governing magazine september 2015vol. 28, no. 12 09.2015 features 24 losing ground southern...

THTHE E STSTATATESES AANDND LLOCOCALALITITIESS SSeptember 2015

LosingGround

Southern Louisiana’s coastal marshes are

disappearing. And local governments aren’t

afraid to pick a fi ght with the state’s biggest

industry in order to stop it.

GOV09_cover.indd 1GOV09_cover.indd 1 8/19/15 11:22 AM8/19/15 11:22 AM

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VOL. 28, NO. 12

09.2015

FEATURES24 LOSING GROUND

Southern Louisiana’s coastal marshes are disappearing. Local governments are desperate to reverse the damage—so desperate that they’re picking a fi ght with the state’s biggest industry.By Chris Kardish

30 SCOTT PRUITT WILL SEE YOU IN COURT

Oklahoma’s attorney general sues the federal government—and even other states—every chance he can get.By J.B. Wogan

36 MEASURED GROWTHOne year into Tennessee’s ambitious education reform eff ort, offi cials take stock. By John Buntin

44 ARE WE OUT OF THE WOODS YET?

Colorado Springs and other cities have rebounded from the recession. But things aren’t as good as they seem. By Zach Patton

50 FAMILY FRIENDLYShifting attitudes about work-life balance have put paid family leave on legislative agendas in many states. By Liz Farmer

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Tennessee Gov. Bill Haslam

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PROBLEM SOLVER

54 Behind the Numbers Many police departments still don’t mirror the racial and ethnic demographics of their communities.

56 Smart Management Why you need to listen and keep track of bad news.

58 Better Government Government doesn’t have to look stupid, as plenty of public offi cials show.

60 Tech Talk How one city has incorporated social media into everything it does.

62 Public Money Recent bankruptcy rulings have protected retirees. But at what expense?

64 Last Look A playful bus stop makes waiting for the bus a bit more bearable.

DEPARTMENTS

4 Publisher’s Desk

6 Letters

OBSERVER

9 Politics and the ChamberChambers of commerce aren’t

refl exively antigovernment.

10 Moses vs. JacobsA new opera dramatizes the con-

fl ict between two urban thinkers.

12 Illegal? Or Unethical?With public ethics, things aren’t

always black or white.

POLITICS + POLICY

14 AssessmentsCities struggle to regulate

panhandling.

16 Potomac Chronicle Like Greece, the U.S. has its own ticking debt bomb.

17 Politics Watch Maine’s governor and legislature are at loggerheads.

18 Health There are some big ifs when it comes to expanding Medicaid.

20 Green Government Is it time to price water diff erently?

22 Economic Engines Job creation is up, but not in rural America.

23 Urban Notebook Cities can learn a lot from Havana’s ride-sharing system.

GOVERNING | September 20152

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Managing Your Jurisdiction’s Financial HealthAs a government leader, you don’t have to be an expert in fi nance,

however, you do need to understand your jurisdiction’s fi nancial

position and speak confi dently about its fi nancial health. Because

fi nancial health is a complex topic, and many leaders do not enter the

public sector with an extensive background in government fi nance, the

Governing Institute created the Governing Guide to Financial Literacy,

Volume 2: Managing Your Jurisdiction’s Financial Health.

The Guide covers all aspects of government fi nancial health and

includes a glossary of key terms. It focuses on fi ve principles to help

public sector leaders improve their jurisdiction’s fi nancial health now

and in the future:

1. Financial health is more than a grade.

2. Financial health is more than a balanced budget.

3. Financial health requires a focus on context.

4. Financial health demands effective fi nancial information systems.

5. Financial health is everyone’s responsibility.

For an in-depth look at these fi ve principles and fi nancial health in general, download a complimentary copy of the Guide at:www.governing.com/fi nancialhealth

Sponsors:

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GUIDE TO

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4 GOVERNING | September 2015

Mark Funkhouser, Publisher

Pay Now or Pay Later

PUBLISHER’S DESK

One way or another, somebody is going to pay. The questions are simply who, how much and in what way. That’s my main takeaway from “Losing Ground,” Chris Kardish’s cover feature this month about the

destruction of the wetlands along the Louisiana coast. The issue comes down to an understanding of costs.

Costs are the consequences of actions, and once an action has been taken, the cost eventually must be paid in one form or another. This seems to me to be almost a law of nature, similar to a principle of physics. One of those, the fi rst law of thermodynam-ics, holds that energy can neither be created nor destroyed. But it can transform from one form to another, such as when chemical energy is converted to kinetic energy in the explosion of a stick of dynamite. Similarly, monetary costs averted today can transform

into an erosion of trust, a degrada-tion of community conditions or even the loss of human life.

Seen from this perspective, it can be argued that public policy is almost entirely about managing costs—today’s and tomorrow’s. This is particularly apparent in the area of environmental regu-lation. Consider, for example, the Buff alo Creek disaster in West Vir-ginia in 1972, when 14 little towns were wiped out by a fl ood resulting from the failure of a dam built by a coal company out of mine waste.

One hundred twenty-fi ve people were killed and more than 4,000 were left homeless. A year earlier, the company had been cited for more than 5,000 mine violations nationally, with $1.3 million lev-ied in fi nes. The company challenged each violation and wound up paying a total of $275.

In Louisiana, as Kardish’s story details, about 1,880 square miles of coastal land have been lost over the last 80 years as a result of the activities of oil and gas companies. With the disap-pearance of the land has also gone a natural barrier against the destructive force of hurricanes. Now a state agency and several local governments are suing the oil and gas companies to get them to pay billions of dollars in damages that would go toward funding coastal restoration. Still, as Kardish writes, “it’s impos-sible to read the lawsuits and the mountains of work on Louisi-ana coastal erosion without asking one simple question: Where were the state regulators?”

In the end, regardless of the outcome of the lawsuits, the costs created by the oil and gas companies will be paid, either for coastal restoration or in damage, destruction and loss of life from the next big hurricane.

Publisher Mark Funkhouser

Executive Editor Zach PattonManaging Editor Elizabeth DaigneauSenior Editors Alan Ehrenhalt, John MartinChief Copy Editor Miriam JonesCopy Editors Lauren Harrison, Elaine Pittman Staff Writers Liz Farmer, Alan Greenblatt, Chris Kardish, Daniel C. Vock, J.B. WoganCorrespondent John BuntinContributing Editor Penelope LemovColumnists Katherine Barrett & Richard Greene, Scott Beyer, William Fulton, Mark Funkhouser, Peter A. Harkness, Donald F. Kettl, Justin Marlowe, Alex Marshall, Tod Newcombe, Aaron M. Renn, Frank Shafroth

Senior Editor, Governing.com Caroline CournoyerNews Editor, Governing.com Daniel LuzerData Editor, Governing.com Mike Maciag

Chief Content Offi cer Paul W. Taylor

Chief Design Offi cer Kelly MartinelliDesign Director & Photo Editor David KiddGraphic Designer Kimi Rinchak Production Director Stephan Widmaier

Chief Marketing Offi cer Margaret MohrSenior Director of Marketing Meg Varley-Keller

Founder & Publisher Emeritus Peter A. Harkness

Advertising 202-862-8802Associate Publishers Jennifer DeSilva, Jon Yoffi eDirector of Business Development Noel HollisBusiness Development Manager Maggie RansierSales Administrator Teviá JohnsonOffi ce Manager Alina Grant Marketing/Classifi ed [email protected]

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Governing (ISSN 0894-3842) is published monthly by e.Republic Inc., with offi ces at 1100 Connecticut Ave. N.W., Suite 1300, Washington, D.C. 20036 and at 100 Blue Ravine Road, Folsom, CA 95630. Telephone: 202-862-8802. Fax: 202-862-0032. Email: [email protected]. Periodical postage paid in Washington, D.C., and at additional mailing offi ces. Copyright 2015 e.Republic Inc. All rights reserved. Repro-duction in whole or in part without written permission of the publisher is prohibited. Governing, Governing.com and City & State are registered trademarks of e.Republic Inc.; unauthorized use is strictly prohibited. Postmaster: Send address changes to Governing, 100 Blue Ravine Road, Folsom, CA, 95630. Subscribers: Enclose mailing label from past issue. Allow six weeks. Member: BPA International. Made in the U.S.A.



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AT&T security experts analyze more than 310 billion fl ow records each day for anomalies that indicate malicious activity. It’s what makes us uniquely qualifi ed to help state and local government agencies address the security challenges they face. Our proactive network-based approach to managed security delivers some of today’s most powerful weapons to combat cyber security attacks – helping to safeguard all the elements of your IP infrastructure. To learn more, download the CIO Security Guide at att.com/govsecurity

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LETTERS

The Bad Data ExperienceIn their July cover story “Bad Data,” Katherine Barrett and Richard Greene wrote about how data has become essential to state and local govern-ments. Unfortunately, the data itself is often fl at-out wrong or doesn’t exist at all. Barrett and Greene looked at the many reasons why data was missing the mark, interviewing more than 75 public offi cials in 46 states. The report reso-nated with many of our readers, making it our most popular magazine article so far this year. Several people wrote in to share their own takeaways and run-ins with bad data.

While technology is important, the graphic [in the article] on the major causes of data problems highlights that

66 percent of the issues are related to leadership, man-agement, people and com-munication challenges, not technology. We need leadership in every line department that believes data is important in mak-ing decisions.

—Victoria Pequena on Governing.com

As researchers, we run into [the bad data] problem on a daily basis. Some agencies appear to spend more time format-

ting their data than checking integrity. When we try to analyze public data from state and local agencies, we spend a great deal of time cleaning it and working through aberrations resulting from cod-ing inconsistencies, errors, duplications and strange characters that cannot be processed, like asterisks and tildes. As the saying goes, we spend 90 percent of our time on 10 percent of our data.

Accountability for reporting data must also include the responsibility for explaining it. Data doesn’t just explain itself; good data analysis should be part of telling a coherent story.

If incoherent patterns exist, they should be cause for alarm. If no one is asking questions about the data, it never gets the kind of scrutiny that makes qual-ity a concern. If agency management

is not data-driven, they won’t make an eff ort to ensure data quality because nothing is on the line.

—Joe Adams on Governing.com

In more than 40 years’ experience in automated data collection systems includ-ing accounting, utility billing, income tax collections, payroll and human resources, this is the most informed article on com-puterized data collection I have ever read. I always told folks, “There are not many bad decisions made in life, but many deci-sions are made with bad data.” The lack of policy and procedural manuals with adequate internal controls and the proper checks and balances continue to be the primary problem resulting in bad or mis-leading data information systems.

—Loren Sengstock on Governing.com

Three other issues that impact the bad data problem are a lack of dynamic modeling for economic impacts, low understanding by analysts who choose which data points to include (sometimes aggravated by political agendas of private-sector entities who “educate” them on a given issue) and politicians who need a desired outcome and therefore direct analysis to produce it in the data. In bud-geting for the state, this leads to all sorts of false assumptions for revenue collections to balance expenditures. And, sadly, when money is at stake, the motivation for tin-kering with the data is much higher.

—Pamela Gorman on Governing.com

States are embracing the promise of big data. But just how good is the information they’re collecting in the first place? By Katherine Barrett and Richard Greene

July 2015 | GOVERNING 25

A Special Report


Correction:

In the August article “The Big

Behavior Bet,” Liz Farmer

wrote that “in December

2013, New York became the

fi rst state to try social impact

bonds, with its program at

Rikers.” The Rikers project

was run by New York City.

New York state actually

became the fi rst state to try

social impact bonds with

another program.

Do You Have a Bad Data Problem?

In an informal online survey, we

asked readers of the July “Bad

Data” feature how often they

run into problems with data in

public-sector agencies. With 199

responses so far, 77 percent of

respondents said they have had

problems with bad data frequently

or often. What has your experience

been like? Take the survey at

governing.com/BadDataReport.

5% CAN’T TELL

3% NEVER50%FREQUENTLY

27%OFTEN

12%SOMETIMES

3% RARELY



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2015Texas Leadership ForumAug 20, 2015

Summit on the Cost of Government Sep 23 – Sep 24, 2015

Health & Human Services SummitOct 8 – Oct 09, 2015

Pennsylvania Leadership ForumOct 21, 2015

Public O cials of the YearDec 2, 2015

California Leadership Forum Dec 8, 2015

2016Outlook – State & Local Market ForecastFeb 2 – Feb 3, 2016

Michigan Leadership ForumMarch 2016

Massachusetts Leadership ForumApril 2016

Virginia Leadership ForumMay 2016

Summit on Government Performance & Innovation June 15 – June 16, 2016

Illinois Leadership ForumAugust 2016

California Leadership ForumSeptember 2016

Texas Leadership ForumOctober 2016

Pennsylvania Leadership ForumOctober 2016

EVENTS

*Governing’s roster of 2016 events is fi lling up quickly! Visit governing.com/events to learn more.


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In Politics, Chambers of Commerce Carve a NicheIT’S BASICALLY A NO-BRAINER that states want to improve the quality of their workforces. When Colorado legislators recently decided to create a position that would formally coordinate efforts of industry and educational institutions to achieve this goal, though, they made a surprising choice. They decided the person leading the charge shouldn’t be housed in the department of labor or even the department of education. Instead, the new hire will report to work every day at the Denver Metro Chamber of Com-merce. “It will be a state employee who will be housed in our space,” says Kelly Brough, the chamber’s president.

This isn’t the fi rst time the chamber has played host to government offi cials. The 41-member Colorado Metro Mayors Caucus not only meets monthly in its offi ces, but also receives fi nancial backing from the chamber. That has helped increase communication between the city and businesses when it comes to big projects such as building out the Denver area’s light rail system.

This type of ongoing collaboration speaks to something that, while true in many places, is often overlooked. Chambers of commerce have a deserved reputation for being skeptical about government spending and regulation, but they are not refl exively antigovernment in the same way that some other conservative forces are these days. In fact, chambers are often the strongest allies politicians have when promoting cer-tain programs, particularly when it comes to education issues and infrastructure. “We don’t want to pay a lot of taxes, but we rec-ognize there’s a role for government,” says Trey Grayson, head of the Northern Kentucky Chamber of Commerce. “We recognize the need to make the investments in our schools

and our infrastructure in order to make our businesses and region thrive.”

In South Carolina this year, for instance, chambers from across the state put together a coalition promoting the idea of raising the gas tax by a dime or more to pay for better roads. (The effort failed despite broad sup-port, as legislators couldn’t agree on the size of an offsetting income tax cut.) And for more than 20 years, the Nashville Chamber of Commerce has been publishing an educa-tion report card, the most visible portion of its

effort to support stronger schools.At a recent meeting with Kentucky

legislators, Grayson made it a point to link two seemingly disparate priorities. Area businesses insist that Kentucky become a right-to-work state, he said, but they also continue their support for strong educational standards to improve the workforce, includ-ing Common Core. “For the chamber, those are not two contradictory things,” he says. “Those are both important to our members.”

—Alan Greenblatt

The Denver Metro Chamber of

Commerce is collaborating with

government in new ways.



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THE WORLD OF URBAN PLANNING is fi lled with epic confl icts and larger-than-life characters: The villain developer who bulldozes poor neighborhoods and tosses destitute residents out into the street. The band of misfi t neighbors who join together to rise up and fi ght to save their community.

It’s dramatic. It’s impassioned. It may even be operatic.

At least that’s the idea behind a new project from director Joshua Frankel and composer Judd Greenstein. They want to turn the confl ict between Robert Moses and Jane Jacobs, the two biggest

titans of 20th-century urban planning, into an opera. Frankel, who grew up in the New York City neigborhood of Hell’s Kitchen and frequented the same park as Jacobs, still sees tension between outsiders looking to redevelop an area in the name of some utopian vision and the people who call it home. With the acceleration of urban development in the United States and around the world, “this is a story that is important now,” Frankel told The New York Observer in May.

The confl ict between Moses and Jacobs certainly makes for high drama. At one point, Jacobs literally defended her home from Moses, the country’s most prolifi c builder of public works at the time. He wanted to pave a highway through Washington Square Park and

Greenwich Village, which would have displaced Jacobs and thousands of families. The plan was typical of Moses and other so-called master builders of the era who sought to reorganize urban neighborhoods around the automobile.

The story is helped by larger fault lines between Moses and Jacobs. It wasn’t just about one roadway. On a personal level, Moses and Jacobs were a study in contrasts. He held degrees from Yale and Oxford and enjoyed being addressed as “Dr. Moses.” She took courses at Columbia, but considered it a badge of honor that she never fi nished college.

He was a government insider, at one point holding 12 appointed positions on city and state commissions. She applied pressure from the outside, both as a journalist and neighborhood activist.

The biggest diff erence between them, though, was philosophical. They disagreed on every aspect of urban living, from transportation to policing to the designs of parks and homes. Moses oversaw grand infrastructure projects that embodied urban renewal in the 1960s—housing towers, parks, tunnels and bridges. He wanted to bring elements of the suburbs to cities, with residential communities disaggregated from the workplace and connected by car-centric roadways. Jacobs rejected Moses’ vision for cities and helped usher in the principles

of new urbanism—dense, mixed-use development and streets designed for pedestrians and bicyclists, not cars.

The as-yet-untitled opera is scheduled to debut in Williamstown, Mass., next year, with a New York premiere in 2017. To drum up public interest and fi nancial support, Frankel and Greenstein held short scene presentations in May and are documenting their progress through Twitter and Tumblr. The story is set in 1960s New York, when Jacobs organized several successful grassroots campaigns against projects Moses had planned.

The production is the latest in a series of recent attempts to refl ect on the twin legacies of Moses and Jacobs. Two books in recent years—Anthony Flint’s Wrestling with Moses in 2009 and Roberta Brandes Gratz’s The Battle for Gotham in 2011—both explore Jacobs’ challenge to Moses’ power. One reason for this interest in their dynamic may be the complete omission of it in Robert Caro’s defi nitive 1974 biography, The Power Broker: Robert Moses and the Fall of New York. The 1,300-page Pulitzer Prize-winning book is silent on Jacobs; much later, Caro revealed that he had written a chapter about Jacobs, but it was a casualty of the editing process.

Frankel and Greenstein say they’ll present their opera as a love triangle between the city and two visionary urban theorists vying for its aff ections. Nowadays, it seems that Jacobs won that courtship. Her seminal work, The Death and Life of Great American Cities, is required reading for city planners. The American Planning Association, at fi rst critical of the bottom-up approach to community planning advocated by Jacobs, has since adopted many of her principles in its charter. “Death and Life changed how the world viewed cities,” says Gratz. Traces of Jacobs’ ideas are alive today in highway teardowns, the proliferation of bike lanes and the walkability scores by which many neighborhoods are rated. “We are undoing Robert Moses,” Gratz says, “and bringing in more of Jane Jacobs than ever before.”

—J.B. Wogan

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Producers of a new opera about

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staged some scenes in May.

Urban Planning Gets an Aria




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Despite the stagnant stats on women managers for the past generation, Martel says she’s hopeful for the future. Public policy schools, for example, are now graduating more women than men. Ultimately, she says, the goal should be a government that better mirrors the population it serves. She likens the need for more female managers to the importance of promoting racial diversity in leadership, something that’s become a touchstone in police confrontations across the country over the past year. “With some of the issues we’ve seen with law enforcement,” Martel says, “you see the evidence that when executive leaders don’t refl ect their communities, the values of those communities aren’t embedded in the operation.”

—Liz Farmer

WHEN PATRICIA MARTEL got her start in government in Inglewood, Calif., in the early 1980s, just 13 percent of American cities’ chief administrative offi cers were women. A lot of things have changed since then, but gender diversity isn’t one of them. According to a survey conducted last year by the International City/County Management Association (ICMA), the percentage of women city managers has barely budged in three decades. It’s now at 14.4 percent .

Martel wants to get more women to join the executive ranks. Today she’s the city manager for Daly City, Calif., and the incoming president of ICMA. She aims to use her national platform to involve more women in city management. She says she was fortunate 35 years ago to have a city manager in Inglewood who saw her potential. He off ered to help groom her for an executive level position in government. “That wasn’t always the case for many women,” she says. “I was one of the lucky ones.”

It’s not that there aren’t women working in the public sector. Women make up nearly half of the roughly 9 million noneducation workers in state and local governments . But women remain underrepresented in management and leadership roles. ICMA has formed a task force focused on women in government, whose goal is providing women better resources to advance their careers.

Part of the problem, Martel believes, is that women in her generation felt they had to prioritize work over family obligations to signal they were committed to a professional career. To many women, this was too unattractive a choice. “Many of us sacrifi ced family life to demonstrate we were serious about the job,” she says. “Today I wouldn’t do that. That’s what I tell young people: If your kid

A Manager’s New Focus: Women in Government

needs you today, go do that. Work will always be here tomorrow.”

The other key piece, says Martel, is providing role models for women who are mid-level managers. Last year’s ICMA survey noted that women who may seek to move up in their jobs often don’t have a female role model to follow. Four in 10 organizations surveyed responded that they’d never had a female chief administrative offi cer or chief appointed offi cial. Martel thinks mentorship is key and points to successes in the 14 states where ICMA has established such programs. She plans to get more states involved, starting with a big push at the association’s annual conference in Seattle this month. “One of the most critical things is having a role model,” she says. “You can’t be who you can’t see.”

Patricia Martel

wants to increase

the number of

women in executive

positions.



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Number of Arizona welfare recipients who failed drug tests between 2009 and

2014. The tests cost the state $9,500 to administer .

3

THE BREAKDOWN

The combined economic benefi t—cal-culated in new jobs and cheaper energy

bills—of cutting carbon emissions in nine northeastern states from 2012 to 2014.

combined economic benefit ca

$1.3b

11.4%Portion of the U.S. population that remains

without health insurance, which is thelowest since Gallup began tracking the

statistic in 2008.

82kThe size, in square miles, of China’s new planned supercity, Jing-Jin-Ji, an area

about the size of Kansas. The city, which will encompass Beijing, is intended to

house 130 million residents.

Illegal? No. Unethical? Illegal? No. Unethical? That’s Another Story.That’s Another Story.WHEN IT COMES TO PUBLIC ETHICS, things aren’t always black or white. There are

plenty of actions that might not be illegal, but

nonetheless would be seen by most people as

an abuse of power.

In Ohio, such occurrences ultimately

went unfl agged in audit reports. But State

Auditor Dave Yost wants to change that. In

July, he implemented a new policy allow-

ing for fi ndings of “abuse” that are meant

to draw attention to highly questionable

behavior by public offi cials not directly con-

tradicting state rules or laws. “We would see

isolated instances where people were not

breaking the law, but were treating the public

purse as their own ATM,” says Yost, who

emphasizes that most public employees are

well intentioned. “There was a need for us to

make a public record of it.”

Previously, Yost says, such instances of

abuse rarely showed up in audit reports, even

though the designation was permitted under

state auditing guidelines. This meant that

the public rarely learned of highly question-

able—but still legal—offenses unless they

were uncovered by a newspaper or watchdog

group. (In some other states, instances of

abuse are typically included as a part of

larger reports.)

These abuses frequently involve areas

where public offi cials make purchases at their

own discretion, such as travel expenses. In

one example cited by Yost, four members of a

local school board attending a conference in

Columbus stayed at a hotel that charged three

times the nightly rate of neighboring hotels.

In another case, a superintendent’s contract

enabled him to receive $170,000 in public

funds to pay off his college loans.

For Ohio auditors to fl ag an action as

abuse, it must go beyond a mere error in judg-

ment. The offi ce will follow the federal govern-

ment’s generally accepted auditing principles,

which defi ne abuse as “behavior that is

defi cient or improper when compared with

behavior that a prudent person would consider

reasonable and necessary business practice

given the facts and circumstances.” As with

traditional audits identifying misappropria-

tion of funds, offi cials have an opportunity to

respond to abuse fi ndings prior to publication.

Offi cials found to have committed abuses

won’t face penalties in a courtroom. But they

will be subject to the court of public opinion.

And that possibility of public shaming will act as

a deterrent, says Yost. “The only consequence

of fi nding an abuse is it seeing the light of day.”

—Mike Maciag

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By Alan Ehrenhalt

Politics+Policy | ASSESSMENTS


Let’s start with a little quiz: You’re walking past a street corner in your neighborhood and you notice a man sitting on an orange

crate and holding up a hand-lettered sign that says, “Homeless. Please Help.” Is he threatening or harassing you in any way? You’d most likely say no. If so, you’re in agreement with most Americans and vir-tually every court that has ruled on the subject in the past two decades. Asking for money in that situation is considered to be a form of free speech, protected by the First Amendment.

How about this one: You’re making an ATM withdrawal and a teenager comes up to you and says politely, “I sure could use one of those twenties you’re taking out of there.” That’s a diff erent story. Local gov-ernments all over the country consider that sort of thing to be illegal harassment and have made it a crime.

Now we get to a harder case: You’re standing in a long line waiting to buy tickets to a concert. A young woman walks alongside, telling the people in line that she’s hungry and needs some spare change so she can buy herself dinner. Is that against the law?

The answer is that it’s legal in most places, but illegal under the terms of some tough panhandling laws that communities around the country have been passing. According to the reasoning undergirding those laws, anyone standing in a line like that is a kind of captive, unable to move out of the way, just as they would be in a closed subway car. Soliciting anyone in a captive situation constitutes aggressive panhandling and is subject to a fi ne or even, in some cases, a stint in the county jail. But it’s also arguable, and civil liber-tarians will press the point, that a person is no more captive standing in line than he is walking down the street, and the pan-handler is the one whose rights are being

curtailed. Whichever side you’re on, it’s a pretty close question.

But it’s one of many legal puzzles that have come up in recent months as courts and communities try to work out the rules of lawful behavior in public places. The rules at the far ends have been estab-lished: Simple begging is protected speech; aggressive solicitation is not. It’s the behav-ior in the middle that’s being fought over.

And it’s coming up often these days for a couple of interesting reasons. One is the increasingly broad defi nition of free speech that federal courts, including the U.S. Supreme Court, have chosen to stake out. The other is the growing attractive-ness of city centers as entertainment dis-tricts, both for tourists and local residents out for dinner and a good time. Urbanites are hanging out downtown in numbers that would have been unthinkable a cou-ple of decades ago. Panhandlers are hang-ing out there too—after all, it’s where the money is. That’s essentially what this con-fl ict is all about.

There is some statistical evidence that the cities’ worries are rational. A recent survey conducted in Salt Lake City reported that 20 percent of those who avoided going downtown said it was because of aggressive panhandling. Other cities seem to harbor similar fears for their spruced-up and newly welcom-ing downtown districts. They’re seeking ways to keep visitors from being hassled without violating the First Amendment strictures that the courts have laid down.

There are several possible ways to do this. One is to declare certain parts of downtown off limits to panhandlers—not just ATMs or ticket lines but anything within a specifi ed distance of a sidewalk café, a bus stop or even a parking meter. All of these have been tried. So have restrictions based on the time of day: No panhandling before sunrise or after sun-

set. The only thing cities know for sure that they can’t do is discriminate based on the content of the solicitor’s message.

The U.S. Supreme Court tightened the rules this June in the case of Reed v. Town of Gilbert. This wasn’t a panhandling case per se, but it raised some of the issues common to any dispute over solicitation. The Arizona town had passed ordinances delineating rules for signs displayed in public places. Those rules determined how large the signs could be, where they could be placed and how soon they had to be taken down. Political signs were allowed to be larger than religious ones and didn’t have to come down as quickly. Pastor Clyde Reed of the Good News Presbyterian Church sued the city, claim-ing that the stricter rules governing the church signs violated his First Amend-ment rights. He lost at the federal appeals court, but the Supreme Court reversed that verdict, ruling that the signs were free speech and the ordinance was a discrimi-nation on the basis of content.

The Reed decision didn’t settle any-thing in the broader panhandling dispute, but it did focus attention on the case that is liable to provide some defi nitive answers in that argument: Thayer v. Worcester. In 2013, Worcester, Mass., enacted one of the nation’s toughest and most compre-hensive panhandling laws. In an eff ort to prevent what it called “fraud or duress,” Worcester outlawed panhandling within 20 feet of an outdoor café, bus stop or ATM, and within 20 feet of “any place of public assembly.” It is illegal in Worces-ter to ask for money after sundown or before sunrise. As City Attorney David Moore puts it, “Approaching someone at night has a fear or intimidation factor that isn’t present in the daytime.” Moore said recently that since the law’s enactment, there had been nearly 200 incidents of enforcement, all of them in cases where

The Panhandler DilemmaWhen cities try to regulate them, they fi nd themselves in a legal minefi eld.



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the panhandler refused to desist after a warning and was fi ned $50.

All in all, the Worcester law makes it rather diffi cult to be a panhandler any-where near a large group of people, which is where any sensible panhandler would want to operate. Caught in one of the many solicitation-free zones, a panhandler in Worcester can be found guilty of a criminal violation just for holding a cup or carrying an “I’m hungry” sign.

But there was one thing Worcester tried hard not to do: discriminate on the basis of content. The Girl Scouts, the Salvation Army and local sports teams are subject to the same restrictions as a homeless person seeking money for unspecifi ed refreshment. As long as the city kept its law content-neu-tral, the Worcester City Council believed, it could go as far as it wanted regarding time, place and circumstance.

Worcester is winning. Last year, in a case brought by the American Civil Lib-erties Union, a federal appeals court held that the city’s rules are legal. The judge who issued that ruling was former U.S. Supreme Court Justice David Souter, serving on the appeals bench as a senior replacement. Souter wrote that aggres-sive soliciting can cause “serious appre-hensiveness, real or apparent coercion, physical off ense or even danger,” and that communities were entitled to take strong measures to guard against it.

The contest is not over. In June, the U.S. Supreme Court ordered the appeals court to review its Worcester fi nding in view of the decision in the Arizona church case. The plaintiff s in the Worcester case argue that that city’s law is not content-neutral; they say the fact that panhandling may make some people uncomfortable is

no justifi cation for such a sweeping law against it. The plaintiff s are also citing the 2014 Supreme Court decision in McCul-len v. Coakley, which ruled on free speech grounds against the creation of 35-foot buff er zones to protect abortion clinics from aggressive protesters. Defenders of the Worcester law counter that any eff ort to link abortion to panhandling is misguided.

It is likely to take several months, at least, before all of this is sorted out. In the meantime, cities all over the country con-tinue to test the limits of what they can and can’t do to control panhandling. In many cases, their eff orts are clear refl ec-tions of the contest between visitor appeal and the First Amendment.

Lowell, Mass., 35 miles from Worces-ter, enacted an even bigger buff er zone to ward off aggressive panhandling. It encompasses the city’s entire historic dis-trict—essentially the whole downtown. “The law in Lowell was a result of pres-sures in the business community. Panhan-dlers were driving away tourists and cus-tomers,” says Kevin Martin, a lawyer who is representing the Worcester panhandlers in court. Tampa, Fla., passed a similar law aimed at curtailing solicitation in its Ybor City district, a popular nightlife magnet.

Whatever experiments they wish to try, cities may want to tread carefully. Some of the more creative antipanhan-dling laws can produce unintended con-sequences. Muskogee, Okla., decided in 2013 to allow panhandlers to operate, but to require them to obtain an annual permit and wear a neon vest identifying them to the public. A local reporter who checked on the results of the experiment after the fi rst year found that panhandlers were happy with it and that some were arriving from other towns just to work in a protected environment. Shortly after that, the city did away with the permits. “People thought we were saying ‘Come into town and try it,’” says Deputy City Attorney Matthew Beese. Now panhan-dlers have to register with the police every three months. They still wear the vests. G

Email [email protected]

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Politics+Policy | POTOMAC CHRONICLE


By Peter A. Harkness

The Debt Bomb

ing that the total state pension shortfall is creeping up on $1 trillion, with the fund-ing gap between what has been promised and what is available rising by 6 percent to $968 billion.

But another report on state and local plans prepared by the Center for Retire-ment Research at Boston College—con-sidered the gold standard in the analysis of public pensions—is a bit more sanguine. It notes that when the disastrous year of 2009 was rotated out of the so-called “smoothing process” in 2014, it resulted in “a sharp increase in actuarial assets and … the fi rst improvement in the funded status of public-sector plans since the fi nancial crisis.” The average percentage of required contributions paid last year bounced up to 88 percent from the aver-age of 82 percent over the past few years .

In other words, a slowly improving economy and healthier fi nancial markets

The U.S. may not be the next Greece, but we must face up to some hard decisions.

As uncomfortable as it has been to watch, the unfolding drama in Greece has had one clear benefi t: It has forced many

other countries, including our own, to take a closer look at debt, as well as rev-enues, costs, growth rates, demographics and so on.

Fortunately the United States, com-pared to most European countries, doesn’t look too bad. Our economy has bounced back from the Great Recession far faster than others. Still, our national debt as a share of gross domestic product has lev-eled out at a rate somewhat higher than most European countries’. Between that and the unnaturally low level of current interest rates, an aging population and a likely pickup in health-care costs, econo-mists are betting that the overall federal debt will resume its historic rise, leaving only about 5 percent of GDP available for all discretionary federal programs, includ-ing defense.

Former Democratic Sen. Robert Ker-rey of Nebraska and former Republican Sen. John C. Danforth of Missouri, who co-chaired the 1994 Bipartisan Commis-sion on Entitlement and Tax Reform, recently warned in a retrospective on the commission’s report that “the cost of ser-vicing our higher debt will become the fastest-growing category of the budget.” Already, they noted, “federal spending on major investment programs is 2.7 percent of GDP and 12.8 percent of the budget—both historic lows.”

Clearly if Washington is to right the ship—an almost humorous notion in this age of dysfunction—there will have to be signifi cant tax and entitlement reform, as well as elimination of many subsidies handed out over the years to special interests.

That’s the federal picture, but what about states and localities? The fi scal

outlook is mixed, but there are some gen-eral conclusions one can draw. According to a survey conducted by 11 associations of state and local offi cials, most states and localities are experiencing mod-est improvement in revenues. Forty-one states expect to meet or exceed their rev-enue projections for 2015. A recent study by Moody’s reveals that state debt levels last year declined for the fi rst time in 28 years. Ending balances for cities are near-ing their pre-recession highs, though they are still below the levels achieved in 2006. Counties are recovering even more slowly and unevenly, but they are recovering.

Meanwhile, the most politically sensi-tive and worrisome economic issue state and local leaders face involves public pen-sions. The news here is also somewhat contradictory. In mid-July, the Pew Chari-table Trusts released a research report covering the period through 2013, warn-

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| POLITICS WATCH


By Alan Greenblatt

The Maine Showdown The governor and legislature are at loggerheads.

Governors can generally get their way—even intimidate legislators—through the

power of the veto. Unless, of course, they overdo it. That seems to be the story

in Maine, where animosity between the executive and legislative branches has

reached an entirely new level.

The confl ict boils down to Republican Gov. Paul LePage wanting the legisla-

ture to move toward abolishing the state income tax. When that didn’t happen

this session, he decided to veto practically every bill that reached his desk. In all,

LePage has issued nearly 170 vetoes this year. That’s a big number, but what’s

really striking is the fact that the legislature managed to override him about 70

percent of the time—more than 120 overrides in all, including the state budget.

This, despite the fact that his party controls the state Senate. “It’s clearly not

about him versus Democrats,” says Phil Bartlett, chair of the Maine Democratic

Party. “It’s Gov. LePage waging war against the legislature.”

Indeed, the fi ght is certainly more insti-

tutional than partisan, which is unusual.

Most governors can veto with impunity, as

long as their party controls a third of either

chamber. The last great “serial vetoer,”

New Mexico GOP Gov. Gary Johnson,

rejected hundreds of bills during the late

1990s and was never overridden until his

fi nal year in offi ce. There have been some

governors who have been routinely over-

ruled, but you’d have to reach back to the

early 1990s to fi nd examples. More com-

mon is a case like Wisconsin, where not a

single veto has been overridden over the

past 30 years.

That’s not how it’s playing out in Maine. The current drama started when LePage

threatened to withhold state funding from a nonprofi t unless it withdrew a job offer

extended to Mark Eves, the Democratic state House speaker. (Eves fi led suit against

the governor in July, accusing him of “vindictiveness and partisan malice.”) After that,

LePage decided to veto practically anything that came his way. The state Supreme

Court ruled in August in a dispute between LePage and the Democratic attorney

general that the governor had waited too long to veto 65 bills. “He’s alienated his

own party’s leaders, as well as the rank and fi le,” says Howard Cody, a University of

Maine political scientist. “The governor has become so unpopular with the legislature,

many members have become predisposed to override on principle, regardless of

the details of the bill.”

The question now is how the governor and legislators will get along over the

next three-plus years. Maine has a long tradition of bipartisan agreement. That’s

still happening between the Democratic House and the Republican Senate, a

dynamic that could leave LePage out in the cold—and get worse for him, if vot-

ers blame him for ongoing disputes and put Democrats fi rmly in charge of the

legislature next year. “As long as the legislature can vote two-thirds in favor of

some bill, it doesn’t matter what the governor thinks of it,” Cody says. G


off er a slight ray of hope. “What happens from here on out depends very much on the performance of the stock market,” the Boston College report stated. “In 2018, assuming a healthy stock market, plans should be at least 80 percent funded.”

That’s a signifi cant fi gure, because somewhere around 80 percent fund-ing is considered the minimum to deem a pension plan healthy. We haven’t seen that level in some time. But the Pew study includes a signifi cant warning: “State and local policymakers cannot count on investment returns over the long term to close this gap and instead need to put in place funding policies that put them on track to pay down pension debt.”

So despite some recent improvement, serious problems remain, some of which dominate headlines. If this country has a Greece, it’s probably Illinois, with Chicago as its Athens. Or perhaps it’s a common-wealth like Puerto Rico, now some $70 billion in the red and seeking permission from Washington to restructure its debt in bankruptcy.

Localities may still depend on federal assistance in the case of natural disasters like hurricanes or fl oods. But the report from the 11 state and local associations makes clear what they don’t want: “State and local governments can weather dif-fi cult economic periods and offi cials are taking steps to restore fi scal stability,” it said, but added that “interference in the fi scal aff airs of state and local govern-ments by the federal government is nei-ther requested nor warranted.”

Translated, that means “hands off .” But that gets tricky. The courts have struck down a number of both state and local reform eff orts in places like Arizona, Cal-ifornia, Illinois and Oregon, putting new pressure on governors and legislatures to come up with meaningul, systemwide overhauls. So Washington and many states and localities are running out of options for signifi cant fi nancial reforms, not just for pension systems, but their bal-ance sheets as a whole. The sooner they meet their responsibilities, the better. G


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Politics+Policy | HEALTH


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The Merits of More Medicaid

By Chris Kardish

Research shows that expansion can improve health, but there are still some big ifs.

When a team of researchers seized on a rare oppor-tunity in Oregon to get real cause-and-eff ect answers to a politically charged question—does Medicaid make people healthier?—there was no

doubt that their fi ndings would get attention. And when those fi ndings appeared to undercut the Medicaid expansion that’s a key aspect of the Aff ordable Care Act (ACA), just as the federal law was going into eff ect, critics seized on them to declare the policy a failure before it even fully started.

But the fi rst reading of the fi ndings was never really fair, and a newer study in the journal Health Aff airs helps underscore why. The study adds a caveat to the answer to the above ques-tion. Medicaid does make people healthier—but only if a state’s health-care system actually works.

The Oregon Health Insurance Experiment, as the earlier study was called, started in 2008 when the state expanded Med-icaid. Since there were only a limited number of slots available, however, the state held a lottery. That gave a team of research-ers from Harvard, MIT and other institutions a unique chance to compare over time the health of those who got in with those who didn’t.

Their fi ndings came out in three separate reports, with the fi rst noting positive things: People in the Medicaid group were actu-ally going to the doctor and feeling less depressed because they fi nally had some fi nancial security. But next came fi ndings that, among the Medicaid group, there was no statistically signifi cant improvement in chronic conditions such as hypertension and dia-betes. And then, just as the ACA’s wider Medicaid expansion was kicking off in 2014, the researchers found that Oregon’s earlier expansion coincided with a huge spike in emergency room use.

To Medicaid’s critics, the Oregon study was a cautionary tale that should discourage other states from expanding the program. But to its support-ers, there are a couple of problems with that inter-pretation. First, they argue, we shouldn’t discount the fi nancial and psychological benefi ts of having insurance. And second, the results, particularly those surrounding ER use, were a symptom of a dysfunctional health-care system that Oregon has since taken pains to reform. The overhaul included assigning every benefi ciary a primary-care team within a comprehensive health network. As a result, the state is now seeing signifi cant improvements in ER use, hospitalizations and health outcomes.

The new study published in Health Aff airs focuses on a diff erent program in a diff erent state, but its lessons are instructive to this debate. Before Ohio expanded Medicaid in late 2013, the state had received a waiver to do a smaller-scale project in the state’s largest county, Cuyahoga. The county-owned MetroHealth System and two federally qualifi ed health centers would provide comprehen-sive care to people earning at or below 133 percent of the federal poverty level. Through extensive use of electronic health records that allowed for information sharing, along with team-based pri-mary care and nurses acting as coordinators across the system, Cuyahoga wanted to show that it could improve health outcomes.

About 30,000 patients signed up, and they showed signifi cant improvements in diabetes compared with a control group of sim-ilar patients who remained uninsured during the study period. Costs came in about 30 percent below the cap for the program, which had to be budget-neutral under federal waiver rules.

The outcome in Cuyahoga County certainly wasn’t perfect. Hypertension, for example, wasn’t signifi cantly improved. But what the evidence does show is that failure isn’t written into Medicaid’s code. It’s subject to the same frailties that can doom any ambitious enterprise. G


60%

40%

20%

0%

Financial SecurityMedicaid reduced the probability of having to borrow money by more than half, according

to results from the Oregon Health Insurance Experiment. About 12,200 people, roughly half

enrolled in Medicaid and half not, were surveyed in the randomized, controlled study.

Not enrolled in Medicaid Enrolled in Medicaid

Any Out-of-PocketSpending

CatastrophicExpenditures

Any Medical Debt Borrowed or Skipped Bills

Expenditures incurred over a 12-month period in 2012



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www.aflac.com/smallbiz

By Elizabeth Daigneau

The Price Is WrongWill new water pricing models be the answer to both revenue problems and waste?

Californians are getting very good at conserv-ing water. Since Gov. Jerry Brown ordered a 25 percent reduction in urban water use this April to combat the state’s severe

drought, Golden State residents have surpassed that mandate. Water use for the months of May and June decreased 28.9 percent and 27.3 percent respectively, according to the State Water Resources Control Board. But if Californians were hoping their conservation eff orts would lead to a little extra change in the pock-etbook, they’ll be disappointed.

Water departments across the state are looking to raise rates—in some cases by double digits. That’s because as customers use less water, revenues are plummeting. It’s a Catch-22: Water utilities want and need customers to conserve water, but when that happens, utilities lose much-needed funds to upgrade and repair critical infrastructure.

This isn’t just a California issue. Increasing weather events and a growing population is putting pressure on water resources in every state. So how do water utilities reduce water use and stay in busi-ness? They price water diff erently.

Indeed, Brown’s executive order in California explicitly demands that water utilities develop new “rate structures and other pricing mechanisms” to save water. This is also the sub-ject of a new report from Western Resource Advocates, Ceres and the University of North Carolina’s Environmental Finance Center. Released in August, the report looks at water connection fees—the one-time fees that most water utilities charge to connect new users and developments to the water system.

While there’s been plenty of research on how utilities price the volume of water being sold to encourage conservation, there’s been very little of it on water connection charges and how they might lead to water-saving practices. “It’s one area that hasn’t been looked at,” says Peyton Fleming, communications director for Ceres, a nonprofi t organization that advocates for sustainability practices. “We wanted to know, can these water connection charges that are being used all across the country be done a little bit diff erently and in ways that might be helpful to water utilities and consumers?”

To answer that question, report authors surveyed more than 800 local water utilities in Arizona, Colorado, Georgia, North Car-olina and Utah. They found that most utilities’ water connection charges—about 90 percent of the 800 surveyed—didn’t take into account the types of factors that aff ect a home’s water footprint. In other words, most users pay the same fee regardless of the size of their lot and house, the type of landscaping they have, and the

effi ciency of their fi xtures, among other things. But the report found that when fi nancial water-saving incentives are included in water connection fees, developers implement conservation measures that help water utilities save money in the long run.

Aurora, Colo., is one place that employs a “multifactor” water connection fee. Back in 2002, it was experiencing one of the worst droughts in its history. Municipal reservoirs only had enough water to last nine months. In response, the city began implementing a number of conservation programs, including a redesigned water connection fee. The utility wanted to develop a structure that would better align fees with water utility costs and provide an incentive to builders to construct more water-effi cient developments. It adopted a fee that “incentives low-water-using landscaping through lower fees, including one particularly innovative program called ‘z-zone’ in which no fee is charged if the landscape requires no water after plant establishment,” according to the report. Since it started in 2014, fi ve of six new developments have used “zero-water” land-scaping in order to get a full refund on their connection charges.

In addition to Aurora, the report also features three other case studies. “Well-designed connection charges that incentiv-ize water-effi cient development show enormous potential to help utilities reduce overall water demand and avoid costly new infra-structure projects,” Sharlene Leurig, director of Ceres’ sustainable water infrastructure program and a co-author of the report, said in a statement. “Unfortunately, very few communities are taking advantage of this tool for encouraging water-effi cient growth.” G


Politics+Policy | GREEN GOVERNMENT


Water utilities are increasingly

encouraging xeriscaping in an

effort to use less water.

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ARE YOUR DATASOLUTIONS A PUBLICDISSERVICE?New digitization mandates. Sensors.

Video surveillance. The proliferation of

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www.business.comcast.com/government

long associated with the inner city have now migrated to this rural area and many other similar places around America.

This might seem surprising given that some population-wide social indi-cators, such as teenage pregnancy rates, have been showing improvement nation-ally. But that’s only part of the picture. As scholars as ideologically diverse as Charles Murray and Robert Putnam have documented, there has been a signifi cant degradation in the recent past in social conditions in communities outside of the upper middle class.

From my own observations, one cause is the intergenerational decline of social capital. We can certainly see this in the areas of divorce and the rise of out-of-wedlock births since the late 1960s. The fi rst generation experiencing these had robust family and social structures to sus-tain them when splitting up or having a child outside of marriage. Fast-forward to today, and this social capital has badly deteriorated. After multiple generations of single parenthood, even grandparents no longer have the fi nancial or personal capacity to be as supportive as they would have been decades ago.

Many other factors have been at work too, such as the rise of at-home meth manufacturing and the growth of drug distribution networks, along with painful changes in the industrial economy.

We can see the impact of these trends across the job market. My father, who retired a few years ago as a quarry super-intendent, told me of the diffi culty he had had hiring and keeping employees. This was at a fi rm that, while not glamorous, paid some of the best full-time wages in the area—wages that came with full benefi ts plus profi t-sharing. Yet the overwhelming majority of applicants weren’t considered viable enough to even interview. Of those he did hire, a third failed to last even six

The New UnemployablesThe migration of urban social ills to rural America is having a profound effect.

Job creation is up. That’s the good news. The bad news is that the associated decline in the unem-ployment rate has been driven

more by people dropping out of the labor force than by those fi nding work. There are still millions of long-term unemployed people, and the disability rolls, partially seen as a form of shadow unemployment, have also soared. In the meantime, many employers say they can’t fi nd qualifi ed workers or that there are skill shortages.

This puzzling disconnect—workers can’t fi nd jobs while jobs can’t be fi lled—has been attributed to many factors, such as mismatches between skills or geogra-phy. But while those may account for part

of the problem, the issue is more funda-mental—one of baseline unemployability.

I grew up in a rural southern Indi-ana community. It was no Mayberry-like idyll, but you really could leave your doors unlocked and the keys in your car. The boys in high school did carry on, and yes, people were sometimes killed in drunk driving accidents. But things like hard drugs were nonexistent. They simply couldn’t be obtained there.

Today southern Indiana is making national headlines for its drug-related HIV epidemic. The rural county where I grew up had 35 meth lab busts in 2013 alone. You can’t leave your doors unlocked anymore. Drugs, crime and other social ills

By Aaron M. Renn

Politics+Policy | ECONOMIC ENGINES


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months, with many being fi red early in the probationary period.

This had nothing to do with job avail-ability or wages and everything to do with the basics, such as having a high school diploma and reliably coming to work every day. This goes beyond hard and soft skills to baseline employability.

While certainly the good old days of plentiful high-paid jobs at the auto plant are gone, it’s still possible to build a life in America if you graduate from high school, stay away from drugs and crime, wait until you’re married to have chil-dren, and show up to work every day. But if you slip on one of these points, say by dropping out of school, you are put into a defi cit in life from which you may fi nd it diffi cult to recover. Sadly this has aff ected a lot of people, who are now in a very dif-fi cult place.

To be clear, there are many who suff er from a bona fi de skill defi cit or geographic mismatch, especially older industrial work-ers who long ago demonstrated that they are able and willing to work a steady job but have struggled to fi nd work after plant clo-sures. Yet for a segment of our population, traditional workforce or economic devel-opment remedies will not help. Whatever their root cause, which is a source of dis-pute, there are baseline personal and social issues that need to be overcome.

Addressing this matter will not be easy, because the issues are so politically charged and require confronting unpleas-ant truths about legal and social changes that virtually no one wants to roll back, but which have had profoundly negative eff ects on the working class. At a mini-mum, the emergence of inner-city-type conditions in white working-class areas might perhaps convince some whites that something other than race produces these results.

Regardless, today inclusive economic development is no longer simply a mat-ter of creating jobs or teaching special-ized skills. It will increasingly mean con-fronting thorny social as well as economic problems. G


By Scott Beyer

| URBAN NOTEBOOK

Hitching a RideU.S. cities can learn a lot from Havana’s ride-sharing system.

Thanks to recently normalized U.S.-Cuba relations, I got to visit Havana this summer. What I discovered there was an unenviable economic system. Residents are strik-ingly poor, and because much entrepreneurship is illegal, they’ll stay that way for the foreseeable future. But when Raul Castro became president in 2008, he pursued mild liberalizations. One was letting citizens use their cars as taxis. This has created a complex ride-sharing system within Havana that may be worth imitating in the U.S.

To be clear, Havana has two systems. One is the traditional government-run cabs that serve tourists. These are unaff ordable to Cubans, most of whom live on less than $240 annually. But early on I learned about the other system, a private option called carro particular that locals take for 10 pesos, or about 40 cents. The cars don’t serve lone patrons, but those willing to share rides. To hail one, you go to a curb along a busy avenue and signal with your arms your desired direction. Once a car pulls over, the driver quickly negotiates how close to your desti-nation he can get. You either hop in or you don’t. If you don’t, another driver is usually close behind.

This system may sound chaotic, but several times I used these cars—the majority of which were built before the 1959 Revolution —and found that they were remarkably effi cient. I was picked up and delivered near my destination faster than if using a U.S. taxi or even an Uber, largely because cars are readily available. Havana is dense and the profes-sion is considered lucrative. Ultimately this means residents, who once had to hitchhike or take unreli-able buses, can now quickly navigate their city.

So why doesn’t such spontaneous mass ride-sharing exist in the U.S.? Well, to some extent it does. Services like Uber provide on-demand rides for individual patrons. There’s “slugging,” when unacquainted commut-ers ride together in order to access HOV lanes. And several new carpooling apps have sprung up that connect people bound for the same destination. But these services are more formal, generally requiring pre-arrangements on where to meet—and none is as pervasive as the carros particulares. There is no U.S. city where you can just wave your arms on any street and suddenly join a random car of strangers. This is due partly to government decisions. For political and safety reasons, America’s public offi cials have been reticent toward ride-sharing. Last September, for example, the California Public Utilities Commission informed Uber, Lyft and Sidecar that starting carpooling off shoots was illegal. Other crackdowns have abounded elsewhere concerning taxis, jitneys and other ride-sharing models.

Offi cials should re-examine this mentality because, as Cuba shows, ride-sharing enhances mobility. They probably wouldn’t want to allow something as informal as the carros particulares, which don’t list prices, print receipts or require identifi cation. But in the U.S., sophisticated technology and regulations have already improved ride-sharing’s accountability. For example, Uber’s rating system helps it self-police drivers and passengers, while localities make the company provide background checks and proof of insurance. Assuming that other companies embrace such accountability, they should be allowed to further experiment—even, or especially, if it begets an impromptu system like Havana’s. G



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Ground

The rusty remains of

oil and gas production

are scattered across

what is left of the

marsh in Plaquemines

Parish, La.

SSoouutthheerrnn LLoouuiissiiaannaa’’ss ccooaassttaallmmaarrsshheess aarree ddiissaappppeeaarriinngg. LLooccaall ggoovveerrnnmmeennttss arree deesperate too reevveerrsee tthhee dammage—so desperaate that they’re picking a fi ght with the statee’ss bbiggest industry.

BByy CChhrriss KKaardisshhPhotographp s by DDavid Kiddd



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In the middle of Lake Hermitage, about 30 miles south of New Orleans, there used to be a marsh about a mile long. There also used to be, amid the grasses, dozens of wells tapping oil and gas deposits below. Dave Marino, a charter captain who grew up nearby, scans the coast from his boat. Down the road, closer to the Gulf of Mexico, he says, “it’s all gone.” Marino is talking about the marsh.

While there are a few wells still standing, the marsh itself has vanished. “When you kill the vegetation,” he says, “the rest of it just melts away.”

Louisiana’s wetlands were once considered more of a nuisance than an environmental bless-ing. But that was before people understood they served an important purpose: They formed a natural barrier against hurricanes, which lose strength as they travel over land. In other words, the longer the coastline, the greater the protec-tion. With the loss of mile upon mile of wet-lands, the threat of severe fl ooding has intensi-fi ed. Flooding here could disrupt an economic corridor of national importance, an area that’s home to the nation’s largest commercial port, that refi nes a quarter of the country’s crude oil and that brings in more than half of its foreign supplies. But it could also further wreak havoc on coastal life. The local government here blames the energy companies for the damage, and it wants them to pay.

Lake Hermitage is just one waterway named in 21 lawsuits fi led by the government of Plaquemines Parish against many of the energy companies that have helped pay its bills and employ its people for decades. There are other suits from governmental groups as well. They’re all diff erent, but at bottom they want the same thing: to force oil and gas companies to pay for wetland destruction that has made the area more vulnerable to storms.

The stakes are enormous. Louisiana has lost about 1,880 square miles of coastal land in the last 80 years, and offi cial estimates predict the loss of another 1,750 in the next half-century if the state doesn’t take drastic engineering measures to stem the erosion and recreate land. Studies by the U.S. Geological Survey have concluded that the energy industry is responsible for at least 36 percent of the damage; other esti-mates put the number much higher. But the politics of the oil and gas industry in Louisiana is a tricky business. At one point, that industry contributed 70 percent of state government revenue—today, it’s about 14 percent—and still supports close to 300,000 jobs in the state, according to a study commissioned by oil and gas interests. Critics contend that industry infl uence has led regula-tors and elected offi cials to take a loose approach that allowed the damages to mount.

Once consigned to the op-ed pages, these critics are now turning to the courts. Growing awareness of the coastal crisis has prompted the most signifi cant legal action in the state’s 100-year

relationship with the oil industry. But it’s happening without the blessing of state leaders, who argue litigation isn’t the best way to get the industry to help with a restoration eff ort that most agree is essential. Support for the legal action is far from universal in the coastal parishes, where the infl uence of the energy companies remains potent, but the lawsuits demonstrate that a vocal con-tingent of Louisiana residents is demanding relief, no matter how crucial the industry is to local commerce and day-to-day living.

The lawsuit that has attracted the most attention is the one

that was fi rst out of the gate: The Southeast Louisiana Flood Pro-tection Authority-East, charged with protecting the New Orleans area from the kind of fl ooding that followed Hurricane Katrina, argues in its suit against 97 oil and gas companies that their exploration and extraction undermined the authority’s mission. It wants them to pay billions in damages, and the money would go to fortifying levees and shoring up the state’s coastal restoration plan, which is far from fully funded.

In the fl ood protection authority’s view, the single biggest con-tributor to wetland loss has been the network of canals forged out of the marshes surrounding New Orleans over the past 80 years or so. There are at least 10,000 miles of canals cut across coastal Louisiana to access rigs, navigate barges and construct pipelines. But the canals disrupt the natural process that replenishes wet-lands with sediment and allows saltwater intrusion that corrodes freshwater vegetation. The fl ood protection authority says the

L O S I N G G R O U N D

A 50-year restoration

plan is creating new

barrier islands and

restoring wetlands,

but there’s not enough

funding to reverse

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canals should have been backfi lled and restored to their previous condition under coastal regulations.

The opposition to the authority’s lawsuit has been fi erce. Gov. Bobby Jindal opposes the suit and has fought to reassert state control over the fl ood protection authority, whose members he appoints. The legislature passed a bill trying to preempt the law-suit. And in February, the federal judge presiding over the case ruled that the authority doesn’t have standing to sue oil interests for coastal damage. An appeal is expected to be heard in the com-

ing months by the U.S. Court of Appeals for the Fifth Circuit, which has a history of backing the business side in environmental cases.

Chip Kline, the Jindal-appointed chairman of the state’s coastal restoration fund, acknowledges oil industry involvement in coastal destruction, but says that state litigation isn’t the way to nego-tiate over damages. He and others say the author-ity’s lawsuit overstates the industry’s responsi-bility compared with other drivers of erosion, particularly the leveeing of the Mississippi River that contributed to fl ood protection but deprived wetlands of the sediment they needed to main-tain themselves. Under Jindal, the state has launched a $50 billion, 50-year restoration plan that, among other things, is creating new barrier islands off Plaquemines Parish. But independent experts argue that it will cost at least double that price tag. Currently, the plan has enough fund-ing to stay on schedule for about seven years, and much of the revenue over that time depends on settlements from the 2010 BP oil spill that will gradually thin out. The state has nowhere near $50 billion committed after that. As for the oil and gas industry, Kline says, “they’re absolutely hesitant to come to the table and discuss anything until the lawsuit is 102 percent put to bed.”

But Kline takes no issue with the local law-suits, of which there are now 28 in total, seven from Jeff erson Parish and 21 from Plaquemines. It’s expected that two more parishes will fi le suits

as well. The parish litigation may face fewer questions about the right to sue because of state law giving coastal governments some infl uence over their wetlands. The energy companies, however, are not conceding this.

Plaquemines Parish is more dependent on oil jobs and money than Jeff erson, which makes the Plaquemines council’s unanimous decision to sue such a bold one. Two-thirds of government revenue comes from oil and gas companies. But Plaquemines

Parish is also a critical front in the fi ght to save Louisiana’s coast. It actually accounts for nearly 10 percent of the entire nation’s wetlands, and it’s right at New Orleans’ back.

The Jeff erson and Plaquemines lawsuits could come to trial sometime next year. In addition to canal dredging, the parish cases focus on industry techniques for disposing of saltwater

that bubbles up from oil and gas wells. Lawyers for Plaquemines argue that oil companies discharged their saltwater directly into the wetlands or through pits dug into the marsh, usually with-out getting a permit. Louisiana didn’t offi cially outlaw the waste pits until 1986, however, decades after other oil-producing states, according to attorneys.

Many of those pits, like the marsh, have washed away. “The oil industry knew going back to the ’30s that if you put water in these pits that are unlined, you’re kidding yourself if you think it’s going to stay there,” says John Carmouche, whose law fi rm is taking the lead in the Plaquemines and Jeff erson suits. The fi rm is still fl eshing out the level of damages it will ask for and ironing out the responsibility of individual companies, but one partner at Carmouche’s fi rm said the number they’re thinking of for both parishes “will have to have a ‘b’ in front of it.”

Despite the unanimous vote in favor of litigation in 2013, the resolve of Plaquemines Parish government is in question. The for-mer parish council president who became synonymous with the suit, Byron Marinovich, lost his re-election bid in 2014 to a gas company administrator bankrolled by energy interests. Despite some grassroots sentiments in favor of killing the suits, however, the councilwoman who replaced Marinovich has failed to rally a majority so far.

The only coastal parish that has publicly refused to fi le a suit is nearby Terrebonne, one of the hardest-hit in terms of land loss. A quarter of the 1,880 square miles of Louisiana coastal land that has disappeared over the last 80 years has come from the Terrebonne Basin, eliminating an amount of land roughly the size of New York City. One council member said last year that the parish’s crest bears a fi shing boat and an oil rig for good reason. “Without the two there is no Terrebonne,” she said. “There is no good earth, no good people and no good economy.”

The oil companies have said little publicly in their defense, instead arguing that the fl ood protection authority and the par-ishes have no legal right to sue. A spokeswoman for BP, Shell and Chevron declined to make company offi cials available for an interview. “While there may be isolated exceptions,” she said in a statement, “we believe that the vast majority of the industry com-plied with these permits, which were regulated and monitored by the agencies that issued and managed them, including the Corps of Engineers and the Louisiana Department of Natural Resources. These agencies also had the authority to enforce these permits, and that includes the authority to bring suit, which they have not done.”

It’s impossible to read the lawsuits and the mountain of work on Louisiana coastal erosion without asking one simple question: Where were the state regulators? The Department of Natural Resources has issued oil and gas permits in Louisiana’s coastal zone since 1978 and is also charged with enforcing them. The department defends its record by pointing out that canal dredging is now relatively rare and takes place on a smaller scale. When the department does allow larger-scale dredging, it requires opera-tors to use the proceeds to off set damage through a state program. “What you’re trying to do is balance economic benefi t without sacrifi cing too much environmental impact,” says Patrick Cour-reges, a department spokesman.




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Used to access rigs,

navigate barges and

construct pipelines,

the network of canals

that cut across coastal

Louisiana can still be

seen in the sinking

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The question for critics is whether the balancing act has been achieved. Development has clearly won out, even in some of the most environmentally sensitive areas. The state has the legal authority to establish special zones to minimize it, but so far only two of these zones have been created. Backfi lling canals is also within the department’s enforcement powers, but a sur-vey by Louisiana State University scientist Gene Turner has found only 10 miles of backfi lled canals in the state, compared to at least 10,000 that were dredged. Alternative methods for access-ing wells, such as requiring air-cushioned vehicles that would minimize the need for dredging, have been rejected by state regulators even though they are commonly used in other places, according to Oliver Houck, a Tulane University environmental law professor who’s written a history of energy regulation in the state.

State regulators argue that Plaquemines’ claims of improper waste disposal should come to them—not to the courts. But with-out legal intervention, there’s little parishes can do to enforce environmental law or get compensated for damages, especially from activities that are decades old. The state’s Oilfi eld Site Res-toration Program has a long waiting list and only about $4 mil-lion in funding a year. If the state really wanted to monitor waste disposal properly, critics contend, it would need a small army of watchdogs. According to Courreges, there are about 20 on patrol in the coastal zone at any given time.

On the issue of canal dredging, arguably the biggest sore spot for environmentalists, the Department of Natural Resources says much of the damage came so long ago that requiring restoration isn’t possible. But about 70 percent of the more than 200 dredging permits listed in the fl ood authority’s lawsuit came from the state under the coastal zone program after 1978. The state just doesn’t view backfi lling canals as a good policy, as they’ve publicly said, because operators may need to reaccess a well at some later date. Paul Templet, who helped to write Louisiana’s environmental law and has also worked in other states, says Louisiana could set tougher standards for companies that claim they’ll need to reuse the canals and press far harder for eff orts to mitigate damage. “If you put pressure on oil and gas companies, they’ll fi nd ways to do things and money to do it with,” he says.

That’s essentially the lesson of Long Beach, Calif. That city stands on a bounty of fossil fuels; drilling was so heavy in the 1930s that the area began to sink at a rapid clip. That was because sucking up oil from reservoirs below the earth without replac-ing it creates a vacuum that leads to subsidence, or sinking land. Offi cials in California were so alarmed that they put a halt to most drilling in the 1960s. But fi ve major oil companies formed a consortium to construct manmade islands that allow for drill-ing away from population centers, along with replacements that maintained pressure in oil reservoirs to prevent subsidence. “In the 1960s, Long Beach said, ‘Fix it or leave,’ and they fi xed it,” says Brandon Taylor, a lawyer representing the Plaquemines plaintiff s. “I guess the question I have is, why couldn’t they do the same things they were in Long Beach in Lake Hermitage?” G

Email [email protected] More photos at governing.com/wetlands



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Oklahoma’s attorney general sues the federal government—and even other

states—every chance he can get.

By J.B. Wogan



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S C O T T P R U I T T W I L L S E E Y O U I N C O U R T

merely trying to reassert limits over executive power and would do the same regardless of the president’s political affi liation. In Pruitt’s view, Congress should make laws and the executive branch should administer them. Everything else should be left to the states. Instead, Pruitt says, “you see federal agencies taking license. That’s simply not how our checks and balances work.”

This isn’t just some academic point for Pruitt. He believes the American system of government is under attack by a president unwilling to respect the constitutional limits of his offi ce. Amid partisan gridlock in Washington, Obama has promised to use “a pen and a phone” to accomplish as much as he can through administrative action. That has won praise from liberals, but it has

When the Environmental Protection Agency pro-posed rules regulating carbon dioxide emissions from coal-fi red power plants, Scott Pruitt sued. When the Justice Department off ered legal sta-

tus to young undocumented immigrants, Scott Pruitt sued. And when the Obama administration sought to give tax credits to states that hadn’t set up their own health insurance exchanges, Scott Pruitt sued.

Since becoming Oklahoma attorney general in 2010, Pruitt has fi led or joined lawsuits against federal agencies at least a dozen times. Even when Oklahoma isn’t an actual party in litigation, the state often submits a legal brief against the federal govern-ment. Besides air pollution, immigration and health care, Pruitt has fought federal laws and regulations on banking, contraception and endangered species. These days, whenever states go to court against the Obama administration, the chances are that Pruitt is somehow involved.

Not that Pruitt is alone. During Obama’s presidency, the entire cadre of Republican attorneys general (27 at present) has coordi-nated cases against federal agencies at an unprecedented pace. But Pruitt is at the center of the action. He has set up a fi rst-in-the-nation “federalism unit,” which seeks to combat instances of federal overreach by every possible means: letters, comments dur-ing the rulemaking process, congressional testimony, legal briefs and, most conspicuously, lawsuits. When Pruitt became chairman of the Republican Attorneys General Association (RAGA) in 2012, he took the strategy national by launching the group’s “Rule of Law” campaign to help RAGA members research cases related to state autonomy, the Constitution and federalism. “He’s completed the shift for attorneys general nationally who realize now how important it is for states to push back against the federal govern-ment,” says former Nebraska Attorney General Jon Bruning, a Republican ally of Pruitt who left offi ce in January.

The legal justifi cation for Pruitt’s court challenges is almost always related to states’ rights. It’s easy, though, for his critics to presume an alternative explanation. He is, after all, a conser-vative politician fi ling lawsuits to undermine the liberal poli-cies of a Democrat in the White House. But Pruitt insists that today’s hyperpartisan world misinterprets him. He claims he is

In Pruitt’s view, today’s court battles will affect American governance long after Obama leaves offi ce. “We live in a consequential time,” he says. “Precedent is being set.”

Pruitt and Oklahoma Gov. Mary Fallin



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horrifi ed Pruitt, who sees attorneys general as a critical fi rewall against federal offi cials infringing on state sovereignty and mak-ing national policy without Congress.

While Pruitt admits that he disagrees with Obama’s positions on immigration, health care and the environment, he insists that those concerns are secondary to a more “transcendental” issue: maintaining the system of government as the framers intended it, with no single branch wielding unilateral control. That mission should matter to Democrats, he argues, because they may one day face a Republican president intent on bypassing a Democratic majority in Congress in the same way. In Pruitt’s view, today’s court battles will aff ect American governance long after Obama

leaves offi ce. “We live in a consequential time,” he says. “Prec-edent is being set.”

Pruitt, who is 47 years old, projects a political identity that took root more than a decade ago, when he was a state senator from Broken Arrow, a suburb of Tulsa. He framed his early cam-paigns around shrinking the size of government. He supported a cut to the state income tax and wanted to adopt a formula that would limit future spending growth. At the time, Oklahoma was one of the few states to off er in-state tuition to undocumented immigrants, and Pruitt was among the chorus of Republicans who wanted to restrict that benefi t to citizens. (The state reversed its policy after he left the legislature.)

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sanship. But that began to change at the start of the 2000s, when the Republican Party set up a group dedicated to electing conser-vatives to the post. A few years later, Democrats countered with their own group.

Pruitt continues to reject the insinuation that his work is driven by a partisan agenda. “Opponents want to present it that way,” he says. “It’s not that way at all for me.” Nonetheless, the fact remains that he consistently fi nds legal justifi cations for policies popular among conservative Republicans, while chal-lenging policies that his party opposes. From the outside, the lawsuits seem to be less about state sovereignty and more about a broader Republican strategy to upend the president’s domestic policy agenda.

When he isn’t challenging Obama directly, Pruitt frequently can be found weighing in on other disputes that clearly divide liberals from conservatives. Much of the time, these center on religion. As attorney general, Pruitt released an offi cial legal opin-ion in favor of distributing Bibles in public schools; he defended the installation of a religious monument on state Capitol grounds; and in a legal brief in support of an Oklahoma-based business, Hobby Lobby, he argued that businesses should be able to refuse to cover the cost of employees’ contraception on the basis of reli-gious liberties.

“There are broader trends that have been going on for a few years now where the attorneys general have been far more activ-ist,” Nolette says. “But it still requires some sort of entrepreneur to pick it up and press the extent of the power.” Pruitt has been that kind of entrepreneur.

One example is the King v. Burwell case. The plain-tiff s in the case mounted an argument that actually was fi rst embraced by Pruitt. The case hinged on language in the Aff ordable Care Act that said tax

credits were to go to individuals who purchased health insur-ance through an exchange set up by the state. Yet in practice, the federal government has awarded tax credits through both state-based and federal exchanges. If the tax credits were invalid in states with federal exchanges, the law would unravel. Ulti-

After three years in the state Senate, Pruitt mounted an unsuc-cessful campaign for Congress. In 2006, rather than seek re-elec-tion, he ran for lieutenant governor and nearly upset the Repub-lican House speaker, losing in the primary by less than 1 percent of the vote.

In his second attempt at statewide offi ce, in 2010, timing helped. Obama wasn’t on the ballot that year, but he might as well have been. Pruitt continually portrayed the president as a big-government Democrat working to increase regulations on health insurance and fossil fuel production. To some degree, Pruitt was tapping into populism that’s always been a part of his state’s poli-tics, says Keith Gaddie, a political scientist at the University of Oklahoma. “Standing up to those fancy Eastern Yankees is very much a tradition in Oklahoma.” Pruitt’s résumé turned out to be an ideal one in a state where voters in both parties largely shared his fears about federal encroachment.

The Republican primary for attorney general focused on the legal challenges to the Aff ordable Care Act. The outgoing Demo-cratic governor and attorney general both refused to join a mul-tistate lawsuit against the health-care law, with then-Gov. Brad Henry calling it “an exercise in legal futility.” By contrast, both Pruitt and his opponent in the primary promised to join the law-suit. But Pruitt went further. He pledged to establish the nation’s fi rst federalism unit focused entirely on fi ghting attempts to expand the federal footprint.

Pruitt’s disclaimers aside, it’s impossible not to interpret the federal-state court battles of recent years as contests of both party and ideology. Empirical research supports that view. Paul Nolette, a political scientist at Marquette

University, analyzed 20 years of U.S. Supreme Court cases and found that blocs of state attorneys general were challenging the federal government on a partisan basis much more often than they had in the past.

When attorneys general sued the Clinton administration in the 1990s, the coalitions they created tended to be bipartisan. In instances where most of the challengers came from a single party, they were usually Democrats suing a Democratic president. By comparison, the major lawsuits of today feature a homogeneous slate of Republican attorneys general litigating against the Obama administration, with a similarly homogeneous slate of Democrats fi ling friendly legal briefs in support of Obama.

Nolette says attorneys general are taking legal positions for political purposes and that both parties are doing it. He gives the example of the two same-sex marriage cases decided by the Supreme Court in 2014. Both parties found legal rationales that fi t their political ideologies. A bloc of Democratic attorneys gen-eral wanted the court to respect state sovereignty when it meant allowing states to legalize same-sex marriage, but also wanted the court to strike down a California law that banned same-sex marriage. Likewise, Republicans argued for states’ rights to save California’s ban on gay marriage, but invoked federal supremacy to maintain a defi nition of marriage that excluded gay couples.

Until relatively recently, the offi ce of state attorney general was seen for the most part as free from both ideology and parti-

Pruitt’s disclaimers aside, it’s impossible not to interpret the federal-state court battles of recent years as contests of both party and ideology. Empirical research supports that view.



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We want you to make an informed decision about the university that’s right for you. For more about our graduation rates, the median debt of students who completed each program, and other important information, visit www.apus.edu/disclosure.

*This program takes advantage of the Contract Management Body of Knowledge (CMBOK) as defined by the National Contract Management Association (NCMA).

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mately lower courts didn’t agree on whether the broader context of the law—aimed at getting people to sign up for health insur-ance—meant that federal agencies could ignore an oversight in the statute. The U.S. Supreme Court decided against Pruitt’s posi-tion in late June.

“Dozens of think tanks and attorneys general have been analyzing ways to challenge the law,” says Bruning, the former Nebraska attorney general. “It’s been part of the law for years. Many of us didn’t see it.” While Pruitt himself didn’t come up with the novel argument presented in King v. Burwell, he was the fi rst to use it as the basis of a lawsuit. At the time, the architects of the argument—Jonathan Adler of Case Western Reserve Uni-versity Law School and Michael Cannon of the libertarian Cato Institute—were having trouble getting Republican state offi cials to mount a challenge based on what seemed like a highly techni-cal reading of the law’s mechanics. Even though other plaintiff s fi led lawsuits later on that advanced beyond Pruitt’s case, he was the fi rst attorney general to recognize the potency of Adler and Cannon’s analysis.

So far, Pruitt’s willingness to wade into controversial issues has made him a celebrated fi gure in conservative circles. In 2014, he ran unopposed for his second term, and he’s on a short list of candidates mentioned prominently for the Oklahoma governor-ship. But there’s one issue on which he has rankled fellow Repub-licans. It concerns a lawsuit fi led last year by Pruitt and Bruning against Colorado’s legalization and regulation of marijuana. In

most of Pruitt’s other high-profi le disputes, he has argued against federal intrusion, but in this case, he and Bruning say federal law banning the use of marijuana should preempt state law in Col-orado and other jurisdictions that have legalized it. That posi-tion strikes many as inconsistent with Pruitt’s eff orts to defend state prerogatives. “I think that’s misplaced,” replies Pruitt, who alleges that Colorado’s law has increased illegal drug traffi cking in nearby states, including his own. “What about the states’ rights of Oklahoma?”

While both Oklahoma and Nebraska have argued for federal supremacy in the marijuana case, it’s also clear that Pruitt and Bruning disagree with legalization on policy grounds. “It’s about what’s good for our country in the long term,” Bruning says. “I see a slacker culture that makes me think of the fall of Rome. I don’t want to hire employees who smoke marijuana on their lunch break.”

Adler, the law professor who was Pruitt’s ally in the challenge to the Aff ordable Care Act, summed up conservative dismay over Pruitt’s challenge to Colorado in an op-ed article earlier this year. “It is as if their arguments about federalism and state autonomy were not arguments of principle,” Adler wrote, “but rather an opportunistic eff ort to challenge federal policies they don’t like on other grounds. It makes Oklahoma and Nebraska look like fair-weather federalists.” G


GOV09_32.indd 35GOV09_32.indd 35 8/17/15 11:17 AM8/17/15 11:17 AM


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www.StudyatAPU.com/governing


One year into Tennessee’s ambitious education reBy John Buntin

MEASURED P H O T O G R A P H S B Y B R A N D O N D I L L



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n reform effort, offi cials take stock. GROWTH

AAA YYYYYYYYYYYYYYYeeeeeeeeeeeeeaaaaaaaaaaaaaaaaaaaaarrrrrrrrrrrrrr aaaaattt FFFrrraaayyysssseeeeerrrrr HHHHHHHiiiiggghhhhFinal installment in a 4-part series



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Throughout the 2014-2015 school year, Governing has tracked eff orts to turn around one Memphis, Tenn., high school. This is the fi nal installment in a four-part series; the other parts can be found at governing.com/frayser.

One day this past May, Tennessee Gov. Bill Haslam slipped away early from a luncheon in Memphis hon-oring academic high achievers to visit students at a school that had long been associated with academic failure: Frayser High School .

It was a low-key visit—no local press, no student assembly. Instead, Haslam was greeted at the school’s entrance by Bobby White, founder and CEO of Frayser Community Schools, the charter management organization that operates the school. White ushered Haslam down a hallway to a fi rst-fl oor classroom that had been converted to a small conference room. There, four high school students awaited the governor, along with a handful of local notables, including Stephanie Love, a parent of a Frayser student and a member of the Shelby County Board of Education. Frayser Community Schools didn’t answer to Shelby County any-more. Instead, it was accountable to another person in the room, Achievement School District (ASD) Superintendent Chris Barbic.

Barbic had come to Tennessee four years ago, after establish-ing well-regarded charter schools in Houston. Upon arriving, he’d set an ambitious goal: moving schools that were in the bottom 5 percent in academic performance to the top quartile in fi ve years’ time. This was year three for the ASD, and year one for Frayser High, which had been stuck in the lower ranks for years. Barbic wanted Haslam to see what a turnaround in process looked like.

Haslam also had his own reasons for visiting the high school. One year earlier in Nashville, he’d met with a group of students from a north Memphis neighborhood who were on the cusp of entering Frayser. The governor was interested to see how they were faring. “My only purpose is to see what you guys are working on, to get a fl avor of that and see how things are going,” he said.

The students spoke right up. “Do you think our school is improving?” one asked.

“I do not have a strong sense of that,” Haslam replied frankly. “I am hoping to get some information on how the school is diff er-ent this year than last year.”

Another student jumped in. “Looking at the school academi-cally, I think it has changed tremendously,” said Marteja Martin . “Last year they just gave you an A for doing the work. This year, they were really engaged. They challenged you.”

“There’s a lot more stability this year,” added Decorion Caples . “A lot more control. This year, they stay on you.”

Things had changed for parents too, said Love. “When you walk in the offi ce, they speak to you. ‘Hey, how are you? Can we help you with something?’ Last year, I could literally sit in the offi ce for 15 minutes and no one would say anything to me.”

Martin had another point to make. “It’s not average,” she said, pausing to fi nd the exact words she wanted to describe her school. “It’s ... above.”

“Got it,” said Haslam. “It’s not average. I like that.” In fact, Frayser High had been below average—far below aver-

age—for decades. Barbic believed that the old Frayser High was

the kind of school that traditional systems failed. He thought the ASD could do better. Barbic, who’d been hanging back at the edge of the classroom, now stepped forward. “I am actually really excited to come to this school because it encapsulates the vision of what we are trying to do,” he told the group. “As a district, our job is not to tell Bobby [White] who to go partner with or what curriculum to adopt. Our job is to fi nd good people on the front end, go through a rigorous process of vetting and matching, and then hold them accountable.”

It was a concise statement of Barbic’s philosophy, one educa-tion reformers are eager to apply to public education as a whole. But was it working?

Over the course of the 2014-2015 school year, Governing has chronicled Barbic and White’s achievements and setbacks, as well as examined other models of reform, notably Shelby County’s Innovation Zone schools. Barbic began the school year with the knowledge that the ASD schools would need to make notable gains to meet his ambitious goals. This fi nal installment in the series takes up the question of results. What, at the end of the school year, did they achieve? And at a time when numerous other states are beginning to embrace the ASD turnaround model, what should Barbic and White’s experiences in Memphis tell policy-makers about its potential—and perils?

In June 2014, White and his new local charter organization received the keys to Frayser High. To signal the school’s new ambitions, White and his board immediately changed the school’s name to MLK College Preparatory School. Along with Principal Kimberly Hopkins-Clark and her team of

administrators and teachers, most of whom had just a few years of experience, White began the diffi cult task of changing the school culture, which in recent years had been marred by frequent fi ghts, poor attendance and chaotic classrooms.

In this eff ort, White and Hopkins-Clark were strikingly suc-cessful. As students returned from winter break in early Janu-ary 2015, both White and Hopkins-Clark were pleased with how readily they adapted to the school’s new rules. “I think we are ahead of the curve in creating an environment where learning can be sustained,” White said in the spring.

The challenge now was to demonstrate that a change in cul-ture could translate into real academic achievement. That was a task that fell primarily to Hopkins-Clark, who knew that a sig-nifi cant number of students were still reading and doing math at levels much lower than their grade levels. Addressing these defi ciencies now became a top priority. Students spent approxi-mately 40 minutes a day in their homerooms. Hopkins-Clark asked instructors to spend that time focusing on reading and math skills.

In February, MLK College Prep students took the MAPP Assessments exam as part of an eff ort to chart progress in read-ing and math. Hopkins-Clark was pleased by what the numbers revealed. “We’ve seen a tremendous shift, where our students are growing fi ve to 10 points a week,” she reported in the spring. If that rate of growth could be sustained, “then without a doubt, the majority of our students will grow at least a grade level or a semester grade level,” she said.

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In March, students took end-of-course benchmark tests, sub-ject matter exams that would refl ect overall profi ciency levels. These were less heartening. Although a signifi cant number of students had moved from a “below basic” level of profi ciency to “basic,” movement from “basic” to “profi cient” or from “basic” to “advanced” had stalled.

Hopkins-Clark wanted students to understand where they stood on the profi ciency spectrum in the key subject areas of reading, math, science and social studies. So subject area teach-ers were instructed to periodically display “data dashboards” on

their classroom whiteboards so that students could see whether they were assessed as below basic, basic, profi cient or advanced in each subject area. (To preserve anonymity, each student was given an identifying number.)

As the end of the school year came into view, White and Hopkins-Clark were focused on three metrics in particular. The fi rst was profi ciency, which would be measured by end-of-course subject matter tests. White and Hopkins-Clark were hoping to achieve double-digit growth in these areas. Doing so would delight the ASD and make it more likely that the ASD would give Frayser Community Schools permission to expand and take over a middle school in the fall.

The second important measure was the Tennessee Value-Added Assessment System (TVAAS). While end-of-course exams measured a school’s overall profi ciency in a handful of subject areas, TVAAS measured individual student growth compared to

other similarly ranked students over the course of a school year. Measuring how much growth individual students, classes and grades at any given school had gained or lost compared to oth-ers would help administrators and regulators determine—at least in theory—how eff ective teachers and the schools they taught in were. Schools that met their expected rate of growth earned a TVAAS score of 3. Schools whose students made the most prog-ress in comparison to their peers earned a 5. Schools whose stu-dents lagged furthest behind their peers scored a 1.

End-of-course tests and TVAAS were the primary measures the ASD would use to assess MLK College Prep’s performance. But the third measure that was impor-tant to White and Hopkins-Clark was the American College Testing scores. The ACT focuses on subject expertise, and it’s the measure that could unlock access to college for MLK students. A score of 19 is gen-erally considered to be the threshold for college readiness. Scholarship opportunities typically open up for students who earn scores of 21 or higher. MLK College Prep students had taken the ACT in October, and their average score was 13.8. Students would take the test a second time in April. White and Hopkins-Clark hoped to see that score rise.

Benchmark tests taken in March suggested that MLK College Prep students were lagging behind where White and Hopkins-Clark hoped they would be with subject profi -ciency. A cold winter had hurt: Stu-dents had missed more than a week of school due to icy conditions. To make up for lost time, White and Hopkins-Clark decided to institute Saturday morning classes for all of

April and a few weeks into May. Teachers invited roughly 350 of MLK College Prep’s 500-plus students to attend. Between 150 and 170 students voluntarily attended school on Saturdays—a strong response. “We were proud of our students,” says Hopkins-Clark. “We also received tremendous support from their parents.”

In many ways, the hard work paid off . MLK College Prep’s end-of-course scores showed progress in most subjects. Alge-bra 1 scores, for instance, rose by 6.7 points; English 1, 6.1 points; and English 2—a class taught by one of MLK College Prep’s star teachers—by 19.9 points. Biology, the only science tested, rose by 2.6 percent. All told, the school had outpaced the state levels of growth in three of four subject areas.

ACT scores were also positive. They had risen by 2 points, from 13.8 to 15.7. This was a signifi cant success. However, given that the cutoff for college readiness is considered to be 19, it was also a reminder of just how far the school had to go.


Gov. Bill Haslam

visited MLK College

Prep in May to see

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Preliminary TVAAS scores, meanwhile, were a bit disap-pointing. They gave MLK College Prep a score of 1, meaning that compared to students who began the year with the same level of educational attainment, its students had regressed.

White seems to have taken the results in stride. “I wanted double-digit gains in every category. That didn’t happen,” he says. “But enough of the data points showed movement that I am very encouraged and excited by where we are.”

Already White and Hopkins-Clark were preparing for the 2015-2016 school year. All but six of MLK College Prep’s teachers had indicated that they were returning for the upcoming school year. White and Hopkins-Clark had plans to boost teacher per-formance: An anonymous donor was allowing them to off er two years of leadership training to 10 teachers. The idea, says Hop-kins-Clark, is that these 10 “can then support the other teachers in our building as mentors.”

White and Hopkins-Clark want their students to encounter a culture of high expectations and academic excellence early, and to continue in that environment until they graduate from high school. They are planning to greatly increase students’ exposure to college, a tactic from the playbook of successful charter opera-tors. Starting next year , beginning in the ninth grade, every stu-dent will have three exposures to college a year.

Summing up his assessment of year one, White says, “Turn-around work takes three years because of the phases. Year two is when all of the things that you put in place in year one start to become natural. [That’s where] I think we are right now. We’re ahead of schedule. That second phase will really take off and cata-pult us into the next stratosphere next year.”

ASD Superintendent Barbic sees reasons for cautious opti-mism in MLK College Prep’s test results as well. “We have to be careful not to draw too-big conclusions,” he says. “If MLK was getting a [TVAAS] level 1 three years out, I’d be concerned. But given that year one is about getting culture right, I am not.”

Barbic is also positive about MLK’s future based on intangibles he sees happening in the building—positive collaboration, buy-in and team spirit among staff . MLK College Prep is clearly a bet-ter place than the high school had been the year before. “That, combined with early data, and I think there is a lot to be hopeful for,” he says.

The same could be said of Barbic’s view of the ASD’s over-all performance, which at the end of year three is mixed. “Our hypothesis is the longer this is at work,” he says, “the better growth scores are.”

Segmenting schools by time spent in the ASD produced results consistent with that theory. Six schools had been under the ASD’s oversight for three years. Of those schools, four achieved level 4 or 5 TVAAS scores, meaning students in those schools were learning at a much faster rate than comparable students in other schools. The remaining two schools scored 1’s—a disappointing outcome. Another eight schools had been under the ASD’s supervision for two years and their results were slightly less strong. Five achieved level 4 or 5 TVAAS scores, indicating greater than average student learning. And fi nally, six schools had been under the ASD for one year and their scores included one 3, one 2 and four 1’s, a weaker showing overall.



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Of course, Barbic had set a goal for the ASD as a whole that was anything but modest—moving the bottom 5 percent of schools into the top 25 percent in fi ve years time. At the end of year three, some ASD schools were on track to make that jump. Whitney Achievement Elementary, for instance, made 30-point gains in math last year. “That’s huge,” he observes. But he also acknowl-edges that most schools were not faring as well.

Overall, the ASD schools are outpacing their counterparts in math and science. Reading scores, however, continue to be a source of frustration. After increasing slightly in 2014, reading scores actually declined in 2015. “What we have learned from the last three years is that it may take a bit longer than that,” Barbic says. “It’s still the goal—the right goal—but not every school is going to be able to hit that mark in fi ve years.”

Barbic knows that if the ASD misses its original goal, some critics will interpret that as a sign of failure. Still, Barbic has no regrets about setting his sights high. “The goal has created a sense of urgency, and a sense that this was a game worth competing in, quite frankly, all across Memphis,” he says. “Every-one stepped up as a result.”

Barbic notes that on a recent trip to Mem-phis, he saw an Innovation Zone (iZone) school advertisement in which the Shelby County School District touted its own plan to get its “5 percent schools” into the top 25 percent in three years time—two years faster than the ASD. “We are competing about who can get into the top quartile faster, “ Barbic says. “That’s great.”

Barbic himself has had an especially tough school year. In September 2014, he suff ered a heart attack and under-went emergency bypass surgery. Then in October 2014, the ASD was forced

to contend with a backlash from elected offi cials, teachers and parents in several Memphis commu-nities whose schools had been targeted for char-ter conversion. At the last minute, several charter school operators, including the charter manage-ment organization that Barbic himself had founded in Houston, YES Prep, unexpectedly withdrew from the process. Barbic tried to put a good face on the controversy, but the perception was that the ASD had been damaged.

Barbic spent the 2014-2015 school year not only repairing relationships in Memphis, but also work-ing to secure his organization’s survival. During its fi rst four years of existence, the ASD operated with federal Race to the Top dol-lars. But those funds ran out this summer. In order to continue to operate, Barbic had to convince state legislators to provide the ASD with a $4.5 million a year operating budget, an amount Bar-bic proposed to raise by levying a 2.5 percent authorizing fee on ASD students. But the legislators who seemed to have the stron-gest opinions about the ASD by and large wanted to stop or slow school takeovers. When the legislature convened in January, state representatives and senators fi led 22 bills seeking to curtail the

ASD’s operations. The appearance that opposition to the ASD was growing, however, proved to be misleading. Not only did Haslam stand by the ASD, he rallied Republican legislators to support leg-islation that would allow the ASD schools to off er admission to students from outside the areas they served. When the legislative session ended in April, all but two of the bills curtailing the ASD’s operations had gone down in defeat.

The positive vote for funding doesn’t mean there’s not still sig-nifi cant opposition to the ASD. The ASD “was supposed to be a pretty small organ within the state department of education,” says Will Pinkston, a Nashville school board member who was an aide to then-Gov. Phil Bredesen and helped draft Tennessee’s Race to the Top application fi ve years ago. “It was supposed to take over a dozen or so schools, establish some proof points about what works and what doesn’t, and export best practices” before return-ing schools to local control. What the ASD had become instead, he says, is something more like a charter school authorizer, “one that is diverting much-needed resources away from the traditional

public school system.” Worse, Pinkston believes that instead of driving changes that would lead to broad improvements in pub-lic education, it’s become a substitute for change. The ASD “is not turning around anything,” he charges, and certainly not the schools with the neediest students. “It’s turning its back on them.”

Others, chief among them Shelby County Schools Superin-tendent Dorsey Hopson, credit the ASD with creating greater urgency around reforms. He also notes that having local leaders heading up turnaround eff orts has real advantages. The perfor-mance of Shelby County’s iZone schools, which enjoy levels of


Bobby White, left, and Chris

Barbic will be parting ways.

“Within just a few years,

chronic failure in schools will

have real potential to be a thing

of the past,” says Barbic.



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autonomy similar to charter schools, proves his point, demonstrating strong growth on par with the ASD. But it isn’t just the iZone schools that have made progress. Shelby County has on the whole scored a 5 on TVAAS, indicating that district students are improving at a much faster rate than comparable students in other parts of the state. Despite a tight budget, Hopson also won a com-mitment from his board to expand iZone schools from 14 to 16.

In mid-July, Barbic announced that after four years he was resigning as superintendent of the ASD. In his resignation letter, he cited his need to focus on his health and family, and touted the ASD’s successes. During its tenure, the ASD has brought in 14 charter school operators to run 30 schools serving 10,000 students. In Barbic’s opin-ion, it prompted major interventions, most nota-bly the Shelby County School District’s creation of iZone schools that are making a major diff erence in the improvement of education in the most vulner-able schools. He noted that over the past two years, student profi ciency in Tennessee’s so-called priority schools—those in the bottom 5 percent—had grown four times faster than in nonpriority schools. “By this time next year,” he wrote, “every priority school in Tennessee will be in the ASD, in a district-led iZone or undergoing some kind of major local intervention. If we keep this up, within just a few years, chronic failure in schools will have real potential to be a thing of the past.”

Lawmakers in other states seem to view the ASD’s interven-tion as successful too. During early 2015, two states—Arkansas and Nevada—passed legislation to create their own versions of the Achievement School District. Georgia moved ahead with plans to off er voters a constitutional amendment to create an “opportunity school district” next year, and Missouri, South Carolina, Texas, Utah and Wisconsin are also advancing plans to move ahead with statewide charter school districts or variants of the ASD.

But Barbic worries about the ability of these states to fi nd high-quality charter operators who can do turnaround work. He estimates that fi ve years ago, there were eight to 10 charter organi-zations in the fi eld; now that number is closer to 30. Most of these groups, however, are small startups with fewer than three schools each. As a result, they don’t have the capacity to take over schools in new markets. “If the philanthropic community will invest in them,” he says, “those numbers and capacity will grow, but none of that is going to happen in the next 24 months.”

Despite all the enthusiasm surrounding Tennessee’s reform experiment, the ASD’s future is uncertain. Barbic has indicated that he hopes to continue to serve as the ASD superintendent until a new chief is chosen later this fall. But it is unclear whether the ASD will—or should—continue to operate in a semi-autono-mous fashion, as it has under Barbic, or if it should become a more normal part of the state education bureaucracy. It is also unclear whether the ASD will continue to show the same appetite for tak-ing over schools and transferring them to charter operators that it did under Barbic.

Whatever the ASD’s future, MLK College Prep was celebrat-ing its accomplishments on graduation day last June. It was a dignifi ed, even solemn, occasion—intentionally so. White and Hopkins-Clark wanted none of the rowdiness that sometimes occurs during graduations in Memphis.

White took a quiet moment before the ceremony began to refl ect on how far he had come. Many of the seniors who were graduating that day had been his students when White was the principal of Westside Middle School around the corner. Back then, several teachers told White: “Don’t send your kid to Frayser. They won’t challenge him.”

For 30 years, Frayser High had been a dead end. Now, on grad-uation day, White felt optimistic. He felt as if a huge burden had been lifted. A few years ago, White had asked the community to give him the opportunity “to lead your babies and do this work the way it has never been done.” Now, he says, “these babies—they have done it.”

For the graduating students, this was a moment of pride and vindication. “They labeled us as numbers. They gave us a stat, when we were in the third grade, based upon our test scores, I believe. They already knew who was going to be in jail,” said vale-dictorian Demarro Smith .

Smith believed the graduating class had proved them wrong. He was off to the Army after graduation. Three of his classmates would join him in the military. Fifty-three of the seniors were going on to community colleges.

And that ultimately underscores Gov. Haslam’s goals for Ten-nessee and its turnaround eff ort. “The whole income inequality issue, you see where it comes from,” he says. “It’s going to get bigger and worse unless we actively intervene here. I think public education is our last hope.” G

Email [email protected] More at governing.com/frayser


The challenge was

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Are We Out of the Woods Y

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The lights are back on in Colorado Springs.

Five years ago, in the immediate aftermath of the Great Recession, Colorado Springs, Colo., became a poster child for municipal service cuts. Because the majority of its revenue comes from sales taxes, the city

was hit hard—and particularly early—by the economic downturn. After its revenue plummeted in 2009, Colorado Springs slashed many core public functions in an eff ort to make ends meet. One-third of the city’s streetlights were turned off to save money. Swimming pools and community centers were shuttered. The city stopped collecting trash from parks and ceased mowing the grassy medians in downtown streets. Buses quit running on nights and weekends; some routes were terminated altogether. City jobs went unfi lled, including fi refi ghters, beat cops, drug investigators and other essential positions. The police depart-ment auctioned off its three helicopters online. Infrastructure spending fell to zero.

The sweeping cuts gained international attention, including a cover story in this magazine fi ve years ago this month. But it wasn’t just the cutbacks that drew focus to Colorado Springs. It was the way citizens responded to them. In November 2009, with the looming service reductions already announced, local voters overwhelmingly turned down a proposed property tax increase. The message from residents was clear: We’d rather suff er the cuts than spend more to avoid them.

Thus the already libertarian-leaning city became an extreme experiment in limited government. “People in this city want gov-ernment sticking to the fundamentals,” City Councilmember Sean Paige told Governing in 2010. “I think the citizens have made it clear that this is the government people are willing to pay for right now. So let’s make it work.”

In many ways, that’s exactly what happened. The bare-bones budget went mostly to fund fi re and police services, along with some money for parks and public works. Citizens and private

Colorado Springs and other cities have rebounded from the recession. But things aren’t as good as they seem.

By Zach Patton

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groups fi lled in the gaps. Neighborhoods chipped in to pay for their own streetlights. Churches ran some of the community centers that had been slated to close. Volunteers helped out with back-offi ce police functions. Some outsourcing was more formal: A city-owned hospital was sold off to the University of Colorado health system, and the YMCA formally took over the public swim-ming pools. The city even privatized its entire fl eet of vehicles.

By late 2011, things started looking up. Sales taxes began to rebound, and the city restored many of the services that had been cut. The lights came back on, trash pickup resumed, more cops were hired. By the next year, Colorado Springs’ reserve funds were at their highest levels ever, a fact that helped the city cope with a couple of devastating fl oods and wildfi res, including the 2012 Waldo Canyon fi re that killed two people and destroyed nearly 350 homes in the area. By 2013, the city’s revenue was already back to pre-recession levels.

It’s easy for Colorado Springs residents today to feel as if the city has fully recovered from the recession. “There’s this sense that everything’s back to

normal,” says Daphne Greenwood, an economics professor at the University of Colorado at Colorado Springs. “But just like the rest of the country, we’re not really back to where we were.”

What’s happened in Colorado Springs has played out in municipalities across the country. Revenues are back up and jobs are returning. Many cities, in fact, are thriving. But there are wor-risome cracks in the foundation—structural imbalances that go beyond the cyclical churn of the economy. “Compared to 2010, obviously cities are much better off —at least in the short term,” says Kim Rueben, a senior fellow at the Urban-Brookings Tax Policy Center who focuses on state and local economies. “But there are still fundamental problems. Things are getting better, but I wouldn’t necessarily say it’s all sunshine and roses. This is really just a time for people to catch their breath.”

Nationwide there’s a lot to be optimistic about when it comes to local government fi nances. Property values, after bottoming out in 2012 and 2013, have bounced back. The National League of Cities’ (NLC) most recent City Fiscal Conditions report, published last

fall, showed that property tax collection was at 90 percent of pre-recession levels, and NLC economists say they expect to see higher numbers in next month’s report. Just in the past year, it seems cities have turned a corner. That 2014 NLC report showed the fi rst positive growth for city revenues in fi ve years, and for the fi rst time since the downturn, a majority of local offi cials sur-veyed in the report said they were optimistic about their cities’ fi scal health.

There are other positive indicators. Last year, more cities increased the size of their municipal workforce than decreased it, something that hasn’t happened since 2008. In fact, this past May marked six consecutive months of job growth for cities—a fi rst in several years. And in the fi rst quarter of 2015, Moody’s credit rat-

ing upgrades for cities fi nally outpaced downgrades. But every silver lining has a cloud. Take the

employment numbers. Despite those six months of sustained growth, cities are still about 195,000 jobs below the peak employment levels they saw at the end of 2008.

Or consider the Moody’s upgrades. It’s an important sign, says Tom Kozlik, an expert on local fi nances and a municipal strate-gist with PNC Bank. “On the other hand, it took several years for that to happen, and there are still a number of down-grades happening.” Many of those downgrades are occurring because of multiyear fi scal structural imbal-ances. Lots of municipalities are still dipping into their reserves as a way to balance the budget year to year. “That tells me it’s

going to be really diffi cult to turn this trend around,” says Kozlik. “If local governments don’t really sit down and recognize this new fi nancial reality—budgeting con-servatively and managing expenditures—then their credit will deteriorate and they’ll continue to face downgrades.”

Overall the recovery has been markedly uneven for locali-ties. An NLC report released in late July laid out some of the frustrating inequalities of “an economy defi ned as much by job gains as by slow productivity growth, suppressed wages and stub-born unemployment.” In the report, which surveyed more than 250 municipal offi cials from across the country, nearly all cities reported a rosier economic picture, with 28 percent reporting a “vast improvement’ in their economy and 64 percent citing a “slight improvement.” But smaller cities of under 100,000 resi-dents haven’t seen the same rates of economic growth that larger cities have, and some of those smaller localities actually reported worsening conditions over the past year. Rising demands in all cit-ies for assistance in areas such as food and housing indicate that not everyone has shared in the strengthening economy. “Even

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those cities that are emerging as post-recession leaders still have a long way to go in terms of low- and middle-class residents,” says Christiana McFarland, co-author of the NLC report. “You see confl icting storylines within the same city.”

The recovery has been a mixed bag in Colorado Springs as well. On the one hand, revenues are at 10-year highs. But the city’s population has also risen, meaning per-capita revenue and expen-ditures have actually fallen sharply since 2007. And while police and fi re positions have almost inched back up to where they were before the downturn, other departments are still stretched thin. The number of nonemergency civilian positions is down 24 per-cent today compared to 2008. “Of course we’re in a better place now than we were,” says Kara Skinner, the city’s chief fi nancial offi cer. “But we’re still super, super lean.” City departments like parks and public works want to add back some of the staff they’ve lost, she says, “but the funds are just not there to meet those requests. Realistically that’s just a new normal for us.”

Drive around Colorado Springs today and there’s one thing you can’t help but notice: “Potholes,” says Green-wood, the economics professor. “It’s hard to keep your eye on traffi c because of having to dodge all the pot-holes.” Colorado Springs is spread out over 195 square

miles, with 5,600 miles of roads, and most of them are in disre-pair. Sixty percent of the city’s roadways have gone more than a decade without being repaved, and the pothole problem has become severe. The city’s roads are “rapidly deteriorating, and we need to deal with it,” says Mayor John Suthers, who took offi ce

this June. “That’s defi nitely a product of the recession. There’s still essentially no money for road improvement or maintenance.”

Suthers is backing a slight increase in sales taxes for fi ve years, which would give the city about $50 million a year solely to fi x its roads. Residents will vote on the proposal in November. Suthers says he’s “incredibly optimistic” that it will pass, despite the strong antitax sentiment in his city. Residents, he says, are keenly aware of the poor state of the city’s roadways.

Infrastructure investment is not a problem unique to Colorado Springs, of course. During the recession, one of the fi rst places cit-ies reduced their spending was on the maintenance of roads and bridges and other facilities. Most haven’t restored that funding even now. But as the nation’s infrastructure continues to deterio-rate, localities will have no choice but to spend money to repair it. As early as next year, “growing capital demands will force local governments to signifi cantly increase investment in infrastruc-ture,” one Moody’s analyst said in a report earlier this year.

“Cities are disinvesting—you’re not even maintaining the value of the infrastructure you have,” says Michael Pagano, dean of the College of Urban Planning and Public Aff airs at the University of Illinois at Chicago and co-author of NLC’s City Fiscal Conditions report since 1991. “We’ve postponed repair and maintenance for so long that we’ve now got to decide what to address, what to abandon and what to sell off .” Public-private partnerships are one way to help fi nance projects, and cities are increasingly utilizing them as an important tool. But many of cities’ most pressing infra-structure needs—alleys, sidewalks, school facilities and bridge maintenance—might not be attractive to corporate partners.


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If infrastructure is one looming crisis for localities, the other is certainly pensions. While a few cities have initiated some retire-ment benefi t reforms in the past fi ve years—around 20 percent of localities, according to NLC—pensions remain a major fi scal problem for municipalities. Pension burdens increased for 31 of the 50 largest local governments in fi scal 2013, the most recent year for which data is available, according to a recent Moody’s report. And in general, required pension contributions are growing faster—in some cases much faster—than local govern-ment revenues. As aging public employees retire in the next decade, those pension obligations will continue to gobble up an increasing share of city expenditures, crowding out spending on other services.

The twin crises of infrastructure investment and pension burdens represent deeper structural problems that cities must confront. The good news, says Pagano, is that cities are at least talking about their pension and infrastructure needs. But talk doesn’t always translate into appropriate action. “Yes, cities are having serious conversations” about these topics, he says. “But are they adequately addressing the long-term liability issue? That’s something we don’t have an answer to yet.”

The underlying question, in Colorado Springs and elsewhere, is whether cities are any better equipped to handle the next fi s-cal downturn. If history is any guide, an economic contraction will happen within a few years. Are cities ready? In one aspect, they may be. “If the Great Recession taught cities anything,” says Pagano, “it taught them not to believe in overly optimistic fore-casts in their pension systems. Maybe that’s a good thing.”

In Colorado Springs, leaders say they’re defi nitely better pre-pared. The city’s reserves today are $10 million higher than they were in 2007. And Suthers says that if voters pass his tax increase for road repairs, the city will be on even surer footing. “We’re in a better place than we were,” he says. While Suthers doesn’t question the cuts that were made in 2010 because they were “philosophically consistent” with the views of Colorado Springs residents, he acknowledges that they remain an issue. “I’m still dealing with many of the cuts we made fi ve years ago and trying to get back to square one.”

For the most part, though, cities continue to face those entrenched, longer-term trends that will make it much harder to weather future fi scal storms. In addition to unmet infrastructure and pension needs, cities are bridled with an increasingly out-dated sales tax system that doesn’t refl ect the shift to a service economy. “I had hoped the Great Recession would cause cities to really examine the adequacy of their fi scal architecture,” says Pagano. “But for the most part, that hasn’t happened.”

Without some sort of action on taxes, infrastructure and pen-sions, he says, cities won’t be able to withstand the next downturn any better than the last. “I’m not sure they’re any more prepared for a recession in the next fi ve to seven years than they were in 2008,” Pagano says. “The future isn’t going to be too much diff er-ent from the past.” G

Email [email protected] Read Governing’s September 2010 story on Colorado Springs

at governing.com/coloradosprings



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In 2006, John de Graaf was in the middle of turning the book The Motherhood Manifesto, which chronicled some of the harder choices working mothers face, into a docu-mentary fi lm. As part of his research he met Selena Allen, a mother who had delivered her baby boy six weeks pre-

maturely and couldn’t aff ord to take off more than four weeks—cobbled together using vacation and sick time—from her job. Not knowing how long their son would be in intensive care at the hospital, Allen and her husband decided that her time off would be best spent when the baby came home. That meant that Allen, who gave birth on a Thursday, was back at her desk Monday morning with a heavy heart and a premature baby in a hospital in Seattle, some 20 traffi c-clogged miles from her home in Kent. The commute to see her baby after work and the rush home to pick up her older son at daycare added to the stress.

“It was a terrible story; I couldn’t believe it,” says de Graaf, who wanted to use the documentary, also titled The Motherhood Manifesto, to increase awareness about the need for paid time off for families with new babies or loved ones who unexpect-edly need care. While Allen’s story is extreme, it highlights the struggle many Americans go through when faced with the choice between work and a family emergency. At the time Allen had her baby, only California had a state program that helped replace the income workers lost when they took a family-related leave of absence. Allen and the rest of American families had to rely on the federal Family and Medical Leave Act (FMLA), which was considered breakthrough legislation when it was passed in 1993. FMLA guarantees that workers’ jobs will not be lost if they opt to take time off for a family-related event. Workers are covered for 12 weeks of absence, but the law does not provide any fi nancial sup-port during that time and most employers don’t off er paid time off to care for a loved one. For too many, unpaid leave isn’t an option. Ten percent of those who use FMLA are forced to turn to a public assistance program to cope with the loss of a paycheck.

FMLA has other drawbacks. It only applies to businesses with more than 50 employees and to workers who’ve been at their jobs for at least a year, which means the law excludes two-fi fths of the workforce. Among those who are eligible, fewer than 1 in 5 use FMLA, according to a recent survey by Family Values @ Work, a multistate consortium pushing for paid leave.

Given the limits of the federal law, advocates have been turn-ing to the states. In 2007, when Washington state considered a paid family leave bill that would provide $250 in weekly replace-ment wages, Allen addressed the legislature in support of it. “I worked in the early childhood education fi eld; I was surrounded every day by the research citing how important those fi rst days are for bonding and lifelong learning,” Allen testifi ed. And yet she was forced to miss out on much of that time. She told the legislators that the $250 fi nancial cushion would have allowed her to stay with her baby in the hospital. “It broke my heart that I could not be with my son when he needed me so much,” she said. “These were, by far, the most diffi cult days of my entire life.”

Ultimately Washington passed the bill, but lawmakers stripped it of a payroll tax that would have funded it. With the general election a year away, lawmakers were “terrifi ed that S

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of their wages during that time. New Jersey followed seven

years later with family leave insur-ance benefi ts, which replace two-thirds of a worker’s wage for six weeks of leave. Rhode Island’s Temporary Caregiver Insurance program, which launched last year, off ers four weeks of paid leave. The insurance pool pays a minimum of $84 and a maximum of $795 per week , depending on the worker’s earnings.

These states are three of fi ve that currently collect a temporary disability insurance payroll tax. Hawaii and New York are the other two. These states already have much of the fi nancing infrastruc-ture in place to start paid family leave programs. The states are also able, if necessary, to increase the underlying tax to keep up with the new expenses. After the program’s fi rst year, the Rhode Island Depart-ment of Labor and Training kept the disability tax rate at 1.2 percent. The new insurance had caused about an 11 percent bump in claims, reports Deputy Administrator Ray

Pepin , but the program had enough in cash reserves to cover it.With a fi nancing infrastructure already set up, these states

were instead able to focus on winning over the business commu-nity. Rhode Island state Sen. Gayle Goldin, author of the state’s paid family leave legislation, says that while she didn’t win sup-port from the Providence Chamber of Commerce, she was able to get small businesses to help push her bill through the legislature. It passed with healthy majorities in both houses. “The reality is that here and everywhere else, those trade associations are only representing a portion of the business sector,” Goldin says, add-ing that small businesses couldn’t compete with larger ones on benefi ts like paid leave. “We had small businesses in Rhode Island saying, ‘I want my employees to be able to take this leave, but I can’t aff ord to pay them for that.’”

It’s been a diff erent story 170 miles away in Albany, N.Y., where paid family leave has remained an elusive goal for the past 15 years. The business lobby has been a powerful force there, arguing that it would cost businesses overtime pay to cover absent work-ers’ schedules. The result would be increased personnel costs and diminished morale for those who pick up the slack, accord-ing to a memo issued by the Business Council of New York State. Groups like the Society for Human Resource Management and the National Federation of Independent Business have fought paid family leave in New York and elsewhere, framing it as “yet another entitlement program” during a time when businesses and state governments are still struggling after the Great Recession.

52

if they talked about a tax increase of any kind—even just a few cents—they’d lose the next election,” says de Graaf, who is also president of Take Back Your Time, a paid leave advocacy organiza-tion. Nearly a decade later, the program has yet to be implemented.

Several states interested in similar paid leave bills have also been stymied by politics, funding or both. Since California passed its law a decade ago, just two other states have launched their own programs: New Jersey in 2009 and Rhode Island in 2014. But that could be changing. Shifting views about work-life balance, par-ticularly powered by the millennial generation, have softened the political stigma that pigeonholed paid family leave as a women’s issue. Data from existing paid family leave programs are fortify-ing arguments that such programs are not harmful to business. The other big barrier to adopting paid family leave—how to pay for it—could also be weakening as the federal government off ers states grant money to study ways to create and fund programs. Many advocates for paid leave believe the next few years could be pivotal for passage in several states across the country.

When California passed its paid family leave pro-gram in 2002, many supporters hoped it would be a model for others. The law is fi nanced by an employee payroll tax and lets workers take six weeks off to care for a newborn, newly adopted

child or ill family member. Employees can receive up to 55 percent

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Selena Allen’s son Connor was born prematurely. She could not afford to take

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Sherry Leiwant, co-founder of A Better Balance, a nonprofi t legal advocate for work-family balance issues, says the closest her group got to advancing paid family leave in New York was in 2008 with Gov. Elliot Spitzer’s administration. The discussions abruptly came to a halt, however, when Spitzer got caught up in a prostitution scandal and resigned. “So it’s been political and it’s also been bad luck,” says Leiwant.

In the 45 states without temporary disability insurance, fund-ing a paid leave program remains the primary obstacle. In Wash-ington, the intention was always to revisit the 2007 bill’s fund-ing issue. But the Great Recession created a budget crisis and the program was shelved. There have been attempts to revive it, but many balk at what state Sen. Karen Keiser, who sponsored the bill, estimates is $15 million to $20 million in startup costs.

Advocates hope that recent data on the eff ectiveness of paid leave will eat away at “bad for business” arguments. A 2011 study of California’s family leave insurance program found that most employers reported either a positive or no noticeable eff ect on productivity. Small businesses were less likely to report any negative eff ects. Similarly a 2014 study on New Jersey’s pro-gram found that none of the participating employers reported any change in pro-ductivity or turnover.

When conducting fi eld interviews for the California study, co-author Ruth Milk-man says she expected that employers would struggle most with how to cover a worker’s absence. But her interviews revealed that experienced business own-ers already had a contin-gency plan in place for an employee’s extended absence. “The business opposition is based on incorrect assumptions,” says Milkman, a sociology professor at the City University of New York Graduate Center. “Hopefully more and more people are aware of that now.”

Long seen as a women’s issue, paid family leave is now increasingly becoming a work-life balance issue. In California, women’s support on the 2002 legislation was matched by a vocal group of young fathers and “sandwich generation” workers who were responsible for caring for aging parents. AARP has lobbied for paid family leave so workers can take time to care for their older parents without putting themselves fi nancially at risk. As income inequality has grabbed more national headlines, argu-ments have been made that poor families are the greatest ben-efi ciaries of paid family leave since their access to any paid time off is minimal.

Several presidential candidates, mostly Democrats, have also been weighing in on the topic, and some hope that means paid family leave will get a national airing during next year’s election, just as the FMLA idea did during the 1992 presidential campaign.

Meanwhile, study after study has shown that the millen-nial generation, which is now the largest population bulge in

America, places a high importance on work-life balance. Some are even willing to take less pay to achieve that. “It’s only very recently that it’s been reframed as this argument that the work-place is very much organized and designed for the 1950s and nobody really works that way anymore,” says Brigid Schulte, author of Overwhelmed: Work, Love and Play When No One Has the Time. “It’s taken a very long time for that conversation to come through.”

But perhaps the most important change in recent years has been with fi nances. More than a dozen states were considering paid family leave after California launched its program. But then the recession turned the issue into a nonstarter in states that didn’t have a temporary disability insurance program in place. Now, with most budgets stabilized, many see states picking up where they left off . Connecticut, New Hampshire and Vermont have established task forces to study the issue. Bills have been proposed in Colorado and Massachusetts. Some cities, includ-ing Washington, D.C., and St. Petersburg, Fla., are instituting paid leave polices for their own workers and encouraging local employers to do the same.

Most recently, a substantive push from the Obama admin-istration is helping more states study the issue. Last year, the administration awarded a total of $500,000 in grants to the Dis-trict of Columbia, Massachusetts, Montana and Rhode Island so that they could come up with a way to create programs. This year, the federal grant pool more than doubled to $1.25 million.

All told, 18 states have considered legislation or studied the issue, says Ellen Bravo, executive director of Family Values @ Work. She expects that list to increase after the winners of this year’s federal grants are announced. With that momentum, she predicts the number of paid family leave programs could double in the next few years to include Connecticut, New York and the District of Columbia. Movement on that level could be enough to spur federal action, just as it did when early state action on fam-ily leave moved Congress to pass FMLA. “We have three states now—that’s millions of people with access to paid family leave, and that builds upon the momentum that you’re not alone,” says Rhode Island’s Goldin. “It’s not a personal problem you’re trying to deal with. It’s a systemic issue. The politics are fi nally catching up with the will of the people.” G


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In the 45 states without temporary disability insurance, funding a paid leave program remains the primary obstacle.

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Problem Solver

For years, the Irving, Texas, Police Department has sought to become a more diverse force. Recruiters have traveled to pre-

dominantly black and Latino colleges across the state, attended cultural events and forged relationships with high schools to pitch students on law enforcement careers. But despite such eff orts, the department is still overwhelmingly white. While minori-ties account for 70 percent of city residents, they only make up about 17 percent of offi -cers—one of the biggest disparities of any larger police department nationally.

Irving, however, is far from alone. A Governing analysis of 2013 personnel data reported to the Bureau of Justice Statis-tics fi nds minority groups remain under-represented, to varying degrees, in nearly all local law enforcement agencies serv-

Diversity in BlueMany police departments still don’t mirror the demographics of their communities. Some cities are looking to change that.


2013 Minority Share of Police Offi cers

2013 Minority Share of Population

Fontana Police Department (CA) 25.6% 85.6%

Edison Twp Police Department (NJ) 8.5% 63.6%

Irving Police Department (TX) 16.7% 70.1%

Grand Prairie Police Department (TX) 21.1% 72.5%

Daly City Police Department (CA) 36.7% 87.5%

Allentown Police Department (PA) 10.3% 59.3%

Hartford Police Department (CT) 35.3% 84.1%

Fremont Police Department (CA) 28.1% 75.7%

Elizabeth Police Department (NJ) 37.4% 84.7%

West Covina Police Department (CA) 39.3% 86.1%

ing at least 100,000 residents. Racial and ethnic minorities are underrepresented by a combined 24 percentage points on average when each police department’s demographics are compared with Census estimates for the general public. In 35 of the 85 jurisdictions where either blacks, Asians or Hispanics make up the single largest demographic, their individual presence in the police department is less than half their share of the population.

Recent events highlighting tensions in predominantly minority communities, such as in Baltimore and Ferguson, Mo., have amplifi ed calls for improving police diversity. While increasing the ranks of minority offi cers alone won’t solve many of the underlying problems, a litany of factors have slowed progress. “Many people in our society see us as not always

[standing] up for their best interests,” says Irving police Lt. John Mitchell, “and you certainly see that in recruiting.”

The longstanding perception of police as an oppressive force has hurt minority recruitment, particularly among Afri-can-Americans. “The history of racism that surrounds the policing profession is an impediment to recruitment across the country,” says Delores Jones-Brown, a professor at the John Jay College of Criminal Justice. Further compounding matters, young black men are dispropor-tionally burdened with prior arrests dis-qualifying them from police work.

Departments in Philadelphia, Pitts-burgh and other cities have faced recent criticism over hiring practices. Others just haven’t made hiring minorities enough of a priority. “There is a segment of police departments that does not feel it is neces-sary to have offi cers of color in order to deliver just policing,” Jones-Brown says.

While most recruitment eff orts have been focused on increasing numbers of black offi cers, data suggest the disparity for Hispanics is even worse, with under-representation averaging 11 percentage points in all agencies reviewed. “It has puzzled us over the years,” says Andrew Peralta, president of the National Latino Peace Offi cers Association. “We’ve tried to get people involved at a younger age.”

Some Hispanics, Peralta says, want nothing to do with cops if they’ve migrated from countries where police are corrupt. Just convincing them to call the police is a challenge, so it may take a genera-tion or two before their children view law enforcement as a career. By contrast, white males have historically dominated the ranks of local law enforcement, and their children are more likely to view the profession as a viable career.

Stark DivisionsOf all local jurisdictions reviewed, the following had the largest percentage-point diff erence between the minority share of the population and that of the police department.

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By Mike Maciag

| BEHIND THE NUMBERS

Police departments where minority groups are most underrepresented are typically found in areas experiencing major demographic shifts, such as Irving and other parts of Texas, and Califor-nia. Of all agencies reviewed, minorities are most underrepresented in Fontana, Calif., a working-class city that’s seen an infl ux of Latino- and Asian-Americans. According to current agency fi gures, just

28 percent of its 188 full-time offi cers are minorities, compared to roughly 86 per-cent of the total population.

Some agencies with low turnover can’t keep up with rapid population changes. Consider the Irving Police Department, which typically hires about a dozen offi -cers a year for an agency of just under 350.

Minority representation in all local police departments, which stood at 27

percent in 2013, has climbed in recent years, but not any faster than that of the total nonwhite population. Although no national standards regarding diversity levels exist, the Commission on Accredi-tation for Law Enforcement Agencies does require accredited agencies to adopt steps to ensure their workforce mirrors their communities.

An imbalance in a department’s racial or ethnic makeup carries several potential ramifi cations. Peralta, who also serves as a lieutenant with the Las Vegas Metro-politan Police Department, says citizens are less likely to trust police in day-to-day interactions. “Once trust is eroded,” he says, “everything deteriorates from there.”

Irving’s Mitchell adds that language barriers may also arise when police are called to incidents and can’t wait for translators to arrive.

To boost minority representation, most departments target initial applicant pools. Irving police, for instance, set a recruiting goal for minorities and women to make up half of entrance exam takers, and they’ve recently reached levels in the mid to high 40s . Agencies most successful in attracting minorities visit nontraditional locales and involve offi cers in the recruitment process, says Hassan Aden, who oversees research and training for the International Asso-ciation of Chiefs of Police. Also, Aden and others stress that agencies should broaden diversity eff orts beyond race alone while working to retain and promote new hires.

Hiring more minority offi cers, however, won’t solve problems if departments fail to establish proper protocols or address cul-tural issues promoting police misconduct. It’s for this reason that law enforcement experts emphasize that mending fractured relationships with communities takes much more than merely a diverse force. “Trust and legitimacy is the bottom line,” Aden says. “If you behave like an occupy-ing force, regardless of their race, you’re going to be seen as such.” G

Email [email protected] the full report and data at

governing.com/policediversity


Asian Black Hispanic Non-Hispanic White

Underrepresented

Percentage-point difference between racial/ethnic representation of police force and general population

Overrepresented

+40 +20 -200 -40

The Race GapIn the 269 local agencies reviewed by Governing, minorities remain vastly underrepresented when the largest racial or ethnic group in each jurisdiction is compared with its presence among police offi cers. Each dot represents a police department serving a jurisdiction with 100,000 or more residents.

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grievance system in place until recently, if an employee felt that he didn’t, say, have the right safety equipment, and an initial conversation with a supervi-sor didn’t get him that equipment, the employee had to go through a grievance process that could have as many as fi ve steps, including talking to the supervi-sor, then the department head, then the manager’s offi ce, then a citizen advisory group (appointed by the town council). That group would hear the grievance and

make a recommendation to the manager who would follow the recommendation. “This took a long time when all a person wanted was a piece of equipment,” says Rae Buckley, Chapel Hill’s assistant to the manager for organizational and stra-tegic initiatives.

A new process has been introduced that refi nes the use of grievances in which a specifi c employee has been directly mistreated—someone, for example, who

By Katherine Barrett and Richard Greene

Problem Solver | SMART MANAGEMENT

participants had to dig for the informa-tion we requested because it either was unsystematically collected or not col-lected at all.” Los Angeles representa-tives, for example, indicated that they have been tracking the data but do not have it aggregated for the whole city, nor do they have a trail that goes back as far as fi ve years. In Houston, city rep-resentatives were unable to provide the number of grievances fi led prior to the current contract. It seems to us that the

city would be far better served if it could see the changes in the total number of grievances from year to year, in order to reduce their quantity in the future.

Some grievance policies are griev-ances unto themselves. Chapel Hill, N.C., for instance, wasn’t happy with its policy. The grievance process seemed to substi-tute for a course of action that should have been handled by a conversation at the lowest managerial levels. Under the

The Importance of ComplaintsWhy you need to listen to bad news.

One of the darker little cor-ners of state and local human resources departments is the area of grievances. Here, in-

house claims are fi led by employees when they believe they’ve been treated unjustly by their government employers. Many employees’ claims stem from a belief that they were unfairly denied the chance to work overtime, that their pay is too low, that they have been refused an anticipated bonus or that they have been passed over for promotion.

States and localities set up grievance procedures to avoid the expensive and debilitating lawsuits that could emanate from angry employees who see no other means to settle their problems internally. And although most cities and counties are not over-whelmed by the number of grievances fi led, the claims take their toll. “They con-sume signifi cant amounts of managerial time and cor-relate with employee turn-over rates,” according to a report from the University of North Carolina (UNC) School of Government.

While grievances may be annoying, there is important information to be gleaned from analyzing the claims, starting with how often the claims occur and which particu-lar departments or policies produce more than their fair share of complaints. Yet city representatives interviewed couldn’t eas-ily come up with the answer to such basic questions as the number of grievances fi led in the most recent year and years past.

The UNC study confi rms this obser-vation, reporting that “many survey


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believes he or she has been passed over for a promotion because of racial dis-crimination. That doesn’t mean that peo-ple won’t still push for things like better safety equipment, but they won’t utilize the grievance process to do so.

In most places, the steps in a griev-ance procedure are similar to those in Chapel Hill, but some governments can take things a step further. In Staff ord County, Va., if all else fails, the grievance case can meander all the way up to the cir-cuit court. This is somewhat ironic for an eff ort designed to keep things out of the courts in the fi rst place.

Fortunately there are solid approaches to make the grievance process more eff ec-tive. Three cited in interviews with city HR offi cials and also by the UNC study include:• Gather data about grievance claims so

that the information can be analyzed to pinpoint problem areas.

• Refresh the process. When rules stay in place for many years and aren’t reevaluated, they become outmoded. As one assistant city manager told the UNC researchers, “Our grievance policies are based on a 1950s model of organizations that no longer fi ts.”

• Train supervisors and managers to deal with complaints. A 2009 study in the Annual Review of Psychology found that better trained managers are more likely to resolve complaints before they get bumped up to offi cial griev-ance claims.There’s no great call for reform, but the

issue is more important than its low pro-fi le suggests. “Grievances are one of the underbellies of local governments,” says Karen Thoreson, president of the Alliance for Innovation, a part of the Local Gov-ernment Research Collaborative, which funded the UNC study. “No one wants to talk about it. But our research showed us that organizations that take their griev-ance policies seriously and continue to collaborate with employees to keep them updated will have an improved organiza-tional culture.” G


| BETTER GOVERNMENT

Making Broken Government WorkIt doesn’t have to look stupid, as plenty of public offi cials show.

“Nothing today is politically feasible. Nothing,” writes Philip K. Howard in The Rule of Nobody: Saving America from Dead Laws and Broken Government. While his book veers into occasional hyperbole, its overall premise is sound: The proliferation of laws and regulations that attempt to spell out precisely what public offi cials must do in every conceivable situation makes it increasingly diffi cult for them to get anything done and coincidentally weakens their moral authority.

The book includes lots of stories like this one: During a storm in February 2011, a tree fell into a creek in Franklin Township, N.J., and caused fl ooding. The town was about to send a tractor to pull the tree out of the water when it learned this was a “class C-1 creek” and that formal approvals were required before any natural condition could be altered. The town had to spend 12 days and $12,000 to get a permit to remove the tree.

Situations like this one make government look stupid. The solution, according to Howard, is sweeping changes, including laws that entail broad principles rather than specifi c details and give public offi cials discretion. On the whole, it’s a pretty depress-ing read—real problems correctly described, but proposed solutions that seem like pie in the sky at best.

I fi nished the book on the plane to Lansing, Mich., for a Governing event and had dinner that evening with Billy Hattaway, a regional director for the Florida Department of Transportation, a

2014 Governing Public Offi cial of the Year and leader of that state’s collaborative and successful eff orts to reduce pedestrian and bicyclist deaths. Howard makes a compelling case that the system is so clogged with rules that it cannot work, and yet Hattaway and thousands of other public employees are making it work rather than waiting for some sort of sweeping change.

Another good case in point is Zachary Thompson, director of the Dallas County Health and Human Services Department, who found himself in the middle of the Ebola crisis last year when a man who had traveled from Liberia to Dallas died of the disease after having been treated and released by a local hospital. At the time there was widespread confusion about federal guidelines, the role of emergency responders and medical privacy laws. Thompson was successful in working with state legislators, and this June Gov. Greg Abbott signed legislation authorizing local health offi cials to use their discretion to determine when to disclose the suspected presence of a communicable disease to fi rst responders.

Howard is right that the growing thicket of rules creates a system of governance in which it is increasingly diffi cult to perform eff ectively, but he is wrong in saying that as a result nothing works. Many public offi cials are showing that positive outcomes are not just feasible, but that they actually occur. That’s not depressing—it’s inspiring. G


By Mark Funkhouser


Howard makes a compelling case that government is so clogged with rules that it cannot work. Yet thousands of public employees are making it work.”

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Problem Solver | TECH TALK


Integrating Social Media

By Tod Newcombe

How one city has incorporated it into everything it does.

vice. While citizens can still notify the city about a problem via a phone hotline, social media followers increasingly use the city’s Facebook and Twitter pages to query, complain or ask for help. “It’s become a highly eff ective way to contact us,” says Melinda Mayo, communications and media offi cer.

Social media also has given Roa-noke an economic boost in the form of increased tourism traffi c. Along with the free publicity generated by pho-tos of Roanoke posted by citizens, the city spends about $100 a month on Facebook advertising to attract outsiders to the city. This cam-paign has worked well, according to Martin, generating between 300 and 600 additional Facebook “likes” every month.

To cope with the new work and responsibilities generated by its new social media approach, Roanoke has introduced a set of very straightforward policies, which include obeying the law and refraining from making controversial remarks. They also designated a person in each city department to administer social media activity and paid to have a social media consultant review the city’s many Facebook pages, point out the pros and cons of each page, and off er recommenda-tions for future posts to the department’s social media administrators.

Martin also holds regular quarterly meetings to review the eff ectiveness of pages, to provide more training, and to show more examples of new social media options and tools that pertain to Facebook and Twitter—the two most popular plat-forms. These meetings can also act as brainstorming sessions.

The biggest drawback of the new approach is the amount of new work it has required. Social media needs constant

Back in 2008, Roanoke, Va., a city of about 100,000, had a modest social media program run by its Department of Communica-

tions. But when an unusually strong snow-storm hit the city in the winter of 2014, things changed practically overnight.

Timothy Martin, communications coordinator in charge of social media, planned to use the city’s Facebook page to get information about the storm out to res-idents and to provide an avenue for peo-ple to ask questions about snow removal, among other things. He thought it also would be fun if residents posted photos of the storm. The response was overwhelm-ing. “Those photos were viewed by more than 400,000 people on Facebook,” Mar-tin says. “That was the moment social media took off in Roanoke.”

In that instant, Martin and others real-ized social media wasn’t just a side project anymore, something to use merely as an occasional tool to get news of an event out to the public. So offi cials went about integrating it into Roanoke’s daily rou-tine. The city saw its followers grow from about 22,000 on Facebook and Twitter to more than 100,000 in just over a year, and the number of social media pages run by various city departments now exceeds 40.

Today Roanoke residents can fi nd all of the city’s social media feeds under the “Social Media Center” icon on its website. Citizens can view combined Facebook and Twitter streams for all departments or just view posts from one agency. They also can browse the city’s various other social media platforms, such as Instagram and Flickr, as well as city videos and news releases. The goal is to make getting and sharing information from all the city’s departments easier.

Since Roanoke launched its Social Media Center, offi cials have found that the accounts also act much like a 311 ser-

feeding, Mayo says. High-profi le departments, such as communications, police, and parks and recreation, usually post on a daily basis. Other departments post less frequently. While there are no specifi c performance benchmarks, such as a required number of social media posts, or how much “reach” or how many “likes” or “followers” each department has, Martin monitors metrics and consults with admin-istrators on posts that might drive more traffi c. The strategy is to avoid a drop-off in traffi c, and it appears to be working. Roanoke has received a number of national awards, creating the kind of buzz that social media fans can appreciate. G


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Problem Solver | PUBLIC MONEY


Bondholders Beware

By Frank Shafroth

Four cities emerged from bank-ruptcy court this past year, and in each case, their road to fi scal sta-bility was paved not with cuts to

the pensions of fi refi ghters, teachers and other local government employees, but to the wallets of bondholders who had invested in those cities. In California’s San Bernardino, Stockton and Vallejo, and in Detroit, bondholders faced losses of up to 99 percent of their holdings, according to Moody’s Investor Services. In the bank-ruptcy resolutions in all three California cities, the courts preserved full pensions for retirees, while in Detroit pensions were cut only by about 18 percent.

This has neither ensured nor clarifi ed the future fi scal sustainability of those cit-ies or for others with structural debt prob-lems. It has merely perpetuated concerns that cities have found a get-out-of-jail-free card. In June, Moody’s sharply down-graded Chicago’s credit rating, attributing the decision almost entirely to the city’s pension liabilities for its teachers and its inability to pay for schools. Should the Illi-nois Legislature grant Chicago and other municipalities access to bankruptcy, many fear that municipalities’ political inabili-ties to rein in pension liabilities could trigger future bankruptcy court decisions that, as in California and Michigan, would have repercussions for municipal bond-holders throughout the nation.

Naturally this is pitting bondholders against retirees. The former are critical to a municipality’s future and its ability to raise money to build and modernize infrastruc-ture and services. The latter are a fi scal burden, but their pensions are stabilizing factors in two ways: They help attract the most competitive applicants to provide city services, and they help ensure that retirees themselves do not become burdens. This was an imperative factor in the resolution of Detroit’s plan to exit bankruptcy.

The importance of stable retiree income is echoed in federal law. The Pen-sion Benefi t Guaranty Corp. explicitly provides for continuity in pension ben-efi ts—but only for nonmunicipal corpo-rate bankruptcies. The exclusion of cities and counties in this critical matter dis-criminates against the fi scal capacity of a city or county to invest in its own future. Some states, such as Michigan and Rhode Island, have reacted by making unique and needed commitments to the fi scal sustainability of their municipalities. Oth-ers such as Alabama and California leave cities to twist in the fi scal wind.

Almost every state that authorizes cit-ies or counties to fi le for municipal bankruptcy imposes requirements or mandates. In Michigan, for example, that included the suspension or pre-emption of the authority of elected leaders. The post-bankruptcy process in Detroit of reverting to municipal authority came with strings attached, one of which is a decade of oversight by the state Financial Review Com-mission. The commis-sion is charged with reviewing and approving Detroit’s four-year fi nan-cial plan and establishing programs and require-ments for prudent fi scal management. To emerge from oversight in 2018, Detroit must maintain a balanced budget for three consecutive years.

This state oversight is important to Detroit’s fi scal future in two ways. First, it means the state has a stake in Detroit’s long-term fi scal sustainability. Second, it means that municipal bond investors

Recent bankruptcy rulings have protected retirees. But at what expense?

have greater assurance and incentives to purchase and hold the Motor City’s bonds, providing critical capital investment for Detroit’s future.

The bankruptcy events of the past two years—in California and Michigan specifi -cally—suggest the need to establish fi rm and credible fi scal actions to guarantee citizens’ essential services and pensioners’ suffi cient income. Fiscal boards, which are outside of political considerations, would bear the responsibility to guaran-tee the continuity and honor of the fi scal commitments agreed upon by states and their localities—especially in the wake of a restructuring process.

The road back from fi scal distress or bankruptcy for state and local governments is far more challenging under current fed-eral laws than for nonmunicipal corpora-tions, so innovations that encourage capi-tal investments in these cities’ futures are invaluable. Bondholders are watching. G


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Last Look

You can’t miss it. Its designers call it an “obvious bus stop.” Bill Gilmore, executive director of the Baltimore Offi ce of Promotion and the Arts, calls it “hit-you-over-the-head simple.” At 14 feet tall and 7 feet wide, the structure, which spells out “B-U-S” in wood and steel, is indeed eye-catching. Designed by the Madrid-based artist collective mmmm, each letter is big enough to accommodate two to four people at a time. According to the artists, the “B” protects bus riders from the elements, the “U” frames the sky and the curve of the “S” invites passengers to sit back and relax while they wait. While the “U” and “S” are raised off the ground, the “B” is just a few inches high so as to be accessible to people with limited mobility. Located on South East Avenue in the Highlandtown neighborhood of Baltimore—one of three arts districts in the city—the bus shelter was installed last summer using money from private grants. While still relatively new in the U.S., playful bus stop designs are more common in Europe. —Elizabeth Daigneau

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governing magazine september 2015vol. 28, no. 12 09.2015 features 24 losing ground southern...

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