RESPONSIBLE DEVELOPMENT MEANS NOT GIVING AWAY OUR CITY – Part 1 of a 3-Part Series

In this series, we’re going to try to get to the heart of something I call “Responsible Development” in Mount Vernon. It’s something I’ve been trying to promote as a member of the City Council and one I will implement immediately as Mayor. Responsible Development aims to have Mount Vernon reclaim control over its development agenda – how we build, what we build, and what we are willing to invest in ourselves to see the right things built. Responsible Development above all demands that tax dollars are spent, as the name implies, responsibly. It requires transparency and accountability. Mostly, Responsible Development is part of a larger community conversation about what we want our city to become.

A lot of what I’m going to discuss in this series focuses on another one of the Mayor’s “black box” agencies, the Mount Vernon Industrial Development Agency (MVIDA). As I detailed a couple of months back with the Water Department, taxpayers are and should be understandably outraged by what is considered “business as usual” at these un-policed, rogue agencies controlled by the Mayor.

As we’ll also see, development in Mount Vernon has become a haven for “takers” who saddle our taxpayers with ever-increasing property tax hikes to support the building of developments that consume city resources with little or no net benefit to the community – keeping us poor while making developers rich. The current system is completely out of control, devolving into a shameful farce designed to line the pockets of well-connected real estate opportunists who operate in the shadows of City government to secure huge, decades-long tax breaks for themselves only to turn around and sell off the properties at huge gains. It’s a massive redistribution of wealth from those who can least afford it to those who do not need it. And, frankly it needs to end now.

In this column, I will layout the basic background and identify some of the local players. I’ll dive deeper into the sometimes shady and questionable activities of the MVIDA in the next column. In the final part, I’ll set forth some more detail on how to implement Responsible Development in Mount Vernon, a blueprint for taking back our City from the corporate vultures picking apart our most valuable assets.

Let’s start with the most basic question: what is “economic development”? While it takes many forms, the short answer is it’s the government stepping in to help private business through things like subsidies, marketing campaigns, improving local infrastructure and even direct purchasing. All of it arguably is designed to encourage private business to invest in local areas, whether that’s a state, county or a city. As the theory goes, local investment will create local jobs and spur the local economy. How far do local governments go to encourage this kind of investment in their area? A long way, it turns out. Subsidies to private companies can include outright cash payments, cheap debt, and even huge tax breaks (abatements, credits, etc.). When it works, economic development benefits the community by driving new local revenue in a way that offsets the cost to taxpayers – in some cases, many times over. A good example is when a company is looking to build a new manufacturing plant in a city, one which creates hundreds of new jobs. New jobs mean new residents paying new taxes on new and existing homes. Proponents of the Amazon deal in Long Island City cited these possibilities in support of the economic development initiatives to get Amazon to move here.

When it goes wrong, though, it is little more than unnecessary corporate welfare that can shackle local areas with ongoing costs that can extend for decades. Sometimes it fuels illegal kickbacks to politicians in favor of well-financed political contributors. Often it’s just unnecessary, giving away taxpayer dollars to companies that were going to develop in the area anyway. Critics of the Amazon deal cited a lot of these worst-case scenario arguments, whether real or imagined to kill the deal. However, if not thoughtfully done, these projects can cost taxpayers immensely.

Economic development since the late 1960s has been centered in local “industrial development agencies” (IDAs) that are public benefit corporations created by State law. Generally speaking, there’s an IDA for each county and additional IDAs in big cities within each county. Mount Vernon has its own IDA, designed to spur investment not just in Westchester County (which has its own IDA), but specifically in Mount Vernon.

IDAs have broad and sweeping powers to spur economic development in local communities. They can seize property by eminent domain, issue tax breaks, own property outright, give loans, and generally do anything that arguably might attract businesses to invest in their area. They might for example, use taxpayer funds to build a museum or playground to make the area more attractive to would-be investors. Basically, they can do just about anything to make their area more investment-worthy. And that broad authority is almost completely funded by taxpayers.

The problem with having such broad authority is that IDAs have the potential for massive corruption and abuse. There is usually very little oversight by taxpayers or legislators with these agencies. In Mount Vernon the MVIDA is another “black box” agency run by the Mayor with a handpicked board that answers to no one. The City Council has no meaningful way to police the activities of the MVIDA. Setting aside the possibility of corruption, IDAs are generally unaccountable for even basic incompetence. Stupid decisions that cost the local area tons of money are just as damaging as corruption from an accounting standpoint. It’s not a small thing either. IDAs across New York State control properties worth in excess of $34 billion – all of which are exempt from real estate or sales taxes or both.

IDAs are often poorly managed with antiquated information systems. The accounting protocols and controls are often inadequate and not transparent. The hidden costs to local areas are frequently ignored (for example, building a residential development increases policing, fire, and school costs to a local area). Payments due to IDAs often go unaccounted for or are never collected. Agreements with developers by IDAs can contain provisions which benefit only the developers or are poorly enforced even when the IDA should be receiving a benefit it negotiated. As we’ll see next week, the MVIDA is not immune from these problems, either.

Responsible Development puts the People before developers’ profits. That’s not something these shadowy agencies necessarily want. Greg LeRoy, Executive Director of Good Jobs First, a Washington, DC-based resource on accountable development, said it best and his advice is worth remembering as we continue this series:

“The big picture is it’s a very corporate-dominated process in which the people that have the power, who really control the way this process has evolved … want as little information as possible out there. They don’t want people questioning what they’re doing, they don’t want people to have a lot of information ahead of time.”

Responsible Development means it’s time to stop giving away our City to people who have no obligation or incentive to give back.

If you have thoughts or comments about this issue or any other, reach out to me at ADWCMV@gmail.com.

IT’S OUR TIME, IT’S OUR CITY

Dear Neighbor,

Mount Vernon has been my home for over 30 years. I’ve raised my family here, made friends here, and run a business here. There’s no place I’d rather call home. There’s no place I want to see succeed more.

As City Council President, I have consistently served as the people’s voice against corruption and waste. I always vote against irresponsible developments (PILOTs) that are robbing the citizens of Mount Vernon of much needed tax revenue.

I have bold and specific plans to make city government more responsive to the people. When I am mayor, my administration will establish an environment conducive to economic opportunity while improving quality of life for all Mount Vernon residents.

As mayor, my top priorities will be job creation, economic development, keeping taxes low and homes affordable, fixing our streets, repairing our parks, improving city services, and restoring both our crumbling infrastructure and our reputation.

I hope to earn your vote in the Democratic Primary Election on Tuesday, June 25, 2019.

This is not the time for cheap politics or unrealistic campaign promises. This is the moment when we decide together what kind of city we want to be.

In these uncertain times, it’s important to be there for each other. I have always stood ready to help the City that gave me so much. Let’s keep building together!

It’s our city. It’s our time.

Join the movement for a better Mount Vernon. The primary is less than 2 months away, and our campaign needs your help to get our message out there. Can you contribute $25 now? Any amount helps, and every dollar go towards helping us build a strong and focused campaign.

Thank you for your help, and I look forward to meeting you on the campaign trail!

Respectfully Yours,

André Wallace

Time to Stop the “Takers” from Fleecing Our City

I’m going to be outlining this topic in more detail in another 3-part series over the next few weeks, but I wanted to give you a quick preview of a discussion on a very important topic affecting every taxpayer in Mount Vernon.

This series will introduce many of you to a concept you may not be familiar with: Payment in Lieu of Taxes (called PILOTs or PILOT programs). These programs are made in conjunction with local “industrial development agencies” which are authorized by State law to provide tax breaks for developers who want to build in a city. Generally speaking, they donate some amount to the local development agency and, in return, they receive huge tax breaks, which can last for decades.

Two residential projects which have been approved by Mount Vernon’s Industrial Development Agency (IDA) in the last few years involve over $120 million in tax giveaways over the next FORTY years, meaning Mount Vernon’s taxpayers will be subsidizing these developments for the foreseeable future. These developments continue to use city services like police, fire, education, and sanitation, which are becoming dangerously inadequate and causing property taxes to double. These PILOT’s won’t contribute to the cost of those services. It’s just outrageous.

More concerning is that the “donations” made by the developers to the IDA in order to get these huge tax breaks are often poorly accounted for or, frankly, just missing. Like the Water Department, the IDA “black box” is overseen and run solely by the Mayor’s office, often through the Planning Commissioner, without the usual City Council oversight of other city agencies. The opportunity for abuse, kickbacks, and corruption is staggering.

What’s needed is a smarter approach. We need to end the gravy train these residential developers are on and re-embrace the original intent of the IDA – which is to encourage “industrial” (that is, commercial) development. Commercial development, unlike residential development, doesn’t consume nearly as many city resources (for example, a Target isn’t using the city’s schools but a high-rise apartment building is), provides ongoing jobs beyond the construction itself, and generates sales tax revenues for the city. So, even if there is some property tax reduction to encourage a retail store, that reduction is offset by other tax revenue – making a properly constructed PILOT actually beneficial to the city. Right now, the PILOTs that have been approved are fleecing Mount Vernon under the nose of the Mayor and our taxpayers.

We need to tell the “takers” that they’re no longer welcome in Mount Vernon and encourage responsible commercial development that will actually help our city grow. We need to conduct a full investigation into recent activities at the IDA, which very well may include the involvement of several candidates currently running for Mayor, and demand a full audit of the funds of that “black box” agency. The corruption has to stop, and we need these people to explain themselves and their decisions.

As Mayor, I will only allow responsible development that produces jobs with livable wages. I will seek development of businesses, which currently do not exist in our City. Businesses such as Hotels, Auto dealers, catering halls, shopping centers and movie theatres are very much needed in Mt Vernon. It’s time to stop trying to improve our skyline by killing our bottom line.

If you have thoughts or comments about this issue or any other, reach out to me at ADWCMV@gmail.com.

WHAT IS THE REAL MEASURE OF PROGRESS IN MOUNT VERNON?

I’ve been giving a lot of thought lately to the future of Mount Vernon. There’s a lot to accomplish in the present, but as an elected leader, part of my job involves positioning our city for future success. My background is in construction and education, so I’m always thinking about the importance of a solid foundation on which to build. This is no different than how we should approach government. Anything built on shifting sand will crumble and fall. So, the first challenge is to determine whether we are standing on solid ground.

How do we measure if our city is moving in the right direction? Is there any particular metric that is more important than others? Some people will point to crime statistics as an interesting measure, but that only suggests that we’re doing “less worst” than we were. That’s barely something to celebrate. Personally, I am always more focused on whether people are working. That is always a sign of good things to come for a city.

When I look at Mount Vernon’s unemployment numbers, however, I am very concerned. If you look at the percentage in the abstract (5.1% for February 2019), it seems innocuous. However, if you put the number in context, things become clearer and more troubling. Mount Vernon’s unemployment rate is 17% higher than the State of New York and 35% higher than Westchester County. While the official unemployment numbers are coming down everywhere, Mount Vernon is clearly not keeping pace with our neighbors in terms of employment.

The “official” unemployment figures suggest that only 5 people in 100 are out of work, right? Well the “real” number maybe 4 times that amount which is closer to 1 in 5. The official statistics suggest there are only 1,700 people unemployed in Mount Vernon. But, if you peel back the numbers removing those under the age of 18 and over 65, also, those who are on disability, we’re left with about 9,000 folks who are not working. Even if we were to assume that half of those folks have a good reason not to want a job of any kind, you still have the effect of almost tripling the unemployment rate (to 14.6%), which, is a very generous assumption. If you just deal with able-bodied people of working age, the number is even higher at (22%). Either way, the “real” number is 3 to 4 times higher than what is reported.

I focus on employment because it has such a huge impact on what we can do together as a city. When people are working, they are using fewer city resources allowing those finite resources to go farther to help those who are really in need. They become net contributors to the city. They spend money in the city. They look to buy homes in the city. They pay taxes in the city. This allows a city to do more with more, instead of less because of less. Employment can break the cycle that often leads to that other oft-quoted statistic “crime” especially when we get our young people working.

There’s only one way to increase employment in our city and that is to increase “employment opportunity” in our city. We can sit back and hope our neighbors create enough new jobs to put our people to work (while we watch them spend money in those other cities and hope we get some scraps), or, alternatively, we can put our own people to work. The only option I can comprehend requires two parallel initiatives: focused economic development initiatives and workforce training.

First, we must make development, especially “commercial development”, a priority in our city. We need to establish an “Office of Economic Development” to support existing small businesses and new businesses coming in to our city and make sure they receive all of the benefits available to them at both the city and state level. Moreover, we need to leverage the strengths of Mount Vernon, particularly its access to major highways, homes, and workers, to bring new businesses into our city. Let’s not start with trying to woo Amazon to Mount Vernon. Let’s start with movie theaters, car dealerships, shopping centers, hotels and all of the other types of business that refuses to invest in our city. It’s simply unacceptable that a city of our size cannot attract the basic commercial infrastructure it requires. If we want business to come, we need to let investors know that we as a city are “open for business” and are willing partners in helping their investment succeed. We’ve done a terrible job of that in the past years and the results are all over the city in vacant lots, decrepit buildings and empty commercial spaces. If we don’t change the way we interact with the business community, no one will or should invest in Mount Vernon, and the problems you see now will only get worse.

Second, we need to make a real commitment to educating and re-educating our young workforce to give them the tools to succeed in a competitive employment environment. I have been training young people for a decade to work in the construction trades, creating almost 1,000 new workers with good-paying jobs. It requires dedication and effort, nevertheless the results are there and they can be replicated in other industries. We need to get our kids trained in industries that are growing. Increasingly, they are coming out of school without enough tools to even hold down menial jobs, let alone the types of jobs that can provide them with a lifetime of work. We can attract talented training facilities to Mount Vernon, if we’re willing to support them in their efforts. Young people want to work and it’s not a myth. But, they will stay on the sidelines if you don’t convince them to get in the game. In my experience, the best way to do that is to give them the tools to play in that game. They will take care of the rest.

We want to build Mount Vernon. We can all agree on that. But, before we do, let’s make sure to shore up our foundation first. I’ve got a plan to do that, one that will set the stage for Mount Vernon’s next generation of success.

If you have thoughts or comments about this issue or any other, reach out to me at ADWCMV@gmail.com.

WHAT MOUNT VERNON CAN LEARN FROM SWEDEN

Last week, I came across an interesting CNBC interview with Alan Greenspan, former head of the Federal Reserve, who was discussing some of the economic challenges the country faces in the future. Mr. Greenspan is widely considered a preeminent economic expert and what he says can and often does move markets. In other words, when he talks, people listen. In this interview, he made a pretty shocking prediction about the national economy. He suggested that the burdens associated with financing entitlement programs would completely offset and eventually overwhelm the benefits associated with growth in the United States. Basically, he was saying that the social programs we have created will bankrupt the country such that new money coming in will not be able finance the promises we’ve made to people, which a scary prediction.

What are “entitlement programs” exactly? Basically, they’re promises government has made to people to ensure they receive benefits, which the government and the electorate have determined people are “entitled” to receive. You can also use the term “safety net.” It means the same thing. Social Security and Medicaid are two primary examples. Welfare, unemployment insurance, homeless shelters, SNAP, Pell grants, housing assistance, WIC, discounted phone service, SSI, earned income tax credits, child tax credits, and Head Start are other examples. Some of these programs are funded by the recipient’s contributions (e.g., Social Security, Medicare) whereas others are funded by the taxes collected by the government generally and are not based on contributions by recipients (e.g., welfare, Medicaid).

The challenges with many of these programs is that they are based on what is called a “defined benefit” strategy – that is, you will get a specific amount of money if you meet the program’s requirements. When the number of people who meet those requirements dramatically increase, the costs can skyrocket. This is happening with Social Security and Medicaid. As the Baby Boomer generation begins to collect in record numbers the amount being paid out of the system is not being replaced by enough new entrants to the workforce. If we believe Mr. Greenspan, that’s a recipe for national bankruptcy.

The politics around entitlements are obviously important considerations when it comes to discussions about reform. Nobody for example wants to tell seniors that their benefits are going to be cut. Nobody wants to tell hungry children that there’s no money for supplemental nutrition assistance. While the desire to avoid delivering hard news to struggling recipients is understandable, it’s not necessarily the best course. When asked whether the whole system had to break before any real reform of these programs would happen, Mr. Greenspan’s response was “Of course! That’s what the danger is. You don’t see these crises arising until it’s at your doorstep.” Simply put, not talking about the issue doesn’t prevent the problem.

How does that play out here in Mount Vernon? Everything that is playing out on the national stage is happening here too. You’ve heard the old expression, “all politics is local.” Well, all financial problems are local also. Some of these same issues with entitlements are beginning to pose real challenges to our city government as well. I’ll address some of these ideas in more detail in the coming weeks, but it’s important to understand that Mount Vernon is not immune from these problems. While our compassion for our fellow citizens may be infinite, our resources are finite. When that happens, we need to ask hard questions and make hard decisions.

That’s where Sweden comes in. Sweden has one of the most far-reaching concepts of a “safety net” of any country in the world. But in the 1990’s, Sweden fell into a deep recession and was faced with the prospect of running out of money or dramatically reforming its entitlement system. There are some great articles on the details of the plan they came up with but, in short, they decided that the only way forward was to move away from “defined benefit” programs and toward a “defined contribution” model where benefits are calculated based on what has been paid into the system, ensuring that the system wouldn’t run out of money. They didn’t scrap their safety net. They just made sure that it was funded before they spent the money. It’s a concept that we need to come to grips with in Mount Vernon too.

We cannot continue to be the dumping ground for the most expensive students and residents in the county. There isn’t enough money in our budget to continue to feed, house, and educate the neediest populations simply because our neighbors force them to our doorstep, even though we might want to and even though we might think it is important to do so. It’s time to start a conversation with our neighbors and with the County about the economic realities associated with Mount Vernon taking on responsibilities other communities ignore or avoid altogether. If a disproportionate number of people in this city are receiving entitlements because they can’t receive them in neighboring communities, it’s time for those neighbors to start “contributing” to those efforts.

The challenge here is the same one faced by the Swedes. It’s not about wanting to stop helping people; it’s about having a realistic conversation amongst ourselves about funding these priorities in a responsible way. We must first start with those who are presently living here in our city before taking on any more people. The consequence of failing to have these conversations is that there will be no money to help anyone if we spread to thin. That’s the point Mr. Greenspan was making at the national level and that’s the point we need to start talking about here as well.

Mount Vernon has been treating people with compassion for as long as anyone can remember. It has been providing assistance to those with the most needs and doing so at a tremendous cost, which, other communities have not had to bear. It is often suggested that our city has not developed as fast as some of our neighbors. That’s a true statement. Maybe the reason for that is not a lack of will or a lack of desire but, instead maybe it’s because we’ve been bearing a greater burden than others.

Maybe it’s time for cities and towns that receive a “benefit” from not having to provide these “safety net” programs and this kind of assistance begin to “contribute” to those that do. If we do not address this problem seriously, we will find a much bigger crisis on our doorstep

If you have thoughts or comments about this issue or any other, reach out to me at ADWCMV@gmail.com.

MARIJUANA: THE LEGALIZATION DEBATE: PART 3 – PULLING IT ALL TOGETHER

This is the final part of the debate over legalization of marijuana. Now I will attempt to weigh the evidence for and against the legalization and share some of my conclusions. Obviously, this is going to be my position only. Your position may differ and given the complexities of the issues involved, won’t be surprising if people come to different conclusions. Understandably, people’s positions are most very likely to evolve as the issue works its way through the process.

Before getting into my conclusion I wanted to address a few of the stickier issues despite everyone’s persuasive arguments, which still remain undecided or too close to call. They’re important issues that seem to weigh heavily in most calculations, so they’re worth spending a little time on.

First, we need to talk about the issue of addiction. Depending on which definition of “addiction” you apply, marijuana is or is not addictive. It’s a result-driven exercise used to support whatever point someone wants to make. It’s not a proper use of scientific evidence; it’s more political than anything else. I prefer the more classical definition of “addiction”, which talks about the need to increase usage to achieve the same effect (i.e., you have to use more of a drug to get the same high). Marijuana under that definition is not addictive in the way that we know other drugs like cocaine are. People who use marijuana tend to use it in about the same amount and don’t really ramp up usage over time. All of this is to say that arguments relying on the so-called “addiction” dangers are probably not that persuasive and should be discounted.

Second, the other common refrain against legalization is that it will increase teenage use and therefore later adult use. Given that there are a number of states that have already legalized recreational use, we now have some numbers on that front that are too close to call. Some studies suggest teen use increases, while others forcefully argue that it decreases. Again, there’s a lot of politics in this science, so it’s hard to do anything except discount both conclusions and make this a non-factor in the decision-making process.

Third, there is a common argument that increased usage means more impaired drivers and workers leading to more accidents occurring. Unfortunately, we just don’t know if that’s true. The data cuts both ways and the layering of alcohol into the discussion totally skews the results. The reality is that there are already legal substances that cause impairment, alcohol being the number one cause among these. No one is seriously talking about banning alcohol to reduce impaired driving (even though it exists), but they expect us to believe that not legalizing marijuana should be considered to avoid increased impaired driving (even if they can’t prove it). All in all, it’s a pretty weak argument, one that ultimately requires people to police their own use of substances that can cause impairment. We don’t accept drunken airline pilots (though they exist) in the workplace nor should we accept high ones (and they will probably also exist). There are already consequences, both criminal and financial, for abuse of these substances. Adding a new substance to the mix doesn’t change any of that.

For me personally, taking everything into account, I come down on the side of legalization. I am very concerned about some of the unintended consequences of increased usage, particularly in the workplace. As someone who has spent decades teaching the construction trades about workplace safety, it’s something that hits close to home. That said, I also think the employment marketplace will sort out that problem to a large extent, in the same way that abuse of alcohol has been addressed. If you choose to use marijuana, legal or otherwise, you may impair your job performance and indeed, you may lose your job entirely. That’s a personal decision, which the consequences must be owned at the individual – not governmental – level.

I also believe that the regulatory scheme that is set up to support legalization needs to recognize the past abuses by our government, particularly in regard to our inner cities. If a huge amount of tax revenue is not earmarked for infrastructure improvements in those cities hardest hit by the War on Drugs, we will have missed a golden opportunity to right a shameful wrong. Without this, we are simply going to add an additional tax to communities that were hard hit by overzealous prosecution and law enforcement abuses, while others continue to profit. If the result of legalization is that the maker of Marlboro adds billions to its bottom line while the inner cities remain mired in blight and garbage, then we will have failed. That result is far more likely than any other, so we need to address it right up front in the legislation needed to make marijuana legal. Tax revenues must also be considered for funding training programs for those returning from prisons on marijuana charges due to the war on drugs.

We need to acknowledge as the culture shifts, our approach to government must also shift. Marijuana once the symbol of the counter-culture has now become basically mainstream. Keeping something illegal and continuing to expend resources that are ineffective at stopping it is just wasteful spending. Let’s stop wasting taxpayer dollars on something those taxpayers increasingly don’t see as worth demonizing any more.

Keeping it out of the hands of kids, however, must be a priority or else we’ll lose a couple of generations of them if we’re not careful. There needs to be strict penalties for distributors and marketers of this product. They need to know that if their product gets into the hands of kids, there will be financial consequences for them. A license to distribute marijuana must be known to all possessing one, that it is easily revocable. Big Tobacco made billions for decades targeting teenagers to smoke cigarettes. If we don’t pay close attention, history can and may repeat itself, and we’ll only have ourselves to blame.

In short, I’m in favor of a common-sense legalization, one that acknowledges the debt that is owed to certain communities, one that places responsibility on the individual, and one that punishes those who abuse their license to distribute and sell the product. If we acknowledge the drawbacks in our architecture of the regulatory system, we can build a better system. If we focus only on the benefits, we’ll rush headlong into at least twenty years of unintended consequences, abuse, and wasted opportunities.

 

I’d be happy to hear your thoughts and concerns. This series has come to an end, but we can and should certainly continue the debate.

 

If you have thoughts or comments about this issue or any other, reach out to me at ADWCMV@gmail.com.

MARIJUANA: THE LEGALIZATION DEBATE. PART 2 – REAL CHALLENGES!

Last week, we discussed some of the new opportunities presented by a legalized cannabis industry in New York. Obviously, full recreational legalization is still some time away, but the momentum for it is growing. This series is designed to touch on some of the main points both for and against it. This week we’ll tackle the real world challenges that legalization presents, which are ignored or glossed over by advocates for legalization. As voters and elected officials we shouldn’t ignore the costs, which may even outweigh the many benefits we discussed last week.

In Part 1 of the series we discussed some exciting opportunities associated with a regulated marijuana industry such as, compelling medical uses, increased tax revenue, investments in infrastructure and communities, elimination of minor marijuana possession crimes and the potential for hundreds of thousands of new jobs. If you want to read the whole article, it’s available on my website at www.andrewallace.com.

In this column we need to spend a bit of time looking at the unintended costs and consequences of legalized marijuana. There are a number of issues, which need to be carefully considered and planned out in advance before simply opening the doors to full legalization.

Medical Concerns. We discussed some of the sketchy evidence last week from users who have seen marijuana relieve severe symptoms, even replacing harder drugs (like opioids) with no loss of effectiveness. There are some vocal opponents including the American Society of Addictive Medicine, American Cancer Society and the American Academy of Pediatrics to name a few, which seem to disagree. Some scientific experts point to findings of increased risk of psychosis, depression and memory loss associated with chronic use of marijuana. A number of critics vigorously oppose smoking and inhalation as a delivery method citing the same problems with smoking tobacco, e.g., reduced lung function, secondhand smoke, chronic bronchitis, etc.

Another concern about legalization is that it encourages users to experiment with harder drugs to achieve a similar effect. Studies point to some disturbing correlations between marijuana use and the use of other drugs, such as, tobacco, alcohol, cocaine, and methamphetamine. Some reports show that people addicted to marijuana are three times more likely to be addicted to heroin. Legalization will increase availability and could magnify these negative correlations dramatically.

There is a growing concern, especially among children and elderly groups, which are unfamiliar with appropriate dosage limits, strengths of differing strains, and any historical experience with the drug itself. Increasing availability can only increase the amount of accidental overdoses and serious health effects in those groups. Obviously, this is a real concern.

Governmental Challenges. Any new regulatory system involves a new enforcement system. Putting a psychoactive drug in the hands of millions of people will create at first, a huge strain on government resources including police, first responders, hospitals, treatment centers and school personnel. One key area of concern is impaired driving, with some opponents of legalization pointing to a compounding effect of the already tragic DUI problem. Not only will we be adding new impaired drivers to the roads, we may be making those who are already impaired by alcohol even worse. Right now there’s no good roadside test for marijuana impairment, so the tendency will clearly be for over-enforcement and “better safe than sorry” policing.

Assuming we can sort out the enforcement problem, a larger concern is the sheer mismanagement of resources that will come with all of this new tax revenue. Years ago (and still advertised today), citizens were sold on lotteries as a way to subsidize education. This voluntary “tax” on those who could least afford it could be justified because the money was “ear-marked” for schools. That myth was quickly debunked as the lottery money was dumped into the state’s general fund and some of it may or may not have ever made its way to schools. Can you honestly say the schools are in better shape today with all of those billions in lottery money “invested” in them? I don’t think so. The same waste played out in the tobacco settlements. What was sold as a “healthcare” fund quickly turned into a general deposit for politicians to dole out pork projects in their districts. The amount of tax revenue that could be generated by legal marijuana will dwarf those two examples and likely will amplify the waste.

Then, there are other sticky issues for governments to navigate like banking rules. It is illegal to deposit money generated from marijuana in banks that are insured by the FDIC. Also, you cannot pay for marijuana with a Visa or MasterCard. Technically, for the United States to legalize marijuana at the federal level it has to fix some of these problems first. It would be violating at least three international treaties and workplace rules. Legalization is not a finish line; it’s a starting gate. There’s so much more to do after deciding to legalize it and, if done wrong, it could wind up costing us more than we ever recoup from increased tax revenue.

Commercial Limitations. Issues of legal use of marijuana in the workplace will become overwhelming for employers very quickly. They have already cited numerous problems in states that have legalized recreational use, including increased workplace accidents, increased absenteeism and reduced productivity. Employers who do business with the federal government, even indirectly, are still bound by the Drug-Free Workplace Act of 1988, which requires federal contractors and subcontractors to utilize drug-free employees on federal contracts. Now, if it comes down to keeping an employee who uses marijuana recreationally or keeping a lucrative government contract, employers will undoubtedly choose the latter. The proposed job gains under legalization then may be more hypothetical than real.

Some other commercial challenges will also include competition from unregulated synthetic marijuana and home-grown producers. Legalization only works if all of the participants are playing by the same rules and these kinds of unregulated producers will undermine the overall effectiveness of any legislation. Moreover, the disappearance of the Black Market is greatly overstated. Given the massive taxes being levied on legal producers, illegal producers will have a huge advantage in underpricing the legal competition. In the same way that massive tax increases on tobacco in the 1990s revived the Mafia by providing a huge new line of business for bootlegged cigarettes. So will a heavily-taxed legal marijuana industry. Faking a tax stamp is not a difficult technical challenge for people already willing to break the law.

Finally, the widespread availability of legal marijuana combined with efficient delivery methods, particularly those powered by social media platforms, will make keeping it out of the hands of children almost impossible. Schools are incapable of policing illegal edibles and vaping of marijuana in schools with test scores and graduation rates already in peril. Commercial actors are the least capable of stopping this terrible result and indeed, are actively incentivized to encourage it. We may cripple at least one generation of kids while we sort out how best to enforce a legalized product and keep it out of the wrong hands. That cost, itself, may be too high to bear.

As you can see, this debate is not a simple one, and there are real costs to offset the benefits. If anything, the costs may quickly outweigh any good that can come from legalization.

We’ll take up the task of trying to pull it all together in the final part of the series. In that column, I’ll give you my personal position, as well.

If you have thoughts or comments about this issue or any other, reach out to me at ADWCMV@gmail.com.

OUR PROBLEM WITH PRISON HEALTH CARE

It’s not unusual for people come to me with things they want to see changed or need fixed. That’s part of the job in public service. Generally, it’s something fairly easy to take care of, like a permit or stop sign or something like that. However small it may seem, it was sufficiently important to them to take time out of their day to seek a solution. The take-away from citizens like this, those who look to solve problems cannot ever get complacent – where there are issues, we need to address them. We need to take them seriously and find solutions.

That lesson, of course, is even more meaningful when it comes to really difficult complicated problems like the one that came across my desk last week. This one arose from the death of an inmate in the Westchester County Jail in 2013. Rashod McNulty, originally from Mount Vernon, was 36 years old and a father of six. Mr. McNulty reported to the infirmary that he had serious chest pains and was given antacid and sent back to his cell. He collapsed on the way and was put in a wheelchair and wheeled back to his cell where he died less than two hours later of a massive heart attack. As you’d expect, the details of this case are playing out in the court system now, as his family has sued the County as well as the private healthcare contractor who is responsible for the healthcare in prison.

As I looked more into what happened I realized that this is not as rare as you might think. The medical provider in Westchester County, Correct Care Solutions, has been sued hundreds of times in Federal court alone and another half dozen times in State court around the country as well. Although I’m only a Councilman in the City of Mount Vernon, I still stand-up for issues affecting people beyond our four square miles. We must always remember that injustice and inequality must be addressed no matter where it may reside. The deeper you look into the private prison healthcare industry, the more clearly it seems that serious reform is in order. Don’t think that this is a small industry either. According to the Department of Justice’s annual spending report by states on prison healthcare exceeds $8 billion, with estimates suggesting that over half of that money is outsourced to private providers like Correct Care Solutions, Corizon Health, Wexford Health Sources and Correctional Medical Group Companies. As you might imagine, the number of cases filed against these entities stretches into the thousands.

But, let’s be clear, anyone can file a lawsuit for any reason, and just counting lawsuits is not sufficient to make a determination that private healthcare providers in jails and prisons is any worse than public healthcare – it’s really terrible too. The fact that healthcare has been privatized does not mean the quality of care is going to be worse. What we do know, however, is that privatizing prison healthcare is cheaper for states and counties, which is why they do it. We also know that these private providers have a profit motive and that often comes with substandard care in order to minimize cost. We have seen consistent claims in these lawsuits that substandard care costs lives. Rashod McNulty’s family can certainly attest to this.

I raise this issue now for a very specific reason: the Correct Care Solutions contract is up in June of this year and Westchester County has already indicated it will be issuing a contract bid process for the jail’s healthcare in the very near future. All of the companies mentioned above will likely put it bids to win that contract and, as part of the evaluation process, I suggest we take an opportunity to demand a few things of these proposed vendors, including:

  • Submission to Independent Oversight. Left to their own devices, private healthcare providers have no incentive to prioritize the care given to prisoners. That causes mistakes and leads to structural indifference and incompetence. The most effective private programs have rigorous oversight programs in place, whether from state or county regulators or independent observers (e.g., local hospitals). The private contractors must be held to the same standards of care as those practicing in the larger community, and they should be able to empirically demonstrate that in a transparent fashion.

  • Substantial Economic Consequences for Failure. One way to hold a private company accountable when it does not perform as expected is to severely penalize it where it hurts: in their pocketbook. Sadly, these contractors have negotiated contracts with public entities that make the fines for non-performance so insubstantial that they represent just an inconvenient “cost of doing business” rather then real deterrent to bad behavior. Any winning vendor should have to agree that performance and payment are based on the same level expected of practitioners outside of the prison system.

  • Evidence of Process Improvements. There isn’t going to be a single vendor who bids on this contract that hasn’t been sued multiple times over the years. That’s a sad reality. What the County can require, however, is evidence that lessons have been learned and applied in the vendor’s processes when it comes to providing care. All systems as complicated as healthcare can be improved and a quality company will be able to demonstrate such improvements have been incorporated into its system of “best practices.”

If we approach this issue clouded by emotion, we’re going to do a poor job of getting a decent deal in place. We need to set aside the moral judgments associated with how or why a person finds himself in need of prison medical care as well as the tendency to assume that incarcerated people are somehow less deserving of basic medical care. Let’s view this through clear eyes and a very simple proposition: the County is going to be paying a lot of tax money to a contractor to perform a vital service, and it has every right to expect the contractor to perform competently at all times. If performance falls short, there should be severe economic consequences.

There are six children out there without a father now. There is a huge hole in their lives that will never be filled, regardless of the outcome of any lawsuit. We owe it to them to make sure that their loss, while tragic and unnecessary can ultimately lead to something positive. Regardless of what he did to wind up in that jail, Rashod McNulty echoed the greatest fear all of us have when he pleaded to a nurse, “I don’t want to die.” At that moment he was just a vulnerable human being desperately asking for help. Help, which he did not get!

Let’s hope we’ve learned the lessons from his case and more importantly, let’s work to put in place a system that accomplishes its purposes. Let’s hold providers accountable and avoid the results that too frequently occur when no one is paying attention. This is after all, the real responsibility of government and the officials who inhabit it.

If you have any thoughts or comments, reach out to me at ADWCMV@gmail.com.

WHY CREDIT MATTERS IN MOUNT VERNON

You’ve probably heard a fair amount in recent weeks about Mount Vernon’s loss of its bond rating by Moody’s Investors Service. For those of you familiar with credit ratings, a lot of this column might be a review, but for those of you who are not, let’s use Mount Vernon’s current financial situation as one of those “teachable moments” – one that you can, hopefully, utilize in your own personal finances, as well. The same principles apply when you are talking about applying a credit rating to a city as when you’re talking about a single individual. And, the negative consequences for doing the wrong things are equally painful.

Let’s start with the basics. What is the City’s bond rating? Just about every city finds itself at one time or another in need of more money than it can raise from taxpayers. This usually happens when a city wants to do some major capital project and needs the funds to build it, even though it may recoup those funds over time from tax revenue. If a city wanted to build a new stadium, it might need to borrow the up-front funds to pay the contractors to build that stadium. The most common method for borrowing money, if you’re a city, is by issuing municipal bonds. These are basically loans made by investors to the city on the assumption that the city will repay the loan with future tax revenue. Municipal bonds have, historically, been a good investment for people because cities have regular streams of money coming in (i.e., your tax payments) that they can use to pay off these bonds.

Moody’s is a bond rating agency. It’s job is to look at the way a city operates, the way it handles its finances, and the way it pays off its vendors. It then applies a “bond rating” to the city for future bond issuances. The better your rating, the better the interest rate the city will pay on its loans. The poorer the rating, the higher the rate it will have to pay to get people to loan it money. In that sense, a bond rating for a city is identical to an individual’s credit score.

As many of you know, an individual’s credit score is impacted by a number of factors, including: length of time you’ve maintained credit (longer is better); the number of open accounts you have (too many is bad); the amount you have due as compared to the amount you are allowed to borrow (a lower percentage is better); and your on-time payment history (longer is better). There are some other factors which play into it as well, including things like bankruptcies, how many times you apply for credit, and sometimes just errors and wrong information. This last piece is why you should always check your credit score, at least once per year. You can get free credit scores at various places on the internet. AnnualCreditReport.com and CreditKarma.com are two free resources you might check out.

In Mount Vernon’s case, the situation is actually much worse. Moody’s removed our bond rating entirely. If it’s possible, that’s even worse than having a bad rating. It means that Mount Vernon has done such a poor job at giving the rating agency confidence in its financial operations and ability to make repayments that they won’t even bother with a bad rating. It also basically means we cannot borrow any money on the bond markets until we get this fixed. That’s the bad news.

The good news is that we know how to get it fixed. We need to conduct audits of some of the Mayor’s “black box” agencies (Water Department, Urban Renewal Agency) dating back to 2016 so we can close the City’s books for those years. It’s not a small job, but a necessary one and one everyone agrees needs to be done. Who is going to pay for those audits has been the subject of some disagreement between the City Council, the Comptroller and the Mayor – which has caused needless delays in getting it done. As part of the Memorial Field lawsuit, the judge in that case tasked the City with getting those audits started immediately. I put forth legislation that approved the Mayor’s choice of auditors to be paid for by the City, but that legislation was not passed by the full City Council. That’s an unfortunate result, especially given the real consequences it has on the City’s financial reputation and ability to borrow.

You’ve seen the newspapers. The Department of Public Works (DPW) has enormous challenges with its vehicles and equipment. Replacing those DPW trucks should be a priority, for sure. But, we would need to borrow money to do it. And, without doing the work to get the bond rating back in place, we simply cannot borrow money, no matter how important the reason. We’re going to need more money for infrastructure repairs, Memorial Field, and even upgrades to our internal systems. Again, it doesn’t matter what we might need the money for. Right now, we’re shut out of those money markets.

Per the direction of the Court, the Mayor has until Friday to come up with enough money in his allocated budget to pay for the auditors, and, if necessary, I’ll help him identify where that money can come from. We both agree this needs to be done and done quickly.

The Mayor has also suggested another possibility, one I absolutely do not agree with: private borrowing. In the context of an individual, this is akin to having been denied a loan by every bank in town and going to a loan shark to get one instead. Personally, I think that’s insane, but I will ask the Mayor for his detailed plan on this front, just the same. That said, there must be a solution by Friday, so he does need to find the money in his budget to pay for the auditors, If not, the Council will.

The short answer is this: if you are not diligent in your financial responsibilities, you will pay more and in some cases, considerably more than you should. Often times, it’s a downward spiral as a result. The same principles apply to Mount Vernon. Pay bills on time, don’t get yourself over-extended with debt you don’t need, look honestly at your financial situation, and make sure you understand the consequences for not tending to your “financial reputation” out there. I recognize this is not always easy for everyone, and I don’t mean to suggest it’s ever going to be. But, if you know what to look out for, you have a better chance to succeed.

At the City level, we know what needs to be done. It’s time to come together to get it done. Quickly. Transparently. Responsibly.

If you have any thoughts or comments, reach out to me at ADWCMV@gmail.com.

I BELIEVE IN OUR CITY

Having been completely consumed by the City’s budget nightmare for the last few months, I haven’t been able to spend much time reflecting. It’s an important thing for all of us to do, but this political life has me running in so many directions usually that I don’t get to do it as much as I would like. Reflection gives you perspective and allows you to focus on real priorities without getting lost in the weeds. It gives you strength to take on the next challenge.

This job isn’t an easy one. It taxes your relationships and cuts into your family life. It keeps you up at night. It impacts your health. It saps your energy and spirit. So, why do we put ourselves through it? Why do we endure the criticism and false facts? Why do we put ourselves out there, when there are so many other easier paths we could take?

I can’t speak for others, and every elected official has their own set of reasons, but I can share with you why I do this. I can tell you why I keep going in the face of difficulties. I wish it was more complicated, but it’s not. It’s simply because I believe in this City. I have a vision of what it can be in my mind, and I want to help us get there. I am not going to be so presumptuous to think that I can do it myself. If we get there, it will be because all of us have seen that vision, too. It will be because we have, as a community, decided to make that vision a reality. I want to play my part and help. That’s all. That’s why I do it.

I’ve lived in this City for over thirty years. I’ve seen it change a lot, sometimes for the better, sometimes not. What never changes, though, is the sense of community I feel when I walk its streets. We’re not the biggest city or the flashiest or the hippest. That’s never really been our calling card. This is the “City of Homes” and that has always meant one thing: that each of our families combines to form a bigger family. We can bicker and disagree, just like families do. But, just as likely, we pull together when times are tough and solve difficult problems, just like families do. That sense of “togetherness” never leaves you when you come from Mount Vernon. It’s the same feeling you get when you think about your own family home. That’s the “thing” that makes Mount Vernon special.

Maybe we’re the underdog, but, you know what? Everyone roots for the underdog. Because the thrill of achievement and sense of victory is so much more glorious when it happens. People are rooting for Mount Vernon. You need to know that. When we succeed, we will have an enormous fan base to cheer us on. They see in us what, sometimes, we overlook in ourselves. We have as much talent in these 4.4 square miles as cities ten times as big and we work as hard as anyone. When you mix talent with hard work, you can beat anyone.

Memorial Field is gone. But, we’ll build a new one and make fantastic memories there. The bridges are closed, but we’ll get them open again and re-connect our city. The financial house is a mess, but we’ll get it sorted out and back on track. These things are just temporary obstacles, and each one will be overcome as we charge forward. How do I know this? Because our citizens’ belief in this city has never faltered, has never failed. I know this City has its best days in front of it and not behind it.

In the trenches, with the bullets flying, you’re so busy fighting that sometimes you forget why you were fighting in the first place. When you take a step back, take a deep breath, and pause for a moment of reflection, it all becomes clear again.

I believe in Mount Vernon and its extraordinary future. I believe in its citizens and their incredible capacity to succeed. I never stopped believing in this place. That’s why I fight for them every day.

If you have any thoughts or comments, reach out to me at ADWCMV@gmail.com.