September 5, 2014 at 7:49 pm

Bankruptcy testimony: Detroit's fire alert method is pop can falling off printer

The Detroit Fire Department's conditions were covered in a day of testimony that touched on everything from the city's antiquated software to its staffing challenges to pension fund abuses -- including inflated annuity payments to retirees -- that helped lead the city into bankruptcy. (Elizabeth Conley / The Detroit News)

Detroit — The city’s fire department has its bells and whistles, but they are not to be confused with anything state of the art.

The technological deficiencies became the focus of Detroit’s bankruptcy trial Friday as city restructuring consultant Charles Moore described the primitive systems the department uses to receive emergency alerts.

Firefighters put an empty pop can beneath a printer and listen for the sound of it being knocked over as an alert mechanism for emergencies, he said.

Moore recounted the story to illustrate needed improvements to public safety technology and equipment that would be included in a $1.7 billion spending plan if Detroit successfully emerges from bankruptcy court.

The fire department’s conditions were covered in a day of testimony that touched on everything from the city’s antiquated software to its staffing challenges to pension fund abuses — including inflated annuity payments to retirees — that helped lead the city into bankruptcy.

Detroit’s Deputy Fire Commissioner John Berlin said Moore’s reference to the contraptions used in fire halls is true, although he says traditionally it was a pop can with coins in the bottom.

Berlin explained that fire department runs are generated at a central office. Once a dispatcher collects enough information for an address, it’s typed into a computerized system and sent out through telephone lines. The run then comes out on a printer inside the fire hall.

He was surprised it was mentioned in Friday’s testimony, but said “it’s not like it’s not true. If you need an example of antiquated – that’s a good one,” Berlin said.

Berlin said the pop cans are old school. Today, most stations are using a more recent homemade system designed by Detroit firefighters who purchased items at Radio Shack: a wire and hinge on a printer creates a buzzing alarm, issuing a beep once the printer starts moving the paper with run information.

“It’s either the way we have always done it or tradition,” he said. “… Fire men are very, very creative.

“We know better technology is out there,” he added. “The city cannot afford it.”

Public safety spending

Moore told U.S. Bankruptcy Judge Steven Rhodes on Friday that he “absolutely believes” the city should implement the investment initiatives to provide “adequate levels of service.”

The city, in its plan, says it must shed about $7 billion in debt and generate revenue by securing grants, charging residents for false alarms, fires and vehicle accidents and billing for medical runs.

If the judge dismisses the plan, however, “it is unclear to me how the initiatives could be funded,” Moore testified.

Moore was the second witness to testify during the trial that started Tuesday. Rhodes will ultimately decide whether the city’s plan is feasible and fair.

Over the next decade, Detroit wants to spend almost $559 million improving public safety, reducing response times, closing more criminal cases and fixing outdated equipment and vehicles.

For Detroit police, the investment means $16 million in non-lethal Tasers, bulletproof vests and body cameras.

The city would spend $91 million on new police cruisers, $59 million on new fire engines and ambulances and $19 million on firefighter coats, helmets, axes, saws, ladders, boots and breathing aids.

Detroit, Moore said, is “one of the last cities” that still has its firefighters operate in a separate division from EMS. The plan contemplates moving into a multidisciplinary department.

The city will realize $483 million in additional revenue over life of the plan. Moore testified he studied “any and all areas” in which the city could generate additional revenue, including new fees, fee increases and additional grant dollars.

“This is a massive undertaking the city is about to go through with reinvestment,” he said . “The only way to succeed is to have a plan that’s as detailed as possible.”

Inflated pension payments

Later Friday, Moore talked extensively about the inflated payments some Detroit retirees received from an annuity savings fund program that’s partially to blame for the city’s underfunded pensions.

The excessive interest payments were exposed after he joined a task force to investigate the city’s two pension systems, he said.

The Annuity Savings Fund program, exclusively offered to General Retirement System employees, allowed members to set aside a percentage of their after-tax pay to the fund. Workers contributed 3, 5 or 7 percent of their paychecks to the savings fund, which is separate from their lifetime pension benefits.

Under a discontinued plan, GRS trustees guaranteed annuity fund participants a minimum 7.9 percent return on their investment – whether the pension fund’s investment performed well or not.

Moore cited one retiree who contributed $100,000 over time and was paid $1.4 million upon retirement. He pegged participation in the program at around 91 percent.

Rhodes inquired how much the worker who received the $1.4 million would have to repay the city. Moore told the judge he didn’t know.

Moore told Rhodes that, for some, there was a “lack of understanding” on the impact of paying excess interest in good years and not taking it away in bad years. But others, he said, “knew what this was.”

The task force review focused on contributions from the 2003 fiscal year through June 30, 2013. The findings showed approximately $450 million in excess interest was paid. Detroit in its debt-cutting plan is seeking to recoup up to $239 million.

Moore took the stand Friday after the city’s first witness, Chief Financial Officer John Hill, testified that he’s entrusted with the monumental task of rooting out impediments in the execution of Detroit’s plan.

“It’s not going to be easy to implement,” Hill told Rhodes . “If you go into this thinking it will be, I believe you will fail.”

Testimony in the second week of Detroit’s bankruptcy trial resumes Monday.

cferretti@detroitnews.com