Thursday, September 30, 2010

Just Cookies Can't Discriminate Against Gays Because It's The Law

I'm not surprised the administration of Mayor Greg Ballard is confused about what the City's human rights ordinance says about discriminating against persons based on their sexual orientation since his administration has been hostile to anything related to gays, but it is a bit disturbing that prominent local lawyers are confused on what the law says. In 2005, the City-County Council adopted a Human Rights Ordinance that added sexual orientation and gender identity to the list of prohibited characteristics upon which discriminatory practices could be based. Despite the law being on the book for almost 5 years now, many prominent attorneys appear to be completely ignorant of its meaning.

This flap began when Fox59 News reported that Just Cookies' owners, David and Lily Stockton, refused to take an order from a student at IUPUI who wanted to place an order for rainbow-colored cupcakes for "National Coming Out Day." Lily was smart enough to tell Fox59 News' Ray Cortopasi that the business refused the order because we sell "Just Cookies" as the name suggests. "Look around, we don't have cupcakes," said owner Lilly Stockton. David, however, couldn't keep his mouth shut and told the reporter he didn't approve of gays and had two young impressionable daughters; therefore, he refused to take an order to prepare cupcakes for a gay-related event. "I explained we're a family-run business, we have two young, impressionable daughters and we thought maybe it was best not to do that," said co-owner David Stockton. That news report set off the firestorm and led to call for the City to take action against the owners.

Everything is going along fine until the lawyers become involved. It seems a number of attorneys in this town are confused about a human rights ordinance that really does mean what it says. The IBJ quotes John Haskin as claiming the ordinance is limited to employment matters:

John Haskin, a local employment discrimination lawyer with Haskin & Larue LLP, said the city ordinance protecting sexual orientation probably doesn't apply at all in this case because it deals only when discrimination is alleged in employment matters, such as the termination of an employee.

“So whether or not the cookie stand violated that ordinance is really questionable,” he said.
Sorry, John, but you should read the ordinance first before commenting on it. The ordinance specifically covers public accommodations. It reads, in part:
The council finds that the practice of denying equal opportunities in employment, education, access to and use of public accommodations, and acquisition of real estate based on race, color, religion, ancestry, age, national origin, disability, sex, sexual orientation, gender identity, or United States military service veteran status is contrary to the principles of freedom and equality of opportunity and is a burden to the objectives of the policies contained herein and shall be considered discriminatory practices . . .
To provide all citizens of the city and county equal opportunity for education, employment, and access to public accommodations without regard to race, religion, color, disability, sex, sexual orientation, gender identity, national origin, ancestry, age, or United States military service veteran status
The term "public accommodation" as defined in the ordinance clearly includes businesses like Just Cookies. It is defined as "an establishment which caters to or offers its services, facilities or goods to the general public." Just Cookies' refusal to take an order from someone based on sexual orientation falls within the definition of a "discriminatory practice" under the ordinance:
The exclusion from or failure or refusal to extend to any person equal opportunities or any difference in the treatment of any person by reason of race, sex, sexual orientation, gender identity, religion, color, national origin or ancestry, disability, age, or United States military service veteran status . . .
Because Just Cookies leases space in the city-owned City Market, the ordinance further requires a non-discriminatory clause in any contract City-County agencies enter into with businesses, organizations and individuals in employment matters:
Every contract to which one (1) of the parties is the city or the county, or any board, department or office of either the city or county, including franchises granted to public utilities, shall contain a provision requiring the governmental contractor and subcontractors not to discriminate against any employee or applicant for employment in the performance of the contract, with respect to hire, tenure, terms, conditions or privileges of employment, or any matter directly or indirectly related to employment, because of race, sex, sexual orientation, gender identity, religion, color, national origin, ancestry, age, disability, and United States military service veteran status. Breach of this provision may be regarded as a material breach of the contract.
An attorney at Barnes & Thornburg decided to add to the absurdity spewed by Haskin suggesting the ordinance doesn't apply to Just Cookies.

Still, most businesses have the right to refuse a customer, said Ken Yerkes, who leads Indianapolis-based Barnes & Thornburg LLP’s employment practice.

“Generally speaking, a private company can decide to whom it will or will not provide services,” he said.
Ken, you better read the ordinance, particularly since your law firm does more legal work for the city than any other law firm in town. And not to be outdone, an Ice Miller attorney suggests the ordinance may not apply because the order was being placed for a group of persons as opposed to one individual:

“If a person walked up to Just Cookies, say a Latino, and [the business] said, ‘we’re not going to serve you,’ that would clearly violate the ordinance,” Blickman said. “What I don’t know is whether the ordinance extends to a group.” . . .

Absent a city ordinance, there would be no basis to argue discrimination, even against a business operating within city-owned property. That’s because neither state nor federal law prohibits discrimination based on sexual orientation, according to attorneys . . .

“And that is why the spotlight is on the Indianapolis ordinance,” Blickman said. “You might say it is on the cutting edge of anti-discrimination in relation to sexual orientation and gender identity.”
Yeah, right, Mike. Are you telling me if the City refused to grant a permit to Indy Pride to hold its annual pride parade and celebration downtown, the ordinance wouldn't apply because it's a group rather than an individual? The ordinance clearly defines a "person" covered by the act to include a group:
Person means and includes one (1) or more individuals, partnerships, associations, organizations, cooperatives, legal representatives, trustees, trustees in bankruptcy, receivers, governmental agencies and other organized groups of persons.
Geez, do any of these attorneys bother to read the law? Further, Indianapolis' ordinance is hardly on the cutting edge of anti-discrimination in relation to sexual orientation and gender identity as Blickman suggests. A number of states and hundreds of municipalities, including several in Indiana, beat Indianapolis to the punch on that one.
So the law is very clear, notwithstanding the confusion of several prominent Indianapolis lawyers on what it means. The question is whether the Ballard administration intends to enforce it against Just Cookies. After all, the owner is recorded on camera stating his discriminatory motive for turning down the order for rainbow-colored cupcakes.

Wednesday, September 29, 2010

Democrats Hit The Country Club Politics Of Mayor Greg Ballard

Marion County Democrats have launched yet another negative Internet ad attacking the policies of Mayor Greg Ballard, who has abandoned virtually every campaign promise he made to the Tea Party supporters who put him in office in 2007 and has provided the Democrats with all of the ammunition they need to sink the fortunes of the Republican Party in Indianapolis for many years to come. I would say it's time to wake up, Mayor Ballard, but I think it's a little too late for that.

Dennis Ryerson Just Doesn't Get It

I'm still trying to figure out what school of journalism Star executive editor Dennis Ryerson attended as he continues to offer the Star's readers further reason for dropping their subscriptions to the newspaper. Ryerson's latest editorial tells the newspaper's readers there is nothing wrong with Mayor Greg Ballard's latest proposal to finance yet another private development on the backs of the taxpayers, notwithstanding the City's inability to appropriately fund other basic services. It's part of your civic duty, you see, to tend to the financial needs of wealthy real estate developers. In an editorial entitled, "Weighing the price for progress," Ryerson writes:

 . . . The Democratic minority leader on the City-County Council, Joanne Sanders, argues that the city shouldn't subsidize the development at the same time IndyGo and the library system have trimmed services because of budget cuts. Such sophistry might score a few political points, but it's a distraction that is, at best, fiscally naïve . . .

Ideally, the city would never get involved in underwriting private projects. But the state of the economy is far from ideal. The price for progress under current conditions involves the city being willing to accept reasonable exposure. Of course, not every deal is worth pursuing. But this one is attractive because of the players -- Buckingham, Lilly, the YMCA -- involved and because of the development's prime location . . .

After reading the editorial, I couldn't help but think Dan Carpenter was reaching for his bottle of Tylenol to nurse his latest sore head from butting it against the news room's wall in total frustration with Ryerson's pandering to the downtown elites. It looks like Carpenter got a chance to release some of that frustration in a column he penned today, entitled Higher uses for your lucre," alongside Ryerson's nonsensical editorial:

You gotta love these proud conservatives, these fierce and faithful stewards of the people's treasure.

Take the Ballard administration, if you please.

Having established a record ranging from lip service to outright hostility toward public libraries, public transportation and bona fide public schools, city hall has shown the love to a wealthy private entity by way of a loan guarantee that's half again the IndyGo annual budget.

The proposed $86 million assist to Buckingham Companies, which will meet with some (Democratic) resistance from the City-County Council, is the latest exercise of the trickle-down theory of Downtown development on which taxpayers have been gambling for three decades.

Like the Colts' subsidies, like the Pacers' old and new deals, like the outsourcing of waterworks and parking meters, this offer of public assets to private enterprise is understood to be more productive for all of us than spending tax dollars directly on us and letting them take their chances with the market.

Echoing their fellow Republicans on the state and national circuits, Mayor Greg Ballard and his allies justify their largess by pointing out that the banks aren't doing what capital does . . .

Hundreds of millions for billionaires, austerity lectures to libraries and schools. Insurrection against Medicaid, inside tracks for contractors. And they're promising to keep the other guys out of my pocket.
Other than the (R) behind his name, I'm neither convinced Ballard is a Republican nor a conservative. I'll certainly never make the mistake of voting for him again. "Lucre", by the way, is another word for money, in case you were wondering.

Charlie White's Residency Issue Not Going Away

As much as my fellow Republicans want the issue to fade away, the Democrats and the media aren't going to let Charlie White's residency issue simply die without getting the scrutiny it deserves. Democrats contend White committed an election law violation by knowingly misrepresenting his place of residency for purposes of casting a vote in this May's primary election. The Star's Mary Beth White has a follow up story today in which she quotes me:

. . . Charlie White voted in the May primary in a Fishers precinct where he no longer lived. He also didn't bother to inform any elections official at the polling place that he had moved.

That, Indiana Democratic Party Chairman Dan Parker said Tuesday, is voter fraud -- fighting words that spurred Democrats to insist on an investigation and accusations from Republicans that the whole affair is much political ado about nothing.

Parker called upon Secretary of State Todd Rokita, Hamilton County Prosecutor Sonia Leerkamp and Gov. Mitch Daniels -- all Republicans -- to investigate, and for Leerkamp to appoint a special prosecutor.

White -- who is running against Democrat Vop Osili and Libertarian Mike Wherry for secretary of state -- refused to answer questions on the matter Tuesday.

Instead, White's campaign issued a statement saying that "the simple fact is that Charlie was entitled under law to vote one last time at his old polling location."

Indiana law, though, isn't quite that simple.

Two provisions in Indiana code allow people who move to vote in their old precinct. One section applies only to people who move 30 days before the election. But White told The Star previously he moved in March, more than a month before he voted.

The other doesn't mention any time deadline but allows people who moved addresses but who are still in their same municipality and congressional district to vote if they correct the voter registration record at the polling place and make an affirmation, which must be put in writing by the voter or polling place clerk, of their new address.

White never did that.

White's campaign called that an "oversight that does not preclude his entitlement to vote" and said he'd cleared everything up when he changed his voter's registration last week.

Dave Brooks, the attorney for the Indiana Republican Party, said that "there's no question that the statute says you're supposed to fill out" a form if you are voting at the wrong precinct.

White, he said, "forgot to do that." But Brooks called that "an inconsequential error". . . .

Under Indiana law, it's a Class D felony -- punishable by up to three years in prison and a $10,000 fine -- for a person to knowingly vote in a precinct except the one in which he or she is both registered and resides.

But while some Republicans called White's actions an oversight, some Democrats charged that White knew exactly what he was doing -- and did it to keep his seat on the Fishers Town Council . . .

Brooks, though, said this is a minor incident that should not spur a criminal investigation.

"This kind of thing has got to happen innumerable times in every county, every election," Brooks said. "And it doesn't get criminalized because it's inconsequential. Every prosecutor in the state would have no time to prosecute real criminals if they wanted to go find some minor irregularity that really at the end of the day has no consequence, and start prosecuting it". . .

It isn't, though, just Democrats who find White's actions troubling.

Gary Welsh, a Republican attorney who publishes the political blog, said that White is both an attorney and Hamilton County Republican Party chairman who should know both election law and the Fishers district boundaries well enough to know if he is living in the district he represents.

"There seems to be a pattern of deception emerging here of an officer of the court who seeks the job of being the state's top elections administrator," Welsh wrote on his blog.

Welsh said he has worked the polls in elections, and regularly encounters voters who tell workers they have moved and seek help in correcting their address and registration.

"They want to make it correct. That bothers me that he didn't do it," Welsh said. "It's just not worth it."

I couldn't disagree more with Brooks on his argument that people vote in places they don't live all the time and White's doing so was an "inconsequential error." As an attorney and officer of the court, I find his dismissive attitude towards White's violation disturbing but not surprising. Every election I've worked in my precinct, we encounter voters who come into the polling place and announce they have moved to another residence and ask if they can vote at their old polling place. We ask them how long it has been since they moved. If it has been less than 30 days, we allow them to vote at their old polling place and have them fill out a change of residence form. If it has been more than 30 days, we try to determine the location of their new polling place to see if it is still in the city and within the same congressional district; if so, an affirmation of such change of address allows them to cast a vote at their old polling place one last time. If average citizens are honest enough to tell you about their change of address, you would think an officer of the court, a county chairman and candidate for the state's top elections official position, all of which White is, would be as well.

When I learned my City-County Councilor Patrice Abduallah had been residing all along outside our council district, I called him out on it in my blog. Abduallah resigned and we later learned Marion Co. Clerk Beth White had allowed Abduallah to run for re-election for his council district knowing that he didn't live in the district. Beth White simply dismissed his residency issue as one she was not obliged to raise as the county's chief elections administrator. I felt then and still feel to this day, she breached her duty not only as an officer of the court but as the chief election's administrator. Marion Co. GOP Chairman Tom John and David Brooks rejected my call for a criminal investigation of the matter. Adding further insult to injury, John and Brooks stood by as Democrats violated election law a second time by allowing Abduallah to be replaced on the ballot with Andre Carson despite the passage of the applicable deadline over my objections.

Yes, Charlie White likely committed a criminal law violation by representing he lived at an address at which he did not live. Yes, Abduallah committed a criminal law violation when he ran for a council seat and voted at a polling place at which he knew he did not live, not just in one election but in multiple elections. Beth White likely committed a criminal law violation by aiding and abetting Abduallah in perpetrating a fraud on the voters in his council district. This isn't a question of politics. This is a question of the rule of law. Republicans may not like the consequences of holding Charlie White accountable to the law, but that's the way the cookie crumbles. Too bad the Democrats weren't as concerned about the law in 2007, but shame on the Republicans for letting Abduallah and Beth White get by with breaking the law in 2007.

Matt Tully adds his thoughts to White's residency controversy today:

White's claim that he didn't realize his new home was outside his council district is hard to believe. I've never met a council member who couldn't tell you the exact boundaries of his or her district -- down to the streets. And we're talking about miles here, not a block or two. If White knew so little about his district, he was a negligent councilman.

Outgoing Republican Secretary of State Todd Rokita has made a career of lecturing about clean elections. If he doesn't agree to look into White's case, as Democrats have requested, he will look like he is taking care of one of his political buddies.

Democrats are within bounds to talk about this controversy. But if this is all they have to talk about five weeks before Election Day, that's a sign the party is in trouble.

Tuesday, September 28, 2010

Rahm Emanuel's Residency Problem

It turns out Indiana GOP Secretary of State candidate Charlie White isn't alone in battling a residency dispute. Obama White House Chief of Staff Rahm Emauel wants to move back to his home town of Chicago asap to run for Chicago mayor next year after Richard Daley announced he would not be seeking re-election. There is a hitch. In order to be a candidate, Rahm must be able to demonstrate residency in the city for one year prior to next February's municipal primary election. Although he has maintained his voting registration at the home he owns in Chicago, he rented it out to another family in 2009 and renewed that lease for another year to the family just six days before Daley announced he wasn't running for re-election. Rahm wants to move back into his Chicago home, but the family is refusing to budge and won't even allow Rahm to set up residency in the home's basement. The Sun-Times' Michael Sneed explains Rahm's rift with his renters:

"I'm told Rahm and a close lawyer friend made several polite phone calls to [Robert] Halpin last week, but he bumped up against the wrong guy," said a top Sneed source. "Halpin reportedly conducts his business from the house and his two kids are in school. He doesn't want to move."

In a telephone interview, Halpin, who described himself as an industrial real estate developer in the midst of heading to Louisville on business Monday, told Sneed: "Look, according to the lease I am not allowed to speak to the media about the house.

"But I can tell you I have no plans to move."

Through various sources, Sneed was able to piece together the following scenario . . .

"Rahm explored the option of moving back into his house, he offered to compensate [Halpin] for three months of rent and then compensate him for the rest of the lease if he moved out," said Rick Jasculca, a close friend and spokesman for Rahm. "It was cordial, but [Halpin] was unwilling to terminate the lease. So now Rahm will explore other options."

Sneed notes Rahm has been voting in Chicago the past two years using the home he leased to the Halpins as his registered voting address. The Halpins have also registered to vote at same address. Experts offer varying opinions on whether he can survive a residency challenge, but she said you can count on one being filed. "You can bet it's going to be challenged," said an election expert who asked not to be identified. "It's a hot button. Simply owning a building isn't enough. But the terms of the lease might be a different story." Elections law experts agree Rahm would have had no residency issue if he had not rented out the property to another person and continued to maintain his voting address there while living and working in D.C.

More On Pittsburgh Got A Better Deal Than Indy For Parking Meter Lease

WRTV's Norm Cox just happened to be in Pittsburgh last week to see a Pirates game with his son, Jeff, when Pittsburgh announced it was awarding a 50-year lease for its parking meter and garage services that would net the city $451 million up front. LAZ Parking, the same contractor who paid the City of Chicago almost $1.2 billion for a 75-year lease agreement for the Windy City's parking meter business, submitted the winning bid. Norm caught my blog post discussing how Pittsburgh seemed to make off better than both Indianapolis and Chicago, with its long-term lease agreement and stopped by to interview me for a story. Here's some of what Norm said today in his report:

Critics of Mayor Greg Ballard's plan to lease Indianapolis' parking meters said they believe he could have negotiated a much better deal for the city.

Skeptics point to Pittsburgh, which has a deal expected to bring in $451 million, compared to Indianapolis' $35 million arrangement, 6News' Norman Cox reported.

Pittsburgh, which plans to lease 8,700 spaces and nearly 9,000 more in 11 garages, is a bigger metro area with more daily commuters, while Indianapolis is a bigger central city leasing 3,600 spaces, but none in the city's garages.

Both deals are for 50 years, but Pittsburgh will get $416 million more upfront than Indianapolis.

"It does make you have some pause as to whether or not we're getting the best deal," said Advance Indiana blogger Gary Welsh.

Deputy Mayor Michael Huber said Indianapolis could have gotten more money if it had agreed to raise meter fees as high as Pittsburgh's, up to $4.50 an hour.

"We are getting less money overall because of some of the policy decisions that we've made," he said.

Pittsburgh will get all money upfront, while Indianapolis will continue to share revenue with the operator over the life of the deal, an estimated profit of between $200,000 and $400,000, Huber said.

But Welsh argued that even with the differences in spaces, fees and funding, the deals don't even out.

"If you have immediate access to $451 million, and the city of Indianapolis is having to wait 50 years to get access to that money, you know, that's a big difference," he said.

Most financial experts advise getting money upfront when it's more valuable, before inflation erodes its buying power, but Huber said he disagrees.

He said the feedback the administration got from residents is that they don't want the politicians to get their hands on all that money at once and squander it, but preserve most of it for future generations.
There were a couple of additional points I made to Cox that didn't make the aired report. One is that the large upfront payment Pittsburgh is getting allows it to retire $300 million in long-term debt the city would have been paying off with costly interest payments for many years to come. By taking a small upfront payment and a share of revenues over the 50 years, Indianapolis cannot use any of the money to retire long-term indebtedness and, even under the best projections, won't recover over a 50-year period anything close to what Pittsburgh is getting up front, particularly when you factor in inflation as Cox' report notes. Indianapolis would have to issue bonds to realize upfront benefits from the deal and commit the revenue stream to paying debt service on that debt, but it would wind up paying a lot more money over time to cover interest on the debt.

The other key point relates to the higher price Pittsburgh charges for its parking meters under its deal. Pittsburgh, unlike Indianapolis, has a very robust public transportation system. It has a subway system operating in the downtown area that connects to a light rail system that reaches into the outer reaches of the city and some of the suburban communities, in addition to a city bus service. Indianapolis has no viable public transportation option for most commuters who don't want to pay the higher parking fees. If you want to come downtown, you have no choice but to pay to park your automobile in a metered spot, a parking lot or garage. 

More Questions On City-Financed Downtown Project

If Jeff Swiatek's story in today's Star is any indication, it looks like at least Democratic councilors may challenge approval of the City of Indianapolis financing a $155 million private developer's plan to build a hotel, apartments, retail space and a YMCA largely for the benefit of Eli Lilly and Wellpoint on the City's near southside downtown area. There are also many unanswered questions that must be addressed.

Joanne Sanders, the Democratic minority leader, said she would rather see the money help the IndyGo bus system and the library, whose budgets have been slashed because of the recession. "We're doing this for a private entity," Sanders said, "but we have two government entities dying on the vine."

Council President Ryan Vaughn, a Republican, said the project "goes a long way to stabilizing and securing the large corporate citizens of Downtown. It breathes some life into that part of Downtown."
The first question to be asked is what, if any, role Vaughn's law firm, Barnes & Thornburg is playing in this transaction. As we've seen with almost every major transaction undertaken by the Ballard administration, there seems to be a Barnes & Thornburg connection.

Next, as I've written about on many occasions in the past, Pay To Play Is The Ballard Way. Sure enough, that's the case with this deal:

Buckingham -- whose president, Bradley Chambers, donated $10,000 to Ballard's mayoral election campaign, according to public campaign records -- hopes to start construction on the 10-building project late this year. Construction would take two years, with a 152-room Dolce-brand hotel being one of the first things to open in 2012, perhaps in time for the Super Bowl that Indianapolis will host in February 2012.
Is it the case as one reader asks that the public relations work for this project was being aided by Hirons & Company? That would be the same firm that hired Greg Ballard, Jr. and started getting all kinds of work from the Ballard administration, which Ballard assures us has absolutely nothing to do with his son working for the company.

We know Lilly is donating the land for this project, which the City has grossly over-valued at $15 million, sort of the way they did that parking garage for Tadd Miller's project next to the City-County building, which was supposed to get underway within 9 months (it's now been more than a year later, but we'll save that one for another post). We learned from the Tadd Miller project the City uses a bogus appraisal method in violation of state law that projects what a piece of real estate is worth post-development as opposed to pre-development.

The Lilly land, valued at $15 million and used by Lilly for employee and vendor parking, has become an "idle asset" as Lilly's work force shrinks, said Lilly's director of strategic real estate, Steve Van Soelen.
Lilly and its employees stand to benefit by having a hotel, new apartments and a YMCA adjacent to its corporate campus, he said.
Lilly also would put about $15 million into the project from money the city owes Lilly from a project done at Lilly's technology center campus off Kentucky Avenue in the 1990s, Kintner said. The city plans to pay off that debt with a lower-interest loan, and Lilly has agreed to put the proceeds from the payoff into the North of South project, Kintner said
Lilly is being credited with $15 million the City owes it for the Kentucky Avenue project from the 1990s? What about all of the millions that the City is supposed to be clawing back from Lilly because it failed to meet its job creation promises after the City awarded it hundreds of millions of dollars in tax abatements and other incentives and instead shed thousands of jobs at its city facilities over the last several years. See these past headlines:  "Eli Lilly Gets Indianapolis Incentives of $214 Million for $1 Billion, 7,500-Job Deal"; "Eli Lilly To Layoff 5,500 Workers Mostly in Indiana". Presumably, Lilly is putting people up at other hotels in downtown currently. What impact will the loss of that business have on those downtown hotels and has anybody bothered to factor that into this equation? And please, Lilly employees could care less about having a YMCA near their campus. Don't insult our intelligence.

The City claims its investment in the deal is relatively small compared to other recent projects:

Kintner said the city's $9 million direct investment in the project amounts to only 6 percent of the total project cost, much less than the 25 percent to 30 percent direct city investment in three other recent Downtown developments: the JW Marriott hotel, the headquarters of Simon Property Group and the Conrad Indianapolis Hotel.

The City's investment is small if you assume the developer doesn't default on the $86 million debt obligation the City is taking on with this transaction and stick taxpayers with paying it off, which is a real possibility.

Kintner said the city-guaranteed bond to the project is meant to be paid back using $7 million a year in anticipated profits and property taxes from the project.
I lay 9 to 1 odds right now this project willl not yield the $7 million a year in anticipated profits and property taxes.

So how much is the big Ballard contributor putting into the project, who claims who couldn't obtain conventional financing for the deal?

Other private money in the deal is $7 million from Buckingham. The city also is working with the state of Indiana to steer $6 million into the project through a Community Development Block Grant or other federal grant.
Not bad for Buckingham. A 5% investment in a $155 million project. See what I mean when I say Welcome To Fantasyland?

We also have Lilly donating land that is supposedly worth $15 million, which we know is really worth a fraction of that amount. We have some mystery money supposedly owed by the City to Kentucky for its Kentucky Avenue project from more than a decade ago but no mention of the clawback money owed to the City by Lilly from the tens of millions in past incentives that failed to create the requisite number of jobs promises. We now know state taxpayers are being asked to kick in another $6 million for the project, even though Gov. Daniels is slashing state agency budgets and laying off state workers left and right. Like I said, it's more of taxing the poor to give to the rich. Are you going to stand for it? Or are you going to pick up the telephone and start calling your councilors and the Mayor's office to express your outrage?

UPDATE: A commenter on the Star's website has a good summary of who is paying what on this project, noting 84% of the project is being financed with public dollars:

$86 Million - Indianapolis Bond Bank

$15 Million - City of Indianapolis (Payment thru Eli Lilly?)

$9 Million - City of Indianapolis (utility/sidewalk/roads)

$15 Million - City of Indianapolis Lease of Eli Lilly Parking Lot

$6 Million - State of Indiana through a Community Development Block Grant

$18 Million - YMCA

$7 Million - Buckingham Companies

None - Dolce Hotels and Resorts

None - Wellpoint

None - Indiana Farm Bureau

$156 Million Total Project Cost

84% Government Funding - $131 Million

16% Private Funding - $25 Million

Monday, September 27, 2010

SEIU Rep Illegally Registers More Than 23,000 Voters In Texas

The integrity of our representative form of government is completely under assault as people on the Left continue to thwart our electoral process in this year's elections just like they did during the 2008 elections through massive fraudulent voter registrations and absentee balloting. ACORN may have been sidelined temporarily by the numerous investigations stemming from their illegal activities during the 2008 elections, but it looks like their brethren at SEIU are picking up the slack. Thanks to the hard work of citizen tea party activists in Harris County, Texas, efforts by an SEIU thug to illegally register more than 23,000 voters have been unearthed and turned over to a prosecutor for investigation. Texas Insider reports on this disturbing news:

Service Employees International Union (SEIU) member Steve Caddle of Houston, Texas has been caught registering 23,207 fake voters in Harris County alone due to the hard detective work of Catherine Engelbrecht and her “True the Vote” project.

This is one of the best examples of what good citizen activism inspired by Tea Party principles can do for their community.

Catherine Engelbrecht was sick and tired of the vote fraud perpetrated by unions and Democrats and set out to expose it herself. Along with many friends who donated their time, computers, and sweat, they’ve uncovered thousands upon thousands of illegal Democrat “voters” in Texas.

“The integrity of the voting rolls in Harris County, Texas, appears to be under an organized and systematic attack by the group operating under the name Houston Votes,” the Harris voter registrar, Leo Vasquez, charged as he passed on the documentation to the district attorney. A spokesman for the DA’s office declined to discuss the case. And a spokesman for Vasquez said that the DA has asked them to refrain from commenting on the case.

The union thug behind this particular criminal enterprise admitted only that there “had been mistakes made.” Yeah, like not worrying about icebergs was just a “mistake” made by the Titanic’s crew! Of the 25,000 voter registrations turned in by Caddle only about 1,793 were legal.

“Vacant lots had several voters registered on them. An eight-bed halfway house had more than 40 voters registered at its address,” Engelbrecht said. “We then decided to look at who was registering the voters.”

….The other registrations included one of a woman who registered six times in the same day; registrations of non-citizens; so many applications from one Houston Voters collector in one day that it was deemed to be beyond human capability; and 1,597 registrations that named the same person multiple times, often with different signatures.

Does anyone have any doubt that this sort of crime has been perpetrated by Democrats the nation over? How many millions of fake, dead, nonexistent, and/or fraudulent voters have Democrats foisted upon the voter rolls in every corner of the nation?

Well, due to the excellent work of Catherine Engelbrecht we see exposed at least some of the criminal behavior of Texas Democrats and Union thugs.

So what was the outcome of Engelbrecht’s hard work? All of Harris County’s voting machines were torched in a three-alarm fire by person or persons unknown. Bet those shadowy firebugs hold SEIU membership cards, too!

This is precisely why I'm alarmed at Secretary of State Todd Rokita's efforts to relax voter registration safeguards to the point people can simply register online or over the phone. Indiana law has no protections to ensure that persons registering to vote are actually eligible citizens. Rokita has boasted nationally about his Voter ID law that has been upheld by both the state's and nation's highest courts, but it's completely meaningless if people can easily be registered to vote who aren't even eligible to become registered voters.
Interestingly, as Engelbrecht and the other citizen activists were gathering up evidence of the illegal voting registrations, a warehouse storing all of Harris County's voting machines caught fire and destroyed 10,000 electronic voting machines. Fire investigators have not ruled out arson as the cause of the three-alarm fire that broke out a month ago at 4:20 a.m. County election officials have scrambled to purchase E-Slate voting machines, borrow electronic voting equipment from other counties and use paper ballot back-ups to deal with the loss of all of its voting equipment.

Outrage: Indianapolis Taxpayers To Finance Another Downtown Private Development

We may be in the worst economic recession since the Great Depression, and city government agencies might be facing across-the-board reductions in essential city services due to plummeting revenues, but Mayor Greg Ballard in his infinite wisdom thinks Indianapolis taxpayers should borrow $86 million to finance a $155 million hotel, apartment and retail complex with another YMCA that will largely benefit workers at Eli Lilly and Wellpoint on the City's near southside, nothwithstanding the layoff of thousands of high-paid workers at Lilly in recent years and the company's failure to satisfy the promises made when taxpayers awarded them tens of millions of dollars in property tax abatements and incentives to expand their business operations in the city. And to nobody's surprise, there is an urgency in ramming this latest proposal through as quickly as possible so the new hotel financed at your expense will be ready in time for the 2012 Super Bowl. An online Star report clues us in on this latest outrage:

Indianapolis officials will finance most of the cost of a $155 million project to build a hotel, apartments, retail space and an office incubator building on land donated by Eli Lilly and Co. on the south edge of Downtown.

"This is a great project. It's an innovative project," Mayor Greg Ballard said today as he announced the project with developer Buckingham Cos. of Indianapolis and Lilly officials.

The Star reported in June that the Indianapolis developer was talking with the city and Eli Lilly and Co. about building a hotel and conference center with retail stores, apartments and a fitness center next to Lilly's headquarters campus Downtown.

The 10-building project, tentatively called North of South, will spread over 14 acres along South Street, bordered roughly by the rail tracks on the north, Virginia Avenue on the east and Delaware Street on the west. Groundbreaking is planned for late this year, with construction lasting about 2 years.

The 152-room hotel will be a high-end Dolce brand hotel that specializes in corporate bookings. It might open in time for the 2012 Super Bowl in Indianapolis. Plans also call for about 320 apartments, 30,000 to 40,000 square feet of retail space and 10,000 square feet of office space that will be leased to life-science-oriented start-up companies . . .
The city will finance about $86 million of the cost by floating bonds guaranteed by revenues from the Downtown tax increment financing district, said Deron S. Kintner, executive director of the Indianapolis Bond Bank.

The property tax revenues from the project would be used to pay off the bonds over 25 years, he said.

The city got involved in financing the project because private banks and other commercial lenders have largely pulled out of the market for new commercial development, he said.
Did it occur to anyone that private financing cannot be lined up because it may not be a viable economic development project absent huge public subsidies? Has any downtown project for that matter been undertaken in the past two decades that has not been heavily subsidized by Indianapolis taxpayers? And please, Mayor Ballard, what the hell is "innovative" about a private development project that is financed at the public's expense? Is it not forced slavery for those of us who have to work to pay the taxes to benefit these private developers? Welcome to Fantasyland, otherwise known as the City of Indianapolis. Tax the poor and give to the rich.

This comes after we just learned Mayor Greg Ballard approved the diversion of $8 million a year in property tax revenues derived from the downtown TIF to the CIB to help fund the ICVA's efforts at promoting business for the downtown convention business. Indianapolis taxpayers paid $60 million to finance the J.W. Marriott Hotel adjoining the convention center. We spent another $20 million to finance construction of the Conrad Hilton and gave $25 million to Simon Property Group to build their new corporate headquarters on a public park, along with a free parking garage to boot. We spent more than $700 million to build Lucas Oil Stadium for the Colts to use rent-free. We spent close to another $200 million to build Conseco Fieldhouse for the Pacers to use rent-free, but we still have to  subsidize their owners with another $33.5 million in public subsidies. Mayor Ballard now wants to turn over control of the City's parking meter business to the politically-connected ACS and more than double our parking rates in order to fund $35 million in downtown and Broad Ripple improvements prior to the 2012 Super Bowl. He already committed $10 million to a Georgia Street project using federal stimulus dollars for another Super Bowl project, on top of another $10 million used for an expanded downtown Cultural Trail.

Add it all up and you find the cost of hosting one Super Bowl game, which may or may not ever happen because of a collective bargaining dispute between NFL owners and players, will top $100 million. Yes, we have the worst public schools in the country. School closings and teacher layoffs are the norm. We have the worst public transportation system in the nation for a city our size. We are closing public pools. Our public parks are falling into desperate disrepair as the parks budget is slashed. We have entire neighborhoods without sewers or sidewalks. We are closing libraries and slashing other essential city services, but when it comes to finding money for the latest dreams of the downtown elites, there is no limit on what taxpayers will be asked to shoulder. The priorities of these people are so misplaced it is simply beyond belief. If the voters of this city don't rise up in revolt and throw every last one of the bums that run city hall out of office next year, they deserve the absolute worst of what government has to offer them.

And as a YMCA member let me add my further outrage. I will never donate another dime to your organization when you come asking for contributions for your capital campaign. You closed the Fall Creek YMCA rather than improving it. You refuse to expand the Athenaeum YMCA despite the parking lot adjacent to it that is for sale.  And now you're building another downtown YMCA just a few blocks away from the current downtown facility. Obviously, the YMCA doesn't have a clue how to manage its resources economically so the organization isn't deserving of future support from their members. Doesn't Lilly and Wellpoint already offer on-site fitness centers to their employees, by the way, not to mention the new fitness center down the street at the Villaggio?

UPDATE: A reader sent an e-mail communication sent this past Friday by a city planner responding to an inquiry today's announcement. Here's is what the planner wrote:

 . . . [W]e do not have renderings or drawings of any sort of this project that Buckingham is putting together with Lilly.  Apparently, there is a big announcement planned for Monday that will reveal the development proposal.  Yesterday, a rezoning petition was filed to rezone the area to, I believe, CBD-2, which will be heard on October 20th by the MDC.  They requested and were approved, a right to hear this at the MDC for its hearing rather than going through the Hearing Examiner step first.  We did meet with Buckingham on two occasions recently where we were shown plans, but none were actually given to us.  We gave feedback based on the Guidelines. We appreciated that we were involved in this project before plans were drawn in a more firm mode.
Obviously the city planner is a bit out of the loop. The plan had already been greased for approval with taxpayer funding by Mayor Ballard before any renderings or drawings were even shown to the city planners at DMD.

Register To Vote By Cell Phone

I've said it before and I'll say it again, the state of Indiana's Voter ID law is totally useless if you don't even bother to verify the people who register to voter are U.S. citizens. Indiana already allows persons to register to vote online. Now the state allows you to register to vote by cell phone. WTHR reports on this latest "high-tech" development:

Indiana has a new high-tech way residents can register to vote for the Nov. 2 elections - using Internet-capable mobile phones.

The state has offered voter registration online since July and announced the online service for cell phones on Sept. 21. Residents have to have a valid Indiana driver's license or state-issued ID to use either registration service.

The mobile phone service allows new voters to register. Existing voters can update their registration information.
The problem of registering non-citizens to vote began popping up after the federal government forced the Motor Voter law on the states, which requires motor vehicle agencies and welfare agencies to offer voter registration services to people who use their services. Immigration attorneys will tell you it is not unusual to encounter permanent residents seeking to become naturalized U.S. citizens who were illegally registered to vote at a BMV branch or a welfare office. A non-citizen can be deported under federal law for voting illegally in U.S. elections, although the law is rarely enforced. With the laws on absentee balloting increasingly being relaxed, it becomes easier for persons illegally registered to vote to cast votes without fear of having their votes challenged.

Many non-citizens have driver's licenses so it's a piece of cake for them to register the vote. The law relies entirely on the honesty of the person registering to vote. The registrant is required to state under penalties of perjury they are a U.S. citizen. One might wonder why a BMV worker or welfare worker would offer the opportunity to register to vote to someone who is obviously not a U.S. citizen, but it would actually violate federal law for them to make such additional inquiries. If everyone isn't offered the opportunity to register to vote when they visit a BMV branch or a welfare office, you can count on the ACLU filing a lawsuit against the state as happened in Indiana. The law requires government workers to offer the service to everyone who walks in the door; it's up to the person to tell the worker they are not a U.S. citizen. Some states, like Arizona, require a person to provide proof of their U.S. citizenship, such as a birth certificate showing birth in the U.S. or proof of naturalization, in order to register to vote. Indiana is not one of those states. As we learned from the 2008 presidential election, it is possible to be elected president of the United States without proving you are actually constitutionally eligible to serve so it should come as no surprise that it is no problem to become a voter in U.S. elections regardless of whether you are a citizen.

Secretary of State Todd Rokita has been one of the nation's biggest proponents of Voter ID as a means of reducing voter fraud. One might want to ask Rokita why he has no problem with Indiana laws that make it so easy for people to illegally register to vote, and to illegally cast absentee ballots in this state, two forms of voter fraud that are far more likely to occur than voter impersonation.

Saturday, September 25, 2010

Homeowners Get Little Relief From Property Tax Caps

The property tax cap law our governor and legislators have boasted are providing significant property tax relief to homeowners turns out to be something quite different. An analysis of the property tax cap law's impact by Purdue Professor Larry DeBoer show the lion's share of the relief going to apartment owners (almost 50%) and businesses (22%) according to a story in the latest edition of the IBJ. Only 28% of the tax relief realized by the property tax cap law aids homeowners, even though the caps on homesteads is 1%, compared to 2% for rental properties and farmland and 3% for business properties. Statewide, the tax caps are providing only $335 million annually in property tax relief. Here's how that relief breaks down:

Rental and farm property ($169.2 million)
Homesteads ($92.8 million)
Business ($73 million)

A lot of people don't realize the property tax relief they received since the property tax cap law first went into effect two years ago was the result of beefed up homestead exemptions, which have been phased out as the property tax cap law has been phased in. Lawmakers used one-time revenues from the sale of the slot machine licenses granted to the state's two horse race tracks in Anderson and Shelbyville to pay for the higher homestead exemptions. Some homeowners are actually going to see increased property tax bills even with the 1% property tax cap on their assessed value. On a $200,000 home, for example, your property tax bill cannot exceed $2,000; however, if taxing units within your area have successfully gone through the referendum process to levy higher property taxes, your tax bills can exceed the 1% cap. The savings you've seen the past two years came from the temporarily higher homestead exemption, not the property tax caps. To the extent you see property tax relief, it is more likely the result of lower assessments resulting from unprecedented drops in home values during the worst economic downturn since the Great Depression. At the same time, all Indiana taxpayers are permanently paying a 1% hike in the state sales tax as a trade-off for the property tax caps. A question appears on this November's ballot to make the property tax cap law permanent by making it a part of the Indiana Constitution.

Daniels Seeks To Cover A_ _ In Wake Of Duke Hiring Of IURC's Top Lawyer

After the State Ethics Commission reached an untenable position that the state's one-year cooling off period for state employees doesn't apply to the hiring of the state's top utility lawyer at the Indiana Utility Regulatory Commission by Duke Energy, Goveror Daniels' office has sent a letter to the IURC expressing his view Scott Storms should have no communications with IURC during the next one-year period on any matter on behalf of Duke Energy. A letter authored by the Governor's general counsel, David Pippen, was obtained by the Indiana Law Blog and reads:

The Governor has been made aware of your General Counsel's hiring by Duke Energy ofindiana. I informed him of the Formal Ethics Opinion and the particular matter restrictions contained in the September, 2010 opinion. While the opinion may be technically correct, the Governor intended the ethics laws to reassure the public that state employees would not trade influence for personal gain. This letter should be read to explain our understanding of that opinion and of the spirit and letter of the ethics laws in Indiana, as strengthened in 2005 by the Governor's Executive Order and later by statute.

The Formal Opinion, No.1 0-1-11, makes clear that Mr. Storms is precluded from representing Duke in certain "particular matters" for the entire life of those matters and not just three hundred and sixty-five days following his departure from state employment. Matters before the Commission such as smart grid, demand side management as well as IURC review of the Edwardsport IGCC project have specific cause numbers associated with them, but the restriction on representation or assistance may apply to other matters which necessarily must consider the outcomes and impacts of those "particular matters".

Further, in keeping with the spirit as well as the letter of the Governor's Executive Order on ethics and the ethics statutes, we question whether any issue Duke Energy ofindiana may bring before the IURC in the next three hundred and sixty-five days could be divorced from the particular matter restrictions outlined by the Ethics Commission. Indiana Code 4-2-6-11 specifically considers the "circumstances surrounding the employment" and only issues unrelated to the "particular matters" raised in the next year would be conflict free for Mr. Storms to represent Duke's interests before the IURC. The Governor has asked me to inform you that we don't see any issues unrelated to the "particular matters" which may come up in the next year and as such would expect Mr. Storms not to appear before or assist on matters before the IURC for the three hundred and sixty-five days following his departure.

We are certain the IURC intends to abide by the letter and spirit of the ethics laws and that it shares our view that the formal ethics opinion for Mr. Storms contains significant restrictions on his duties as counsel for Duke Energy of Indiana. Had Duke seen fit to assign him out of state, this would have been clear to all. To be certain that the spirit of the laws are fully honored, the Governor asks that the IURC not entertain communications or have contact with Mr. Storms for the next twelve months.
If Governor Daniels believes the opinion issued by his Ethics Commission is "technically correct," then perhaps he should be entertaining a new revolving door law that actually has some teeth to it.

East Chicago Mayor George Pabey Found Guilty Of Conspiracy And Theft In Public Corruption Trial

Pabey (right) with his attorney, Scott King (center) and Jose Camacho's defense lawyer, William Padula
East Chicago Mayor George Pabey had to wait only 2 1/2 hours to learn his fate in a public corruption trial against him and his former city supervisor, Jose Camacho, in a Hammond federal court. A jury found the two guilty of theft and conspiracy charges stemming from the use of public funds for improvements to a home owned by Pabey in Gary. The Northwest Indiana Times' Sarah Tompkins reported on Pabey's conviction:

A jury of nine women and three men found prosecutors met the burden of proof in showing Camacho and Pabey conspired to use city money to revamp a house Pabey bought thee years ago in the Miller Beach neighborhood of Gary. Prosecutors claimed Camacho used city accounts with Pabey's blessing to purchase home improvement items for the residence, and that Camacho instructed city employees to work on the home while on the city's clock . . .

City Controller Charlie "Tuna" Pacurar became interim mayor Friday under a 2008 Indiana law that ousts felons from elected office as soon as they are convicted. His term will last until Hammond Mayor Thomas McDermott Jr., as chairman of the Lake County Democratic Party, conducts of caucus of East Chicago Democratic precinct committeemen. They will elect someone to fill the remaining 15 months of Pabey's term . . .

Camacho's defense attorney, William Padula, said he and his client were "pleased" and "grateful" jurors acquitted Camacho of the witness tampering charges, after Padula pointed to conflicting employee testimony about whether Camacho told them to lie to federal investigators. Padula did not contest the government's evidence of conspiracy and theft . . .

Bell said the government will seek forfeiture of the Gary house, which means prosecutors will try to take back anything Pabey and Camacho gained through their criminal activity.

Pabey bought the brick home in Gary's Miller Beach neighborhood in 2007 for $67,000, according to county records. A real estate appraiser testified that the home now is appraised at $135,000. It is on the market for $124,900 but originally was listed for $149,000 in September 2009 . . .

Pabey's predecessor, Robert Pastrick, served for more than 30 years before Pabey defeated him in a special election in 2004. The Indiana Supreme Court had called for another vote after investigating allegations of rampant absentee ballot fraud.

When Pabey took office, he pledged to reform the city and get rid of the shady politics best characterized by the 1999 sidewalks-for-votes scandal that led to federal convictions against three city councilman and an additional trio of Pastrick aides.

Although Pabey's predecessor, Robert Pastrick was never charged criminally in his sidewalks-for-votes scandal that did result in a number of East Chicago officials being sent to federal prison, Pastrick and two of his former allies were ordered to repay city taxpayers $108 million in a federal civil RICO case brought against them by the Indiana Attorney General. Pastrick and his aides declined to defend themselves in the civil lawsuit. After the verdict awarding $108 million to the city, Attorney General Greg Zoeller commented:

"This case is historic; never before has a city government been adjudged a corrupt organization under federal racketeering laws," Zoeller said.

"This is a victory for the state of Indiana," Zoeller said.

The Attorney General's office continues to pursue casino revenues from the riverboat casino that operates in East Chicago that flow to a a nonprofit set up by Pastrick, Second Centuries, which he believes was used to enrich Pastrick and his associates. It is ironic that Pabey faces jail time for relatively small sins compared to Pastrick, who lived like an emperor among the serfs of his kingdom during his several decade-long corrupt rein in East Chicago, and who faced no jail time for his criminal conduct.

Friday, September 24, 2010

Phyllis And Marla Stevens Plead Guilty

GLBT activists and former Indianapolis residents Phyllis and Marla Stevens pleaded guilty to multiple felony charges brought against them in a Des Moines federal district court stemming from Phyllis' embezzlement of $6 million from her former employer, Aviva, a successor company of the Indianapolis Life Insurance Company. The Des Moines Register reports on their voluntary pleas of guilty in court this week:

Phyllis Stevens, 59, pleaded guilty to two counts of wire fraud, one count of computer fraud, one count of conspiracy to commit money laundering, one count of conspiracy to file false documents and income tax returns and one count of filing a false tax return in 2003.
As part of the agreement, prosecutors dropped 14 counts against Phyllis Stevens including two counts of aggravated identity theft that carried mandatory two-year prison terms that would have to be imposed consecutively on any prison term she served.

In pleading guilty together on the count of filing false documents and income tax returns, the two women admitted that Phyllis Stevens embezzled about $6 million from 2003 through 2009 and conspired with Marla Stevens to attempt avoiding detection by the U.S. Internal Revenue Service by providing a number of false explanations for the money including a claim that Marla Stevens obtained income from running an insurance business.

Phyllis Stevens faces a maximum prison term of up to 48 years and fines amounting to $1.75 million at sentencing. Under the original 20 count indictment, Phyllis Stevens faced up to 319 years in prison and $5.5 million in fines.

Marla Stevens, 58, pleaded guilty to a count of conspiring to commit money laundering and a count of conspiracy to file false documents and income tax returns.

Marla Stevens now faces a maximum prison term of up to 25 years and fines amounting to $750,000 at sentencing. Under her original five-count indictment, Marla Stevens faced a maximum a maximum penalty of 50 years in prison and $1.2 million in fines, if convicted.
Phyllis Stevens' attorney earlier unsuccessfully argued to the court that his client was incompetent to stand trial because she was mentally ill with dissociative identity disorder as a result of severe sexual, physical and emotional abuse by her adopted parents as a child. The two could likely spend the rest of their lives in prison unless the judge metes out lenient sentences to them, in addition to $2.5 million in fines. The two are scheduled to be sentenced in January.

Phyllis and Marla used the money to make hundreds of thousands of dollars in campaign contributions to Democratic candidates, in addition to purchasing a number of homes in Iowa, Indiana and Florida. At the time of the couple's arrests, Marla had been living at the Bellagio Hotel & Casino in Las Vegas for months, spending close to $2 million of the embezzled funds there. Locally, the two were one of U.S. Rep. Andre Carson's largest campaign contributors, making more than $25,000 in contributions to his campaign committee. The couple also donated thousands of dollars to his grandmother, the late U.S. Rep. Julia Carson. Marla had been a frequent blogger on the blog prior to her arrest. Phyllis had chaired Iowa's Marriage Equality USA organization in addition to working as a financial analyst for Aviva.

Fair Finance Claims Top $180 Million

The bankruptcy trustee for Fair Finance, the Ohio-based company Indianapolis businessman Tim Durham allegedly operated like a Ponzi scheme, reported receiving more than 4,000 claims totalling $181.3 million to date at the latest case status hearing. The trustee says as many as 5,300 Ohio residents purchased more than $200 million worth of uninsured certificates of investment in the company. The trustee obtained an extension until October 29 for creditors to file their claims in the bankruptcy case. The trustee has sold two collectible cars turned over by Durham for more than $250,000 and has plans to sell many more expensive cars collected by Durham, along with a 100-piece art collection at auction on October 16 in Cleveland. The art collection can be viewed by clicking here. Federal prosecutors have yet to bring any charges against Durham in the matter.

Thursday, September 23, 2010

A Salute To Chris Kennedy

It isn't often that I've been in a position to complement a member of the Kennedy family, but this is a huge exception. Chris Kennedy, the son of Robert Kennedy, gave an impassioned speech to the Board of Trustees of the University of Illinois of which he chairs against granting professor emeritus status to best pal of, and ghost book writer for, President Barack Hussein Obama. The Board of Trustees unanimously voted down emeritus status for Bill Ayers after Kennedy's persuasive speech. The Chicago Tribune's Jodi Cohen describes the highly emotional scene:

The vote, at a U. of I. board meeting in Urbana, was unanimous and came after a passionate speech by board chair Christopher Kennedy, who invoked the 1968 assassination of his father, Sen. Robert F. Kennedy, in saying that he was voting his conscience.

The other trustees, without comment, also voted against the appointment.

Ayers, the Vietnam War-era radical, had been an education faculty member at UIC since 1987. He retired effective Aug. 31 and then sought the emeritus faculty status, a largely honorific title that includes some benefits such as library privileges.

A co-founder of the Weather Underground anti-war group, Ayers was frequently in the media spotlight and, as such, was one of the university's best-known faculty members.

While trustees regularly vote on emeritus appointments, they rarely comment about them.

But in an emotional statement, Kennedy discussed his reasons for voting against Ayers' request.

"I am guided by my conscience and one which has been formed by a series of experiences, many of which have been shared with the people of our country and mark each of us in a profound way," Kennedy said.

He said he could not confer the title "to a man whose body of work includes a book dedicated in part to the man who murdered my father."

Kennedy was referring to a 1974 book co-authored by Ayers, "Prairie Fire," which was dedicated to a long list of people including Robert Kennedy assassin Sirhan Sirhan and "all political prisoners in the U.S."

Ayers became a controversial figure in Barack Obama's presidential campaign because they worked on a school-reform initiative together, leading opponents to say Obama was linked to a "terrorist." UIC was forced to release more than 1,000 files detailing the activities of that group. The university also faced questions in 2001 after Ayers wrote in his memoir about helping with the non-fatal bombings of government buildings.

According to the UIC faculty handbook, the granting of emeritus status is "based on merit" and is "an extraordinary title that is given for extraordinary service."

Kennedy said he hoped faculty, staff and Illinois residents "understand my motives and my reasoning" and concluded: "How could I do anything else?"

Ayers could not be reached for comment, and UIC School of Education Dean Vicki Chou did not return a call from the Tribune. She told the Tribune last month that Ayers has "been really a very good colleague here" and "the good far outweighs any negative press."
It absolutely sickens me that the President of the United States and Commander In Chief of our armed services has chosen to so closely align himself with a man like Ayers who considers the assassin of Robert Kennedy a political prisoner. When I used to work for the Illinois legislature, we had a Republican legislator who relentlessly offered up resolutions to denounce the University of Illinois for giving a professorship to such a despicable terrorist like Ayers. His presence at the University of Illinois permanently maligned my view of the school as an institution of higher learning. Thank God the Board of Trustees was more sensible than the university's administration has been these past 25 years in allowing the terrorist Ayers to teach at the school.

Zionsville School Property Tax Increase Referendum Misleads Voters

We saw this last year in the referendum proposing a new $700 million county hospital to replace the existing Wishard Hospital. Now we're seeing it in a suburban school district seeking support for a major property tax rate increase. Clever referendum writers use vague and misleading language to give voters the impression they are voting on something other than the actual question they are deciding through the referendum process. WRTV's Kara Kenney picks up on this latest deceptive tactic in Zionsville where a property tax increase is written to appear as a tax-limiting question instead. Here's the language used to describe that property tax increase question:

For the seven calendar years immediately following the holding of the referendum, shall the school corporation impose a property tax rate that does not exceed twenty nine and one half cents on each $100 of assessed valuation and that is in addition to all other property tax levies imposed by the school corporation.
As Kenney explains, "The intent of the referendum is to add up to 29.5 cents to the current tax rate of $1.29 per $100 of assessed value." There is nothing in the referendum question, however, that puts the voter on notice he is voting for what amounts to a 23% increase in the school tax levy. That would equate to a $480 a year property tax increase for a person owning a home worth $300,000 Kenney notes. Keep in mind also that property tax levy increases approved by referendum allow property taxes collected by that unit of government to override the 1% property tax cap law on homes. The statute governing referendums doesn't require voters to be put on notice if a tax increase allows the property tax cap limit to be exceeded.

Illinois has a similar property tax limitation law. Here is the language used in a sample school referendum question that would allow the school district to exceed the state's property tax limitation law:

Shall the limiting rate under the Property Tax Extension Limitation Law for Oak Park School District Number 97, Cook County, Illinois, be increased by an additional amount equal to ____% above the limiting rate for levy year 2010 and be equal to ____% of the equalized assessed value of the taxable property therein for levy year 2010?
(1) The approximate amount of taxes extendable at the most recently extended limiting rate is $___________, and the approximate amount of taxes extendable if the proposition is approved is $_______________.

(2) For the 2010 levy year the approximate amount of the additional tax extendable against property containing a single family residence and having a fair market value at the time of the referendum of $100,000 is estimated to be $______.
(3)If the proposition is approved, the aggregate extension for 2010 will be determined by the limiting rate set forth in the proposition, rather than the otherwise applicable limiting rate calculated under the provisions of the Property Tax Extension Limitation Law (commonly known as the Property Tax Cap Law).
As you can see, the wording of the Illinois referendum question clearly puts a voter on notice as to the question the public is being asked to decide. What is disappointing is Gov. Mitch Daniels, a big proponent of the property tax cap law, has appointed people to run the Department of Local Government Finance who are interpreting the referendum law to allow units of government to deliberately mislead voters, and who have failed to draft regulations that protect the spirit of the property tax cap law and the purpose of subjecting property tax increases to referendum.

Mary Jane Michalak told Kenney the referendum language in question "follows the law." "Any changes to the statute would need to come through the General Assembly," Michalak said. It's interesting how our government imposes liability on the issuers of securities who mislead investors in this fashion in their offering statements, but if it's the government making the representations, it is free to mislead taxpayers at will. If the legislature doesn't act quickly to correct this abuse of the referendum law, then Mitch Daniels' property tax caps he has taken to the airwaves to promote are simply going to become a figment of our imaginations. Voters need to demand a commitment from their legislative candidate to clean up the law so it is not completely undermined by deceptive local government officials.

State's Revolving Door Law Has No Teeth

The hiring of the top lawyer for the Indiana Utility Regulatory Commission by Duke Energy is Exhibit A for demonstrating Indiana's revolving door law has no teeth. The Star's John Russell has a story on the state ethics commission giving a green light to Duke Energy to hire Scott Storms, the IURC's general counsel:

Indiana's largest electric supplier, Duke Energy, has hired the top lawyer away from the state commission that approves utility rates, a move that raised ethical howls from several consumer-watchdog groups.

Scott R. Storms will begin his new job Monday as a lawyer in Duke Energy's regulatory division, just days after leaving his job as general counsel of the Indiana Utility Regulatory Commission . . .

While working for the state, Storms helped manage the regulatory process over Duke Energy, including oversight of its controversial Edwardsport power plant in southwestern Indiana.

The plant, which is still under construction, has seen its construction costs climb sharply, which will result in higher electrical rates for customers. Storms also acted as an administrative law judge in the case, taking testimony and evidence and overseeing numerous proceedings about the Edwardsport plant . . .

State ethics law forbids certain state employees from taking a job with a company the state regulates for at least a year. But the panel said the prohibition didn't apply to Storms, because he never made a regulatory or licensing decision on behalf of the state affecting Duke. Nor did he negotiate or administer a contract with Duke, the ethics panel said.

"This provision would not be triggered by Mr. Storms' work at the IURC as he was neither a commissioner nor a voting member of the regulatory body that may have made license or permit decisions regarding Duke," the panel wrote in a decision issued this month.

However, the ethics panel added that Storms would be prohibited from representing or assisting Duke on any matter in which he was "personally or substantially involved as a regulator." Those include several cases involving the Edwardsport plant and Duke's "smart grid." . . .

"An administrative law judge is extremely involved in handling all the legal evidence, procedures and details in a utility case, maybe even more so than a commissioner," said Julia Vaughn, policy director of Common Cause Indiana, a nonpartisan government watchdog group. "He or she is really the person who does the hard, hands-on day-to-day work."

She said that allowing a utility to hire a state regulator without an extended "cooling-off" period could give the impression that the corporate job was a gift offered in exchange for favorable regulatory treatment.

It's bad enough the revolving door law is only applicable to a one-year cooling off period after a person leaves their governmental job. The law becomes completely useless when the state ethics commission issues opinions which grant exceptions that completely consume the rule.

Wednesday, September 22, 2010

Anti-Gay Pastor Tied To Black Expo Sued For Coercing Young Men To Have Sex With Him

Pastor Eddie Long presides over one of Atlanta's largest black churches. He has led rallies denouncing homosexuality. Now he stands accused of coercing two young men to have sex with him. Pastor Long was a special guest of Indiana Black Expo during the organization's summer festival when 10 young men were shot in downtown Indianapolis. Long spoke out against youth violence following the shootings to WISH-TV.

Is Pittsburgh Getting A Better Deal For Its Parking Meter Business?

LAZ Parking has agreed to pay the City of Pittsburgh $451 million for a 50-year lease agreement for the city's parking meter and garage business. LAZ Parking is the same company that paid the City of Chicago $1.16 billion for a 75-year lease of the nation's third largest city's parking meter business. Indianapolis will receive a relatively paltry sum of $35 million and eventually receive a minority share of the parking revenues over the life of the agreement after ACS recoups the $7 to $10 million it expects to invest initially in new electronic parking meters. The City of Indianapolis anticipates it will receive approximately $400 million in shared revenues over the 50-year life of the lease from ACS. J.P. Morgan is partnering with LAZ Parking on the deal, along with IFF Acquisitions. Morgan Stanley served as financial advisor to the City of Pittsburgh. LAZ beat out competing bids by EQT Partners and The Carlyle Group.

"The winning bid of $451 million, it certainly blew away my wildest expectations," Pittsburgh Mayor Luke Ravenstahl said. Mayor Richard Daley came under heavy fire for leaving too much money on the table when he inked his nearly $1.2 billion lease agreement with LAZ Parking for a longer term. Chicago is a city of 2.8 million people compared to Pittsburgh's 311,000 population. Indianapolis is more than double the size of Pittsburgh with a population of 807,000. Ravenstahl had hoped to raise $100 million to cover debt owed by the city's parking authority and another $200 million to support the city's pension fund debt when he first announced his plan to privatize the city's parking meters and garages earlier this year.

Pittsburgh's deal is much different than Indianapolis' deal with ACS to be sure. Parking meter rates in downtown Pittsburg will jump from $2.00 an hour to $4.50 an hour and be adjusted thereafter for inflation compared to Indianapolis' meter rates, which are scheduled to jump from 75 cents an hour to $1.50 an hour and be adjusted for inflation thereafter. Unlike Indianapolis, however, Pittsburgh has lower parking meter rates in areas outside of the downtown area. Neighborhoods outside downtown Pittsburg will see their rates average about 50 cents an hour higher, ranging from $1.00 per hour to $3.00 per hour. Pittsburgh last raised its parking meter rates 15 years ago, while Indianapolis hasn't raised its rates in 35 years. The Pittsburgh deal includes several city-owned parking garages that will see their fares increase substantially. Daily rates at those garages will vary from $9.75 to $24.00. Indianapolis rates would double by 2012, while Pittsburgh's higher rates are being phased in over a 4-year period. Advertising rights for the parking meters and garages are being awarded entirely to the concessionaire under the Pittsburgh deal, which will also have the opportunity to lease out retail space at the ground level of those city-owned parking garages; ACS is required to share some of its advertising revenues with the City. A key difference in the parking situation in Pittsburgh and Indianapolis, however, cannot be overlooked. Pittsburgh has a subway and light rail system to move pedestrians throughout the city, in addition to a public bus system; Indianapolis has one very lousy bus system that inefficiently transports people around the city who choose to go without automobiles. For most Indianapolis residents, public transportation is no substitute for the automobile so it is nearly impossible to avoid the parking fees if you plan to visit downtown or Broad Ripple.

Like Indianapolis, the lease agreement with LAZ Parking is subject to approval by the city council, where support for the deal is not a given. Some business owners, particularly small business owners, have expressed concern about the impact of the higher rates. Pittsburgh's mayor has warned the city may be forced to lay off up to 400 police officers and cut other city services if the deal is not approved. Pittsburgh must come up with $200 million by January 1 to cover its unfunded pension liability or face a state take-over of its pension fund, a move that would thereafter cost the city at least $30 million annually. Mayor Ballard got lucky during the first year in office when the state legislature approved a measure that required the state to pick up close to a half billion dollars in unfunded public safety pension liability. Mayor Ballard plans to use the $35 million upfront payment from ACS to make street and sidewalk improvements in downtown and Broad Ripple neighborhoods where the parking meters are located. Interestingly, the $451 million the City of Pittsburgh is getting for its parking lease deal is nearly identical to what the City of Indianapolis received from Citizens Energy for permanently giving up ownership of the water and sewer utilities, along with giving up billions of dollars in revenue stream derived from operating the utilities. Indianapolis did, however, manage to offload $1.5 billion in debt in the process of giving up ownership of the utilities.

Critics of the Pittsburgh deal point out the City could expect to capture over $1 billion over the same period if it implemented the anticipated rate increases but kept control of the parking meters and garages. Pittsburgh's mayor insists the large upfront payment is essential to shoring up the City's unfunded pension liability, a requirement alternative proposals cannot satisfy. Clearly, Pittsburgh is facing financial problems more serious than Indianapolis is currently facing; however, it's hard to argue Pittsburgh may not be getting a better deal than Indianapolis over the life of the lease when you consider the city is getting all of that money upfront, while Indianapolis must wait 50 years to recoup an even smaller sum of money.

A thought occurred to me after thinking about all of the players in the Chicago, Indianapolis and Pittsburgh parking meter lease deals. Is there a risk of collusion among the key players in this business? LAZ won out in both Chicago and Pittsburgh. Morgan Stanley is a player in all three transactions. ACS participates in the LAZ Chicago parking lease agreement. LAZ Parking competed against ACS for the Indianapolis parking meter deal. LAZ Partners actually offered Indianapolis a larger upfront payment, $46.8 million compared to $35 million. Indianapolis favored ACS over LAZ Parking because it said ACS offered more flexibility to the city on removal of meters, rate reductions and duration charges. The City also preferred ACS because it allowed approval of any meter technology proposed for use by the concessionaire.

Failed Welfare Privatization Deal Cost Taxpayers $500 Million

The original IBM-led privatization of welfare services agreement FSSA entered into may be dead, but the costs to taxpayers is still being tallied. FSSA Secretary Anne Murphy pegs the cost at $500 million to date and climbing. WRTV reports:

Indiana's human services chief said the costs to modernize the state's welfare eligibility system since 2007 have topped $500 million.

Family and Social Services Administration Secretary Anne Murphy told state lawmakers Tuesday that IBM Corp. has received nearly $442 million of that total through Aug. 31.

Gov. Mitch Daniels fired Armonk, N.Y.-based IBM in October 2009, citing poor performance, including lost documents, lengthy hold times for the call centers and too many errors in processing of food stamps and Medicaid.

Its work ended in December, but it collected more than $4 million more after that for "disengagement services."

FSSA and IBM have sued each other to recover costs each claim to be owed.

Murphy said federal agencies have paid more than $275 million of the total. The state's share comes in at just under $225 million.

Nearly $59 million has gone to IBM subcontractors who now work directly for FSSA.
The largest amount of the $59 million paid to IBM subcontractors went to ACS, the same company with whom Mayor Greg Ballard wants to award a 50-year parking meter lease deal if he can convince the Indianapolis City-County Council to go along.

Marion County Democrats Blast Conflict Of Interest In Ballard Administration Awarding Parking Meter Lease Agreement To ACS

The Marion County Democrats picked up another fumbled ball by the Ballard administration and are running with it. The party's chairman, Ed Treacy released this statement yesterday discussing the ties of the City's paid lobbyist, Joe Loftus, to ACS:

Mayor Greg Ballard's chief counselor and lobbyist is apparently using his contract with the city to enrich other clients, most specifically ACS in the parking meter privatization scheme.

Joe Loftus has been a frequent visitor to the 25th floor of the City-County Building. Loftus is the city's chief statehouse lobbyist and a counselor to Mayor Greg Ballard. The city's lobbyist registration shows Joe Loftus as registered to lobby for ACS, the company Ballard chose to award the potentially billion dollar parking meter privatization to. It is unknown whether Loftus consulted the Mayor on the deal or lobbied for ACS or both.

"It's awful that Mr. Loftus would take the taxpayers' money and put it into his left pocket while taking ACS's money to lobby the city and putting into his right," Marion County Democratic Party Chairman Ed Treacy said.

Treacy indicated that this conflict of interest was serious enough to question the entire parking plan. "Well, I guess we can add it to the list of questions, but did the Mayor try to get a good deal, or was he just trying to further his friend and political counselor's pocketbook?
Joe Loftus told the IBJ the Democratic attack on him is "unacceptable." Scott Olsen reports on Lofus' reaction:

When reached by phone Wednesday morning, Loftus acknowledged he has lobbied for ACS “for years,” but said he was not involved in the negotiations from either side.

“I’ve been doing this for 30 years,” he said. “Nobody’s ever attacked me like this. That’s not acceptable.”

Loftus further said he’s never discussed the parking deal with Mayor Greg Ballard and pointed to an ethics ordinance the mayor led that requires anyone contracted with the city to disclose other contracts.
What people need to understand is Loftus' ties to ACS and its representatives run very deep. His former boss, Mayor Steve Goldsmith, worked for ACS. His fellow colleagues in that administration, Mitch Roob, Skip Stitt and Ann Lathrop, all later worked for ACS. Loftus and his law firm helped ACS obtain a large subcontract on FSSA's badly bungled privatization agreement for the agency's welfare services with IBM after Roob became Secretary of FSSA as an appointee of Gov. Mitch Daniels. Roob's successor later terminated the agreement under heavy fire and filed a lawsuit against IBM; the agency, however, allowed ACS to continue operating a criticized call center in Marion, Indiana that operates in a building owned by State Rep. Eric Turner and his son. Turner's daughter served as chief counsel to FSSA at the time the IBM-ACS privatization agreement was inked. She recently left the agency. It also hasn't gone unnoticed by this blog that Mike Huber, the Deputy Mayor who spear-headed the 50-year lease agreement with ACS on behalf of the Ballard administration, is a former associate of Skip Stitt, who is ACS' chief administrative officer in its Washington, DC office.

During the transition between the Peterson and Ballard administrations, Loftus and Bob Grand, both partners at Barnes & Thornburg, played key roles as representatives of Ballard in helping choose people to serve in Ballard's administration. Loftus helped place Huber in a job with the Ballard administration. The old ACS hands likely played a key role in Huber's earlier hiring by the Daniels administration to work in his budget agency before he joined the Ballard administration. In addition to serving as Ballard's chief lobbyist, Loftus has also served as a mentor to members of Ballard's administration like Huber and meets often with them. Ballard appointed Grand as his first CIB President despite his obvious conflict of interest because his law firm represented the Simons and their Indiana Pacers. Ballard named yet another ACS hand to the CIB, Ann Lathrop. She first served as its treasurer and now as its president. It is hard to separate the ACS-Barnes & Thornburg ties from almost any decision of importance made by this administration. And lest we forget that Loftus hired City-County Councilor Ryan Vaughn as a high-paid lobbyist with the firm after Ballard's election. Vaughn later was elected as the City-County Council President. He has refused to recuse himself from participating in the approval of the 50-year parking meter lease agreement with ACS despite his firm's representation of the company that stands to make a lot of money off the agreement.