The Price of the Mayorship

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    If you speak with some of the city’s unions against his cost- cutting measures, Mayor Dave Bing is on the wrong path. Talk to his boisterous opponent Tom Barrow, who is lurking behind the façade of the political climate trying to create a groundswell against Bing, the city is on a downward spiral.

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    But when you sit down with Mayor Bing himself, he exudes confidence and is calm and collected in his approach to pressing local government issues. After being in office for more than 100 days, Bing insists he is not one cut out of the political cloth, but simply a man driven to public service for love of a city he’s invested his business in for more than 30 years.

    On Sept 14, Mayor Bing sat down in his office with Michigan Chronicle senior editor Bankole Thompson for an extensive interview on the burning issues facing the city. In the interview,
    the man Detroiters picked over City Council President Ken Cockrel Jr. to run America’s 11th largest city said the city’s unions must face the hard reality of the current economic downturn. Brandishing them as living in the past, Bing said it’s time for unions to face up to the challenge and be agents of change. The mayor said he would not rest until Detroit is on the right path to recovery, and that small businesses would get his attention.

    Following are excerpts from that interview.

    MICHIGAN CHRONICLE: How would you describe the environment we are in now with you having a tug of war with the unions?

    DAVE BING: There are a lot of stalling tactics. But it’s inevitable that people have to look at where the city is and going. And they can slow the process down. It’s costing the city money every day that happens. And then the potential impact is more people getting laid off.

    MC: What do you mean by stalling tactics?

    DB: Well, they (unions) are asking for….I can show you what we are asking for and what they’ve asked for. They don’t want any changes. As a matter of fact, AFSCME Local 25 (American Federation of State, County and Municipal Employees) just came back over the weekend saying that they were not willing to take furlough days. There is no choice in that. They want no changes in their pension, no changes in vacation, no changes basically anywhere. So I don’t know where they are living. If every municipality that I read about is going through the same kind of budget crisis, and almost every major industry is going through every kind of financial crisis, what makes us think that’s not going to impact us? We don’t have the funding to continue
    to do what we were doing. So if they want to dig their heels in, I understand that nobody wants to give up anything, but that’s not reality. You’ve got to get into the real world. If we start making a comparative analysis in terms of what they have in their contract and what other private sector folks have in their contracts, there is a huge gap. And we’ve got to close the gap.

    MC: Other people are saying that if different departments have to make sacrifices, what sacrifice is the Mayor’s Office going to make?

    DB: We’ve made them. Under the Kilpatrick administration there were 145 appointees. There are 112 under this one. There is about a $1.2 million differential. So that’s a sacrifice. All of the salaried employees, appointees and others have already taken as of Sept. 1 the 26 furlough days, which is the same as the 10 percent reduction in their wages. It’s already been done. I hear a lot of folks say you’ve got cars. There is not one of my employees that’s got a car. So I think the things that we need to do from a leadership standpoint are being done and we need the union folks to follow suit.

    MC: This tug of war between you and the unions, is it an issue of perception? Do they see you as someone not accepting of the principles of labor?


    DB:
    It could be. I don’t personally sit in the negotiations. You have a labor team that does that. If they think it would help for me to be there I can be there. That means I can’t do other things that need to be done. But I think the issue more than anything else is that they are still stuck in the 1960s, 1970s and 1980s in terms of how negotiations were conducted. This is 2009 and the conditions are altogether different, and we’ve got to act as such. So I think we are doing that from the management side. I don’t think they’ve made the adjustment from the labor side.

    MC: What have you discovered so far in the city’s finances after 100 days?

    DB: There is no difference in what I thought the first 30 days. I can be probably a little more specific. I can say $280 million is our deficit. When I came in the budget that I accepted said in October we would run out of cash. We’ve been able to close that gap. That doesn’t mean that we are flush with cash. But nobody’s going to have a payless payday in the month of October.We’ve been able to do some things in terms of revenue generation to take us probably into the first quarter of next year. But as these negotiations continue to drag along it’s costing the city money.

    MC: So are these negotiations your biggest challenge?

    DB: I would say the biggest challenge is the negotiations and making sure that we get our labor cost competitive with the marketplace. I’m sensitive to the fact that nobody wants to go backwards, but if we don’t make a concerted effort to understand the conditions we are under today, the city will not be able to go forward. I don’t care who comes in here it won’t be able to go forward.

    MC: Is your labor team made up of former union members?

    DB: For the most part, no.

    MC: Do you think that’s a problem?

    DB: No. I think the person leading it has been there for 30-plus years. So she’s been through several negotiations and so has her team. They are an experienced team. But once again I would say that anytime that anybody has to give up something that’s been hard earned, that’s been negotiated, nobody wants to be in that position. I understand that but we are up against the wall with no real choices.

    MC: What consequences do we face if the unions don’t give in?

    DB: Well, I’m going to continue. I’ve got to lay people off. There is no way I can continue to go down this road paying money out that we don’t have. It is a road to hell and I don’t intend to go there. So I’m going to have to whether they come to agreements or not. There are going top be layoffs. So the real key from my vantage point is that for those who are going to be laid off, the sensitivity and the support I want to give them is to get them trained, retrained in something else. I’m talking to other companies at this point, trying to find out what their needs are. You don’t have to work for the city. If you want a job there are other jobs that are available. There are actually jobs in the city of Detroit that are available. But you’ve got to make sure that you’ve got the right kind of background to fill those jobs, and it’s been difficult to fill some of the positions.

    MC: Have you received the report of your Turnaround Team?

    DB: I have it on my desk. I got it late Thursday night. I have read it. We would probably take the next 48 to 72 hours for my team to have a chance to look at it and determine what we think we need to do. Because we’ve done the same thing internally that the external team did. So we want to see where we are on the same page. And those are the things I’m willing to go forward with. We will sometime next week make it a public document.

    MC: Some City Council members complained that you did not come to the table to talk to them about issues in the budget. Is that the case?

    DB: We are not in a position to go to City Council with any amendments on the budget at this point in time. So there is no need to go to them if we are not making amendments. We are focusing the concentration on revenue generation, cash flow and union negotiations. Those are the three big issues right now and I don’t think City Council can do anything in any of those areas. That is on us.

    MC: What are you doing as mayor to generate revenue for the city?

    DB: The reality is that all we can do is go out and try to collect what is owed to us. And there is a lot of money owed to the city right now. Whether or not we are going to be successful

    in collecting all of that is another story. But there is a plan to hire an outside agency to look at the outstanding receivables that are collectible. They will be supported by our internal team. I am not looking to get rid of the internal folks right now. But we need some support from the outside and they are only going to get a percentage of what they collect and that helps our cash flow. I have made it public that there is an escrow account of about $27 million that DTE Energy has. We are close to coming to an agreement to get that. The Cobo deal takes effect next month.

    On an annualized basis it would be a $15 million upgrade because that money has been historically coming out of our general fund. But because we are now almost four months into the fiscal year, we are only going to recognize about $10 million. So when you start adding all of that up we think we would be able to generate about $60 million in revenue. Right now the shortfall based on the projects of the budget, we are somewhere between 60 and 80 million. So I’ve closed the gap substantially in a short period of time and if in fact we are successful with union negotiations, we would get to where we need to be.

    MC: It was reported that you would cut bus services on weekends. You came out and said that proposal never came out of this administration. What actually happened?

    DB: I get several recommendations a day from people all over the place (internal and external). I look at and listen to those recommendations, but it’s up to me to make those decisions whether or not I’m going to implement those recommendations. The recommendation from DDOT (Detroit Department of Transportation) leadership during union negotiation was this is one way that we can save money. I didn’t have enough detail, there wasn’t enough data. So I didn’t make a decision. But what happened is that the union ran with it and said “they are going to cut services on Saturdays and Sundays.”

    Never the case and I’ve made that very clear on many occasions. But once I got all of the data, including that it costs us $175 per hour to have buses run, using the fleet, the cost of the driver, cost of insurance and cost of the fuel, and the cost for a rider is $1.75. When you’ve got four people on a bus where you can generate maybe $10 and you are spending
    $175 an hour, do the math. We have enough people that are smart and if you tell them what’s going on, give them the details, they will understand the decisions you are facing.

    MC: Is this the time to push regional transportation?

    DB: Yes. You’ve got to look at this in totality and we can’t look at just the buses because we are talking about a comprehensive
    regional transportation system. We are going to get light rail. It’s not going to happen overnight, but we are going to get it. I don’t want to jump into something that’s half-baked. You have to understand the big picture. The comprehensive transit situation is what we need to really focus on and then…here are some steps we need to take to get there and one of them would be the consolidation of the buses. In a lot of cases there is duplication of routes which makes no sense.

    MC: I hear all that you are saying, but if families don’t feel safe, they are not moving into or staying in the city. What comprehensive public safety plan exists?

    DB: I agree with you. That is why I made a change in leadership at the police department.It was not a negative toward chief (James) Barren. But Warren Evans (new police chief) thinks differently. He is doing some things that are different already. If you look at the statistics over the last couple of weeks, the murder rate has gone down dramatically
    because of the sweeps that he’s put in place already. He’s taken probably 300-plus criminals off the streets and that’s been very helpful.

    MC: On education, Detroit Public School Emergency Financial Manager Robert Bobb has been pushing mayoral control. Is that what you need right now?

    DB: My plate is full. Believe me, I am not looking for anything else to do. But there is no way this city will come back and prosper if we don’t have a good public education
    system. So if in fact the residents of the city of Detroit have an opportunity to vote on that issue….

    MC: So this issue should be subjected to a referendum?

    DB: Absolutely. I don’t want to see another takeover. I think we are living with the outcome of that right now. However, we can’t continue to accept mediocrity
    at best in terms of what is available for our children in the school system. Robert Bobb is here for a short period of time and he’s doing some things that needed to be done and he’s made some positive strides. But once he leaves, if we don’t have somebody that can be accountable and responsible for the education system here in the city, there is a strong chance that the things he is doing could slide and we would go back to what was in the last 20, 30 years and we don’t need to go back there.

    MC: You were a member of Detroit Renaissance, which changed its name to Business Leaders for Michigan. What role is the business community playing in your administration?


    DB:
    They are and have been very supportive up to this point. If I need people with certain talents and skills they are helping me with that. From a funding standpoint, all of them are hurting, so it is going to be very difficult to request a lot of funding from them. I think where they are going to be helpful is at the state level which is what they are trying to do right now. They (Business Leaders for Michigan) have taken a hard position with the governor in terms of how to change the state of Michigan, which obviously would have some impact on the city of Detroit.

    So they are looking at this more from a regional standpoint than a local standpoint and I think that’s one of the reasons they went to the west side of the state to get those business leaders to come to the table with them. Because all of them together the largest companies in the state of Michigan got a lot of leverage in Lansing. They are ready to use that power and leverage. I think that’s a positive. I don’t want them to forget Detroit. But I do think there’s a bigger issue in the state that’s got to be corrected.

    MC: In light of the revenue sharing deal, what is the relationship between you and the Governor’s Office?

    DB: Very positive. I talk to her every couple of weeks to let her know what’s going on and she lets me know what’s going on at the state level. My finance people and the state treasurer are talking weekly.

    MC: Would you still say you are not a politician?

    DB: I understand politics but I’m not a politician. I didn’t come here as one and won’t leave as one.

    MC: Are you excited or disappointed about what you’ve seen since becoming mayor?

    DB: Not excited. It’s a mess worse than I thought it was. This is the problem that I think we’ve had historically — too many people not telling the truth and hiding things.

    MC: Piling up problems?

    DB: Oh yes. Our thought process has been whether it’s month-to-month, quarter-to-quarter or year-to-year. There are things that were done in the past that got you over, but at some point in time it’s going to surface and it’s got to be dealt with. That’s what I inherited. The 2008 accumulated deficit was $155 million. When Ken Cockrel Jr. finished the term — for the eight months that he was there — it ballooned to $280 million. So that means we didn’t do some of the things that needed to be done.

    We kept pushing them off, the union negotiation is one of them. There are a lot of people that are saying, “How are you going to get new businesses to come into the city?” That’s not going to happen until we fix a lot of the issues we have here now. My focus is on the businesses that are here, trying to give them the services and support that they need. Because they are committed, they are here. I don’t want to run any of them away. If I can help them stay and expand here, then I’m in a better position to try to go outside and entice somebody else to come here. So we’ve got a lot of small businesses which, in my opinion, is the the key. They’ve got to have support, and they are going to have a lot of focus from this office.

    MC: Are you in for one term or two?


    DB:
    I can’t tell you that right now. That depends on the voters of the city of Detroit. (Laughs.) They may not want me in for another term. I don’t know.

    MC: What is the biggest thing you want to have accomplished by the end of your first term?

    DB: Fiscal stability. Without that you are dead.

    MC: AFSCME Local 25, under Al Garrett, withdrew their support of you for the general election and is now supporting your opponent, Tom Barrow. Is that a threat for you?

    DB: I don’t know what it is. I’m not overly concerned with it. I’ve got bigger problems to deal with. It is not personal to me. I do think that all the union leaderships are up for re-election.

    So let that go where it’s going to go. I’m not afraid to make the hard decisions and the hard decision is to do what is right for the citizens of Detroit. The 13,000-plus city employees are important, but they are no more important than the 900,000 residents.

    MC: Clearly I can sense you are not too concerned about your opponent, Tom Barrow, and what he is doing.

    DB: I don’t worry about Tom Barrow. Once again I’ve got to stay focused on what people hired me to do. I can’t spend all of my time worrying about Tom Barrow. Where has he been? I don’t know what he has ever done. He constantly says I’m an outsider. I probably have done for the city more than he’s ever done. I surely paid more taxes than he has. I have never been run after because I haven’t paid my taxes. That’s another story, but it is what it is.

    MC: And you would not debate him?

    DB: For what? He got 11 percent of the vote. What’s the reason to debate him? I’ve got a job to do here. I don’t want to spend my time playing politics and that’s all that is. If he can convince enough people that he’s the right person based on what he’s done or promising to do, more power to him. But I know who I am. I know what I have done and I know what I’m here to do, and I am going to get it done.

    Senior Editor Bankole Thompson is a radio and television analyst, sought after moderator and public lecturer. Watch his new public affairs show, “Center Stage,” every Saturday at 1 p.m. on WADL TV 38. E-mail him at bthompson@michronicle.com.

     

     

     

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