Posted on 10/07/2015 7:41:30 AM PDT by MichCapCon
When cities cry poverty, the organization helping them pursue more resources from state or local taxpayers is often the Michigan Municipal League. It is interesting then to see signs that the lobbying group is doing some self-reflection, in the form of allowing a city manager with a fresh point of view to address the organization's annual meeting.
“Prosperity doesn’t come from government. It comes from freedom,” Port Huron City Manager James Freed told league members who gathered in September.
Freed gave the group a candid presentation on how pension and retiree health benefits were making it difficult to govern his city. City governments elsewhere have faced similar problems.
“We need to come together today to free the next generation from the crushing burden of unfunded liabilities,” Freed told the group.
The league billed Freed as “a 30-something … with a unique perspective on the next 30 years of municipal government.”
“I’d like to talk about a challenge that Port Huron is facing and maybe we can find similarities with other communities — that is unfunded liabilities — what we have in the bank versus what we owe,” Freed said in his talk.
He described how Port Huron is facing $54 million worth of pension fund liabilities, plus another $47 million in retiree health benefit promises. Freed said that year after year the city finds itself shifting ever more resources to carry this burden. This year, the payment is $7 million. In 15 years, it will be $12 million. The payments are outpacing Port Huron’s projected growth.
“The growth of these payments is consuming more and more resources that could be going to parks, public safety and general government,” said Freed.
Freed said for every dollar the city pays to employees, it has to pay an additional 70 cents for fringe benefits. Half of that 70 cents goes toward the pension and retiree health benefit funds. In recent years, the city has been making additional annual payments toward the retiree liabilities.
The city manager said he has worked closely with all groups to fix the problem.
Workers are now contributing up to 11 percent of their pay toward retirement benefits, up from zero percent not long ago. Health coverage for current employees now comes in the form of high-deductible insurance policies combined with contributions to their own health savings accounts.
Other cities have closed their defined benefit pension plans to new employees, who instead get contributions to 401(k)-style retirement savings accounts.
“Our focus should be the next generation. We are not the great wizards we sometimes like to think we are,” Freed told the group.
Freed said his presentation was warmly received. The next day he participated in a breakout session that he said was packed. A number of people sent him handwritten letters thanking him for his candor.
“You may be witnessing a cultural change in local government,” Freed said.
Hmmmmmm...a guy named “Freed” says prosperity comes from “Freed-om”. Sounds like he’s pushing white privilege to me...
Totally unique!
A sitting government official who understands where money comes from.
He must certainly be the only one in Michigan...land of failed Detroit
Safe bet this guy doesn’t have a college degree in local government.
Port Huron is where I live. They are attempting to pay by stealing everything they can from the people. We have six “code enforcement” officers ticketing us for everything they don’t like. They climb fences, enter back yards at will, take pictures and ticket us. $450 for a wood pile for a wood burning stove. It is considered “debris” and has to be stored INSIDE. $150 for a pressure washer hose coiled by the back door. Even a compost barrel is considered “debris”.
Title 18 No Trespassing signs are ignored, both the city and the St Clair County Sheriff refuse to charge the them with trespass. Neither will even discuss it with us. The City operates with impunity. Revenue enhancement here in the peoples republic.
Someone tell him Hawaii and Alaska are now states of the union!!
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