Truer Than Fiction

 May 8, 1990

Monday I attended the swearing-in ceremony for new Tulsa Mayor G T Bynum, City Auditor Criswell and our nine City Councilors.  It brought back memories of the swearing-in ceremony for Mayor Rodger Randle and the first Tulsa City Council on May 8, 1990, implementing the new city charter, overwhelmingly approved by Tulsa voters the year before, that changed city government from a five member City Commission elected at large, to a mayor and city council elected by districts.  My favorite memory from that day was the private lunch attended by just the eleven elected officials—Mayor Randle, Auditor Wood, Councilors Roberts, Hall, DeWitty, Nelson, Hogue, Benjamin, Polishuk, Bartlett and myself.  The event was mostly about developing camaraderie among the group but also to mildly tease the media since we would never again be able to gather together in private without violating the Open Meeting Act. 

Toward the end of the lunch, and not long before the scheduled public event was to commence, Mayor Randle addressed the group and at the end of his remarks proposed that we all agree to participate in a kind of Tontine whereby we would all agree to put in a certain sum of money that would be invested and made available to the last of us to survive, or according to other conditions we may all agree upon.  There was quick consensus that we should pledge to come together again in twenty-five years to see the status of our Tontine, and that Auditor Phil Wood, electing not to participate, would hold and invest the funds.  There was also consensus that all participating would put up their first month’s officeholder salary, being $1,000 for each of us nine councilors. 

At that point Mayor Randle, being a good Democrat who was liberal with other people’s money but conservative with his own, dropped out when he realized his required contribution would be near $6000.  After some discussion about the likelihood that only one of us would still be living in twenty-five years Mayor Randle offered a second criteria that might accelerate the determination of a winner.  Each councilor would make a prediction that the whole group had to agree could happen in the next twenty-five years; and if a councilor’s prediction in fact did happen, then that councilor would be eliminated from receiving the Tontine investment.  It was also agreed that the twenty-fifth anniversary lunch when we would gather again would be paid for by the winner.

Those twenty-five years passed all too quickly and on May 7, 2015 at a luncheon to celebrate the 25th anniversary we had the opportunity to determine if there was a winner of the Tontine.  All current and former elected officials who had served under the Mayor/Council form of government that began in 1990 were invited and most were in attendance.  When the time came to consider the status of the Tontine it fell to me as the Chair of the first City Council, and obviously one of the surviving charter members, to announce the results in council district order:

Council District 1, Rev. B. S. Roberts, respected minister, civil rights leader and a true gentle giant, was deceased;

Council District 2, Darla Hall, lifelong West Tulsan and owner of a successful insurance agency, was deceased;

Council District 3, Dorothy DeWitty, gifted educator, retired school principal and community advocate, was deceased;

Council District 4, Gary Watts, whose prediction was “An African American will be elected President of the United States”, so I was disqualified;

Council District 5, Robert Nelson, small business owner who often displayed his gift for timely humor, was deceased;

Council District 6, James Hogue, attorney who was subsequently elected to a District Judge post, was deceased;

Council District 7, John Benjamin, whose prediction was “It will be legal for two men to marry in the State of Oklahoma”, delivered with a wink in my direction, so he was disqualified;

Council District 8, Richard Polishuk, whose prediction, resisted by the rest of us until we relented due to time constraints, was “The Vice President of the United States will shoot a man in the face and still remain in office”, so he was disqualified;

Council District 9, then current Mayor Dewey Bartlett, whose prediction, made after he consulted Terry Simonson outside our luncheon room, was “The elected officials of the City of Tulsa and County of Tulsa will work harmoniously together for the consolidation and efficiency of all local government services and betterment of the lives of their citizens in the metropolitan Tulsa region”, which clearly has not happened, so he was effectively the last one standing and winner of the Tontine.

However, it then fell to me to inform Dewey Bartlett that our beloved Auditor Phil Wood, who was deceased, in a weak moment during the late 1990s had sought investment advice from then Councilor Sam Roop who recommended he put it all in WorldCom stock.  Therefore, at the conclusion of the 25th Anniversary luncheon, Dewey received no payoff but was given the invoice for the cost of the luncheon.

If you are still reading and still believing, be careful when you start walking—you may find one leg longer than the other.

Lunch is on me if you are the first to identify with some specificity the location of the photo above of the first eleven elected officials under the new city charter.

 

 

 

 

 

O Regulation! My Regulation!

IMAG0071 (1)

I have a little personal story to share about how government regulations have rescued me from my own lapse into limited-thinker status while vacationing this summer and so was determined to link my story to some silliness put out by the Oklahoma Council of Public Affairs.  It didn’t take long to find a post on October 14, 2016, “Free Market Friday:  A Simple Truth” by Jonathan Small, President of the OCPA.  He relays “According to a study by the Small Business Administration, federal regulations drain from $1.75 trillion to $2.02 trillion from our economy each year.”  When I searched for the study here is part of an official statement of clarification about the study that appears on the SBA website, “However, since the latest iteration of the study was released, the findings of the study have been taken out of context and certain theoretical estimates of costs have been presented publicly as verifiable facts.”  Say it isn’t so; surely the President of the OCPA wouldn’t take findings of a government study out of context and present them as verifiable facts.

I can’t wait to read the entire report, something I doubt anyone at the OCPA has done, because they would have noticed the part where the authors say, “This report does not address the benefits of regulation, an important challenge that would be a logical next step toward achieving a rational regulatory system.”  It’s like if Mr. Small told us that Amazon took $5,000 from him on Cyber Monday—shocking that a big bad corporation would rob an individual of his hard earned cash—leaving out the part about the big screen TV, new computer and other gadgets soon to be delivered to his house.  And I bet no sales taxes were collected.  After I read the report I’ll have more to say in a later post.

Now for my story of shame and redemption.  Over the last 35 years Linda and I have enjoyed many interesting travels to all 50 states and a few foreign countries.  Most of our trips involved flying to a destination and then renting a car.  Being a good econ, a rational decision-maker, or as my Italian daughter-in-law describes me, a pidocchioso (Italian slang for “stingy or cheapskate”), I always look for a low cost rental.  Knowing that the comprehensive and collision coverage through my auto insurance, as well as using a credit card that promised the same, would cover any damage to the rental car, I always decline the “full coverage” they try to frighten you into when picking up your car.  Their scare tactics did succeed in making me focus on the part of the routine where you carefully document existing scratches and dents to the vehicle—quite common with the rentals we used.

I’m guessing we have experienced at least 100 rentals over those years, including a couple of broken windows and flat tires, but the only times I paid more than the contract price were once when I returned a car inside the Chicago loop with a mostly empty tank after an out and back day trip to the highpoint of Illinois, then learned the contract estimated gallons used based on miles driven so I bought a couple of tanks at inflated prices, and again when I thought a parking ticket wouldn’t catch up with me in San Diego—lessons learned.

Now for my sad story beginning with our visit to see our son and his sposa in San Diego this past June.  We have usually rented a car when in San Diego, both for convenience and to take side trips to near attractions like Julian and Palm Springs during the work, from a variety of discount agencies like Fox, ACE, Payless, etc.  This visit the best deal was with Payless which we had used often enough that the agent didn’t even press me when I declined the insurance coverage.  This was my first time at the new multi-story shared facility that has replaced the many scattered rental locations near the airport.  I checked in on the first floor then went with the paperwork to the third floor to collect our car.  The attendant there handed me the key and told me the car’s location.  I found the Hyundai Accent, drove to their check-out line for the inspection, and then left.  After a nice week with our children just hanging out close to their house we returned the car to catch our flight, replacing all the fuel we used that week on the way for $13.23 at California prices and paying exactly the amount agreed, $142.95, for the week rental.

Mid July I was checking my Discover card activity online; this is a card I have used regularly, most years as my primary card, since 1987.  The econ in me likes their business model—easy to claim cash back with no overbearing promotion of confusing points, etc.  What I found, in addition to confirming the $142.95 for the rental, were two charges on July 11, more than two weeks after we had left San Diego, by Payless for $55.56 and $472.48.  I called Payless for an explanation.  The manager informed me that my rental car, on the Friday evening before we left on Sunday, had been identified by FasTrak, California’s equivalent of PikePass, for violating a 75 cents toll outside of San Francisco.  I informed them that there must be some obvious mistake because we had driven less than 150 miles total and never left San Diego with the car.  I asked for the documentation they had and, remembering their check-out procedure, asked that they review their records to see if they had our vehicle’s paperwork switched with a different Hyundai Accent.

After that unpleasant phone conversation I immediately went online to dispute both transactions.  The $55.56 was for their “administrative cost” in handling the notice of the toll violation.  The $472.48 was an assessment for miles driven outside the rental area of Southern California.  I had not paid attention to that or to the 150 miles per day (1050 total) restrictions because we were not going to drive much and were staying in the city.  If the car was driven outside Southern California the contract provided that all miles driven would be assessed at 35 cents per mile.  Their version of the final contract showed the car driven 1101 miles, 51 in excess of the allowed miles, and not enough to support $472.48 at 35 cents per mile.  They never explained how the amount was calculated or why I wasn’t charged for the 51 excess miles when I returned the car.

IMAG0054  Me and the car at the base of Mount Soledad

The disputes I filed with Discover were pursuant to the Fair Credit Billing Act and attendant regulations of the Federal Trade Commission which is responsible for its enforcement.  Upon filing the disputes, the two charges were immediately credited back to my account pending investigation of the matter.  I submitted what documents I could find:  the gas purchase receipt and a Friday evening restaurant meal signed receipt, both with my Discover card, the photo above of our car which was blue contrary to the contract which said gray, and my Friday golf green fee receipt; and offered eye witness testimony from the four of us that the car never left San Diego.

The Discover representatives said none of that was relevant; all they could consider was the contract with my signature and the same tag number as the car that violated the toll.  But, I argued, if the problem began because Payless gave me the keys to the wrong Hyundai Accent there is no way I can prove otherwise if all you consider is the contract that identifies the wrong car.  My lawyer brain spun several times over the realization that eyewitness testimony has been accepted for over two hundred years in this country to send people to prison and their deaths, too many times in error, but Discover would not consider it concerning a $525 billing dispute.

The two charges were then re-posted to my account and I was left to consider my options.  One was to sue Payless but the venue would be San Diego County and, even though my son is a lawyer, the expense of travel, cost of litigation and time involved are all reasons not to do that and reasons why the Fair Credit Billing Act was enacted to regulate resolution of these kinds of disputes where the consumer otherwise has little practical recourse.  Another was to let Discover try to collect from me, an option that would probably work for someone like me who could withstand the little damage it would do to my credit rating because I have no need to borrow money and already have other credit cards to use for convenience.  I chose the latter but also decided to avail myself of one more regulatory option—the Consumer Financial Protection Bureau that is one legacy of the Great Recession.

I went on the CFPB website and filed a complaint against Discover for failing to conduct a “reasonable investigation” concerning my dispute with Payless as required by the Fair Credit Billing Act.  That resulted in both charges being reversed again pending investigation of my CFPB complaint by Discover’s “executive offices” which also gave me a single point of contact with Discover.  I don’t know if this new investigation would have yielded a different result because at this same time something completely different happened—I got notice from FasTrak that the 75 cents was still due.

I had wrongly assumed that part of the $55.56 was 75 cents that Payless paid to FasTrak to clear the toll violation.  While pondering my response to FasTrak, I noticed something huge—the car tag on the Payless contract and FasTrak notice is 7E JE933, but the photo image used by FasTrak shows 7F JE933.  I filed an online dispute with FasTrak about that discrepancy (when I pointed this out to Discover they said the photo was not clear) and about two weeks later FasTrak expunged the violation.  I provided copies of the expunging email to both Discover and Payless because this unpaid toll was their “proof” the car I rented from Payless was driven outside of the permitted area.  I heard nothing from Payless but, about four and a half months after this all began, received notification from Discover that both charges were removed.

Without the FCBA and the CFPB I would probably be waiting for Discover to sue me or, a choice most consumers would not have, using my parental influence to have my son sue Payless in San Diego.  But what about the huge cost to our economy that worries Mr. Small and the OCPA?  The regulations are a burden or cost to Discover.  Revenue to pay that burden comes from merchants, like Payless, who give Discover a percentage of the transactions it processes.  Standard business practice among rental car companies encourages customers to use a credit card rather than cash or debit card for the simple reason that it offers easy protection, up to the customer’s credit limit, for damage to the rental car.  Seems one could almost argue that the regulatory environment works to the advantage of the rental companies, as well as consumers, by providing each with protections around a transaction that is fraught with risk.

It’s like Amazon taking that money from Mr. Small on Cyber Monday—he’s not complaining because he got value in exchange.  Maybe Discover would like to do away with the FCBA and the CFPB, but Discover passes the regulatory cost on to Payless that in turn passes it on to its customers who in turn should be damn glad to have the protections that facilitate commerce throughout our country which benefits Discover and Payless as well.  And when you rent a car confirm the license plate because it could be different than what is on your contract.

Lunch is on me if you are the first to ID the location of the top photo.  In honor of Jonathan Small and the OCPA a clue is the word Liberty.

 

 

The Glib, The Bad and The Ugly

imag0153

Now that State Question 779 has failed there is a lot of talk about a teacher pay raise being front and center in the upcoming legislative session.  That is a good thing but is also a real challenge in face of yet another looming revenue shortfall, a state constitution that requires a three-fourths majority in both houses to increase revenue (thanks to SQ 640 enacted as revenge for House Bill 1017; see my 9/5/2016 post “Once Upon A Time”), and a legislature populated with limited-thinkers who have systematically slashed our state’s tax base believing that would somehow fix all of our problems.  I wish the legislature success; we need to take care of our teachers.  It will take bold action and big ideas to get it done.  One place the legislature should NOT look to for big ideas to fund a teacher pay raise is the Oklahoma Council of Public Affairs.  In prior posts I have analyzed and critiqued three of their big ideas which I call the Glib, the Bad and the Ugly. 

The Glib is for the proposal by Dave Bond, CEO of OCPA Impact, whatever that may be, which I addressed over three posts:  8/31/2016 Waiting for Dave Bond, 9/3/2016 Something Special, and 10/4/2016 Done Waiting for Mr. Bond.  The applicable definition of “glib” is “said or done too easily or carelessly; showing little preparation or thought”.   In summary Dave Bond appeared on statewide television, KOTV’s two-hour special program “Educate Oklahoma” and told Scott Thompson and us that due to recent legislation $100 million in savings on employee health insurance would soon be available for teacher pay raises.  Upon examination of the legislation the $100 million he promised is available simply vanished into his own glibness and, I presume, his ignorance of state employee health insurance reality.  So forget about advice from limited-thinker Dave Bond who just makes stuff up.

The Bad is for the proposal by Steve Anderson, OCPA Research Fellow, in his post “Why Are School Districts Sitting On So Much Cash?”, which I addressed over two posts:  8/10/2016 Where to Begin? and 8/11/2016 Paradox of Thrift.  The applicable definition of “bad” is “of poor quality; inferior or defective”.  Mr. Anderson’s illuminating “research” consisted of spending a little time on the State Department of Education’s website and totaling up all the June 30 cash balances for Oklahoma school districts at $1.9 billion.  The clear message from Anderson to limited thinkers in the legislature is there is plenty of money already available for teacher pay raises or any other education priority so quit thinking about it and just do it.  As I point out in my posts if Mr. Anderson would do real research, instead of just reporting simple arithmetic, he would understand that on June 30 each year school districts are contractually obligated for most of their teachers’ salaries for the ensuing fiscal year but are not required to “encumber” those amounts due to a constitutional exemption and State Department of Education accounting standards.  If these amounts were encumbered on June 30 then I suspect all of the “unencumbered cash” Mr. Anderson reports is available would disappear from school districts’ general fund balances.  The “unencumbered cash” in other funds cannot lawfully be used for teacher salaries and, even if fund balances are available, using one-time funding for annually recurring expenditure increases is not smart budgeting (for example, just because you have $500 in the bank to cover the first month’s rent increase doesn’t mean you can upgrade to a new apartment where the monthly rent is $500 more than you currently pay).  So forget about advice from limited-thinker Steve Anderson whose “research” is so defective it does not provide useful information upon which to develop financial policy.

The Ugly is for the reports by Benjamin Scafidi referenced by OCPA Senior Vice President Brandon Dutcher in a couple of blog posts which I addressed in my posts on 9/5/2016 Once Upon A Time, 10/11/2016 A Dirge for a Surge and 10/25/2016 Purging the Surge.  The applicable definitions of “ugly” are “frightful, dire”; and “likely to cause inconvenience or discomfort”.   Mr. Scafidi’s research documents that the increase in public school district employees across the country over the past 50+ years has greatly outpaced the increase in the number of students.  Further it documents that the increase in the number of “Administrators and other Non-Teaching Staff” has outpaced the increase in the number of teachers.  This leads Scafidi and Dutcher to the conclusion, duh, that if school districts will simply lay off enough non-teaching personnel that will free up funding for a teacher pay raise.  Unlike Mr. Bond’s fictional $100 million and using Mr. Anderson’s exaggerated one-time cash fund for recurring expenditures, the Scafidi/Dutcher plan can actually work.  Of course their plan at the outset understates the numbers of “Administrators and other Non-Teaching Staff” that will need to be laid off and they have not shared what actual work that is done by these school employees that should be eliminated or shifted to other personnel (teachers, get ready to drive buses and clean your classrooms).  The clear implication by leading with “Administrators” is that the growth in “administration” is where the waste is.   My educated guess is real research would demonstrate that even if you eliminate every non-mandated certified administrative position (picture a 1000 student high school with no assistant principal) AND paid the remaining certified administrators off the teacher pay scale in Oklahoma, there still would not be adequate funding available for a $5,000 teacher pay raise.  So let’s see the legislature do the hard work to determine that students living within 3 miles of their school will no longer have bus transportation, that early childhood programs will have classes of 20+ students without any teacher assistants and that school classrooms will not be cleaned daily unless the teacher does it.  It can work but it will be dire, discomforting or inconvenient at best.

Lunch is on me if you are the first to identify the location of the photo above.

 

 

 

     

Purging the Surge

imag0166  Fort Mackinac, Mackinac Island, MI

Actually I am not sure what this title means except that I hope to clean up some of the possible misinformation coming from Benjamin Scafidi’s work that is heavily cited by the OCPA.  I tackled his Surge 1 in my October 17, 2016 “Dirge for a Surge” so now will tackle his Surge 2.  This work built on the first by providing state by state information; specifically, he points out that from FY 1992 to FY 2009 Oklahoma’s “Change in Students” was 10% compared to a “Change in Administrators and other Non-Teaching Staff” of 28%.  His source is the U S Dept of Ed’s National Center for Education Statistics.  He goes on to do the math that at $40,000 each, if the growth in administrators and other non-teaching staff had only been 10%, then there would have been enough funding, about $230,000,000 each year, for teachers to get a $5,000 pay raise.

My critique of Surge 1 was that using the terminology “Administrators and Other Non-Teaching Staff” was intentional on his part to lead the reader to believe that the primary growth has been in administrators when I suspect it has been among the major support personnel categories of teacher assistants, food service workers, bus drivers, etc.  I argued that unless you pinpoint what job categories make up the growth and examine what laws, policies, and other factors have caused the increases, his Surge research merely crunches numbers without providing thoughtful policy direction.  I also disputed his use, which I think was in the spring presentation to OCPA, of $50,000 per non-teaching employee to come up with a $7,000 raise for teachers (lay off TA’s, bus drivers and food service workers and give teachers a raise!).  He uses $40,000 in Surge 2. 

Others have critiqued his work for similar reasons.  At the end of Surge 2 is his rendition of five categories of critiques that he received, it’s supposedly an academic paper, and his responses.

To put more of a face on this data, which deserves consideration by policy-makers, I tallied the current full time staff, numbering 603, at Sand Springs Public Schools by general job category.  Here’s the list:

317 Teachers (includes all certified personnel defined as teachers by law and OCAS coding, i.e. classroom teachers, counselors, therapists, nurses, librarians, etc.)                 

286 Administrators and Non-Teaching Personnel, specifically:

27 Administrators (serving 11 separate instructional sites)

82 Teacher Assistants (in the classroom)                                     

54 Food Service Workers                                                                 

36 Bus Drivers                                                                          

35 Building Custodians                                                                      

32 Office Workers (school sites and central administration)              

12 Maintenance, Warehouse and Mechanics  

4 Information Technology

4 Security Guards                

The total of the “bad” employees is 286; less than 10% of that number are administrators.  Why does Scafidi lead off that category with Administrators unless he is trying to bias the reader?

Most of these support personnel are employed only when students are in school, like teachers, on 180 day contracts.  While their hourly wages may be competitive in the marketplace, their total compensation is reduced significantly as a result.  If Scafidi would do the work he would find, at least in Oklahoma, that support personnel compensation (I mean total cost) is likely more in the range of $25,000, not $40,000.  Throw in 10% of administrators at $75,000 each and you end up with an average of $30,000, well under his $40,000 figure he uses to say we could give teachers the $5,000 raise.

Still it would be something.  Yet another way to look at this, using SDE Annual Report numbers shows ADA grew from 1992 at 556,608 to 603,409, an 8.4% increase (Scafidi’s figure is 10%) while “certified staff” (not FTE) increased from 44,164 to 52,167, an 18.1% increase.  This seems consistent with his central thesis that more and more adults are not getting the job done, if you believe the job is not getting done.  It also says that the student to certified staffing ratio fell from 12.6 to 11.6 over that 17-year period—should we expect that to be a game-changer?

In an earlier blog post I point out that part of the HB 1017 reforms of the early 90s was to expand early childhood education, which requires teacher assistants, and to lower class sizes, for which teacher assistants can be used as a safety valve.  If policy makers think there are too many adults, don’t whine about it, do the hard work and tell school districts what services to reduce, like school meals that are mostly paid for with federal funds that would disappear with the workers, early childhood education, or maybe convenient school bus service that working parents rely on.

Remember lunch is on me if you identify the photo location.  ID’d by Gretchen Hannefield.

    

A Turkish de Fright

imag0148  Wisconsin State Capitol in Madison

My experiences with Oklahoma charter schools began the first year (2000 I think) that charters were granted when, as an attorney with the Riggs Abney firm, I began providing services to Dove Science Academy.  For several years working with successive executive directors/principals who were immigrants from Turkey I just thought these leaders were clever men who had found a way to make a living and stay in the United States after completing their college education at places like Oklahoma State.  Some years into my work with Dove Science Academy I became aware of the fact that Dove was part of a loose network of schools, including the Harmony charter schools in Texas, that were inspired by the work of a Turkish cleric named Fethullah Gulen.  Nothing I learned caused me any concern, rather it made me curious to learn more about him when I could find the time.  All my interactions with the leadership of Dove, and later Discovery Schools of Tulsa, were with men and women who were wholly committed to educating the children of Tulsa parents who chose to send them to these charter schools.  I ended my legal representation of Dove, Discovery and another charter school in 2013 partly to free up more time for other activities, including learning more about the Gulen Movement or Hizmet as it is also called. 

Last Thursday Linda and I attended a lecture “Turkey Democracy in Peril” given by Dr. James C. Harrington, founder of the Texas Civil Rights Project, and hosted by The Dialogue Institute, a part of the Gulen Movement.  The President of Turkey Tayyip Erdogan has blamed the Gulen Movement for the unsuccessful and violent coup attempt in July, which the Movement has denied.  President Erdogan has also demanded the extradition of Fethullah Gulen back to Turkey from Pennsylvania where he has been in self-imposed exile since 1999; to date the U. S. Government has insisted that Turkey must show proof that Gulen was involved in the coup attempt and is following the standards of American due process that protect legal residents as well as citizens in our country.  In the aftermath of the coup attempt thousands of police, teachers, military and even judges who are suspected of being Gulen Movement sympathizers have been removed from their jobs and in some cases even jailed.  If you are interested in all of this I encourage you to look at websites connected to the Gulen Movement and also to read the October 17, 2016 New Yorker article “The Thirty-Year Coup”.

The following day, Friday the 14th, I was in the courtroom of Oklahoma County District Judge Patricia Parrish to participate in a hearing on motions filed by both sides in the OTC Motor Vehicle Collections lawsuit I described in my 6/22/2016 Post “HB 2244”.  It was a pleasure to watch Judge Parrish work through her motion docket; she was well-prepared and respectful of all parties.  I couldn’t help but reflect on how valuable it is to all of us, and especially for those who have enjoyed the greatest economic success in our country, to have matters of controversy decided by judges who generally are unbiased and committed to fair treatment of all parties, even the least among us.  Unlike the remaining judges in Turkey who have not lost their positions for being supposed Gulen sympathizers, I doubt that Judge Parrish had any concern Friday that her decisions, or private beliefs, could cause her to lose her job the following week.  She ruled in favor of the eight plaintiff districts; I will post more documents on my “HB 2244” post and you can go to this link to see as well:  http://www.oscn.net/dockets/GetCaseInformation.aspx?db=oklahoma&number=CV-2016-1249

Saying nice things about a judiciary that just decided a case in favor of my clients may seem a little gratuitous, however it was not a fully successful week.  It had also been my pleasure early on to collaborate with the attorneys who represented the plaintiffs on behalf of the coalition Keeping Oklahoma’s Promises in litigation challenging the 2014 Legislature’s HB 2630 that places all new state workers into a defined contribution plan and phases out over time the defined benefit plan for state workers referred to as OPERS.  The plaintiffs alleged that the legislature had ignored its own law, the Oklahoma Pension Legislation Actuarial Analysis Act (OPLAAA), that requires a two-year process and serious actuarial analysis before making such a significant change to an Oklahoma pension plan.  The defendants maintained, and the Oklahoma Supreme Court agreed, that the Legislature, as a body, doesn’t have to follow its own laws.  You can read for yourself here:  http://www.oscn.net/dockets/GetCaseInformation.aspx?db=appellate&number=SD-114676&cmid=118391

Though obviously frustrating it is a fair decision and all the nice things I say above about Judge Parrish apply as well to our state supreme court.  The decision does not say that moving state workers to a defined contribution system is a good thing, rather it, not so simply, says that it is the Legislature’s choice.  For the reasons I point out in my August 24, 2016 Post “Lies, Damned Lies and Statistics” the Legislature made a bad choice.  It’s not that moving workers to a defined contribution system is bad in and of itself, rather by moving them away from a collective/group plan that has lower costs and higher investment yields they have assured that Oklahoma’s taxpayers will get less bang for our bucks invested in state workers’ retirement which remains an important means of recruiting quality employees to do the important work we expect from our state government.  The beneficiaries of the Legislature’s action are the local financial planners (some who are legislators) and Wall Street firms that will reap more fees and commissions from state workers who are now left to figure it all out on their own.

If the Legislature in 2014 had, in good faith and of its own volition, followed OPLAAA then it would have informed itself about the perils I discuss in “Lies, Damned Lies and Statistics” and perhaps it would have moved to a hybrid defined contribution plan that would retain the benefits to taxpayers and workers of being big and perpetual.  But it did not and instead it followed the simplistic game plan handed to them by the limited thinkers at OCPA.  See my first Post “Hello World” from June 20, 2016.

Cindy Kerr ID’d the photo.

 

    

A Dirge for a Surge

imag0172

Some weeks ago I promised to take a closer look at the work by Benjamin Scafidi with the Education Economics Center at Kennesaw State University in Georgia that was referenced in OCPA blogs on August 31 and March 4, 2016 by Brandon Dutcher.  You can find the Scafidi work by searching “The School Staffing Surge”—there are two reports and I’ve only looked at the first dated October 2012.

His reports document that over recent decades, going back to 1950, the growth in student population has been dwarfed by the growth in the numbers of teachers and even more so by the growth in the numbers of “Administrators and Other Staff”.  Those were the categories he referenced in his presentation to the OCPA last spring but I thought surely his academic work would show more detail.  It doesn’t.

That fact alone betrays Scafidi as something other than an academic scholar; rather he is in good company with the other limited thinkers at OCPA so likely they will tout his work again and again in the future.  The clear message he intended, probably before even starting his “research” was to produce a marketable piece showing how there’s plenty of money for teacher raises if only school districts would get rid of administrators (note how his category description is Administrators and Other Staff).

Having said that, the Surge in adult employment in our public school system certainly merits research and understanding.  However, throughout his first report the only external factor he refers to, and argues is not the cause, is No Child Left Behind.  What he doesn’t discuss is what makes up that “Other Staff”.

I’ll share exact numbers/percentages in the future about the Sand Springs Public Schools (will be interesting to check my memory), but here is the gist of what it will show.  During my ten years as its CFO the district employed between 600 and 650 full time employees.  The largest work group was certified teachers being about 350 I think; this number includes counselors, media specialists, nurses, etc. as defined in state law.  The second largest was classroom teacher assistants being about 100—that’s adults working with students assisting with classroom instruction Mr. Scafidi.  Then we had no more than 150 divided among three other work groups:  bus drivers, child nutrition workers, and maintenance and custodial personnel.  Administrators totaled about 25.

I was an elementary school student through most of the 1950’s in Tulsa.  I remember very large class sizes, especially library and gym class.  Breakfast was not served and seemed like more of us packed a lunch.  I never rode a school bus till I became an administrator at Sand Springs.  There were no students with disabilities in my schools and Kindergarten was half day—no four-year-old classes.

Without looking at each service now mandated for our public schools and the staff required to provide each service we can’t begin to understand why the overall numbers have increased.  Scafidi’s work poses a useful question, while implying an uninformed solution–get rid of all the unnecessary administrators.  As you can see from my estimates for Sand Springs, assuming a longitudinal look at its data would be similar to Scafidi’s numbers, getting rid of all administrators would not affect the trends appreciably.  The growth in “Other Staff”, the people who wipe noses, show flash cards, move children in their wheelchairs, clean the buildings at night, count the football game receipts, drive children safely to school, maintain the wifi, cook and serve meals, and other work needed to operate schools as expected and required, is what has given Scafidi and Dutcher their heartburn.  At least I’d be willing to bet my next state income tax cut that’s what real research would show.

If policy makers had that information, then we could thoughtfully consider our priorities for what we should expect of our public schools.  But no, that’s not why Scafidi and Dutcher are paid, to help improve government services; rather their mission is simply to bash anything government regardless of its value or service to our economy and democracy.  It’s a lot easier to do “research” when you already know your results.

More to come.  And as always lunch on me if you are the first to identify the photo location (in honor of our Presidential Election season).

Done Waiting for Mr. Bond

imag0139imag0141

Royals Stadium, Kansas City.  Oakland Athletics 16 – 4 victory.

My friend, colleague and extraordinary blogger (http://www.viewfromtheedge.net/) Rob Miller alerted me to content in a post by another friend, colleague and extraordinary blogger (https://okeducationtruths.wordpress.com/) Rick Cobb concerning Dave Bond, the OCPA fellow who told Scott Thompson on his fine program “Educate Oklahoma” that the legislature had made $100 million available for teacher raises through legislation sponsored by OCPA in 2015.  This time Mr. Bond was using a transaction at the Catoosa school district to demonstrate how there is lots of money available for teacher raises if boards and administrators would just make the right decisions.

But first that $100 million Mr. Bond promised.  I emailed him last week just to check in since we’d been away a couple of weeks and hoping to avoid more painful reading on the OCPA site.  So far no answer but today I notice this post from September 26:

Teachers Now Benefiting from OCPA Healthcare Proposal Thanks to the efforts of OCPA and some very capable lawmakers, many Oklahoma teachers and state employees will now see significant savings in out-of-pocket medical charges—while also saving money for taxpayers. Read now >> – See more at: http://www.ocpathink.org/post/freedom-flash-sept-26#sthash.UXGz5VOU.dpuf

And when you go to see more, drum roll please, here is what I found:

In 2015, OCPA pushed for the state to create HealthChoice Select, a program that could help teachers and other state employees save up to $30 million annually in out-of-pocket medical charges. Thanks to Rep. Mulready and Sen. Treat, this program is now a reality for 180,000 Oklahomans.

Which does seem to tie back to the House Bill 1567 Mr. Bond referenced in his email to me, see my Post “Something Special”.  However, I’m not seeing the $100 million for teacher pay increases.  Seems like Mr. Bond just made up “something special” just for Scott Thompson and the people of Oklahoma.

Move forward to Wednesday the 28th and Mr. Bond along with Shawn Hime of OSSBA and a couple of others appeared on the local FOX station in OKC for a forum on SQ 779—the penny sales tax for education/teacher raises.  You can access it at Rick Cobb’s October 2 post; I’m not savvy enough to link here.  The fun part is at about 1:05 I think.  The OCPA’s tact is that absolutely teachers need a $5,000 raise (they’ll forget all about that after November 8), but a tax increase is not needed because the money is already there.

I sure can’t find Mr. Bond’s $100 million and looks like neither can he.  But then there’s the grand study I referred to in my “Once Upon a Time” Post that I’m definitely going to get to soon that says school districts have hired bunches of staff, not teachers, over the last 30+ years and all that money could have gone to teacher raises.  My informed hunch is that when we examine the data we’ll see that the largest “non-teacher” employee growth has been with teacher assistants—who work directly in classrooms with children.

Back to the FOX forum, Mr. Bond, to show how money is readily available for teacher pay raises, used Catoosa as an example.  I’m not fact checking any of this but from his and Shawn Hime’s comments it seems this happened:

  1. Catoosa sold land for $700,000 and put it in the building fund.
  2. Catoosa in 2013 voted $900,000 of bonds to erect a press box at the football stadium which they planned to combine with the $700,000 for a $1.6 million project.
  3. It would cost $700,000 to give Catoosa teachers a $5,000 raise. Or maybe to restore a 5-day week since the 4 day week is only saving $200,000.

So Mr. Bond suggested Catoosa should do that and live with a $900,000 press box.  Mr. Hime came back at him saying it’s unconstitutional to use building fund money for teacher raises.  And Mr. Bond retorted he didn’t think anyone would sue over that.  Wow.

Food for thought:

I can’t cite this off the cuff but if the land sale was of land bought with bonds still outstanding then I believe the sale proceeds would first have to be used to retire the bonds.  However, from the comments I don’t think that applies.

Here’s the language in Title 70, Okla. Statutes, Section 1-117:

School districts which receive monies from rental, sale, or lease of buildings, impact aid monies, or grants, gifts or donations for capital purposes, whether from state, federal, or other sources, may place such monies in the building fund authorized by Section 1-118 of this title or the general fund authorized by this section.

So candidly it is not clear to me that Mr. Bond was proposing an “unconstitutional” act.  Even if the funds were restricted to building fund uses there is enough overlap in uses between the general and building funds (see Title 70, Okla. Statutes, Section 1-118) that for most school districts the $700,000 could be used to offset teacher pay increases from the general fund.

However, being legal doesn’t necessarily make it a good idea and certainly these facts are unique to Catoosa and cannot readily be applied to all districts.  The worst part about his proposal is to use one-time funds to finance a permanent teacher pay raise.  Any prudent superintendent and board would ask the question, OK Mr. Bond, your idea may get it done this year, but what about next?  Do we then sell the elementary school to keep the raises in place?

Rather it’s just more drivel from the OCPA, an imaginary $100 million here, an unneeded stadium press box there, and just lay off all the teacher assistants, then presto there’s your $5,000 teacher pay raise.

 

This post photo above is from our vacation through Oklahoma, Kansas, Missouri, Iowa, Wisconsin, Michigan, Indiana, Illinois, and back to Oklahoma through Missouri.  It’s a great country.  The event I was watching was as painful as an OCPA blog.  Lunch on me if you are the first to guess.

My good friend Jim Brown nailed the photo.  Heard today on NPR a state produced story linking recent and tragic Tulsa police shootings with memories of the 1921 Tulsa Race Riot.  Even though I attended Tulsa schools K-12 I did not learn about the riot until I taught at Wilson Junior High where Jim taught Oklahoma History to 9th graders and courageously included a unit on the Tulsa Race Riot.  He brought into his classroom riot survivors to share their memories with his students.

Lighthouses

imag0151

Eagle Bluff Lighthouse, Door County, WI

Linda and I returned over the weekend from a very enjoyable two-week car trip around Lake Michigan so even though I’m not quite caught up with other matters I have to post a quick blog so I can use one of the new photos.  While traveling I forced myself to read “Sales Tax for Education Would Generate Millions” by OCPA fellow Steve Anderson.  He and others at OCPA seem resigned to the passage of State Question 779 which is somewhat surprising and must frustrate them to no end—imagine citizens choosing to finance more government.  His post proposes ending the sales tax exemption for public schools in Oklahoma.  His only reasoning is:  “As conservatives, we believe that disincentivizing government spending is a good thing, not a bad thing.”  In other words if we just make public schools pay sales taxes then what they do will cost more and we’ll have less of it.

He later says:  “Moreover, private-sector companies pay these sales taxes.  Making the government pay them would help level the playing field.”  Sound economic theory informs us that it is important to “level the playing field” among competitors in the same market, but that it makes no sense when talking about the interaction of private sector companies with the government.  Milton Friedman must be turning over in his grave—though he has better use of his eternity than reading OCPA drivel.

The right way to approach government services in a market economy is to first determine what services are appropriate for government to provide, i.e. public education, then determine how much, i.e. what ages and academic standards, and finally determine how to do that most efficiently.  Public education is too complicated for a short or even one blog post so let’s look at another government service—lighthouses.

We spent a little time in Door County Wisconsin which has that name because the entrance to Green Bay was called the “doors of death” by the Native Americans and trappers in that area.  To make passage into Green Bay safer lighthouses were erected to orient sailors and warn of dangerous areas.  Lighthouses are a classic example of a service best provided by government for the simple reason that, unlike a movie in an indoor theater, it can be seen by all whether they have paid for it or not.    No one shipping company might have the resources to fund all the lighthouses needed for safety, and certainly would resist others benefitting without paying, so it has long been a natural for government to provide.

Having decided that government should erect lighthouses, then it must be decided where they will be located and how designed, constructed, etc.  Once those decisions are made then it makes sense to erect, operate and maintain the lighthouses as efficiently as possible so the fees and taxes needed are as low as possible.  Where in this scenario does it make sense to then impose a sales tax on the materials needed to construct them?  That would simply increase the cost and in turn increase the fees and taxes required for their construction.  I don’t get it.  I guess Mr. Anderson just wants fewer lighthouses, period, just because.

Remember lunch is on me if you are first to identify the photo location.  And by the way Dave Bond has still not explained where the $100 million for teacher raises he promised to Channel Six’s Scott Thompson and viewers—see my Something Special post.

***Gretchen Hannefield identified the photo***

House Bill 1017 25th Anniversary

imag0136

We’re approaching (Saturday, October 15, 2016) the 25th anniversary of the “No Repeal” vote on October 15, 1991 which sealed the implementation of what was arguably our state’s greatest legislative achievement—House Bill 1017 that Governor Henry Bellmon signed into law at Tulsa’s Marshall Elementary School on April 25, 1990.  The photo above is of some of the key players was taken at a recent gathering.  Seated is then Senator Penny Williams, next left is Cathy Newsome, then Judy Eason McIntyre who was a TPS board member at that time and later State Senator; back row from left to right are Gary Allison, Charlie Cantrell, Grant Hall, then Speaker of the House Steve Lewis, Beverly Hoster and Lee Clark Johns.  Of course Lewis and Williams were giants in the legislative effort; the others were core members of the Tulsa area citizens who led the NO Repeal effort that was an inspiring success.

The genesis of H.B. 1017 was the work of Task Force 2000, established by HJR 1003 in 1989, and appointed by Governor Bellmon, Speaker Steve Lewis and President Pro Tem Bob Cullison.  It was chaired by Tulsa businessman George Singer; other members included Howard Barnett, now President of OSU-Tulsa, then State Superintendent John Folks, Wilma Mankiller, Tulsa businessman Joseph Parker, Jr., and our last Tulsa County Superintendent Kara Gae Wilson (now Neal).

Governor Bellmon called the Legislature into special session on November 6, 1989 to receive the Task Force 2000 report “Oklahoma’s Public Education:  A Blueprint for Excellence” and to act on education reform legislation.  Beginning on November 15, when House Bill 1017, incorporating many of the report’s recommendations, passed the House but without the emergency clause, there ensued months of deliberations, conferences and votes (including a statewide teacher walkout in advance of the House passage of the emergency clause) with final Senate approval coming on April 19, 1990 and the Governor’s approval on April 25.

This historic education reform legislation included a funding increase initially of $230 million by a 1% hike in the income tax rate and 0.5% in the sales tax rate.  The funding legacy of HB 1017 is that in FY 2016 the “HB 1017 Fund” was $886 million, over 1/3 of public schools’ funding.  It also provided for greater equity in the funding formula to narrow the gap between property tax rich and poor districts.  The minimum teacher salary was increased from $15,060, in 1990, to $24,060, in 1995; it is now $31,600.

The funding also provided for greatly expanded early childhood education; mandatory kindergarten; school district consolidation incentives (resulting in a reduction from 609 to 550 districts); limiting class sizes to 20 for elementary and 140 per day for secondary teachers.  The reforms also included provision for teacher assistants, eliminating county superintendents, statewide curriculum standards, competency testing, college ready courses, alternative certification for teachers and mandatory professional development.  The existing teacher tenure law was replaced with providing for teacher dismissal due process hearings to be held before local school boards.

After passage of this landmark reform legislation, opponents organized and collected signatures on an initiative petition to repeal HB 1017.  Governor Bellmon set October 15, 1991 as the election date for State Question 639.  Statewide campaigns for Vote Yes Repeal and Vote No Repeal ensued.  On election day a record number voted with an especially huge turnout for No Repeal in northeast Oklahoma.

Result:   Yes  360,318  45.67%

No   428,680  54.33%

HB 1017 remains Oklahoma law.

Epilogue:   SQ 640 immediately circulated by opponents of HB 1017, passed with 56% of vote in March, 1992, requiring 3/4 vote of legislature to increase any tax.

Personal Note:   As a former school board member and elected city official I was so used to voting Yes on ballot measures that I reflexively did just that and, for the first and only time as a voting citizen, had to “spoil” my ballot and ask for another so I could vote No.

 

Once Upon A Time

IMAG0052

We’re approaching (Saturday, October 15, 2016) the 25th anniversary of the “No Repeal” vote on October 15, 1991 which sealed the implementation of what was arguably our state’s greatest legislative achievement—House Bill 1017 that Governor Henry Bellmon signed into law at Tulsa’s Marshall Elementary School on April 25, 1990.  Since this blog is supposed to be about correcting misinformation spewing from the other OCPA I looked quickly at their recent posts for a connection and it didn’t take long to find a connection.

Senior Vice President Brandon Dutcher, in anticipation of Labor Day, on a post dated August 31, 2016 alleges the Oklahoma Education Association, as a union for teachers, has failed them because teachers “should demand to know why an education system with $8.7 billion in total revenue last year, the most in state history, can’t seem to raise teacher pay.”  Click on “raise teacher pay” and you get his March 4, 2016 blog “The $7,000 Teacher Pay Raise That Wasn’t”.

I will have fun in the future fully vetting that post but the gist of it is that school districts across the country and in Oklahoma during recent decades have increased “non-teaching” staff at higher rates than the number of teachers.  If all those non-teachers had not been hired since 1993, at the rate of $50,000 each annually (you have to listen to the video for this number), then there would have been enough money to give Oklahoma teachers the $7,000 raise.  He even cites my district, Sand Springs, to illustrate this horrible imbalance.

For a very quick and dirty response I know that by far the largest work group of non-teachers at Sand Springs are teacher assistants and are second only to the number of teachers in the district.  A safe estimate we would use for the annual cost of a teacher assistant position was $25,000.  The next largest employee groups would be cafeteria workers, bus drivers and custodians, with virtually all, like the teacher assistants, working 180 day contracts.  Using a $50,000 average to get to the $7,000 raise makes no sense and is shabby math.

Now for the transition to House Bill 1017:  it promoted the use of teacher assistants as a cost effective way to provide more individualized services to younger students because the expansion of Kindergarten and 4-year-old programs were two of its primary reforms and are probably the largest drivers of the increase in teacher assistant positions.  The genesis of H.B. 1017 was the work of Task Force 2000, established by HJR 1003 in 1989, and appointed by Governor Bellmon, Speaker Steve Lewis and President Pro Tem Bob Cullison.  It was chaired by Tulsa businessman George Singer; other members included Howard Barnett, now President of OSU-Tulsa, then State Superintendent John Folks, Wilma Mankiller, Tulsa businessman Joseph Parker, Jr., and our last Tulsa County Superintendent Kara Gae Wilson (now Neal).

Governor Bellmon called the Legislature into special session on November 6, 1989 to receive the Task Force 2000 report “Oklahoma’s Public Education:  A Blueprint for Excellence” and to act on education reform legislation.  Beginning on November 15, when House Bill 1017, incorporating many of the report’s recommendations, passed the House but without the emergency clause, there ensued months of deliberations, conferences and votes (including a statewide teacher walkout in advance of the House passage of the emergency clause) with final Senate approval coming on April 19, 1990 and the Governor’s approval on April 25.

This historic education reform legislation included a funding increase initially of $230 million by a 1% hike in the income tax rate and 0.5% in the sales tax rate.  The funding legacy of HB 1017 is that in FY 2016 the “HB 1017 Fund” was $886 million, over 1/3 of public schools’ funding.  It also provided for greater equity in the funding formula to narrow the gap between property tax rich and poor districts.  The minimum teacher salary was increased from $15,060, in 1990, to $24,060, in 1995; it is now $31,600.

The funding also provided for greatly expanded early childhood education; mandatory kindergarten; school district consolidation incentives (resulting in a reduction from 609 to 550 districts); limiting class sizes to 20 for elementary and 140 per day for secondary teachers.  The reforms also included provision for teacher assistants, eliminating county superintendents, statewide curriculum standards, competency testing, college ready courses, alternative certification for teachers and mandatory professional development.  The existing teacher tenure law was replaced with providing for teacher dismissal due process hearings to be held before local school boards.

After passage of this landmark reform legislation, opponents organized and collected signatures for an initiative petition to repeal of HB 1017.  Governor Bellmon set October 15, 1991 as the election date for State Question 639.  Statewide campaigns for Vote Yes Repeal and Vote No Repeal ensued.  On election day a record number voted with an especially huge turnout for No Repeal in northeast Oklahoma.

Result:   Yes  360,318  45.67%

No   428,680  54.33%

HB 1017 remains Oklahoma law.

Epilogue:   SQ 640 immediately circulated by opponents of HB 1017, passed with 56% of vote in March, 1992, requiring 3/4 vote of legislature to increase any tax.

Personal Note:   As a former school board member and elected city official I was so used to voting Yes on ballot measures that I reflexively did just that and, for the first and only time as a voting citizen, had to “spoil” my ballot and ask for another so I could vote No.

Remember lunch on me if you guess the photo location.