Left In Lowell

Though times ahead!

19 Responses to “Though times ahead!”

1. Bob Forrant Says:
   November 13th, 2009 at 7:23 pm

   I posted some of this with the Hamilton Canal story and it is apt here too.

   From a job creation perspective HC will work ONLY if we start thinking in terms of a regional economy. Just reading the Globe the last few days and seeing how many area high tech and biotech firms are either leaving the region or being purchased by a firm from outside MA is worrying to me.

   The Commonwealth continues to bleed out when it comes to jobs and the collection of tax revenues from business, mutual funds, and other kinds of investments. Wr have been very much lulled at the state level and locally that thongs are not so bad - folks they really, really are bad! Danger. Danger.

   No amount of big box retail stores coming to Lowell will help us maintain a decent school budget and provide badly needed services and so long as there is no job growth, residents can not afford to pay more. The city’s budget is in a vice and it is tightening. The state is right there with us.

   So, without job creation, a renewed growth in exports that bring new revenue into the state and region, we will watch the new council in January begin to manage a very hard, difficult decline in the essential services we all pretty much take for granted.

   This is where the University and MCC, existing large employers, various regional development entities like the Merrimack Valley Development Council, and the state AFL-CIO which also has a stake in job generation, must get around the table and think through far, far more systematically and long term how to take advantage of Hamilton Canal, research at the university, and the solid medical institutions we have in our area to figure out where new jobs will come from.

   For months, in blogs, on radio, in Sun columns, and to any one who will listen, I have called for a regional jobs summit - but I am not surprised by the deafening silence from most of our elected officials-local, state, national- who need to push this forward. What are you folks waiting for????
   Granted this is hard work - harder than sticking a shovel in some dirt or cutting a ribbon at Target - but if you don’t want to do the heavy lifting give up your seat to someone who will.

   Failure to do this will bite us in the butt before we know it and no matter how gloriously the HC development goes in terms of reclaiming the physical space, no sustainable job creation will follow. Job creation is a very purposeful activity - not a random occurrence - that requires a careful blend of public sector dollars to prepare an infrastructure and prepare a well-educated workforce and private sector money too.

   And for those above who think the economy is improving think again: Banks continue to fail at similar rates to what took place in the early 1930s; long-term unemployment is as high now as it was in the early 1930s; foreclosures are going to jump back up after the first of the year; the stimulus dollars have generated windfall profits and bonuses for the very people who helped mess the economy up; and everyday working people are straining under immense financial pressures while local small businesses are finding it harder and harder to borrow money.

   Nothing against optimism - but only when it is tempered by reality.

2. Kim Says:
   November 13th, 2009 at 10:34 pm

   Mimi,
   Will this Sub-Committee meeting be listed on the city website when it will be happening. Can you speak at a Sub-Committee meeting and do you have to sign up ahead of time?

3. Mimi Says:
   November 14th, 2009 at 7:41 am

   Kim:

   I think they are going to have in 2 weeks. Yes, it will be posted and you can speak without signing up. Usually no one shows up. I will try to contact CC R. Elliott, Chairman of that Sub-Committee to see what the plans are.

4. Kami Says:
   November 14th, 2009 at 1:06 pm

   The unions need to let go of the master medical health insurance. It’s a huge problem. The HMO & PPO costs are artificially high because they’re tied to the cost of the Master Medical. The cost of the MM has to be within a range of the HMO & PPO. It’s a budget buster. The unions are also going to have to consider raising their contribution rate from 25% to a higher number and increasing their co-pays on office visits and medications. Good luck getting Paul Georges to agree to any changes. He’s impossible to work with.

5. nextyearishere Says:
   November 14th, 2009 at 2:50 pm

   The meals tax has an advantage over the property tax in that a significant portion of the revenue would come from those residing outside the City. When I visited a downtown restaurant last week, the couple we were with came from Chelmsford, and the table of 5 next to us were from Acton, having dinner before going to the MRT. So 5/7ths of the added meals tax would have been paid by people living outside the City, whereas a property tax increase would hit Lowell property owners.

   However, with the public sector taking a greater percentage of the money each year, the private sector has diminishing revenue to keep it going. So, no tax would be the best option. That leaves cost-cutting and revenue “enhancement” to balance the books. There may be some measure of savings in the Arena deal, and the $800K payment should help reduce debt service costs somewhat going forward. More than expected revenue will come from the ambulance contract. But there is apparently a reduction of $480K in State aid, and the trash program savings are less than anticipated.

   And with Stimulus money filling some of the gap for now, what is the outlook when that dries up? The Council must cut now rather than use up any savings that will certainly be required come FY 2011. Will they have that courage, or will they leave the dirty work to the next council in January?

6. Kim Says:
   November 14th, 2009 at 10:58 pm

   Why are the trash program savings less then expected???
   I have three homes on my street that have not been recycling and have weekly overflow. At the start of the program we had
   house #1) overflowing with trash with no recycling and no purple bags, house #2) overflowing with trash and one purple overflow bag every week, and house #3) not overflowing with 2 purple overflow bags every week. Today we have 3 houses completely overflowing, with no recycling, and with zero purple overflow bags.
   I am not willing to pay a tax increase due to non-enforcement.

7. Prince Charming Says:
   November 15th, 2009 at 9:27 am

   We always pay due to non-enforcement. Whether it’s unregistered cars in the driveway, basketball hoops in the street, illegal two-family houses, work done without permits. If inspectional services/police dept. would actually enforce some of the ordinances on the city books, there would be no need for tax hikes in Lowell.

8. Mimi Says:
   November 15th, 2009 at 10:24 am

   Re-organizing Inspectional Services as well as other departments charged with enforcing these ordinances needs to be addressed. The new CC needs to give the CM the green light to go ahead and do it. We may have some unhappy people at City Hall as well as on Pine and Middlesex Streets but it is time for operational efficiencies to be maximized before we raise fees again.

9. nextyearishere Says:
   November 15th, 2009 at 10:46 am

   Work done without permits cost the government more than just the permit fees. Contractors that do work without the required permits are more likely to also under-report income to the State and Federal governments, especially when out-of-state contractors are doing the work.

   Good local enforcement of ordinances would not only help the City, but it could benefit the State if there were the appropriate sharing of that information.

   Correction to my earlier post regarding the meals tax - it would be 7/9ths from out-of-town people in the example.

10. Bob Forrant Says:
    November 15th, 2009 at 11:12 am

    I agree with Kim, PC, and Mimi regarding inspectional services clamping down on scoff-laws of all sorts and in general putting an end to people looking the other way who should no better when sewer lines from another town our hooked into Lowell’s.

    But, and a rather large one at that, this is not going to put a dent into the fiscal nightmares coming at us warp speed so long as the state economy continues to perform like the worst singers on the American Idol audition show.

    Just a few weeks ago Globe reporters and many others were writing about the end of recession in MA and how the good times were going to roll once again. News over the last week has knocked all of those rosy predictions into the dumpster, gang. The state economy is in negative growth territory while the national economy is showing some signs of life. The state’s leading employment sectors and greater Lowell’s as well, are still shedding jobs, and the region’s remaining vibrant high tech firms are being purchased by Silicon Valley firms while companies like Evergreen Solar amassed significant state loans and tax breaks and are now moving most of their jobs to China while the state passes on asking them for the money back.

    Making sure folks use the trash system properly makes sense to me - but what makes more sense is that those of us concerned for the direction of Lowell’s the region’s and the state’s economy start asking questions about where the stimulus dough is going and demanding some leadership be shown regarding permanent job creation!

11. nextyearishere Says:
    November 15th, 2009 at 12:59 pm

    Permanent job creation is not easy. There are a lot of impediments to the American worker in the international economy, including wage rates to sustain the standard-of-living, health care premiums shared by employer and employee and the payroll taxes paid by each. That is a national problem, one that could be partly addresses by a shift in the tax and health care costs from production to consumption.

    Beyond that, the State and City must start operating more like a business when considering “investments”, and have an effective business plan to ensure a return on the investments as a whole, even if some are risky and do not pay off. The money “invested” in the technology center at UML should have a return to the university and the State over the next 20 years ten times the investment. Before that money is allocated, the means for that return should be defined (income tax revenue, property tax revenue, royalty payments, etc.) and realistic projections made, enforced by law. It doesn’t seem that this type of discipline is enforced when spending public money, or else we would hear more specifics on the Evergreen decision to move to China.

    In general, City investments get paid back in property taxes, and to some degree the quality of life, and State investments get paid back through corporate and individual income taxes. Rather than the nebulous “jobs created” lets hear financial specifics when we talk about economic incentives.

12. Jack Mitchell Says:
    November 15th, 2009 at 1:42 pm

    Inspectional Services: A Question.

    I am not asking a leading question. I think I know, but I am not convinced. Hence, this question.

    How is mortgage lending and Inspectional Services related? I am concerned that banks will be leery of investing in Lowell properties because there may be significant problems related to conformanace with Building Codes. Afterall, the banks are liable for the property under “joint and several liability,” if I am not mistaken. If the property goes into forclosure, then they are stuck with the property, “as is.”

    My concern is that there will be properties potentially “blackballed” by lenders because they they were built during a period that Inspectional Services are suspected of being lax, especially for specific builders.

    Imagine the hapless home or condo owner that may be unaware that they own such a property. When they go to sell, possible buyers may have a harder time securing a loan.

    Though, when it comes to money making, my cynicism shines through. Lenders will likely hold their nose when they underwrite such loans hoping that improvement costs fall on the lendee. If serious problems come up, the burden will likely fall on the current homeowner that will be stuck with repair costs, plus additional cost associated to bringing the property “up to Code.”

    Inspectional Services are a QA/QC program that ensure homeownership in Lowell is “less risky.” We usually think of onwership in terms of the occupant, but let’s keep it real. It’s about protecting the Lender as much as anything.

13. Bob Forrant Says:
    November 15th, 2009 at 4:10 pm

    Jack,

    To see what happens when critical services lose the confidence of potential investors in a city look no further than 100 miles to our west and check out the mess Springfield found itself in when a good many of its city office deteriorated. Springfield’s mess was compounded by deep cuts in school funding and a finance control board which made war on public sector workers including teachers and public safety personnel. We need to learn the lessons from there.

14. TPetty Says:
    November 15th, 2009 at 7:56 pm

    I agree that city ordinances MUST be better enforced. Inspectional services needs to address the problems brought on by ‘absentee landlords’. As for the new trash ordinance, I like it, however, that too must be more rigorously enforced by the city. Too many people are thumbing their noses to the rules. Ordinances are only good if they are regularly enforced and in my opinion, Lowell has never been very good at enforcement. Maybe with a new City Council, that will change.

15. jdayne Says:
    November 16th, 2009 at 11:08 am

    I’ve been thinking about what an elected city government can do, effectively, to stabilize finances, promote job growth and maintain quality of life in a downturn. Regional planning is an excellent goal and likely could have positive results, but it is a long and arduous process. Note the lack of any such efforts in the Merrimack Valley.
    More immediately:
    1. Start with honesty in discussing what can and cannot be accomplished within the reality of the city budget. Lowell has significantly more fixed or semi-fixed costs than variable due to State mandates, union contracts, legal obligations . . . some of which are, in turn, partially funded by the mandator (i.e., State funding for certain school costs). Those uses and sources of funds are entirely inflexible in the short term and, without serious union or other accommodation to reality, in the long term as well. Municipal unions, without any countervailing competition, result in dollar and productivity costs from work rules limiting flexibility that make adjusting significant City expenses in a downturn close to impossible. Liberal progressive that I am, I believe municipal unions like any monopoly, require re-thinking. But that is no help in the short term.
    2. Given what is left, which tend to be income sources that are real estate or other consumption related (meals tax, user fees) and expenses that are discretionary (the small number of non-union employees and costs like supplies, maintenance, improvements . . ) endeavor to balance increases and cuts to achieve the best overall outcome for now and the future. Then be honest with the citizens.
    I support the meals tax and think it ludicrous that the City Council would fight a line item on which the budget they approved depended to balance and which, in truth, simply will not change behavior. Will the recession mean fewer individuals eat out? Yes. Will the meals tax mean fewer of those who otherwise would eat out will eat out? No. Does the meals tax hit up “outsiders” as much or more than residents? Yes. Cowardice is not a plan.
    3. On job creation. I do not believe that a municipality can create jobs. It can create an environment into which job creators (entrepreneurs, established businesses) wish to operate. This means good infrastructure–as simple as signage, traffic lights coordination & traffic plans to optimize movement, good roads and bridges, appropriate “introduction” to the city (really, the end of the connector is weird to any outsider, one arrives nowhere). This means good city government–clear & fair rules for permitting, inspections, access to decision makers, welcoming support in every contact from telephone to standing in line. Note that the planning & development group in Lowell has done a terrific job in optimizing what Lowell has on offer. Lastly, and perhaps most critical, education for an attractive workforce and citizenry.
    4. New business support. I think that the new business support here is ineffective. I truly do not understand what the alphabet and other soup of quasi government and not for profit business assistance groups do, how they dole out the funds available and how they actually help to see that these funds are used effectively. I have heard “who cares, it is grant money from outside”. But outside is drying up for Lowell. Our days of being a net (significant) recipient of OPM (other people’s money from US and state citizens outside of Lowell) have ended.

    5. Lastly, the City Council can pressure our famously fawned over (by the CC) “delegation” (State senator and reps) to have them pressure Verizon to bring FIOS to Lowell. No 21st century infrastructure, no significant 21st century business/job growth.

    An elected city government has neither the resources nor mandate of the State of Federal government, but it does have the power to effect and, in certain cases absolutely implement, what I recommend above. It also has the responsibility to UNDERSTAND the municipality’s finances. Anyone who sat in on or watched the CC budget deliberations has to be appalled at the ignorance of simple facts. How many times does someone have to ask about a “step-raise” as if asking is some bold strike at fiscal probity? Understand union contracts and then take on the unions or not. But beating up the City Manager on a fact of the union contract? pathetic. And I’d include the self-proclaimed fiscal watchdog councilor among those who exhibited no understanding of municipal finance. Like a for that deluded household believing that avoiding understanding and knowledge of one’s true financial situation will change the facts, time will tell that reality really will bite.

16. nextyearishere Says:
    November 18th, 2009 at 10:48 am

    On point #3 of post #15, I couldn’t agree more. The City DPD appears to be most knowledgeable on facilitating companies through the bureaucracy of permitting, not only for the City, but at the State and Federal level. In addition, they have a good handle on various tax breaks available, especially for the unique Renewal Communities designation that Lowell enjoys.

17. Kim Says:
    November 18th, 2009 at 4:24 pm

    What is the expected revenue per year from the meals tax?

18. nextyearishere Says:
    November 18th, 2009 at 7:10 pm

    The amount of revenue in the revised (July 1st version) of the budget assuming 9 months of an extra 0.75% is $448,452. Assuming that is correct, the 6 months revenue (if the council would pass it now) should be $298,968 and the full year revenue should be $597,936.

    As of today, the net deficit in FY 2010 is estimated as about $300K, so passing the meals tax increase now would just about wipe out that deficit, and would provide nearly $600K for the next fiscal year.

19. Kim Says:
    November 19th, 2009 at 8:48 pm

    We spend about $385,000 a year to pick up leaves. (You all know those things that compost into the ground??) We are one of less then a handful of cities/towns in MA to have weekly pick up all summer long. I think this is a huge waste of my tax money and I have made it a point to do up many spreadsheets showing the waste. I have also driven aroung the city on yard waste pick up days in June/July/August to see what exactly we are paying for. What did I see? NOTHING!!! If we went to the “norm” of 6 weeks of pick up in the Spring and 6 weeks in the fall the city would save approx. $253,000. No one seems to want to act on this! Ahhh! Another waste is the lack of trash enforcement. Lowell has not issued a ticket for overflowing barrels to date. I am completely in favor of a meals tax especially since it is mostly paid by out of town residents but I also want us to cut wasteful spending and “PUSH” enforcement.

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