letter to the editor by michael russo 3-1-2013

Letter to the Editor, New Paltz Times by Michael Russo, March 1, 2013

At the February 21 Joint Town/Village Board Meeting, Dr. Gerald Benjamin stated, in response to a question by Kitty Brown, that funding for the Citizen Empowerment tax credits that would allow a consolidated government to obtain up to $1 million in state funding, has been appropriated in the State Budget.

This is accurate but one has to know that appropriations expire at the end or soon after the end of every fiscal year budget regardless of how much money was spent (NY Finance Law Sec 40.3). If the next year's budget does not renew the appropriation, the funding is gone.

The State’s fiscal year starts April 1, and the Governor's proposed budget is still being debated in the legislature. Even if the Citizen's Empowerment tax credits are approved this coming fiscal year, this is no guarantee for subsequent years.

Dr. Benjamin also stated: "The criticism on relying on state funds is the point that KT Tobin raised earlier, that the state has been unreliable about persisting in the amount of money it gives to local governments over time. But you have to act on the law as you understand it and as you expect it to unfold -- you can't say that the state lies and therefore we can't proceed, or has lied in the past and we can't proceed -- or at least I think we can't say that."

However, if the state fails to continue the availability of Citizen Empowerment tax credits in future years, it will not mean that the state has lied. State Finance Law Sec. 54p does not make any representation that the Citizen Empowerment tax credits will continue year after year, because the law includes the phrase "within the annual amounts appropriated there-for,” which means "only if in the current budget." The State would only be lying if it didn't provide the funds in a given year when the appropriation was already made. There is no guarantee in the State Law that these funds will be appropriated in future years.

If we proceed as Dr. Benjamin suggests, i.e. "to act on the law as you understand it and as you expect it to unfold", then aside from the current fiscal year and this coming year if the legislature approves the Governor's budget, it is anyone's guess as to how the future of the Citizen Empowerment tax credits will unfold.

But in terms of that guess, let’s remember that a few weeks ago in a letter to this newspaper, it was pointed out by authors Tobin, Portier and Preston that state aid to the town and village has dropped precipitously since 2008, from 9% of revenues in 2008 to 4% of revenues in 2011. And a similar decline in aid has occurred for our school district. Such cuts are being experienced in municipalities and school districts all over the state. For me, this is a powerful signal that the Citizen Empowerment tax credit incentive program has a very limited lifespan indeed.

summary state aid 2008 to 2011 np village and town

This chart shows the decline of State Aid to the Town and Village between the years of 2008 and 2011. In  both cases, the amount of State Aid in 2011 is half that of 2008. This has resulted in a combined loss of State Aid to the Town and Village of almost $1.5 Million for the three years of 2009 through 2011, with the 2011 level being over $650,000 off from the 2008 level.

Click on link:  https://docs.google.com/file/d/0B-FIiz39zh5bNkVXTFYwcF8wZkU/edit?usp=sharing

letter to the editor by guy thomas kempe 2-19-2013

Dear Editor:

The grant application titled New Paltz Municipalities: High Priority Planning for Efficient & Effective Government as submitted in 2009 to the NY Department of State secured financial resources to develop a “neutral feasibility study” of “merger, consolidation, dissolution and shared services.” The application asserted that both Village and Town residents will “have the facts and analytical information necessary to make an informed decision about the best governance structure at the most efficient cost” along with eight specific objectives; (1) public participation; (2) assessments of assets and liabilities; (3) short and long term fiscal implications; (4) resolutions and legislation needed to advance recommendations; (5) a calendar and schedule for implementation; (6) a metric to evaluate quality of services and costs; (7) a white paper to provide a model for other communities, and; (8) an application request to the state for implementation funding.

To date, I have been unable to locate a comprehensive and reliable source of information on either municipal website to facilitate my participation in the project. While some documents are available on the village website, the town website currently announces that the “Next working group meeting of the Government Efficiency Project is May 9, 2011, 9 am at Village Hall.”

The Planning Grant identified the following deliverables; (1) Dedicated pages on both municipalities website to provide a record of the study progress and include links to all relevant documents (FAIL); (2) Facilitation of community involvement (FAIL); (3) Analytical study of all options, including the costs, benefits and liabilities of current municipal structures, alternative models and shared services (Not found); (4) Written resolutions and legislation necessary to move forward with recommended scenarios (Not found); (5) A calendar and schedule to proceed (Not found); (6) A final Feasibility Study with Implementation Outlines (Not found); (7) A metric to be used over time to evaluate delivery of better governance (Not found); (8) White paper to evaluate the process and provide informed guidance for other communities (Not found), and; (9) Application for implementation funding partnership (Not found.)

Despite what I trust are best efforts by leaders and volunteers working on the issue, it is clear that we have a long way to go before the facts and analytical information necessary for the public to make an informed decision about any proposal to change local government structure can be evaluated.
-GTK

Email correspondence with and regarding Ken Bond

From: Susan Zimet

Sent: Saturday, December 01, 2012 5:10 PM

To: jtlogan6@aol.com ; planB@hvc.rr.com ; jpgallucci@gmail.com ; kevinbarrylaw@yahoo.com ; assistant@townofnewpaltz.org ; jasonwest@villageofnewpaltz.org ; sallymrhoads@gmail.com ; basco54@gmail.com ; briankimbiztrustee@gmail.com ; stewartglennnewpaltztrustee@gmail.com

Subject: Fw: Follow-Up to Conference Call on Consooidation - 11/30/12

Hi all

Yesterday Dave Lent and I had a phone conference with Ken Bond.

Jason and Nancy joined the call.

I had scheduled the phone call to review certain questions for the Finance Committee

During that conversation Ken's office

Went through the step by step process both boards need to take in order to have a referendum at the end of March

Ken sent a summary that is very comprehensive and all board members should read

The Finance Committeedid has done an awful lot of work that should be very helpful to this process

The Town Board has allocated money for it's half to hire Ken Bond for the work necessary to move this forward.

Hope you are well.

Susan

-----Original message-----

From: "Bond, Kenneth W." <Kenneth.Bond@squiresanders.com>

To: "supervisorzimet@townofnewpaltz.org" <supervisorzimet@townofnewpaltz.org>, "jasonwest.mail@gmail.com" <jasonwest.mail@gmail.com>, "wildfire00@gmail.com" <wildfire00@gmail.com>

Cc: "Neuringer, Matthew E." <Matthew.Neuringer@squiresanders.com>

Sent: Sat, Dec 1, 2012 20:03:55 GMT+00:00

Subject: Follow-Up to Conference Call on Consooidation - 11/30/12

Dear Supervisor Zimet and Mayor West:

Thank you and your colleagues for participating in yesterday's call to move forward the process of consolidation. As the bond counsel for both the Village and the Town, and as special counsel to the joint board considering consolidation, we do not advocate a position on whether consolidation is the right thing to do. The law gives that choice to the voters and the taxpayers of both communities. However, given the short time to move forward proceedings to a referendum in March, 2013 such that a favorable vote by both communities could result in the consolidation being effective January 1, 2014 and the town/village able to begin receiving its $1 million annual state aid inducement payment before March 30, 2014, it is critical that the joint board adopt an agreement of consolidation at its meeting on or about December 20, 2012 pursuant to state law and the timeline we have sent you.

With that date, or an earlier date, in mind we will work diligently with Village and Town stakeholders to draft the agreement. As Matthew pointed out in the call yesterday, the law does not require great specificity in the details - but does require adoption of concepts, structures and principals under which the new entity would operate. We will help you articulate in the agreement the consensus which has been developing on a consolidated community.

That said, I want to clarify a couple items and suggest some larger concepts and principals which the joint board may want to include in the agreement:

1. The $1 million in annual state aid, in our view, is a hard number. Your budget numbers qualify for the full amount each year. The "subject to appropriation" concern should politics or state finances derail the annual payment is not warranted. First, state policy is to reduce and consolidate the state's local governments to reduce the expense to taxpayers and increase service delivery efficiency. Second, New York is not going to run of money - ever. In the state's 2012 FY budget it appropriated $35 million for consolidation inducement payments - and paid out only $3 million. Should the consolidation occur, New Paltz will be the largest and most visible urban area in the Hudson Valley to complete the process. Thereafter, you should be all over your legislators for more appropriated state consolidation inducement aid.

2. It is a legal fantasy that residents in the Village have two votes because they also live in the Town. The 1st Amendment to the US Constitution and the NY State Constitution recognize the "one person, one vote" rule. Village residents would vote in the village referendum. Town residents outside the village would vote in the town referendum. Any other proposal will generate a lawsuit.

3. Much discussion focuses on residents of the town/village paying more/less taxes post-consolidation. The agreement should include a "transition period" commencing with the effective date of consolidation for two years (i) where no taxes go up or down on account of consolidation and any cost savings post-consolidation are spread proportionately and equally among all properties in the consolidated entity, and (ii) the levy for the consolidated entity beginning in its first year equalizes all rates for all classes of property for all properties in the consolidated entity.

4. The agreement requires a statement of a governmental organization. Key officers are a CEO, COO, CFO, police chief, fire chief, DPW supervisor, HR director, planning director, economic development officer, etc. During the transition period (2 years) the CEO (elected [after the transition period] supervisor/mayor) and COO (administrator/manager) should be the current Town Supervisor and Village Mayor. The governing board of the consolidated entity should be the entire town board and village board during the transition (about 11-12 board members) then reduced to 7 (typical city council size) after the transition. No current town or village personnel should be let go during the transition as a "cost saving" measure because of consolidation. Personnel who retire, resign or die need not be replaced (attrition) but no job losses on account of consolidation during the transition.

5. Economic development - should be a major aspiration of the consolidated entity to put more properties on the tax role - should include establishment of one or more BIDs and LDCs.

6. SUNY and non-profit properties and facilities - should pay for services under a PILOT. This may require future state legislation, a lawsuit, etc. But get the idea into the agreement.

7. Costs/benefits of services - move more services to a fee for service payment basis to reduce or maintain property taxes. You want students and tourists to pay for the services the consolidated entity provides.

8. Labor agreements - since they have all expired and the consolidated entity is new, declare that Triborough should not apply and create new uniform labor agreements during the transition period. The unions will fight and they will lose on this. The consolidated entities' employees have little to fear: over the past 10-15 years average salaries and benefits in the public sector (i.e. local government) have consistently surpassed those in the private sector.

9. Debt and agreements - those long-term debts incurred by the separate town and village pre-consolidation are paid by the taxes generated on the properties within the separate entities. Same rule applies to improvement districts' (water and sewer) pre-consolidation debt. Separate entity terminable contracts should be terminated and made contracts of the consolidated entity upon effective date.

10. Fire services - merge any Town fire districts and fire protection areas into the village fire department upon consolidation.

11. Water and sewer districts. Use the Town Law approach. The village water and sewer systems would be treated as a separate improvement district; then establish an entity-wide water district and sewer district and consolidate all water and sewer districts into the entity-wide districts during the transition. We've done this before - not rocket science.

At this point, if there are existing committee reports we can review, like that of the finance committee (have not reviewed) or the Human Resources Subcommittee (forwarded by Jason) please send ASAP. Because, of the shortage of time I would not spend more time on committee reports unless other committees did work and can produce a short written summary of their findings ASAP. That said, you need to have answers to the following items at least in summary form well before December 20 for the agreement:

(a) the name of each local government entity to be consolidated (Town of New Paltz, Village of New Paltz, any fire districts in the town);

(b) the name of the proposed consolidated local government entity, which name shall be such as to distinguish it from the name of any other like unit of government in the state of New York (except the name of any one of the entities to be consolidated) (New Paltz, Manhiem, or some other interesting Huguenot or Dutch word [I'm partial to Friesland and Groningen from where my mother's family immigrated in the late 19th century);

(c) the rights, duties and obligations of the proposed consolidated local government entity - (see note 4 above - this needs elaboration but 4 will get you started);

(d) the territorial boundaries of the proposed consolidated local government entity (the current town boundaries; the village boundaries dissolve);

(e) the type and/or class of the proposed consolidated local government entity (first class town/village [based on population]);

(f) the governmental organization of the proposed consolidated local government entity insofar as it concerns elected and appointed officials and public employees, along with a transitional plan and schedule for elections and appointments of officials - (see notes 4 to 11 - also needs elaboration);

(g) a fiscal estimate of the cost of and savings which may be realized from consolidation - (this will be a guess or perhaps numbers can be tweezed from the Fairweather report or committee reports; however, other than the $1 million annually from the state, you're not looking for savings during the transition [first 2 years] as much as you are looking for efficiencies in operation which generate permanent savings and tax reductions after the transition);

(h) each entity's assets, including, but not limited to, real and personal property, and the fair value thereof in current money of the United States - (public facilities asset values can be obtained from town and village certified financials per GASB 34 reporting; private assets can be obtained from the assessor's office);

(i) each entity's liabilities and indebtedness, bonded and otherwise, and the fair value thereof in current money of the United States - (terminable contracts are only current liabilities - essentially the town and village expense budget numbers; indebtedness is all the town and village general obligation debt - the things we write approving opinions on - plus any financing leases for equipment);

(j) terms for the disposition of existing assets, liabilities and indebtedness of each local government entity, either jointly, separately or in certain defined proportions - (assets to be made owned by consolidated entity during transition; separate town and village long-term liabilities remain where they are - see note 9 above - proceeds of any assets disposed of post-consolidation go into the pot of the consolidated entity) ;

(k) terms for the common administration and uniform enforcement of local laws, ordinances, resolutions, orders and the like, within the proposed consolidated local government entity - (lay out where the consolidated entity will follow Town Law and where it will follow Village Law; it must follow the GML for local laws which might deviate from [but not conflict with] the Town Law or Village Law - I would leave implementation of these things to transition period activities);

(l) the effective date of the proposed consolidation (January 1, 2014); and

(m) the time and place or places for the public hearing or hearings on such proposed joint consolidation agreement - (hold in the town and villages offices on dates indicated by the timeline we provided

- the statutory hearing can be held over for 2+ days; information meetings of an informal nature can be held after December 20 and before the vote).

So there you have it - the Cliff notes for a consolidation agreement. If you can agree on the big concepts you can get an agreement together. If you agonize over details and ruminate in the weeds this will never happen. Any one who absolutely opposes consolidation for any reason can campaign against it to convince the voters to reject it. But opposition by stonewalling to prevent the question from being placed before the voters (at a time they are aware of the issue and forming their own opinions) seems a little disingenuous given the intent and state policy behind the consolidation law.

Finally, we are transactional lawyers and used to the pressure of getting things done with tight deadlines. Matthew is finished with final exams on the 14th and has offered to encamp in New Paltz for a week to work 24/7 with you to craft an agreement - at no extra cost, I should add. I have intentionally not marked this email "Confidential - Attorney Client Privilege" so that you can freely share it with others as you deem appropriate. In the words of Mr. Spock, "Long Life and Prosper." Ken

Kenneth W. Bond

From: PlanB@hvc.rr.com

To: Susan Zimet <supervisorzimet@townofnewpaltz.org>, jtlogan6@aol.com, jpgallucci@gmail.com, kevinbarrylaw@yahoo.com, assistant@townofnewpaltz.org, jasonwest@villageofnewpaltz.org, sallymrhoads@gmail.com, basco54@gmail.com, briankimbiztrustee@gmail.com, stewartglennnewpaltztrustee@gmail.com

Sent: Wed, Dec 5, 2012 04:47:58 GMT+00:00

Subject: Ken Bond Conference Call on Consooidation - 11/30/12

Susan, I'm not clear on where the data and new contracts and water districts etc outlined below by Ken Bond are going to come from. Is this what the $75,000 will provide? Kitty

From: Susan Zimet <supervisorzimet@townofnewpaltz.org>

To: PlanB <PlanB@hvc.rr.com>; jtlogan6 <jtlogan6@aol.com>; jpgallucci <jpgallucci@gmail.com>; kevinbarrylaw <kevinbarrylaw@yahoo.com>; assistant <assistant@townofnewpaltz.org>; jasonwest <jasonwest@villageofnewpaltz.org>; sallymrhoads <sallymrhoads@gmail.com>; basco54 <basco54@gmail.com>; briankimbiztrustee <briankimbiztrustee@gmail.com>; stewartglennnewpaltztrustee <stewartglennnewpaltztrustee@gmail.com>

Sent: Wed, Dec 5, 2012 8:24 am

Subject: Re: Ken Bond Conference Call on Consooidation - 11/30/12

Kitty

All the documents needed Will be developed with Ken Bond's. Team working with us.
It's important we do this right
and cannot do it alone.

Hope this helps

Susan

Regarding the potential loss of significant grant funding due to consolidation

Jason West -----Original Message-----
From: Mark Blauer [mailto:mblauer@evenlink.com]
Sent: Tuesday, January 15, 2013 1:21 PM
To: Mayor Village
Subject: Consolidation

Mayor West

Last Thursday we met with George Popp from the USDA Office in Middletown regarding the Village's pending application for water system assistance.

I used the opportunity to ask George if New Paltz Village would be
eligible to apply to USDA for Water & Waste assistance if the Village
boundary was expanded to encompass the Town of New Paltz. The resulting population would exceed the USDA cutoff population of 10,000.

Mr. Popp's said unambiguously that New Paltz will not be eligible if its
new consolidated population exceeds 10,000. This is precisely what I have been saying when first asked about this subject. I was dismayed that some people (folks who don't write grants for a living) doubted my assessment of future eligibility. They are free doubt my judgement but they should not dismiss the firm answer given by George Popp at USDA on the subject.

FWIW, I am 4 for 4 on grant applications submitted for the Village. This
is something people should consider when thinking about my opinions on the subject of grant eligibility.

If I thought that consolidation would improve and not diminish your
prospects for receiving grants I would say so. I am after all in the
business of winning.

Even if USDA changes its 10,000 cutoff in the future the newly constituted Village would not qualify for the favorable "poverty rate"
loan and grant terms it now enjoys. The Village qualifies for the low
rate of 1.875% (38 years) and grants up to $750,000. The Intermediate rate interest is higher and the grant ceiling is only $500,000.

On several occasions I have noted that our CDBG Small Cities success was directly attributable to the 58% low and moderate income percentage of the current Village. We must prove that any project have at least 51% low and moderate income benefit. Presently the Village's configuration makes Village wide benefit projects eligible. As they say on TV, this is black letter law. The expanded Village would have a new low and moderate income percentage well under 51%.

Consolidation may have arguments in its favor but future grant eligibility is not one of them.

I suggest that the Village carefully consider my input based on 35 years
of grantwriting before sacrificing the grant programs we have relied on to bring $1.7 million to the Village in the short time I have served you.

Choose wisely.

Mark Blauer
Blauer Associates
January 22 at 11:54am

Jason West Mayor West
Fairweather is misrepresenting if he says that a new municipal entity with a population of over 10,000 is still eligible for Water & Waste funding. The Town population is in excess of 14,000 according to the 2010 Census. Perhaps Fairweather would like to ask George Popp if the Town of New Paltz can presently apply to USDA for Water & Waste funding.

George Popp said point blank on January 11th that USDA eligibility for Water & Waste will be lost if the Village boundary is expanded to encompass the Town. We all heard what George said and he represents the Funding Agency. Fairweather apparently dismisses what I and Mr. Popp have to say about Water & Waste eligibility. Nothing short of Congressional action will restore eligibility for municipalities with populations over 10,000. Presently the Town of Ulster cannot apply for Water & Waste. Supervisor Quigley can confirm that.

The Town Supervisor is mistaken if she thinks I am being defensive. I don't suffer disinformation gladly and make no effort to mask my opinions about disinformation.

As per the fundng agency, New Paltz will lose its eligibility for USDA through the expansion according to USDA, OCR funding will be at least more difficult and possibly impossible to obtain. I will finish my current projects and move on to work for other clients.

I won't waste time drawing pictures for the willfully blind. Either they get it or they don't.

Mark Blauer
January 22 at 11:49am

Jason West On 1/16/2013 1:41 AM, Jason West wrote:
> Mark -
>
> Most of Fairweather's comments focused on Small Cities. There was some cross-talk regarding USDA and I will confirm what was said verbatim once the video becomes available. It was clear by both thecomments made by a few and the silence of the rest that in the he-said-she-said Fairweather was seen as a more trustworthy source than I.
>
> I will do whatever I can to stop wasting your time with this nonsense so that we may retain your services.
>
> I am copying this to the entire Village Board so that they understand the consequences of their failure to adequately check their facts.
>
> Jason
January 22 at 11:50am

Jason West Jason
I am not surprised that Mr. Fairweather focused on Small Cities and downplayed USDA. The facts about USDA don't support his argument that consolidation does not lessen grant eligibility. USDA's George Popp was unambiguous on January 11th about New Paltz losing USDA eligibility for the Water and Waste Program once its population exceeds 10,000. My understanding is that the new Village boundary would coincide with the current Town boundary. That puts the new entity over 10,000 population. Like I noted the Town of Ulster is already over 10,000 population and is not eligible for USDA Water & Waste. They are presently hoping that Congress changes the law. Even if Congress changes the law, after consolidation New Paltz lose "poverty" status. That translates into a higher interest rate and a lower grant ceiling from USDA.

If consolidation was already accomplished the $4.1 million water request USDA is currently reviewing would have been denied as the municipal population would already be over 10,000.

Regarding Small Cities, we don't entirely lose eligibility. Some types of projects will be instantly ineligible while other submissions will be vastly complicated after 2020.

The Village is 58% low/moderate while the Town is 42%. All Small Cities applications must demonstrate 51% or better low/moderate benefit. The Village's 58% is why we won the last three Small Cities grants. In contrast, the Town of New Paltz has not won a Small Cities grant in at least the last 10 years. Town-wide projects are presently ineligible and will continue to be so because of the 42%. Consider for example a youth center project. A youth center serving the Village is eligible while one serving the whole Town is not.

When the 2020 Census is conducted the demographics of the old Village will be absorbed within the larger Town boundary. The 58% low/moderate figure will disappear to be replaced by a blended low/moderate figure. That figure will be less than 51%. Small Cities has been operating for 35 years and is likely to continue for many more years. The Village's special competitive advantage will disappear with the 2020 Census. At that point income surveys would be required to justify water and sewer projects. Towns like Ulster and Wawarsing conduct such surveys now. Surveys are difficult, expensive and time consuming. Surveying hundreds of households including off campus students in order to qualify a water or sewer project would be a logistical nightmare for New Paltz. Without the 58% percentage the Village now enjoys our last three Small Cities projects would have required door to door income surveys to determine the income characteristics of approximately 3,800 residents.

Qualifying a Small Cities project that requires surveying 1000+ households is possible in theory but often impossible in practice. Anyone who writes Small Cities applications would understand why I am loathe to discard the Village's separate identity and advantageous 58% low/moderate income demographics.

I can assure the Village Board that I don't wish to stop working on future projects for the Village. I am just being realistic. Casting away eligibility through consolidation may leave me little to do for New Paltz. Without workable opportunities I would have no choice but to move on.

Mark Blauer
January 22 at 11:50am