BUS VOTE PASSES 8-2-1 BUT — STOP THE PRESSES!! — IT MAY BE FOR NOUGHT … DID THE COUNCIL FOLLOW ITS OWN RULES FOR RECONSIDERATION? IF NOT, VOTE MAY BE RESCINDED
By DAN VALENTI
PLANET VALENTI News and Commentary
(FORTRESS OF SOLITUDE, WEDNESDAY, APRIL 23, 2014) — As you likely know by now, councilor Lisa Tully of Ward 1 changed her vote on the bus borrowing measure, which passed on an 8-2-1 vote. At the end of this column, we shall publish the statement Tully sent THE PLANET in defense of her switch.
But first, we stop the presses.
THE VOTE MAY HAVE BEEN ILLEGAL!
We shall explain the drama in a moment.
Morandi, Simonelli Stand Tall
Councilors Kevin Morandi and Tony Simonelli stood by their convictions and reasoning in rejecting this needless purchase, which, as THE PLANET has shown using the Pittsfield School Department’s own data, will cost millions of dollars per year.
One of the high points of the meeting came when citizen watchdog Terry Kinnas shared his analysis of the true cost of the bus purchase, which will be $4 million plus for five years — a figure independently arrived at from THE PLANET’s but convincingly similar to ours. The mayor, Kristen Behnke, Sue Carmel, and the school department have been hiding this true cost. Why? Why the desperation to push through at the very net meeting something that filed the first time? Who’s pockets and purses are being lined, if anyone’s? What’s the true nature of the cost and the kickbacks, if any?
Two days ago, THE PLANET figured in all of the costs of maintaining in-house bus service for the length of the financing, and we arrived at a figure of $23 million. That was a conservative estimate. Kinnas’ calculations were in the same ballpark as ours. That frosted Mayor Dan Bianchi. The Empty Suit got up at the open mic and spit on Kinnas and his figures. It’s interesting that the mayor seemed to be swallowing bile that anyone would dare question his sacred (and blasphemously phony) figures. It made for satisfactory viewing to see The Empty Suit lose his cool in such an unprofessional manner. No wonder the mammals are jumping off the sinking ship that he is helming — on part-time basis, of course.
The only councilors who critically questioned this bad deal were Ward 2′s Kevin Morandi and Ward 7′s Tony Simonelli. THE PLANET thanks them for their integrity, something in bone-dry supply with their colleagues. Ward 3′s Nick Caccamo recused himself, as we said he would have to do.
Was the Vote Legal?
The most urgent point to make about this vote is that is may have been illegal. A measure that has been disposed of by the council, as in the case of the April 8 vote on the buses, cannot simply be brought back at the next meeting.
THE PLANET first got wind of the reconsideration of the bus vote when the council agenda came out on April 17. There and then we learned the mayor, with the enabling of council president Melissa Mazzeo, listed it again on the agenda. Fine, but we have one little question: Was is done according to the council’s own rules? Can you just post it on the agenda of the next meeting and it’s all moons in June from there?
Council Rule 18 states that a vote requiring a supermajority for approval, as the bus vote did, may be brought back for reconsideration by “any member voting with the prevailing side, even though that side is not in the [super]majority.” Again, fine so far, but it further states: “A move for reconsideration may be made only at the same session as the vote to be reconsidered …” (PLANET’s underline).
To boil it down, did any of the seven members who voted on April 8 for the school bus bonding submit, at that meeting, a motion for reconsideration? If not, as it appears to be the case, this would mean that:
(a) the mayor brought it back to the council illegally,
(b) the council president placed it on the agenda illegally, and
(c) the council approved, 8-2-1, again, illegally.
If this is the case, to comply with the law, the council will have to rescind the vote on the buses. We asked councilor Tully if “any of the seven voting in favor submit a motion for reconsideration?”
“To my recollection there was talk,” Tully said, “but not a motion.”
If that is true, last night’s vote must be rescinded.
Now, as promised, here is the statement Tully sent to THE PLANET to explain her vote. We submit it without comment or prejudice. We do thank the councilwoman for supplying here raison d’tete.
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STATEMENT OF LISA TULLY:
Yes, I changed my vote. Feel free to post the entire email.
When we last voted on this proposal 2 weeks ago, I voted against it. I voted against it not because I am against replacing buses, but because I thought a replacement plan would make more economic sense than borrowing $2.8M to purchase an entire new fleet. I also thought that we had enough time to replace all the buses over 5 years as the National Association of State Directors of Pupil Transportation Services recommended 12 to 15 years average replacement.
I assumed that alternatives to this proposal were not investigated seriously by the school department. If they had been, I would have expected this information to have been included in our packet. I believe the public needs to know this information and they shouldn’t have to specifically request it. It should be on-line entitled “Business Case for Borrowing to Buy Buses”. If the analysis had been on-line for public scrutiny, I doubt I would have received so many emails thanking me for my vote against this proposal.
Now, here we are again tonight, with the same proposal as 2 weeks ago. There is nothing added and nothing has changed in it. I don’t see a “Business Case for Borrowing to Buy Buses” included. So now, it is up to me to provide the business case because I have changed my vote on this item and I cannot simply change my vote without a detailed explanation why.
Since the last council meeting, I sat down with Mrs. Benke to review the alternatives. The school department did indeed evaluate bus fleet renewal options, initially in April 2012 and again in June 2013, when leasing was analyzed. I’ve updated my spreadsheet and calculated that, on average, we could expect to pay over $615,000 per year for 5 years to replace the fleet.
I also sat down with Mrs. Carmel to learn about the City’s bonding process. The City sells bonds all the time. The interest rates vary, but the last 2 were at 1 % and 1.25%. I wish I could get a mortgage for that.
I calculated that if the City sold the bond $2.8M bond at 2%, for 5 years, the payments would be approximately $582k annually.
At a minimum, the City will save $30k annually by borrowing to buy all the buses at once. In addition, Mrs. Benke said at the last meeting that the maintenance budget would be reduced by $90k with a new fleet.
Therefore, I have concluded that it is more cost effective to replace the fleet all at once with a bond, including the advantageous bus prices from a volume purchase.
Another concern I had was the age of our fleet. If the recommended replacement age is 12 to 15 years, I thought we are trading them in too soon.
I called around to other Massachusetts communities and obtained information from Needham, Worcester and Northampton, a good mix. All 3 districts contract out most of their fleet, but own some buses. Worcester’s contract calls for a 10 year maximum bus age with an overall fleet age of 6 years. Needham’s buses are replaced every 3 to 5 years, but their contract calls for 7 years. Northampton’s has a maximum of 10 years. In addition, Supt McCandless stated at the last meeting that the average replacement age for contracts in Berkshire County is 7 years.
Therefore, our 9 year old buses are within the Massachusetts range for replacement. We could hold on to the buses another year, but there is a cost of $265,800 to keeping the existing fleet another year; the $90k in additional maintenance and the $175,800 of lost trade-in value. After 10 years, as confirmed by Worcester and Northampton, the trade in value is very low.
Another concern I have to address is the $1.2M we are still paying on the existing fleet. This is unfortunate, but it is part of a larger $22M bond that was sold in 2008 to group many other debts at a lower interest rate. In that respect, it is similar to refinancing your home with a higher principle at a lower interest rate to pay off credit cards. At first, understanding that we still owe on the existing fleet was surprising, but after learning that it was part of a debt consolidation, it made more sense. Realistically, we cannot wait to replace our buses until 2020 when this bond is paid off.
The option to contract out the student transportation was last reviewed for a period of 2005 to 2010. I would like to see our cost to own the buses updated and compared to a new competitive bid. I am not in favor of contracting out our fleet, but would change my mind if it made sense. Contracting out is not the panacea everyone says it is. Last summer, Northampton voters approved a Proposition 2 ½ override because their renewed contract from Durham School services came in $225k higher for FY14 than they budgeted. If the override failed, they would not have offered high school busing. That district is now paying $333.63 per bus per day, over $60k per year per bus. Needham purchased 3 buses to provide transport for their athletics program and saved $85k per year. While the contract option is not on the table this time around, it will be for the future, so that a true cost comparison can be made.
Below is my analysis of the renewal plan, showing that at the very least, we will have to pay $615,000 on average for 5 years by staggering our bus purchases. Our bond, however, will be at the most $582,000 for 5 years. Add this savings to the 90,000 savings in maintenance costs and we are better off replacing the fleet now.
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It looks as if this story is far from over.
“Drunk all the time feeling fine on elderberry wine. Those were the days. We’d lay in the haze, forget depressive times.” — Elton John, “Elderberry Wine,” from the album, “Don’t Shoot Me. I’m Only the Piano Player,” (1973).
“OPEN THE WINDOW AUNT MILLIE.”
LOVE TO ALL.