Howes: Action trumps control in Wayne County fiscal mess
As Wayne County creeps closer to a financial abyss, Commission Chair Gary Woronchak wants the folks to know he and his fellow commissioners are in charge.
Great comfort, that.
"If a financial emergency is eventually declared, under the law it is the Wayne County Commission, and only the Wayne County Commission, that in the first instance will decide what course of action will be taken to remedy the situation," the Dearborn Democrat said in a meeting last week. "We owe it to our constituents to get it right."
He's right on both counts. But the itch to show who's in control amid a financial meltdown hastened by the county's elected leaders — commissioners past and present, essentially led by the hapless administration of former County Executive Bob Ficano — sounds an awful lot like Detroit City Council circa early 2013.
Remember what came next. Emergency Manager Kevyn Orr arrived, followed by a humbling Chapter 9 bankruptcy restructuring the city's elected officials did not develop but now have the responsibility to implement.
Critical differences exist. First, there are serious doubts municipal bankruptcy or an emergency manager, and the state law designed to enable them, can be as neatly applied to Wayne County as they were to Detroit. But there's no such doubt that a financial emergency can be declared by the state Treasury and Gov. Rick Snyder, precursor to a consent agreement that would guide the county's actions into unpopular territory, especially with its unions.
Second, County Executive Warren Evans is no Dave Bing. Where Bing sounded the fiscal alarm often, he did little; Evans and his restructuring team are all business and all candor, an approach that is eliciting respect from Team Snyder, if not from union leaders hoping the nightmare will end itself.
Third, where the last iteration of City Council deluded itself into inaction deeply marinated in denial, the commissioners responsible for the state's most populous county have recent history to inform their actions and decision-making — if they're courageous enough to look, learn and act.
Fourth, the experience of city unions, their leaders and pensioners should be harrowing enough to show their county counterparts the steep cost of stalling. The numbers are the numbers, and like Orr has said repeatedly since leaving City Hall: No one challenged the numbers, just the implications of what their reality means for contracts, wages, benefits and pension payouts.
Fifth, county residents inured to serial abuses allegedly committed in their names — courtesy of Team Ficano and its stellar performance on everything from pension payouts to a half-finished county jail — can see that restructuring managed well pays dividends for the people who pay the bills.
Be it new streetlights in neighborhoods or lighting major streets, reduced response times to 911 calls, or a budget expected to close this fiscal year as balanced for the first time in 13 years, the message of Detroit is there's life after bankruptcy. And it can be a better one, if mature and realistic leaders make decisions too often left to petty politicking.
The numbers are hard to deny. Without one-time gimmicks, the county budget is on track to book a $74.9 million structural operating deficit this fiscal year. The county's pension plan for its retirees is only 44 percent funded; for retirees of the Wayne County Airport Authority, funding hovers near 58 percent.
Real-estate boondoggles, one of the many Ficano legacies, weigh as much on the county's pride as its balance sheet. The Guardian Building, site of county offices, is for sale; an unfinished, woefully over-budget county jail on the edge of Greektown reminds anyone who looks just how inept the county's management has been — and what a mess Evans inherited.
Property tax revenue is running roughly $100 million below its 2008 levels. One result: an exodus of residents that threatens to slow a rebound in property values. Who can blame them, given the demonstrated incompetence of the Ficano years and a timid commission weighted heavily in favor of Democrats and their friends in labor?
A lesson of the Detroit experience is that change comes hard. When it does, it's because the leaders chiefly interested in power and control run out of excuses and ways to punt the problems to taxpayers. Too many aren't buying it anymore, and they shouldn't.
"The county general fund has not had a positive cash balance since February of 2011," Evans wrote state Treasurer Nick Khouri in a letter requesting preliminary financial review of the county's books. "The Wayne County Employees Retirement System faces an unfunded accrued actuarial liability of $870 million as of Sept. 30, 2014. It is for these reasons that I recommend a financial emergency be declared."
Evans'll get it. And the county likely will get a consent agreement with the state, whatever "remedy" Woronchak and the commission add to a process that will drive them more than they drive it.
Daniel Howes' column runs Tuesdays, Thursdays and Fridays and can be found at http://detroitnews.com/staff/27151.