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Saginaw City Council Budget Crisis a Persistent Problem

By Robert E. Martin

                                      
         Roma Thurin,       Deborah Kimble,          Dan Soza,       Mayor Wilmer Ham

     While the dismissal of former City Manager Deborah Kimble is permeated with the stench of racial overtones and an agenda that deserves no place in a multi-cultural and diverse city such as Saginaw, the issue of accountability is one that elected leaders can no longer toss aside.

Apart from the deplorable manner in which Kimble's tenure was terminated by the Council at a sudden closed-session meeting following favorable performance ratings, events during both the public hearing following her dismissal and leading to the present have left responsible citizens outraged - caught between the urge to hold responsible the 'vessels of evil' that Otis Washington described during public comment, while demanding accountability through the 'quiet thunder' that Greg Schmid noted will continue to swell until satisfactory answers are provided for this  major setback the city has now taken.

At the heart of the matter is the issue of financial stability. Those that opposed Kimble stated concern over deficits and the failure of the City Manager to properly reconcile the budget; however, a minimal understanding of the City Charter clearly points to the fact that it was the duty of Fiscal Services Director Karen Lawrence-Webster to supply budget information to the City Manager in a timely manner, which as of Council's most recent meeting, is still pending.

Webster has stated that delays are the result of 'under-staffing', but issues of bounced checks and questions of embezzlement strike more disturbing chords with a public deserving both answers & accountability.

Although we do not know how far the City of Saginaw is in the red, projections seem to vacillate between ranges of $800,000 to $1.5 million dollars.  To her credit, Kimble was able to obtain a refund from Blue Cross in the amount of $300,000. And for this you get fired?

Getting our financial house in order must become the number one priority in this community if it is going to survive. For far too long 'pet projects' and concerns separate from providing fundamental services of city government have undermined it. 

Regretfully, the current situation with Saginaw's financial mess is not a new phenomenon, which makes Kimble's firing even more puzzling, given generational roots of the problem. According to State Law, cities must balance their budget each year, yet as far back as 1988 Saginaw faced a $1.8 million dollar deficit, and in the prior year the city was operating a million dollar deficit, dipping into cash reserves.

Critics like to point fingers at the Tax Cap in the city as a reason for causing the deficits, but in truth the tax cap is the only protection property owners have against the mismanagement and poor decision making that has led to this crisis.

For a better understanding of the legacy of financial blunders that have contributed to the current 'state-of-the-city', here are a few to consider.

Saginaw's Conference Center * In 1986 then mayor Lawrence Crawford signed and the council adopted a lease agreement with Richard & Florentine Van Tiem to take over the Downtown Shopping Mall and convert it into a conference and visitor's center. The facility was never marketed properly nor utilized and wound up costing taxpayers well over $3 million dollars, because all responsibilities for the lease were placed squarely on the city's shoulders. Lesson: Cities should never get into the landlord or shopping mall business.

The $175,0000 Computer Software Package * In a contract awarded to Dunn & Bradstreet for new financial software back in 1993, the decision was made that it was too sophisticated for the city's needs and better suited to federal government as opposed to city accounting methods.

The software was never totally utilized. Initiated by then fiscal services director Jon Bayless, who was terminated by then City Manger Joyce Parker and replaced with new director Karen Webster, the exact reasons why the software was never utilized and the agreement with D&B terminated remains a mystery.

 When The Review broke this story, Bayless commented,   "There is nothing wrong with the MARS system. I know when I left the city that the purchasing part of the software was up and running. We were in the process of getting the budget module together and had one other piece we were waiting for. Why it was never fully utilized is a surprise to me."

The Saginaw Business Incubator *  Located at the site of the former Helfrecht building on South Hamilton and sold to the Visiting Nurses Association as a private parking lot,  the incubator was the pet-project of then councilman Jim Doane. The goal of this $2.3 million project was to offer shared space and services to encourage more businesses to move into the Old Town district.  It tied up $918,000 in federal Economic Development money, $100,000 from the State of Michigan, and $605,000 from the city of Saginaw in Community Block Grant development money.

$100,000 in Missing Americorp Money * In 1996 then City Manager Joyce Parker  obtained HUD money to hire local youths for target rehabilitation areas in the City of Saginaw.

With a total budget of $359,365 alotted through block grants, homes on Bagley, Carroll St, Douglas, and Washington were rehabilitated. However, one of the contractors discovered that at least $100,000 should have remained in the fund at the time the project was terminated in November 1996.

The answer of what happened to this money was never discovered.

Of course, now that Kimble is gone the city must pay her $61,250 for doing nothing as part of her severance package, plus another $110,000 to new interim City Manager Cecil Collins.  And let's not forget about the cost of searching for another fulltime manager.

Mayor Wilmer Jones Ham reflects upon the situation by saying "united we stand, divided we fall".  Councilwoman Carol Cottrell has said, "We must move forward".

The reality is a synthesis.  The city is divided, yet we must unite to move forward, even though we've been penalized miles behind the starting gate.

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