Yay pontiac! EFM Takeover Ends

**Danny** · August-20-13, 08:02 PM

The City of Pontiac is back in action. The EFM takeover is over! All city monetary issues is back the city government's hands. They didn't need bankruptcy to save their city. They did it and survived.

Any thoughts?

**Ben** · August-20-13, 08:10 PM

Good for Pontiac!

**Novine** · August-20-13, 10:47 PM

A bit premature with the celebration aren't we? Have we seen Pontiac go through a budget cycle that didn't rely on gimmicks? Isn't there an outstanding court case related to pensions and health care costs? It makes one wonder about the timing.

**Wesley Mouch** · August-20-13, 11:01 PM

Originally Posted by Danny

The City of Pontiac is back in action. The EFM takeover is over! All city monetary issues is back the city government's hands. They didn't need bankruptcy to save their city. They did it and survived.

Any thoughts?

1) The EFM didn't 'take over', the city voters through their elected officials 'dropped the ball'.

2) Doesn't matter what tool you use -- so long as you get your expenses in line with your income. That's all that matters. The best result is when it is done by the elected officials.

**DetroitPlanner** · August-21-13, 07:37 AM

One down, dozens more to address.

**Honky Tonk** · August-21-13, 08:10 AM

Originally Posted by Wesley Mouch

1) The EFM didn't 'take over', the city voters through their elected officials 'dropped the ball'.

2) Doesn't matter what tool you use -- so long as you get your expenses in line with your income. That's all that matters. The best result is when it is done by the elected officials.

Thank you for that, sir.

**Novine** · August-21-13, 08:40 AM

"1) The EFM didn't 'take over', the city voters through their elected officials 'dropped the ball'."

This is a simplistic view of what happened in Pontiac. Property values cratered in Pontiac even worse than any other municipality in Oakland County. The city has lost almost 50% of its property value since 2008. Property values are still falling in Pontiac. Add to that the cuts in state revenue sharing from Lansing and the overall economic problems and you have a situation that's next to impossible for city officials to fix. Few private companies would survive such a collapse in revenue. That's not to say that city officials didn't have a role in the problems that overwhelmed Pontiac. But the idea that this was entirely the fault of city officials or that it's as simple as getting expenses in line with income shows a simplistic worldview. The EFM has outsourced almost the entire workforce, sold off any assets of any value and tried to dump its healthcare and pension obligations. I can't think of any Michigan community that's had to go through that kind of downsizing and so far, there's little evidence that Pontiac's the better for it.

**Wesley Mouch** · August-21-13, 09:43 AM

Originally Posted by Novine

"1) The EFM didn't 'take over', the city voters through their elected officials 'dropped the ball'."

This is a simplistic view of what happened in Pontiac. Property values cratered in Pontiac even worse than any other municipality in Oakland County. The city has lost almost 50% of its property value since 2008. Property values are still falling in Pontiac. Add to that the cuts in state revenue sharing from Lansing and the overall economic problems and you have a situation that's next to impossible for city officials to fix. Few private companies would survive such a collapse in revenue. That's not to say that city officials didn't have a role in the problems that overwhelmed Pontiac. But the idea that this was entirely the fault of city officials or that it's as simple as getting expenses in line with income shows a simplistic worldview. The EFM has outsourced almost the entire workforce, sold off any assets of any value and tried to dump its healthcare and pension obligations. I can't think of any Michigan community that's had to go through that kind of downsizing and so far, there's little evidence that Pontiac's the better for it.

Yes, very simplistic. I don't think the problem was 'entirely the fault of city officials' or as simple as 'getting expenses in line with income'.

I don't know how 'cratering' compares with the drops in other cities. I know people in great Oakland County neighborhoods whose home value dropped about 50%. I also don't think the real estate crisis was unique to Pontiac. Let's agree that this surely wasn't a simple problem.

Yay Pontiac for getting this far! I wish them luck in keeping the reforms strong and government lean and efficient for the residents.

**Hypestyles** · August-21-13, 09:59 AM

what happened to all of that property in the city that was supposedly put on sale/auction?

**Novine** · August-21-13, 11:07 AM

"I don't know how 'cratering' compares with the drops in other cities. I know people in great Oakland County neighborhoods whose home value dropped about 50%. I also don't think the real estate crisis was unique to Pontiac. Let's agree that this surely wasn't a simple problem. "

Between 2007 and 2011, Pontiac had the largest drop in property values in the entire state. This was for a city that was struggling before property value crashed.

**Detroitnerd** · August-21-13, 11:30 AM

It's kind of amusing to watch people bend over backward to avoid the conclusion that EFM and EM laws target poor communities.

**Wesley Mouch** · August-21-13, 12:00 PM

Originally Posted by Detroitnerd

It's kind of amusing to watch people bend over backward to avoid the conclusion that EFM and EM laws target poor communities.

Is targeting bad? We target poor performing schools, and offer assistance. Isn't that what we should be doing?

If you mean that in the minds of the state this was a plan to attack only poor cities, well -- you're entitled to your opinion about their targeting. I don't go in for conspiracy theories. This looks pretty simple to me on the face. Many cities in Michigan are in financial trouble, for a wide variety of causes -- both external and internal.

We have two choices. Let them fail. Or target them for help.

I prefer to see failure. I'd rather see Detroit have payless paydays.

But we've chosen to do the right thing and help them out.

I think the difference between us is that you see the outside influence as a problem, I see it as an opportunity.

**bailey** · August-21-13, 12:06 PM

Originally Posted by Detroitnerd

It's kind of amusing to watch people bend over backward to avoid the conclusion that EFM and EM laws target poor communities.

that's sort of like complaining about fire departments only targeting houses on fire...isnt it?

**Baselinepunk** · August-21-13, 12:56 PM

Don't worry, with the State switching over the controlling the school district by the time they soak that puppy Pontiac's teat will be swollen once more for the State to step in again soak it dry.

Wash, rinse, repeat.

**Detroitnerd** · August-21-13, 02:07 PM

Oh, yes. Emergency managers are a totally legal tool to help poor communities by helping them shed excess democracy and public capital. Totally impartial forces just there to help balance the bottom line, which was purely the result of bad decisions by corrupt administrators.

**Detroitnerd** · August-21-13, 02:08 PM

If you repeat a lie often enough, it becomes the truth.

**bailey** · August-21-13, 02:50 PM

Originally Posted by Detroitnerd

If you repeat a lie often enough, it becomes the truth.

...he says without a hint of irony.

**compn** · August-21-13, 03:32 PM

i remember pontiac in the 90s. it felt like a real city.
now it feels empty. not as bad as flint or detroit, not yet.
the silverdome closing really hurt pontiac.

**Hermod** · August-21-13, 08:32 PM

You know, there are a lot of upstate counties and communities that lost a significant portion of their population during the 20th century. They just tightened their belts and moved on. Many townships had to combine and surrender their political power to survive. Outside of our metropolitan areas, the state did not prosper in the 20th century as as extraction industries totally collapsed. Next time you are at the library, see of they have a copy of Michigan Ghost Towns.

**Novine** · August-21-13, 09:10 PM

The difference is that Pontiac didn't suffer a 50% drop in population. There was and are still a significant number of people who need services and don't have the income to substitute private services when public services go lacking.

**Detroitnerd** · August-22-13, 10:10 AM

Originally Posted by Hermod

You know, there are a lot of upstate counties and communities that lost a significant portion of their population during the 20th century. They just tightened their belts and moved on. Many townships had to combine and surrender their political power to survive. Outside of our metropolitan areas, the state did not prosper in the 20th century as as extraction industries totally collapsed. Next time you are at the library, see of they have a copy of Michigan Ghost Towns.

Haven't we discussed this before, Hermie? I know about five years ago MICHIGAN SHADOW TOWNS came out, and had all the statistics about how Michigan "lost" about 200 towns between 1900 and 1950. Some of this had to do with modernization of shipping and railroads; small towns didn't need to have their own mills for everything, and the manufacturing that had taken place moved to the big city, mainly Detroit. And, frankly, how ya gonna keep 'em down on the farm after they seen Paree?

But that isn't really what happened here. Detroit grew. It just grew in such a way that it denied the fruits of prosperity to minorities. And then largely blamed minorities for not being prosperous. Over the last 40 years, that race dimension has become more of a class dimension, but we remain a region that refuses to share, every rich community looking out for itself, every impoverished community looking for a quick fix. No amount of "belt-tightening" is going to do the trick. In fact, as leading economists keep pointing out, it is INVESTMENT, not austerity, that is needed.

I like that you study history, Hermod. But I can't understand how somebody so immersed in something that interests me can draw such facile conclusions from it.

**TKshreve** · August-22-13, 11:07 AM

No amount of "belt-tightening" is going to do the trick. In fact, as leading economists keep pointing out, it is INVESTMENT, not austerity, that is needed.

WhoTF is going to invest in Detroit not named Illitch, Gilbert or......... um........

**Detroitnerd** · August-22-13, 12:01 PM

Originally Posted by TKshreve

WhoTF is going to invest in Detroit not named Illitch, Gilbert or......... um........

Actually, I'm not sure there's a word for what billionaires like Gilbert, Taubman or Ilitch are doing in Detroit. Usually when we think of investment we think of people who buy properties, fill them with businesses and pay taxes. These guys do pretty well on buying properties, not so well on filling them with businesses and don't pay a whole lot of taxes. The amount of tax abatements and subsidies they demand [[and get) puts them in another category completely. It ends up being, essentially, a transfer of wealth from the residents and workers in one of the poorest big cities in the country to its richest residents.

**Wesley Mouch** · August-22-13, 12:02 PM

Originally Posted by Detroitnerd

...Detroit grew. It just grew in such a way that it denied the fruits of prosperity to minorities. And then largely blamed minorities for not being prosperous. Over the last 40 years, that race dimension has become more of a class dimension, but we remain a region that refuses to share, every rich community looking out for itself, every impoverished community looking for a quick fix.

I agree that we have a huge issue with class warfare. Our urban cities do need help. But help isn't all they need. They also need a reassessment of what they exist to accomplish -- and how we organize our citizens into municipalities. Arbitrary boundaries are enjoyed by politicians, but they don't serve the citizens.

Originally Posted by Detroitnerd

No amount of "belt-tightening" is going to do the trick. In fact, as leading economists keep pointing out, it is INVESTMENT, not austerity, that is needed.

I also agree with you here. Belt-tightening isn't enough. But where I think we disagree is that it may not be enough, but it is also necessary.

The bigger issues are valid impediments to success. We need to find ways to address our social issues. We need to reorganize government to serve citizens and not themselves. But its also true that we need belt-tightening too.

Both can be true. Austerity isn't enough. But neither is 'investment'. You need both. And that's basically what happens through EFM/EM/Bankruptcy. You reduce the wasteful spending, focus on important core services, and make the city desirable so investors will loan money to you. You tighten your belt, and then investment can follow.

Doctors don't give donuts to fat people.

Nerdinski, I enjoy that we aren't really on opposite sites here. I think we agree on the need to change. You suggest society needs to change. I suggest that we [[the City) needs to change. And really we're both right.

**Detroitnerd** · August-22-13, 12:13 PM

Well, it ain't hard to agree that this whole region is out of whack. When you have young people who can't get a hot meal for breakfast in one area, and sewer grates so brand-new you could grill on them in another, it suggests to me that our priorities are messed up.