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Daniels Mayor of Troy January 7, 2012
Troy Multi-Modal Transit Center Position Paper
As the duly elected Mayor of the City of Troy, Michigan, I feel compelled to have my opposition to the construction of what is called the Troy Multi-Modal Transit Center project read in to Public Record so that the citizens of Troy, Michigan will have this information available to them for all time. The following information has been gleaned from documentation provided to me as Mayor of Troy and from various published information found on the Internet; however, all expressed ideas, thoughts and ascertains are my personal beliefs that are protected under the First Amendment to the United States Constitution as a lawful American citizen. It is my expressed opinion that the entire project's business model is fundamentally flawed. The information that has been disseminated by the Troy City Management has been politically one-sided in support of this project. The documented costs to the taxpayers of Troy have been a moving target at best and purposefully understated at worst. The use of any amount of federal funds from a government that has increased the debt load on generations of Americans yet to be born by at least 5 trillion dollars of printed money in the past three years borders on malfeasance and the argument that it is our money that has been sent to Washington is naive when the truth remains that in order to get out of a serious debt crisis there has never been a legitimate provable case where increasing the debt load of the many by accepting the use of the debt money by the few has ever resulted in an improved economic climate. And to suggest that the tax dollars that we send to Washington are simply being returned to us does not address the fact that our tax dollars are not even keeping pace with the interest that is accruing on the federal debt that has been accumulating for decades now. It is my greatest hope that cities across this country will follow the fiscally responsible leadership of the City ofTroy and stop this spending madness that has gripped and is crippling our nation, Let us look at the history of Amtrak to start. According to statistics taken from The Department of Transportation's Federal Railroad Administration webpage (http://www.fra.dot.gov/rpd/passenger/274.shtml), federal funding for Amtrak's operational and capital grants has grown from $40 million at its inception in 1971 to $1.490 billion in 2009 (this figure does not include the $1.3 billion in capital funds appropriated for Amtrak in the American Recovery and Reinvestment Act of 2009}and this figure grew again in 2010 to $1.565 billion. Overall Amtrak has used over $35 billion in subsidies, Does this sound like a project whose time has come or a project whose time has come to stop this madness? This is not to say that as a compassionate nation we should not be mindful of addressing our responsibility to provide the least fortunate among us a means of transporting from a home environment to a work environment where they can participate in the great American Dream of providing fruitful existence for their families by locating, accepting and engaging in meaningful private sector employment but let's be mindful ofthe big picture - if we continue to tax and spend on projects that cannot sustain themselves we will hurt our ability to help others let alone help ourselves, Even MSNBC's reporter Alex Johnson indicated in his article entitled, "Is Obama's rail initiative a 'train to nowhere" dated November 7, 2011 that California's 2009 projected cost of $33 billion for a 220-mile line between Los
Angeles and San Francisco has grown to a projection in 2011 of $98.5 billion and that is before a single segment oj track has been laid or a single station has opened. That is a cost increase of over $65 billion, Governors in Florida, Wisconsin and Ohio have turned town high speed rail funding due to "wildly inflated bills," said Florida Governor Rick Scott.
So why is Michigan's Governor Rick Snyder apparently supportive of this local project? In his letter dated December 16, 2011 he stated that "this will be a gateway to the intercity passenger rai! system," Is he referring to the $22.5 million Rosa Parks Transit Center built in 2009 that has been reported to be dosed periodically because the City of Detroit cannot fund its operations and maintenance costs? Or is he referring to the fact that Amtrak has reduced its train service by 2Z percent in 2011 due to ever increasing budget deficits? Governor Snyder indicated that this $10 million investment would result in a return of $23 per Amtrak customer. That to me does not warrant the advancement of this highly speculative project. I reached out to Governor Snyder this past week asking him to meet with me to review my opposition. My request for a meeting was respectfully declined. I will be sending a copy of this position paper to his office for his review and hopefully his official response. ~w, referring specifically to the past two years, our City Management had budgeted approximately 9.7 million dollars to the Troy Transit Center. When challenged, Management revealed that only 1.3 million of that entire amount was to be borne by the Troy taxpayers. In the context of debating this City's ability to keep its Public Library open without a tax increase City Manager Szerlag then announced that the 1.3 million dollars was no longer budgeted to the Troy Transit Center. Where did this money go? It is not clear. The fact is from that time forward our City Management has insisted that not one dime of taxpayers' money would be required for this Troy Transit Center. That is until recently when all of a sudden we were told that the on-going operational and maintenance costs were budgeted to be approximately $30,000 a year. I might suggest that one union paid janitor alone will cost more than $30,000 a year. I would like to ask how many bathrooms are planned for this facility and can only one janitor keep them clean on a daily basis with a possible 24 hour operation (not to mention the entire building upkeep)? On November 22, 2011 City Council was presented with an Estimated Project Costs Memo from City Manager John Szerlag in which it was stated that" not much of the design work for the bridge has been done and so 36.S percent of the total budget is anticipated to be most subject to change." The document continued by stating that "the cost of
the platform and canopy is unknown because their design is subject to Federal Rail Administration Disabilities Accessibility requirements (that) have not yet been written."
The memo went on to suggest that the city management was prepared to remove many "green" design elements with a stroke of the budgetary pen -- yet we should know that there are always strings attached to "government funding" and that the above mentioned ADA regulations that we are committed to comply with will no doubt necessarily be filled with mandated and expensive green design elements that we will be forced to comply with long after we have set an imaginary and ever changing cost limit. We were recently told that we would be using a "construction manager at risk" which supposedly means that any cost overruns that are not attributable to scope changes made by the city (or I would assume by extension the federal government) would be absorbed by the construction company. This newly presented concept of a "construction manager at risk" is in direct contradiction to Paragraph One of Section 4: (Cost Reimbursement) of the Environmental Assessment for the Troy Transit Center Intermoda! Rail Passenger Facility, Oakland County, Michigan document Prepared Pursuant to 42 USC Section 4332, 49 USC Section 303, and 64 FR 28545 by the Michigan Department of Transportation and City of Troy, Michigan dated June of 2011 as presented by Mr. Steven J. Vandette, Director of the City of Troy Engineering Department where it states that "The PROJECTcost will be met by contributions from the federal government. Federal ARRA funds will be applied to 100 percent of the eligible items of PROJECTcost not to exceed Eight Million Four Hundred Eighty~Five Thousand Two Hundred Twelve Dof/ars ($8,485,212.00) as set forth in Attachment A.
All costs in excess of the amount stated above wi/! be the CITY's responsibitity"
Let me repeat that QUOTE "all costs in excess of the amount stated above will be the CITY's responslbllitv." END QUOTE. And, is the federal grant cap going to be reduced to $6.2 million if we agree to a reduced cost project? Or is this federal grant money still going to be available
for the taking? In either case, how are we gaining anything? The answer is that we are not.
In a Public Comments presentation given on December 19, 2011 to this city council, Grand Sakwa's attorney, Mr. Brian Amann referred to and provided council with a copy of two letters and his public comments script. One of those letters was dated December 2, 2011. It was addressed to me personally with a copy to City Manager John Szerlag. I must tell you that I never saw that letter before being handed a copy of it during the December 19, 2011 council
meeting. I would also like to point out that mail addressed personally to Mayor Janice Daniels was being opened up by city management without even a request for my consent until my discovery of this practice on or around the date of December 16th when I specifically requested that my mail be opened only by me. In this letter addressed to me Mr. Gary Sakwa outlined his company's concerns about the accuracy of the ongoing costs of operating and maintaining the facility. As I mentioned above, the $30,000 a year total operating budget would not be enough to support one full time janitor. These following concerns were specifically mentioned in this letter written to me:
1. No provision for security
2. 3. 4. 5. 6. No cost inclusion for sewer and water charges No cost inclusion for trash removal or parking lot cleanup No cost allocations for parking lot and building light replacement No budget for fertilizing, landscape supplies and landscape maintenance No mention of the substantial City obligation under the Consent Judgment for the shared cost of maintaining and operating the main drive (located on Grand Sakwa's property) to access Coolidge and Maple Roads Lump sum building maintenance costs are woefully inadequate ... and without would not take long for a transit facility to become an eyesore. proper maintenance it
In the same letter, Mr. Sakwa indicates that the designs are incompatible with the Midtown Square Shopping Center, which as one of the premier shopping centers in Troy and as a significant tax payer to the City of Troy, their serious concerns and adamant opposition to this Transit Center proposal should have been given a higher priority hearing in the public square than has been afforded us to date. Then in the above mentioned letter a reference was made to the second letter that was provided to council on December 19, 2011. This is a seven page letter addressed to Mr. Mark Miller that is dated May 12, 2010. Within these seven pages are a myriad of concerns regarding: • • • • Funding" of the project - whether it was readily available to the City of Troy, the changing nature and scope of the project, the impact on the adjoining Shopping Center as well as the public roadways and intersections in the vicinity ofthe Shopping Center, General Project Description including o routes of ingress and egress for all forms of transportation Transit Center, o the details of the construction activities, o servicing, visiting or utilizing the
the Preliminary Site Plan based upon issues such as the conflict of operations with traffic flow that will interfere with the operations of the Shopping Center and the turn radius from westbound Doyle Drive to northbound Doyle Drive (which) is not adequate for buses, etc.
Traffic Parking Maintenance Allocation of Expenses Insurance/Indemnification Security Easements Environmental Future Modifications and Remedies
What we have not yet seen is Mr. Miller's reply to the many legitimate concerns of Grand Sakwa as outlined above. Does such a reply exist? If so, I would believe that it is absolutely critical to the public's awareness of the full scope of this endeavor PRIORto our vote on the feasibility of this project.
Most recently we were provided with a packet from Hubbell, Roth & Clark, Inc dated January 4,2012 addressed to the Troy Chamber of Commerce in response to an apparent request to revise down the projected costs in an effort to sway Council Members to vote yes on a projected $6 to $7 million venture rather than an $8 to 9 million venture. This is of course after one of the architects stated more than once that the project would be undermined with a $6 million cap. Nonetheless, the cover letter states that " .... the goal is to not drastically reduce the project scope such that key elements of the facility are lost or such that the resulting facility becomes unattractive. In addition, the facility must meet the functionality as stipulated in the conditions of the grant funding approval," At this point I would like to refer back to my previously quoted information such as California's 2009 projected cost of $33 billion for a 220-mile line between Los Angeles and San Francisco has grown to a projection in 2011 of $98.5 billion .., before a single segment of track has been laid or a single station has opened and Federal funding for Amtrak's operational and capital grants has grown from $40 miJlion at its inception in 1971 ... to $1.565 bil/ion in 2010. I will repeat a comment that I have made in the past: Government money is not free. I stand by my words. The HRC cover letter continues by discussing the process: Value Engineering Review. The letter states: "The value engineering review normally happens later in the design phase as more of the project variables have been defined." So, in understandable English I take this comment to mean that we are getting a value engineering review before the project variables have been defined and before the regulations have been written with under defined operational and maintenance costs in an economy where we fought for two years to keep our Public Library open without a tax increase. We are borrowing money from people who have not yet been born for a bus station that has no nationwide infrastructure yet built (50 it might end up being inconsistent with requirements if in fact this national infrastructure ever does get built). The letter continues by stating that, "the earlier preliminary estimates prepared for the project thus far were for budgetary purposes and for the acquisition of grant funding to assure that the grant amounts could fully cover all projected costs." In understandable English! interpret this comment to confirm what I have been saying all along and that is that budgets are assumptions that are often developed to fit a particular agenda. So, now that it is HRC's agenda to lower the projected costs, they now just lower the budget numbers? Why is it that we could not get Manager 5zerlag to "just lower the budget numbers" so that we could have seven day library operations after the taxpayers agreed to a $3 million tax increase upon themselves? And are we to forget that the DDA is heading for insolvency simply because management has cancelled all of the scheduled meetings of the DDA since my election? How does this fit in to our acceptance of speculative investment ventures? I would also like to question another sentence in the cover letter from HRCwhere it states that "the unit prices
within the project estimate can be refined to lessen the conservative nature of the pricing due to the past uncertainty,"
What is it that now gives HRC this sense of certainty that was lacking before ... and what exactly does "lessen the conservative nature of the item pricing" mean? Especially in light of the fact that later on in the packet under Proposed Revisions it states that "we believe the original conceptual design costs were conservative in nature." Which is it? Were the projected budget numbers developed to use up all of the available grant monies or are the projections conservative? At this point, who knows? It is a provable fact that ALL wealth is created in the private sector. The greatness of America is based upon the adherence to verifiable forces of capitalism (not manipulated by government forces); supply, demand, free markets, free men and free labor. Our country's principles and our educational institutions have been under attack for many generations to the point where a vast number of American citizens are not educated on the free market principles that drive economic growth and development. Instead they have been misguided into believing that larger, more intrusive governments at all levels are the promoters of economic growth. This Troy Multi-Modal Transit Center is one such misguided government exercise in the misuse of the taxpayers' resources in the unsupported supposition that government projects create wealth. The truth is that government projects siphon wealth and destroy the ability of the private sector to enjoy
meaningful economic expansion.
At this point 1 would like to summarizemany of my concerns: 1. This project's 'drop dead date" has passed, This project will expose Troy to financial risk of missing the completion date; 2. This project that has already been discussed for well over 10 years and has been voted down, It is wasteful and unnecessary; 3. This project has had the contingency reserve striped out of it. That is just plain financially irresponsible; 4. This project now contains revisions so rushed and forced that NO ONE, not City staff, councilor the engineering firm has any true grasp on what it means; 5. This project's cost is an ever shifting ghost - $8mm, $5mm, $6mm, $6.2Smm - contingency in, contingency out. This is unacceptable; 6. City staff has continued to provide unreasonable estimate of future maintenance and repair costs; 7. This project has now been subjected to two council members interfering with staff operations, having met on city business with a vendor, without any authorization or any knowledge of the full council AND neither of which have any engineering background or experience in the matter at hand; 8. Approval of the engineering contract puts Troy at risk for over $600,000 should the project not proceed; 7, City staff has failed to keep the full council informed on this matter - in violation of past policy (what one knows, all know); 8. And lastly] why have you violated council's privacy and opened our private mail. That is reprehensible and unforgivable.
I must conclude that I have no confidence in our City Manager's ability to continue to perform the duties granted him in this position. I would advocatefor a 7 to 0 vote against proceedingwith this ill defined TroyTransit Center project.