Former Sumner Police Chief Offered City Administrator Position – Bonney Lake-Sumner, WA Patch

Sumner’s choice for a new city administrator is already a familiar face in City Hall – former police chief John Galle, who has acted as interim administrator since Diane Supler’s departure this last spring. Supler left her position abruptly; documents obtained in a Courier-Herald investigation show signs of a conflict with Mayor Dave Enslow.

In a special meeting on Monday, July 9, the Sumner City Council voted 5-2 to offer Galle a contract to be the permanent city administrator.

During the special meeting, councilmembers and resident Jon Swanson (the only resident present at the public meeting), lauded Galle’s commitment to Sumner and believe he has done a good job as interim administrator. The employment agreement passed 5-2, with Randy Hynek and Nancy Dumas voting no.

Dumas said that a lack of related experience to the city administrator position and no official review of his job performance thus far are the main reasons for her “no” vote.

“During the past few city administrator’s times of employment, the city didn’t face such critical financial external and economic constraints. I would not have put such great emphasis on fiscal experience requirement of an administrator at that time,” said Dumas. “However, the city is currently working on its biennial budget for 2013-14 and [Galle’s] apparent lack of fiscal experience with such a large budget has me concerned. “

Galle has retired from the Sumner Police Department, but he has not yet signed the administrator contract. Deputy Chief Brad Moriecke is now acting police chief.

Galle holds a Masters of Arts in History, and a B.A. in history for secondary education. He worked at Tacoma Baptist School as a teacher and administrator from 1988 to 1996. He was hired as a Sumner patrol officer in 1997 and rose through the ranks until he was named Chief in 2007.

Dumas believes the matter should have been voted on during the council’s regularly scheduled meeting date, so more members of the community could be made aware of the decision. Hynek seconded her idea to move it to tonight’s meeting, but the motion was denied by the council.

“The vote on John Galle’s approval should have happened at Monday’s regular council meeting so it would be open and transparent to our citizens,” said Dumas. “Instead, it happened before Monday’s study session at a city council special meeting after an executive session. Neither disclosed John Galle’s position as the topic.”

As city administrator, Galle would assist Enslow and the city council in the planning, organization and administration of all government functions, and supervise the city’s administrative and financial departments. He would ensure that city work will conform to city ordinances and state law. Responsibilities also include attending various civic and business meetings on behalf of the city, building the city council agendas and directing the annual budget preparation, among other responsibilities. He would report directly to Mayor Enslow.


If Galle accepts the city administrator position, he is set to make $10,726 per month ($128,712 annually) for 2012, but starting Jan. 1 2013, he will receive a step increase, which will place him at the top of his pay scale, according to the approved contract. He will be a salaried city employee with full benefits and not eligible for overtime.

If the city decides to terminate Galle, the city has agreed to pay him a lump sum cash payment equal to 6 months of pay ($64,356), according to the contract. Or, the city can give him 6 months notice that he will be terminated. The only instance where the city would not pay Galle 6 months of pay would be if Galle were fired for reasons of personal gain or a felony act.

If Galle decides to resign, he will give the city a minimum of four weeks notice.

Galle will be able to accrue and utilize vacation leave, and was given 80 hours with the approval of his contract.

Galle will be evaluated at least once a year by Mayor Enslow, in accordance with performance criteria determined by Enslow and Galle. The criteria may be “added or deleted from time to time… in consultation with Mr. Galle,” according to the document.

via Former Sumner Police Chief Offered City Administrator Position – Bonney Lake-Sumner, WA Patch.

Thanks to SIDs, Nebraska has the most Chapter 9 bankruptcies

The nearly empty E Street Mall in San Bernardino, Calif., is shown on Wednesday, July 11, 2012. The San Bernardino city council voted Tuesday night in favor of the city filing for bankruptcy. City officials have said, San Bernardino “has an immediate cash flow issue” and may not be able to make payroll with a budget shortfall of more than $45 million in the next fiscal year. (AP Photo/Grant Hindsley)
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Quirks in local, state and federal law have made Nebraska home to almost one-fifth of the more than 220 Chapter 9 bankruptcies filed in the United States since 1981, according to a Bloomberg News review of federal court records.

Chapter 9 is in the news as San Bernardino, Calif., population 210,000, became the third California city to seek federal bankruptcy protection in less than two weeks. Chapter 9 applies primarily to municipalities, but also to other taxing entities, including hospital authorities and school districts.

In Nebraska, no cities have filed for bankruptcy, but Chapter 9 has been used by Sanitary and Improvement Districts, statutory taxing authorities unique to Nebraska and used by developers to create residential areas on the fringes of cities, without all the powers of cities.

California is second in Chapter 9 filings, followed by Texas and Alabama. Those states, along with Oklahoma, account for more than half of all Chapter 9 filings in U.S. bankruptcy courts.

The main difference between Nebraska and its larger brethren is the kind of governmental bodies that file for bankruptcy. All 45 of Nebraska’s Chapter 9 cases were by the special tax districts, most of them owned by residential subdivision developers who used property-tax revenue to pay for streets, sewers and other infrastructure.

Chapter 9, used by local governments and entities they create, differs significantly from Chapter 11, the section written for private companies and nonprofit groups. State lawmakers must pass a law authorizing local governmental bodies to file for bankruptcy before they can do so.

About half of the states allow full, or conditional, access to bankruptcy court, according to a legal analysis by Jim Spiotto, a bankruptcy attorney with Chapman & Cutler in Chicago who helped write a book about municipalities in financial distress.

Nebraska grants Sanitary and Improvement Districts unobstructed access to bankruptcy courts, said Brian C. Doyle, a land-use attorney in Omaha who represents bankrupt subdivisions.

For cities and counties, filing a Chapter 9 case is more difficult because it requires a vote of elected officials.

Once in bankruptcy, Chapter 9 gives cities and counties an advantage over companies using Chapter 11 to reorganize. Municipalities don’t need to ask the bankruptcy court for permission to pay any bills they ran up before filing for court protection, including wages, utility bills and rents.

That means creditors can’t put as much pressure on a city over its spending habits, as sometimes happens in Chapter 11 cases, said Lee Bogdanoff, an attorney with Klee Tuchin Bogdanoff & Stern.  The firm represents Alabama’s Jefferson County, which filed the biggest municipal bankruptcy in the U.S. last year, listing more than $4 billion in debt.

In Nebraska, Chapter 9 bankruptcies are more like prepackaged Chapter 11 cases because the district owners and creditors most often work out an agreement beforehand, Doyle said.  Those deals almost always guarantee full repayment of bondholders’ principal, stretched over a longer period of time and at a lower interest rate, Doyle said.

Most of the Sanitary and Improvement Districts in Nebraska are around Omaha, Doyle said. Lincoln won’t allow Sanitary and Improvement Districts to attach themselves to city services, which discourages their creation.

In the next two years, as many as 10 more of the special districts may go bankrupt as debt comes due for subdivisions built during the housing slump that followed the credit crisis, Doyle said.

via Thanks to SIDs, Nebraska has the most Chapter 9 bankruptcies.

MAXIMUS Awarded Contract for Minnesota Health Insurance Exchange – MarketWatch

RESTON, Va., Jul 16, 2012 (BUSINESS WIRE) — MAXIMUS MMS +1.52% , a leading provider of government services worldwide, today announced that it has been awarded a $41 million contract by the State of Minnesota to design and develop the technical solution, including a consumer-friendly website, for Minnesota’s statewide health insurance exchange and Medicaid modernization. Following a competitive bid process, MAXIMUS was selected as the prime contractor to design and develop the Minnesota health insurance exchange, and to deliver major technology improvements to Minnesota’s Medicaid systems to provide streamlined eligibility determinations, enhance customer service, allow for timely eligibility changes, and promote ongoing program integrity.

As the prime contractor, MAXIMUS will lead a team of specialized technology firms in designing and developing the Minnesota health insurance exchange, which will establish a consumer-friendly website for the state’s population, enabling Minnesotans to determine their eligibility for subsidized health insurance benefits online, as well as shop, compare and enroll in health insurance plans, with access to dedicated customer support along the way. MAXIMUS will have responsibility for managing the project, serving as the client liaison, documenting all business requirements, overseeing integration testing, developing an array of reports for the exchange, and delivering an exceptional customer service experience for users of the system.

The Minnesota health insurance exchange development will include the deployment of StateAdvantage, a complete health insurance exchange solution developed through an alliance between Connecture, Inc. and MAXIMUS. Other MAXIMUS subcontractors include IBM, utilizing the IBM Curam solution for healthcare reform, and EngagePoint (formerly known as Consumer Health Technologies).  read more…

via MAXIMUS Awarded Contract for Minnesota Health Insurance Exchange – MarketWatch.

Fayette County Union Newspaper, West Union, IA | Union contract approved

The West Union City Council approved a union contract on Monday, July 2, with Chauffeurs, Teamsters and Helpers Local 238 (West Union police officers). The two-year contract includes wages of $18.03 per hour through June 30, 2013, and $18.57 per hour July 1, 2013 – June 30, 2014.

In addition, the council approved a contract with Prairie Road Builders in the amount of $33,340 for 2012-2013 seal-coating projects.

The biggest portion of the funds ($9,800) will be used on Armour Street from S. Vine to S. Pine. Additional seal-coating is scheduled to take place on portions of Willow, Linden, Lilac, Rickel, Adams, Plum, Washington, and Union streets.

In other business, the City Council:

• Approved a trio of invoices from TeKippe Engineering totaling approximately $30,280 for geothermal well field, Armour Street drainage, and Streetscape engineering.

• Approved two Upper Explorerland invoices totaling approximately $1,850 for grant administration.

• Approved an ordinance for demolition of buildings.

• Approved the sale of old holiday decorations to St. Lucas and/or Hawkeye.

via Fayette County Union Newspaper, West Union, IA | Union contract approved.


Unions can help families grow

Laurie Skurka, Las Vegas

Monday, July 16, 2012 | 2:01 a.m.

 Regarding Rick Wilkening’s letter, “Unions improve quality of life”:

We are a “union” family. My husband worked in the mining industry for 35 years. He started as a laborer, served in Vietnam, returned to work and became a surveyor, big machinery operator, and finally an electrician. His electrical apprenticeship was through IBEW. He went to work every day for 35 years. We raised three daughters and I stayed home part of that time. I returned to school to be a teacher.

We weren’t rolling in money. We had health insurance that allowed us access to preventive care, dental care and eye care. We buy American, support our community, our troops and our country, and we vote. I don’t feel entitled and credit hard work as my secret to a good life. Although we receive a small pension from those years, we both still work. Without the unions, would we be in this position? I don’t think so.

RPT-Pennsylvania joins ranks of states seeking public pension reform

* Gov does not say how $29 bln pension gap will be closed

* Other cities in Pennsylvania should follow suit, governor said

* Illinois hopes to have pension reform approved by August

By Lisa Lambert

WILLIAMSBURG, Virginia, July 15 (Reuters) – Pennsylvania is joining a growing movement across U.S. states to overhaul public pensions, but even while the state’s governor says the need for reform is urgent, he advocates action only after great deliberation.

Pennsylvania, like so many other U.S. states, is facing a yawning gap in its public pension fund, and Governor Tom Corbett acknowledges that finding ways to close that gap won’t be easy.

“It’s going to be a working summer to start coming up with some recommendations, because I don’t think there is a silver bullet to this,” Corbett, a Republican, told Reuters on Friday at the sidelines of a National Governors Association meeting. “If there was, everybody would be doing it.”

Corbett would not describe what he is considering to close Pennsylvania’s public pension gap, estimated at $29 billion in 2010 by Pew Center on the States. “I’m not going to speculate on anything we’re going to do until I have all the facts and we talk to the legislature,” said.

The shortfall is exacerbating other budget problems at a time when Pennsylvania is not only confronting its own financial woes, but also those of many local governments, he said, adding that the cities, too, will have to look at reforming their pensions.

Like many of its peers, Pennsylvania neglected to pay the full amount that actuaries recommended it put into its retirement system from 2005 to 2010, according to Pew Center on the States.

Public pensions have continued to hew to the time-honored “defined benefit” plans that were also once common in the private sector. Such plans guarantee the payout of a fixed amount each month to retirees for their lifetime.

Investment earnings make up most pension revenue, followed by taxpayer contributions. Many states short-changed their pensions for years, and when the 2007-09 recession desiccated their budgets, they pulled back further just as the financial crisis ravaged investments.

Most governors now say they must reform pensions, or risk pulling dollars from other vital areas and public services to pay benefits. According to the National Conference of State Legislatures, from 2009 to 2011, 43 states made changes to their systems.

Some public employees say they are being blamed for states’ poor spending decisions and are being cheated out of money they were promised in good faith. In some states public workers do not receive Social Security, making retirees fully reliant on pension benefits that average about $19,000 a year.


In Delaware, Governor Jack Markell, a Democrat, minces no words on how the state’s reforms passed two years ago affect public employees: They “pay more, work longer, get less.”

Although Delaware’s retirement system was in better shape than most, Markell was worried about an increasing demand for taxpayer contributions. He met with businesses, legislators and employees to find a compromise.

Corbett could choose to follow his lead – Markell notes the changes in Delaware did not inspire the protests or political strife seen in places such as Wisconsin.

In Wisconsin, however, the measures included curbing the collective bargaining power of public sector unions, a measure that went far beyond pension reform.

Pew estimates Delaware’s gap in 2010 was $633 million, and likely shrinking. At the time, the state had enough assets on hand to cover 92 percent of benefit costs.

Nearby Maryland took dramatic steps last year to close a gap Pew pegged at $20 billion in 2010, the latest year for which data is available. At the conference, Governor Martin O’Malley, a Democrat, told Reuters that the reforms went far.

“We made a lot of big changes last year in terms of employer contributions, employee contributions, length of service, benefits – the whole gamut. So, we’re not planning any more changes at this time,” he said.

Some states are now looking at turning to the “defined contribution” pension plans that are now common in the private sector. Instead of guaranteeing a fixed amount of lifetime benefits, the plans are built on monthly contributions made by the workers themselves; many employers also contribute a certain amount. Upon retirement, the individual receives a lump sum.

Hinting at one possibility Pennsylvania could follow, O’Malley advised Corbett “to make sure that you bring everyone in and have an honest discussion about the math.”

“Once you make the decision that you want to preserve your defined-benefit system it’s easier to have an honest conversation,” he said. “If your goal from the outset is to simply do away with the defined-benefit system, then it’s harder to have a stakeholder meeting – you’re trying to eliminate anything in which they might have a stake.”

Another neighbor, Virginia, recently began requiring public employees to put money into the retirement system while also giving them a commensurate raise. Corbett refused to say if Pennsylvania is considering a similar approach.

Nowhere are pension problems more pressing than Illinois, which has an $83 billion gap. The state’s changes a few years ago only applied to future employees and do not impact current funding problems. The Illinois legislature is looking at Governor Pat Quinn’s proposal to essentially have current and retired workers choose between a cut in cost-of-living increases for their retirement payments and health insurance.

“We spent June and now July studying some specific issues that leaders or individual members wanted to look at. You know, we’ve given them that opportunity but we will have to act this summer,” Quinn said, adding that he hopes the reforms will pass before the start of the school year in late August.

“The bottom line is this is the moment of truth for our state when it comes to pension reform.”Image

PICKET: (AUDIO) Jerry Brown’s bankrupt Calif. cities catch up with him

ImageIn February of 2012, California Governor Jerry Brown, a Democrat, declared to me at a National Governors Association meeting in Washington that California was not having bankruptcy problems and that he had not ceded too much to the California teachers’ unions.

Similarly employing President Obama’s ‘blame the last guy in office’ technique, Brown pointed to former Republican Governor Arnold Shwarzenegger for the fiscal crisis California finds itself in, but he made no mention of the state’s Democratic led legislature. Both chambers have been in Democratic hands since 1970, except during the 1995-1996 year, when the Assembly was led by Republicans.

“I reduced the deficit that was left to me by a Republican governor from 26 billion to 9 billion. I have a plan to reduce it to zero. I’m working on it,” said Brown.

When I asked if California was having bankruptcy issues he said, “No, that’s not true. We’re going far. We’re doing quite well.”

Brown’s spokesman Gil Duran interrupted asking, “How about asking a question that’s based on truth?”

(Listen Here)

Brown went on to say, “The economy is doing better. It’s coming back. The private economy had a $90 billion…and that then feeds into the public sector as well. There are deficits, because there have been excesses for the last decade brought on principally by the mortgage bubble and breakdown. And we’re now cleaning up after that mess, but it does take a while to do that and I’d say we’re on a very positive course, but it’s not as rapid as I would like, but the trajectory is all in the right direction.”

Duran proclaimed I was “lying” about California having bankruptcy problems at this point.

“You need to check your facts. You’re saying that California is going bankrupt. S&P just upgraded California to positive…what’s insulting is your lack of your grip on the facts,” he said. “No, you’re totally wrong. You can check your facts. You’re not telling the truth. You’re saying California is going bankrupt. California was just upgraded to positive by S & P. That’s not bankruptcy. It’s just not true.”

(Listen Here)

Six months later, California became the home of three cities: San Bernadino, Mammoth Lakes, and Stockton that are filing for bankruptcy.The S&P cautioned that it could very well reverse the positive rating it gave to California in February if the budget that Brown recently signed is not solid in the eyes of Standard and Poors. It should be noted even after that upgrade in February, California still has the lowest S&P credit rating of all 50 states.

In fact, the Sacramento Bee reported that a Pew study found that California has had the worse credit rating record in the entire country for past 11 years and highest rating California achieved during that period was amid Shwarzenegger’s administration. The lowest rating occurred in 2003 during the state’s budget crisis and Gov. Gray Davis’s term:

California has the worst credit rating of any state now and the nation’s worst credit rating record over the past 11 years, according to a new nationwide compilation by the Pew Center on the States.

The compilation is based on Standard and Poor’s credit ratings and covers every year since 2001. Thirteen states sit atop the Pew chart with AAA credit ratings while California is alone at the bottom at A-minus and is the only state to dip to the worst possible rating, BBB, during the 11-year period.

That happened in 2003, during a state budget crisis so severe that then-Gov. Gray Davis was recalled. The highest rating California achieved during the period, A-plus, came in 2006.

Additionally, Brown’s budget relies on tax hikes, which must be approved by the voters of California in November. If voters reject the tax initiative, Brown has threatened cuts to the California public school system.

While some argue three bankrupt cities do not make a trend, reports at least eight more California cities are seeing fiscal problems:(bolding is mine)

An additional eight California cities, including Fairfield, which declared a fiscal emergency in April, have officially notified the municipal bond market this year that they are facing significant financial hardship, according to Matt Fabian, managing director of Municipal Market Advisors, which conducts independent research on the municipal bond industry.

The notifications don’t necessarily mean these cities are headed for bankruptcy court, but they do signal real adversity.

Along with Fairfield, the other cities include Arvin (Kern County), El Monte (Los Angeles County), Grover Beach (San Luis Obispo County), Lancaster (Los Angeles County), Monrovia (Los Angeles County), Riverbank (Stanislaus County) and Tehachapi (Kern County). “I think people in our market are certainly getting more concerned,” Fabian said. “San Bernardino came out of nowhere, which makes you worry that there are others in a similar situation that you don’t know about.”

In Fairfield, officials said the city is not in danger of declaring bankruptcy but that it faces a deficit of almost $8 million in the 2013-14 fiscal year, which they said is because of the state swiping local dollars for its budget and the elimination of redevelopment agencies. David White, director of finance and assistant city manager for Fairfield, said that after years of cutting back on services, the declaration of a fiscal emergency was necessary to place a sales tax increase on the November ballot.

SFGate also points out the bankrupt cities’ of San Bernadino and Stockton share common traits with other cities that have gone bankrupt in the past:(bolding is mine)

Those include cities with tax revenue severely affected by the mortgage crisis, cities that are older and have a significant amount of deferred maintenance, and cities that are unable to persuade public employee unions to agree to deep cuts in salaries and benefits.

McKenzie said he does not think the recent spate of bankruptcy actions makes other cities see it as a less stigmatized and more palatable action. He pointed to Vallejo, which entered bankruptcy in 2008 and emerged in 2011 with fewer firefighters, police officers and public services. Officials there have cautioned that bankruptcy is a last-resort solution that’s not only about numbers, but also about people and their jobs, quality of life and morale.

“Everybody remembers Vallejo. Everybody remembers sometimes the medicine is worse than the disease,” he said.


Indiana Cities And Bankruptcy?

Indiana Cities And Bankruptcy?

By Mike Corbin (

More broke cities across the nation are filing for bankruptcy protection.

However, one top official says that’s not an option in Indiana. Indiana Association of Cities and Towns Director of Governmental Affairs Rhonda Cook says filing bankruptcy is not a legal option for Indiana cities struggling with deficits. Many Indiana cities have financial woes that were heightened by the 2009 economic downturn, home foreclosures, property tax caps and the decline of many cities’ tax bases plus the unpopularity of raising user fees for services.

Cook says while Indiana cities cannot file bankruptcy, they can seek an emergency manager from the state. Cook says the executive of a city or town can seek “distressed” status and petition the state for help. Cook says there are very few Indiana localities that need such drastic help.

Meantime, Lake Station Mayor Keith Soderquist says his city was in trouble about four years ago. That’s when he said it was struggling with a $2.8 million deficit. The total budget was roughly $16.5 million. He says he implemented massive cuts to the tune of $5 million when he took office. Soderquist says as mayor, he had no choice but to cut programs and impose user fees. Soderquist believes that unless cities take responsibility for out of control spending, it’s very difficult to climb out of deficits. He says Lake Station still has roughly a $1.8 million deficit that continues to shrink.

In total, Indiana has 121 cities and 446 towns. Cook adds that in the past, state lawmakers have expressed concerns that allowing cities to file bankrupcy could have negative impacts on the state’s credit rating.