March 8, 2012. Hollywood has quietly rolled out an eye-popping economic development policy – one that has solid intellectual underpinnings and a promising track record in other locations. This is the first time, to the best of our knowledge, that our City has formulated an economic development strategy that focuses not only on improving the City’s economic base but also on raising the earning power of Hollywood residents.
The new approach is based on the concept of the “industry cluster” – that is, a geographical concentration of companies that are interconnected by the markets they serve and the products they produce. Silicon Valley with its thousands of high-tech companies is the most obvious example. The big question for us is this: Does Hollywood have the necessary assets to create an environment in which industry clusters will grow and prosper?
To answer that question, we start with what we already have. Take for example, our city’s coastal location between Miami, Fort Lauderdale and Palm Beach: three shipping ports, three airports, ready access to the Florida Turnpike and I-95. Listen to Cathy Swanson-Rivenbark, our city’s economic development guru, applying this approach to Hollywood. She says we must understand and capitalize on what’s already here – the “high-growth, high quality industries that are located in Hollywood (such as Life Sciences, Marine Industries, Aviation/Avionics, Logistics/Transportation, and Tourism) and the cross-clustering of these important industries.” She adds that these are unique assets on which to build our development strategy. Groups of closely related and complementary industries operating in Hollywood would reinforce each other. In addition, they would result in more and better jobs for our residents, the great majority of whom now work outside Hollywood.
She goes on to name the Joe Di Maggio Children’s Hospital, Nova Southeastern University’s National Coral Reef Institute, and Barry University’s College of Health Sciences Campus in downtown Hollywood as thriving Hollywood industries that have remained stable and strong during the recent recession and are projected to grow in the future.
Meanwhile, in furtherance of the new economic development policy, city staffer Anthony Grisby has been studying Hollywood demographics, documenting such troubling statistics as an unemployment rate higher and median income lower than nationally. He’s also documented that health sciences, for example, can provide many entry-level jobs for high school graduates as well as job training and advancement opportunities that can help to increase Hollywood’s dwindling middle class. He demonstrates that a focus on business recruitment in health sciences would build on the resources we already have and provide more employment opportunities for Hollywood residents.
To support this new approach, the City has combined its economic and community development functions in a new Department of Community and Economic Development. Since the Director of the former Community Development Department resigned last year, the position has remained vacant. A search is now underway for a director of the new combined department. Keep your eyes trained in its direction to spot what we hope will be significant, positive changes to community development, economic development, and redevelopment in the City of Hollywood.
The schedule is now set for meeting and interviewing the finalists for Hollywood City Manager. All six finalists will be in Hollywood on Thursday and Friday this week, Jan. 5-6. Executive staff will meet the candidates first, accompanying them on a tour of the City and lunch on Thursday morning . Thursday afternoon and Friday morning will be devoted to commissioner interviews. Each candidate will interview individually with Vice Mayor Asseff, Commissioner Blattner, Commissioner O’Sheehan, Commissioner Russo, and Commissioner Sherwood on Thursday afternoon, and with Commissioner Furr and Mayor Bober on Friday morning.
The public’s opportunity to meet the candidates will occur at a “Meet and Greet” on Thursday evening, from 6-7:30 PM, at the Art and Culture Center. At this event, the Mayor will introduce each candidate and each one will give a brief two-minute self introduction.
On Friday at 2 PM, a special commission meeting open to the public will be held, at which time the entire Commission will conduct formal interviews with each candidate and then decide on what step to take next.
The City Commission is now considering the top applicants for the position of city manager. The executive search firm, Affion Public, received 60 applications for the position and selected six finalists to describe to the City Commission at a workshop earlier this week. Based on the head hunter’s presentation, the Commission voted to interview all six.
You can see a photo of each candidate and assess their qualifications at this link on the City website. Hiring a new manager is one of the most important decisions this Commission will make. Because it will affect all of us, Hollywood citizens must become knowledgeable about the candidates and make their wishes known to the City Commission as the selection process continues.
The finalists will be in Hollywood January 5-6, 2012. On the 5th, an evening meet-and-greet event with the public will be held at the Hollywood Art and Culture Center. The following day, the City Commission will hold a public meeting to interview the candidates. Mark your calendars now.
HOLLYWOOD SPECIAL ELECTION – IMPORTANT – SAVE JOBS!
WHAT: Pension Referendum
WHEN: Tuesday, Sept. 13, 2011
This is no time for voter apathy. Our city has a budget crisis that could lead to bankruptcy. As a partial solution, the referendum proposes reducing future pension benefits for members of each of the three unions in city government: General Employees, Police, and Firefighters. These reductions would save the City some $8.5 million and set the City on a more sustainable course for the future.
Note: the referendum would not touch any pension benefits employees have earned to date; only future benefits would be subject to new rules if the referendum passes.
We are voting YES on all three referendum questions. We believe a YES vote will save jobs, maybe hundreds of them in the long run. It will also prevent astronomical tax and fee increases in the years to come for both residents and businesses.
Think about it. The City is strapped for money. The unions have cited as cause of this budget failure a number of wasteful, unwise expenditures the City Commission has made — and we agree with most of these (WiFi, water tower decor, mega developer incentives, excessive severance package for former city manager, etc.). We’ve spoken out against WiFi and excessive developer incentives for years, not just after the fact but before these spending decisions were even made.
More unwise expenditures the unions don’t mention are the excessive pension concessions to the unions themselves. We’ve spoken out against these, too, for years. They’ve been a major contributor to the City’s financial meltdown. Hollywood’s pension costs have skyrocketed about $30 million in just eight years Look at the trend line:
This situation cannot continue without huge tax and fee increases in years to come. And who are we asking to pay these taxes and fees? New census data show that almost half of Hollywood households are designated “low-income,” and foreclosure rates here are three times more than nationally.
If the referendum is defeated and savings can’t be achieved from reducing pension costs, the City says it will have to cut salaries and lay off workers to achieve the necessary savings for the coming fiscal year. Salaries were already cut significantly earlier this year so this would be a double whammy. Reducing future retirement benefits seems the better course to us but if the unions don’t agree, voter approval is required and that’s why we have the upcoming referendum. This referendum gives voters a direct voice in how the City will handle the current budget disaster: (1) pension reform, or (2) no pension reform and more salary cuts, employee layoffs, and service cutbacks instead, not only now but in future years also.
Infuriating and disheartening as reducing retirement benefits can be, we still think the unions would be wise to reach a negotiated settlement with the City rather than pinning their hopes on defeating the referendum. The unions may well succeed at sinking the referendum. Then what? Wouldn’t the subsequent shift to salary cuts and pink slips be worse for the rank and file than a less costly retirement plan?
We believe defeating pension reform will cause much more hardship on the employees than approving it, especially those at the lower end of the pay scale who need every dollar of their salary to make ends meet today. The City has provided each union leader the amount of savings that would have to come from pay cuts and/or lay-offs should the referendum fail. We have copies of this information. If you’d like to see it, let us know and we’ll send it to you.
To see the exact ballot language and more information about what is being proposed, visit the city’s website at this link.
If you wish to vote by absentee ballot and have not yet requested the ballot for this election, you must contact the Supervisor of Elections Office immediately. The absentee ballot request form may be filled out online from the SOE website at this link. Or request it by phone 954-357-7055.
Be sure to vote. This is no time for voter apathy in Hollywood.
Financial Troubles in Hollywood
My candle burns at both ends. It will not last the night; But ah, my foes, and oh, my friends – It gives a lovely light.
Edna St. Vincent Millay
Shocking financial revelations about city finances have alarmed Hollywood residents, business owners, and employees alike. The city’s unchecked borrowing and spending that began years ago has run its course: reserves are long gone and red ink is spread across the budget. The city’s funds are so low that it no longer has access to the debt markets. Should we have hurricane damage, instead of borrowing money for cleanup costs pending FEMA payback, the city will have to find the funds somewhere in its own budget. While many other Broward cities have millions of dollars in reserve accounts, Hollywood has saved nothing for a rainy day.
The big question now is whether Hollywood voters will approve restructuring city employee pensions. A pension referendum is in the works for mid-September unless the unions ratify pension reductions before then, which seems unlikely. The main problem here is that city commissions for years, right up until this year, have promised employees pension benefits way beyond what the city can afford. One of the most burdensome is a city guarantee of 6% (in some cases 8%) interest on public safety retiree accounts for 15 years after retirement.
The Interim City Manager pulls no punches. She says the city will have to “operate under a very different business model moving forward if we don’t accomplish pension reform and savings. Where else can you get a guarantee of 6% return on your money …with the City underwriting the amount even when the market tanks? We have been solving our financial problems by increasing borrowing rather than cutting costs and we can no longer afford it.”
The “very different business model” would likely entail the outsourcing of basic city services and massive layoffs of employees. The unions have taken the position that the city is using scare tactics to cut salaries and pensions. We’ve been watching city budget decisions for years and have written about these problems many times. In 2009, we noted the investment return on the firefighters pension assets was only .86%. The city’s contribution that year was $9.1 million, up from $7.6 million the previous year. When the market tanks and pension investments are down, the city is obligated to make up the difference. Already we have many more firefighter retirees than we do active firefighters. An arrangement like this is clearly unsustainable.
In short, combined with the economy, our elected officials have brought Hollywood to a financial crisis. Problems of this magnitude do not spring up over night. We’ve had a slow build-up, year after year, for at least a decade, with one irresponsible decision following another, the cumulative impact slowly building to today’s crisis point.
Why have our elected officials, with the support of the city manager, year after year continued to approve more and more benefit increases? For more than a decade, the police and fire unions have worked hard to elect commissioners who would vote for this largesse. Their off-duty members would leaflet the large condo buildings the night before the election, using building access that was not available to candidates they did not support. While benefit increases were a political calculation for many of our elected officials through the years, others seemed unaware of the fiscal impact of their decisions and not even curious about it.
As we see it, there are four separate areas that need our attention if the city is to move beyond this crisis: (1) management changes, (2) city elections, (3) taxpayer rate hikes, and (4) employee salary and benefit cuts.
Management
The long-time budget director and city manager have both left. We have a new Finance Director who is working hard to correct the budget errors of the past. The search for a new city manager is under way and the Interim City Manager seems determined not to perpetuate errors of the past. In short, the necessary management changes have occurred or are in the works.
Elections
City elections will be held in November 2012, little more than a year away. This election will mark the transition to staggered four-year terms, so that in the future only half the commission will be up for election at the same time. This transition is causing the commissioners from Districts 1, 3, and 5 to have an initial six-year term.
Voters will need to work much harder than in the past to get qualified people elected to public office. We must be able to count on our commissioners more than ever to set reasonable policies and spend taxpayer money prudently. We can’t continue past practices that have contributed to the present crisis. No longer can we afford a commission that lavishes money on supporters and converts loans to grants. 2012 is the year to work on electing a qualified city commission. This means citizens will have to roll up their sleeves, recruit, and support knowledgeable, high-caliber candidates. No more electorate sitting on the sidelines as so many have done so often in past city elections.
Taxpayers
An urgent need to raise Hollywood’s fund balance before the city’s credit is further downgraded has propelled the commission to propose hefty tax and fee hikes for the fiscal year that begins October 1, 2011. Although not finally approved, and subject to mandatory public hearings in September, the proposal is to raise the millage to 7.4479 (9% increase over last year). Combined with the 2004 General Obligation Bond levy of .4449, our total Hollywood tax rate would be 7.8928. This will be one of the very highest in Broward County. In addition, the city will raise the annual fire fee from $159 to $189. The proposed millage increase plus the fire fee increase represent 11% more than last year. Without question, residents and businesses will pay significantly more.
Employees
Even harder hit than residents are the city employees. They have already received pay cuts ranging from 7.5% to 12.5%. These lower salaries will be the “new normal” for the foreseeable future. In addition, as mentioned above, the commission is poised to freeze employee pensions as of September 30, 2011 and offer reduced pension benefits thereafter. If the unions don’t agree to the pension changes, the city can implement them only with voter approval in the September special referendum.
What Next?
All concerned taxpayers should pay attention to what city government is saying and doing in the days and weeks ahead. Union negotiations are expected to intensify and we hope they can be successful. If not, we will have the pension referendum. From burning the candle at both ends for a decade, we’re down to a pile of hot wax.
The Search Begins
At a workshop on July 6, the city commission discussed the process for seeking a new city manager. They decided to hire a head-hunting firm to conduct a national search. After directing staff to come up with a short list of such firms, they discussed some of the requirements they feel are important in a new manager. They talked a lot about whether to compel the manager to live in Hollywood. Some thought it essential, others expressed concern that such a requirement would limit the qualified applicant pool.
It seems to us that the important thing is not where the manager lives, but what the manager does to become informed and keep current with all aspects of our city. The manager must have the ability to take the pulse of the city quickly and get to know, understand, and value Hollywood’s diverse stakeholders. Early on, the new manager must become familiar with Hollywood’s differing neighborhoods and treat them all fairly, not favoring one area over another. The same is true for the business community — and not just the beach and downtown. Central and West Hollywood are important as well.
While the workshop was well run, the elected officials on the whole didn’t get very specific in discussing the desired qualifications of a new manager. They all want a “super-star” manager, but did not define what that means for Hollywood. We’ve thought about it and suggest the following as qualities we believe essential in Hollywood’s new manager given the current state of our city:
- High ethical and moral values
- Excellent communicating, listening, negotiating, and diplomatic skills
- Proven record of attracting and retaining high quality, experienced managers and treating all employees fairly
- The ability to identify and build support for a common vision that the elected officials, staff, and the community will get behind, so the city can move forward harmoniously
- An understanding of the importance of outreach and early discussion with people who are affected by proposed projects or ideas
- The willingness to speak the truth, however unpopular, when the well-being of the city requires it.
Some commissioners thought it essential that the new manager be able to find new revenue sources and bring in development. We believe these skills are crucial for Hollywood’s success but perhaps not the manager’s primary role. The manager’s job is to hire professional staff with these abilities and enable them to work effectively for the betterment of the city. In short, the manager should manage but not micromanage budget, development and other city staff. The manager must inspire trust and ensure both top-notch results and high ethical behavior from every city employee.
The search is now under way and expected to take several months.
