FinCom's four seconds of misconduct

(This is Part Two on Acton's Special Town Meeting (STM) of November 10, 2015 which approved two union contracts, articles four and five. Part one (http://www.actonforum.com/story/bos-gets-union-contract-costs-wrong-stm) focused on the actions of the Board of Selectmen. This article looks at FinCom's role.)

Annual Town Meeting (TM) is held in April each year, but when important issues come up during the year, the Board of Selectmen (BOS) can call a special town meeting. Once such a meeting is called, the BOS often puts on any other timely warrant articles for TM's consideration. This year, we had 13 warrant articles, which is quite a lot. But that is no excuse not to treat each one seriously by our town boards.

Two of the warrant articles, numbers four and five, were of vital importance. These were two municipal union contracts which needed approval from Town Meeting to be ratified and implemented. The two unions were small, comprised of the Superior (police) Officers, with eight employees, and AFSCME, which negotiates for the town's 27 highway, municipal properties, and cemetery workers. The Town of Acton has over 200 workers (earning more than $10,000 per year) and several times that number of school employees.

For a copy of the STM warrant, see page 10 here: http://www.acton-ma.gov/ArchiveCenter/ViewFile/Item/7371

Union contracts are typically negotiated every three years. State law dictates that Town Meeting needs to vote to ratify municipal union contracts, with the first year's funding serving that purpose. Once that first year is funded, the other two years are guaranteed. And state law also dictates that contracts remain in effect until new ones are approved. Pay increases in new contracts are usually retroactive to when the old contracts expired.

So the decision to grant raises to an employee group is a decision that has ramifications beyond the initial year. Perhaps more importantly, however, the unions work together and use each other's collective-bargaining gains. So if the firemen get a 3% raise, you know the other town workers will ask for the same (or more.) For this reason, the town and school used to have a strategy of getting all the union contracts to be approved at the same time, but that seems no longer to be a priority.

The Board of Selectmen negotiates the municipal union contracts. Once an agreement is reached, the BOS collectively and the members individually are obligated to publicly support the negotiated agreement. They can't go to Town Meeting and speak against the agreement, for example. If any speaker gets up and urges defeat, the BOS cannot even remain silent but must rise to defend the negotiated agreement. So the Town Meeting presentation by the BOS on these union contracts is, by definition, supportive of passage. To do otherwise could subject the town to a lawsuit over an "unfair labor practice."

Since negotiations are done behind closed doors, how does the public know about the details of these agreements, and who informs them about whether they should be supported and funded, or perhaps voted down which would send the negotiators back to the table?

It can't be the Board of Selectmen, because their hands are tied. They must be supportive, so they can't give an objective opinion. And Town Meeting certainly cannot investigate this, especially when there is zero information given out in advance.

So the only group that has the expertise and (theoretically) the independence to review these proposals is the Finance Committee (FinCom.) And they are given that role in the Town Charter's bylaws, which state: "B3. Duties of the Finance Committee-- The Finance Committee shall consider any and all municipal questions for the purpose of making reports and recommendations. Without restricting the general intent of the foregoing, the Finance Committee shall include in its duties the review of and recommendations concerning the budget for the annual meeting, the review of and recommendations concerning any other matter of a financial nature arising at the annual meeting or at any special meeting, and the preparation of long range fiscal plans for the Town."

At the STM, the FinCom urged Town Meeting to approve Article Four. What was that recommendation based upon? To find out, we need to watch the FinCom meeting a week before the STM in which the Committee heard a presentation from the BOS on these articles, held its discussion, and then voted its recommendation.

FINCOM COMMITS GROSS NEGLIGENCE IN RECOMMENDATION VOTE

At the Finance Committee meeting of November 3, 2015, FinCom heard from the Town Manager on the warrant articles that were being recommended by the BOS. I watched the first half-hour or so of the meeting when they discussed Articles Four and Five, which were the two union contracts, and voted their recommendations. You can see the meeting on Acton TV here: http://actontv.org/on-demand/post-video/finance-committee-meetting-11-4-...

Town Manager Steve Ledoux gave his brief presentation and stated the cost for the current year to fund the contracts and the raises to the COLA for the three contract years (this year and the next two) and that was about it. He gave no information about any longer-term costs. And incredibly, there was no financial information about these contracts handed out or electronically transmitted to the Finance Committee, according to FinCom's Chair. So the FinCom was being asked to recommend warrant articles which would have a profound impact on Acton's finances not just for the next year, or even the next three years, but for many years into the future. And these decisions also impact all other collective-bargain negotiations that the town and school do. In other words, this is exactly the type of issue that FinCom would need to focus on, because it clearly and unambiguously falls within its role in the Town Charter, which is to look at and give its opinion to Town Meeting on matters that have long-term financial implications.

FinCom members asked a few questions. One member asked how the COLAs compared to inflation, and was told that the Consumer Price Index (CPI) was calculated at 4.3% over three years, compared to a raise for the workers of over 7% over three years. No one asked why the COLA being given to the workers wasn't the same or lower than the CPI rather than almost twice as much.

Nobody asked how much money the workers would be getting in extra stipends or step raises. No one asked how the workers' earnings compared to similar jobs in other towns or in the private sector. No one asked about the value of benefits and how much they were increasing. And no one asked why they weren't being given adequate financial information to vote their recommendation.

A couple of members did say that the warrant did not print enough information and that the process should be improved. But then the Committee voted unanimously to recommend both warrant articles.

This is about the clearest example I have ever seen of a dereliction of duty by our Finance Committee. I don't know what is worse, to make such a decision without having such vital information available, or to not know they were missing it.

Not having the basic information printed in the warrant was a big clue that something was amiss. But when Town Meeting came and there was still no information forthcoming, why didn't all of the FinCom members immediately huddle and withdraw their recommendation?

FinCom also learned that at least one of the contracts was negotiated and finalized over the summer. Why didn't some members vote against the recommendation because the town clearly dragged its feet in presenting the details in the warrant, let alone to the FinCom?

How about when Selectman Berry made his presentation and announced the three-year cost of the new contracts, information which was not presented to FinCom prior to TM? Didn't anyone realize that the math Berry was using to calculate the cost of the contracts was off by a factor of two? After all, these members are all supposed to be finance experts, right? Yet nobody got up to ask a question or make a comment or to point out that TM was about to approve over $400,000 in raises over three years, not $200,000.

FinCom's only speaking role during the presentation of these articles was for four seconds. They urged Town Meeting to approve Article Four (they never even spoke about Article Five). Here is the link to the Special Town Meeting on Acton TV: http://actontv.org/on-demand/post-video/town-meeting-11-10-15mp4-1447281004. Articles Four and Five with Selectman Berry's presentation start at 1:24:05 and the FinCom's four seconds of fame are at 1:33:00.

Town Meeting members cannot delve so deeply into an issue like this, especially since there was no information whatsoever given in advance. Literally all of the information, as paltry and misleading as it was, was announced during the presentation. So Town Meeting members have to assume that the details were examined and reviewed by FinCom in advance, and that FinCom used its judgment in making a decision to positively recommend a warrant article. In short, Town Meeting trusted FinCom to do its job.

FinCom failed them. And they failed the taxpayers of Acton who are now stuck with two more three-year contracts with more largesse surely on the way.

Town Manager Ledoux said there are still two union contracts in negotiation. Do you think the raises given will be lower than what Town Meeting just approved?

HOW COULD THIS HAPPEN?

You might wonder how such a terrible job could be done by nine dedicated volunteers who are charged with looking out for Acton's long-term finances by our Town Charter. You might wonder why none of them seem concerned about raises that seem too high given the economy and inflation, and given Acton's extremely high property-tax burden already. You might wonder why something as important as precedent-setting union contracts wouldn't be getting closer scrutiny by the only public body that could independently speak out on the issue. You might even assume, if you just went to Town Meeting, that all of this had been done behind the scenes and the FinCom reached a researched opinion that formed their recommendation.

The answer why none of these things were done will be covered in the third part of this series.

FOR PART THREE, CLICK HERE: http://www.actonforum.com/blogs/allenn/boxboros-fincom-commits-heresy

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