost 10 times the cost that was projected by these irresponsible people in power. Hold them personally and financially responsible in the future.
Don't kid yourself, to complete this over the next 20 years the cost your organization projected will also grow from half a billion to between four and five billion. This equates to somewhere close to half a million per property.
Taxes will escalate to an unsustainable amount each year as properties will decline significantly in value and there will be no purchasers as owners will not be capable of selling due to such a huge tax burden. People will then walk away to foreclosure and town coffers will drain to bankruptcy.
Please post and keep this to refer to over the years as chaos will prevail as more and more taxpayers will realize too late to what happened to Chatham in early 2010, when irresponsible people in power started the demise of the beautiful town of Chatham.
Thanks for your concern.
We should heed his messages.
Following what seemed to be a deliberately confusing presentation at the citizens forum on February 23, 2010 by the Town Manager, CCT analyzed his presentation and confirmed our initial impression that he had failed entirely to tell taxpayers how much his centralized sewer plan would cost taxpayers.
The Town Manager has never given taxpayers realistic projections of what this needlessly expensive centralized sewer project will cost them. This presentation was all about how town accounting can be used to make more spending look like less.
What's the reason for this project? The motivation is to rid Chatham's coastal waters of the excess nitrogen that is blamed for unhealthy waters. While there are much less expensive ways to do this, the Town Manager and the Director of Health & Environment chose a centralized sewer system recommended by its consultant Stearns & Wheler, which is an expert in, guess what? Big City centralized sewer systems.
Taking into account the few new pieces of information the Town Manager supplied, CCT has developed and presents below a simple chart that provides the needed information to taxpayers on what this centralized sewer system will cost them.
The numbers really aren't complicated, though the Town Manager tried to make them appear so. There is construction estimated in 2007 numbers (as if all the work was done in one day) at $210 million and $30 million to pay for the operations during construction of this massively intrusive sewer project over a 20-year period.
Money is borrowed from the state for 20 or 30 years. The town has chosen 30 years for which the interest rate is about 2.83%, not 2% as shown in the Town Manager's charts. Connection costs for those forced to connect average $6,500, using town officials' estimate. About two-thirds of the town's properties will be forced to connect, some 4,386 properties. After the construction period annual maintenance charges of $400 will be levied on those connected. All numbers are adjusted for inflation at 3% a year. Voila! The numbers:
Why 20-year costs? Well, we all think or hope we'll live for this period. Also, the Director of Health & Environment told the Cape Cod Times in December that over a 20-year period a taxpayer getting sewered would only pay $175 a year on average or $3,500 for the 20 years.
Since the connection charge average cost is $6,500, his number is ridiculous as well as false. Our chart also identifies the total costs to taxpayers with various assessments over the 50 years of financing.
A copy of the spreadsheet from which this table was derived can be viewed by clicking on the link below:
Cleaning up Chatham's coastal waters can be done for far less money than with the big city sewer the Town Manager and the Director of Health & Environment have been advocating.
These other ways are endorsed by national and state environmental organizations as better for the environment. They cause far less disruption to community life. They don't disturb and drain the water table as the centralized sewer does. They deliver results in far less time. They will not overload Cockle Cove Creek, turning it into an open ditch flooded with treated wastewater. With neighborhood cluster systems, Chatham won't become the Sewer Hub for the Lower Cape, as the Director of Health & Environment rhapsodically envisioned at a recent selectmen's meeting.
What's best for the environment and best for the taxpayer is not being done.
The Town Manager's plan wastes hundreds of millions of dollars of taxpayer money with the hugely expensive centralized sewer plan that many taxpayers are rejecting in Falmouth, Mashpee and Orleans. Will the selectmen save the taxpayers or commit them to decades of unnecessary property taxpayer costs?
The Town Manager plan will cost close to half a billion dollars. Shouldn't everyone want to see if cleaning up the coastal bays of Chatham can be done for half the cost? Apparently everyone does except for the Town Manager, the Director of Health & Environment and the Selectmen and their usual allies.
The selectmen have closed down all discussion of their hugely expensive sewer project at selectmen's meetings. This Gulag-like denial of free speech is unprecedented in Chatham's history, as far as we know. Those who support what the selectmen want to hear are given unlimited talk time. Mention cheaper alternatives to clean up Chatham waters and the selectmen chairman gavels the speaker into silence.
The selectmen have denied taxpayers access to the town's television channel so they can inform citizens of the environmentally better and less expensive choices that taxpayers have. The selectmen need to abandon their devotion to yesterday's technology and open their eyes to what modern methods can do for the environment and the taxpayer's pocketbook. What blinds them?
A fully informed town meeting should vote on a final plan before it is implemented. However, it appears that the selectmen intend to deny taxpayers that vote as they are now denying them the opportunity to speak out at selectmen's meetings for less expensive alternatives that are environmentally superior.
The responsibility for this wasteful spending, therefore, will rest solely on their shoulders after the Town Manager moves on to his next assignment. Ten years is more than enough for someone in that position.
Town officials are fighting to spend taxpayer money on a project they like but refuse to tell citizens why they haven't tried harder to look at far cheaper alternatives and why they are rushing to start construction when there is no urgency. Some taxpayers have concluded that the Town Manager wants to present taxpayers with a fait accompli, that is, to move the project so far along there will be no turning back or shifting to less costly alternatives.
The big unanswered question is why they are so uninterested in looking into ways of saving taxpayer money. The selectmen have a fiduciary duty to spend taxpayer money wisely and they are not discharging that duty. But can they buck the Town Manager?