State of the City Address

State of the City Address   
28 April 2009   
Royal Oak Mayor, Jim Ellison   

Mayor Ellison's State of the City Address can be seen on WROK Royal Oak's Government Access Cable TV channel. Channel 10 WOW & Channel 55 Comcast.

Before I begin my remarks, I would like to extend my appreciation to the Royal Oak Rotary Club for once again hosting this year's State of the City Address. 
You know, when I first started putting together this year's address, I was going to stress and reiterate some points I've made in the past about having grown up in Royal Oak and having seen the range of difficulties she's faced in the past -- but then, I happened to pick up last week's Metro Times, and was surprised to see that they'd put out their highly influential Best of Detroit edition about 6 months early this year, in an attempt to spur consumer spending and help out with regional economic recovery.  So, paging through, I was pleasantly surprised to see how many Royal Oak businesses and institutions were honored compared to other municipalities in the region.  I am certainly edified to say that these awards only help to cement my claim from last year that Royal Oak has become a destination, the epicenter of chic, trendy, and topical shops, restaurants, and boutiques in Southeast Michigan.

Beyond simply our cultural cachet, the cost-cutting measures implemented by former City Manager Tom Hoover and the various unions and departments have, -- according to the second ever Comprehensive Annual Financial Report, put out in December by our Finance Department resulted in a net increase of $1.7 million in the general fund balance.  Even more reassuringly, Standard & Poor's, the world's foremost provider of independent credit ratings, graded Royal Oak's financial management practices "good", their highest grade, thus positioning us in the top 10% of all governmental units rated by the firm.  Although national, state, and regional economies are all suffering, it is my firm assertion that the state of the City of Royal Oak is stable, simultaneously acting to anchor and buoy what is otherwise a fairly bleak economic situation throughout Oakland County and southeastern Michigan.  Though I will not deny that this has come about as the result of hard fiscal decision-making and sacrifice, by working to live up to the expectations our residents and the Best of Detroit voters have of us, Royal Oak may prove to be a model for recovery throughout the region.

Finance

Just four years ago, it was projected that the City of Royal Oak would be facing consecutive years of multi-million dollar deficits -- $5.1m for 2005-2006, and $6.4m for 2006-2007.  However, due to some hard decisions on the parts of the City Commission, former City Manager Tom Hoover, Interim City Manager Don Johnson, and our Departmental Heads, the Comprehensive Annual Financial Report shows, as I stated earlier, an increase in the city's general fund balance was achieved for fiscal year 2007-2008, bringing our total general fund balance to $8.4 million.  The freeing up of these monies came mostly as the result of the elimination of positions opened up through attrition, and city departments continue to do a remarkable job providing service with fewer people.  Ultimately, we would like to see ourselves in a position where we can once again ease the strain on city workers, and we thank and salute all of our staff for their steadfast service and dedication.  Nevertheless, as a result of our staffing contraction, there have been reductions in city services provided; to wit:

* All City Hall counters are now closed from noon to one p.m. daily and most are closed Friday afternoons and Monday mornings, meaning that most City Hall offices are now available to the public 36 rather than 45 hours per week.
* There have been reductions in the size of the Police Department, with the Police having 123 full-time employees in 2004 and 99 today. 
*
Likewise, the Fire Department has had to reduce from 72 full-time employees in 2004 to 63 at the beginning of this fiscal year.  Interim City Manager Johnson projects that without significant changes in revenue or expenses, the department will need to be reduced to 54 employees by 2012; if that occurs, we will have to
close Fire House #3.
* Although most of the activities of the department of public services fall outside of the general fund, the parks and forestry division which is responsible for caring for and maintaining our parks and streetside trees has been forced to find creative measures to curtail their expenses -- which translates on the upbeat, progressive side to a more "green-friendly" trimming schedule for parks and ball fields.  We feel that this is in keeping with the efforts of Mr. Rassel and his staff last year, which
included the improvement of our nature areas, the launching of a dog park, assisting residents in cleaning up their properties, and working with the school district to look for ways to re-utilize play equipment from consolidated schools.

It isn't all doom and gloom financially, though.  As part of the bond issue we put forward in January, our finances were examined by the three leading rating agencies.  Of those , Standard & Poor's increased our bond rating two levels, from AA- to AA+, and as I mentioned already, graded our financial management practices in the top 10% of all governmental units rated by the firm.

The bond issue paid for a number of important projects, including water and sewer projects, the badly needed replacement of several city vehicles, and the acquisitions of the office building at Troy and Third Street, as well as the old Fresard body shop property.  We already have a developer who is very interested in the newly aquired Fresard property.  Their preliminary plans show a hotel and conference center, with retail and a parking deck on the site, but in the meantime, the lot will be prepared for use as a new downtown parking lot.

As for the office building at Troy and Third, we closed the deal to purchase 222 S. Troy, the office building surrounded by City Hall, the police station, the courthouse, and the Farmer's Market (and its associated 331 parking spaces) less than two weeks ago.  With this acquisition, we have accomplished the
Downtown Master Plan's goal of consolidating property toward the creation of a distinct civic center complex.  Naturally, we are honoring all existing leases, but we will likely phase out tenants in this building once the real estate market has begun to recover.  It is still the long-term goal of the DMP to
replace the dated City Hall and Police station with new structures next to the 44th District courthouse, and the addition of 222 S. Troy to adjacent city properties will make this location a prime candidate for development.

Speaking of the Police station, we have made significant and badly needed, improvements to both the building itself and workspaces within in the last year.  Last summer, the roof and elevator were replaced; recently, the back stairs were rebuilt and an environmental cleanup of the firing range was
scheduled, with more clean-up and upgrade projects planned for the firing range in the near future.  Perhaps most significantly, a couple of weeks ago, the entire second floor received a much-needed going over -- new paint, carpeting, lighting, and refurbished furniture.  And best of all, the entire project was
paid for with cash seized in a gambling raid

Improvements are being made at the John Lindell Arena, as well.  The arena floor was originally built without integrated heating elements, meaning that over the years frost has built up under the floor and caused it to buckle -- the result is a sheet of ice that is anything but flat. This summer, the
floor will be removed and the frozen ground will be either thawed or removed. A new floor and under-floor heating system will be installed. The heating system will keep the ground from freezing and buckling.  The arena contracted more ice time this season than it has over the last five seasons, with the addition of
the Dragons Youth Hockey Cross-Ice Program having brought over 180 new hockey players 8 and under to the floor.  Hence, this is a prime time to improve the Lindell Arena.

After a series of special budget meetings last summer, we added an item to our agenda once a month that we call "Solution Today".  This item serves as a time to consider new ideas to save money, increase revenue, or otherwise improve service.  A database of ideas under consideration -- which have come from commissioners, staff, and the public -- is maintained by the finance department and we receive a status report on the progression of these
ideas monthly.

Labor
Speaking of City finances, we have made major progress with our labor contracts.  Last year, I told you about our new agreement with the SEIU, which represents our DPS employees.  In that agreement, the City traded modest pay increases and increased job security for significant changes in pensions, retiree health care, vacation, health insurance, and prescription drug benefits.  Most significantly, the new agreement set up a Retiree Health Savings Account and a Defined Contributions plan, similar to a 401k, for new employees.  The SEIU agreement set a pattern for the negotiations we held with many of our other city unions, and we reached similar accords with ProTech, the AFSCME, and the DPS Supervisors Union, and with our non-Union Department Heads and Deputies, and their executive assistants.

The city and the ROPOA went to arbitration this past year and a settlement was finally determined. While arbitration is not the preferred method of negotiation by either party, the final arbitration determination will now allow the city to better determine future costs for the police department due to changes in wages and benefit costs that are beneficial to the city.

As I mentioned earlier, our attrition plan, put into place to address our projected budget shortfalls, requires most positions to be left open when they become vacant.  That being said, there are, of course, some positions that we cannot do
without.  Mary Ellen Graver retired as City Clerk earlier this year, and was replaced by her former Deputy, Melanie Halas.  Kathy Heikkila retired as Senior Program Coordinator and was replaced by Paige Gembarski, who came to us from the city of Ferndale.

Much like a pecuniary Lone Ranger, Tom Hoover rode into town, made some friends, made some enemies, made some hard financial decisions, and once we found our budget in a more manageable position, declared his work here done.  Finance Director Don Johnson has taken on the title of Interim City Manager in addition to his current duties.  We have established the process for filling the city manager position and expect to have the process completed by August. Although it will be difficult to replace Tom’s level of experience and
expertise, we are confident that our search will be fruitful....

Police Chief Ted Quisenberry was called to service at the County level, and the position of Chief is currently being filled by Deputy Chief Chris Jahnke.  Interim City manager Don Johnson expects that the position of Police Chief will be filled by mid-May. ....

Police and Fire
On that note, have you seen our new police cars? We asked the officers to choose the design of their new street equipment, and the result is a sleek black design with white doors and frames.  We recently took delivery of eight of these new style cruisers and Motor Pool is busy getting radios, light bars and other special equipment installed and putting the new cars in service.

Unfortunately, due to the current Fiscal issues, the department had to reorganize, resulting in the disbanding of the Traffic Safety Division. The duties that were once handled through the Traffic Safety Division are now delegated to on-shift officers. This decrease in manpower has resulted in longer response times to non-emergency traffic issues and special event requests, with emergency issues still taking precedence.

2008 was a year filled with accomplishments for the Criminal Investigation Division. In total, the CID obtained 552 warrants, 11 warrants short of 2007’s all time high of 563. This is significant considering CID only had six (6) fully trained detectives for 2008. The entire CID has demonstrated not only a competence in their individual assignments, but also a level of esprit de corps that has ensured the success of the Bureau. Large or complicate cases, have reached successful conclusions due to everyone’s cooperation and coordinated effort.

As I'm sure you all remember, last year we solved a long-term problem with fire equipment, resulting in the replacement of five ladder trucks and three rescue vehicles.  Today, all of those vehicles are in service and running like a dream.  These vehicles complete our comprehensive Fire and EMS fleet replacement.  With the addition of new Personal Protective Equipment and Self-Contained Breathing Apparatus to replace a 30-year-old Self-Contained Air Bottle filling station compressor (paid for through a grant from the Assistance to Firefighters program), the Royal Oak Fire Department is now as well or better equipped than any other fire department in Southeast Michigan.

Planning and Community Development
To change direction a little, although Oakland County has been following the downward curve for years prior to the severe nationwide economic downturn late last year - and has thus been one of the hardest-hit counties in America - our image as a diversified city center whose revenue is not tied exclusively to the auto industry has allowed Royal Oak to weather the downturn better than many of our neighbors.  Although local and national economic factors - chiefly the availability of financing - have resulted in the delayed start of many previously-approved projects, the city remains a focus of redevelopment in Southeast Michigan.  In terms of reinvestment into existing commercial buildings the city has fostered in 2008, the Plan Commission approved site plans related to the re-use / renovation of 19 buildings for a total of approximately 216,000 sq ft of improvements.

In March 2008, the Plan Commission approved a site plan associated with the 8.2 acre former Starr Elementary School site includes 100 independent senior apartments in 3-story congregate building, 37 apartment units in 10 one-story cottage-style buildings and 5 single family homes on Durham Street.
Construction drawings for this project have been reviewed and approved by the Building Inspection and Engineering departments. Provided funding for this project proves available, we look forward to welcoming new friends and residents to our wonderful community.

With the approval of an exchange of the parcels at the intersections I-696 with Main and Washington in September, LA Fitness will be moving into a new two-story, 45,000 sq ft fitness center.  Ground was broken and this project is under construction.

Apart from commercial reinvestment and redevelopment during 2008, the City of Royal Oak continued to provide housing and community development assistance through the administration of two federally-funded Programs: the Housing Choice Voucher Program and the Community Development Block Grant Program, which provides funding assistance to the Senior Community Centers, Homeowner Rehabilitation
Program, and Public Infrastructure Improvements.  In addition, in January, the Planning Department requested a $1 million grant from the Congressional Neighborhood Stabilization Program to help provide relief to neighborhoods
dealing with the detrimental effects of foreclosure.

Assessor/Building
On that note, as I mentioned a little earlier, even with the downturn in our economy, the real estate market in Royal Oak has maintained some strength, and is thus acting as an anchor to stabilize the regional economy.  SEMCOG is predicting that southeast Michigan communities will lose 20% of their taxable value over the next three years. Oakland County
projected losses of 4.5%, 9% and 5% for this same time period.  I’m pleased to report that Royal Oak’s property values, so far, have held up better than the county as a whole. We actually had a slight increase last year when most of the county saw declines. This year, our preliminary numbers show a loss of less than 1.5%.  With luck and artful management, we should be able to transform this anchor into a buoy to help, even slightly, lift Southeast Michigan out of the morass into which it’s sliding.  The Assessor's Office, led by Jim Geiermann, has had a busy year and continues to do its part, even with a reduction in staff.

Building Official Jason Craig reports the Building Department issued 4500 building permits in 2008 and performed more than 17,500 inspections on everything from simple additions to elaborate commercial building renovations. The Ordinance/Rental Department responded to just fewer than 4000 complaints from residents and licensed 1100 rental units in 2008.
Jason maintains that they are trying to make the process of acquiring a building permit as simple as possible and service to our residents remains their highest priority.

In response to perceptions that it is difficult and/or time consuming for businesses to navigate our land use regulations and building permit process, we established a task force to review our ordinances and procedures. After reading about this project in the Daily Tribune, Royal Oak resident and General Motors employee Matt Beatty volunteered his services. Matt will be using a technique that originated at Toyota and was refined at GM called value stream mapping. This technique has been used to streamline many processes for both firms.  Naturally, we recognize the significance to champions of 'Lean'
of utilizing latent skills in minimizing waste and streamlining policies and practices, so we greatly appreciate Mr. Beatty's contributions to this task force.

Engineering

Our Engineering Department and their Major Street Program oversaw significant repair of Lexington between Crooks and Marais, including the widening of the road adjacent to Royal Oak High School for expedited student pick-up and drop-off, funded by the School District. The Engineering Department also utilized Block Grants and Local Funding to fund concrete repairs made to Cooper, Laurel and Phillips Place.  The Center Street Parking Structure went through major restoration and safety upgrades to extend the life of the building.

In the area of additional funding for the City’s major road projects, the Engineering Department is in line to receive approximately $660,000 in Federal stimulus funds for projects through the year 2010. Those projects include resurfacing of Washington from Woodward to Lincoln and of Crooks Road from Main St to Webster, reconstruction of Campbell Road in partnership with Madison
Heights and it is also anticipated that federal stimulus funds will be awarded to the City to upgrade Lincoln between Campbell Rd and Stephenson Highway with new curbing and asphalt pavement.

DDA
This has been a productive year for the Downtown Development Authority.  The CBD is looking squeaky clean with the addition of new newspaper racks, recycling containers, and bicycle racks to replace the weather-worn hodgepodge we'd all become used to.  The DDA paid to renovate much of the existing streetscape in the CBD.  They also collaborated with the City Commission to amend the sign ordinance to allow tasteful sandwich board signs in the Central Business District to benefit downtown businesses.  It is in a large part due to the efforts of the DDA that Royal Oak shops, restaurants, and businesses perennially fare so well in the Best of Detroit
competition.

Most importantly, the DDA helped us to improve our financial picture by taking over responsibility for the debt service on the court
building. This allowed the city to send more of the court-generated fine revenue to the general fund where we need it to pay for basic public safety services.

The City has hired a professional parking firm to manage and staff our three downtown parking structures.  We expect this to result in better service, higher utilization and reduced costs.  On a similar note, our new golf contractor has golfers raving about the improvements at Normandy Oaks and the Royal Oak Golf Course.  The city and the operators are currently exploring the issuance of a liquor license for the clubhouses.

DPS
Naturally, the DDA is not the only agency working towards the beautification of Royal Oak. Much of both our greenspace cultivation and day-to-day operation is thanks to the effort of the Department of Public Service.  This last winter proved one of the wettest in recent memory, and the DPS was responsible for clearing away among the heaviest of snowfalls in years. During this same time, the department responded quickly and efficiently to over 70 water main breaks.

The DPS continues to lead the way in the greening of Royal Oak as the city added 4 hybrid vehicles to our fleet. Working with the
Royal Oak Environmental Advisory Board and the DDA, on-street recycling will be a reality in our CBD. Mr. Rassel also reports that business recycling continues to grow both in numbers of participating businesses as well as the volume of recycling collected throughout the community.

Farmer's Market
And speaking of Best of Detroit wins, I don't think any single structure or entity performed better than did our own newly renovated
Farmer's Market.  Given that farmers’ markets are among the fastest-growing public venues in the country, the fact that ours is both among the oldest and the best should be a point of pride for all of us who buy our fresh, local-grown produce there.  The Farmer's Market was awarded wins for best flea market and both public and staff votes for best suburban Farmer's Market.

City Clerk
Which leads me to the City Clerk's Office.  Under new City Clerk Melanie Halas, the Clerk’s office had quite a 2008 with a whopping
three heavily attended elections successfully conducted! They survived one of the biggest elections in history this past November with a 76% voter turnout! The 10,000 absentee ballots issued were another record high. This past presidential election was also the first election in which we hired high school students to work half- day shifts in all dual precincts. The students worked at "help desk stations" to direct voters to their correct precinct and streamline what could have otherwise been mass confusion. This was especially helpful for first time voters who weren’t quite sure where to go, and we heard a lot of positive feedback from voters on the extra help at the precincts.

We've also heard how many residents appreciate that the Clerk has begun accepting credit cards at the counter, which should, once again, help to streamline the City Clerk's service to the residents.  Also, the City Commission is now completely paperless for their meetings, which is not only a big cost savings, but has also cut out overtime for the Clerk’s office staff for no longer having to prepare those bulky packets! Melanie wanted me to remind you all that we are gearing up for our City/School Election this November 3rd, so
make sure to come out and vote!

Treasurer
The Treasurer’s office continues to expand their services with the use of direct debit, electronic checks, and credit card payment processing. About 7% of residents are now utilizing direct debit for their water bills, and the Treasurer expects that number to increase, which bodes well for similar proposals in the future.  Like the Clerk, the Building Department, DPS, and the Library, the Treasurer's desk has begun accepting credit cards for some payments -- in their case, for parking -- and this addition is expected to streamline resident service and further reduce costs. They have expanded their Amtrak parking program so that passes can
now be purchased directly at the SMART bus station, saving users an additional trip to City Hall.

Unfortunately, significant reduction in investment rates over the past year has adversely impacted our investment income, but the
respective financial strength of the banks we invest with are continuously monitored, with changes made as soon as any concern is
noted.

HR
Moving from the City Clerk to the Treasurer and beyond brings us to Human Resources and despite the omnipresent reduction in staffing due to attrition, the HR Department:
* Processed more than 500 applications for part-time positions, promotions or transfers.
* Processed the hiring of a Police Officer, Controller, Assistant City Attorney, Automotive Mechanic, 66 part-time positions and 120 election workers for the national election in November, as well as 17 retirements.
* The HR Department is also spearheading the search for a new City Manager.

Library/IS/WROK
Although we've seen some staffing and hour reduction in our indirect resident service department, the public faces of the city are
working harder than ever to keep residents connected and in-the-know.  I haven’t seen another municipal website that contains more information than ours.  In the interests of full transparency, our website hosts our last seven budgets, and our last six annual financial reports too. You can not only find the agenda and minutes of city commission meetings, you can actually watch streaming video of
City Commission, Planning Commission, and Zoning Board of Appeals meetings. Our video archive extends back over two years, just in case you've really run out of other things to watch!

Additionally, our Information Services department is embarking on a project to make the site more attractive and easier to navigate. It will also be much easier for us to keep up-to-date.  To help departments easily maintain their own pages with little interference from Information Services, we are implementing a content management system utilizing a freeware system called Drupal.

Another new service that will show up on our website soon is Royal Oak Q&A. This consists of a searchable database of questions and answers about city services and regulations, and gives citizens the ability to get answers or make requests 24/7. It also features a means for citizens to place service requests through the website and a means for tracking the status of those requests.  Once again, in the interest of maximizing resident service, the system also provides us with reports that show how quickly we are able to
respond to citizen requests. I want to thank and applaud the department of Information Services, led by Manager of Information Services Scott Newman, for providing these resources to our residents.

WROK, The City of Royal Oak's Government Access Channel is entering it's 25th year of coverage of City Commission meetings, having first recorded the April 1, 1985 commission meeting.  WROK and the Information Services department are jointly researching
new ways of making City Meetings more readily available on the website. WROK, also recently upgraded the video monitors in the commission chambers.
 
The Library has had an especially bumper year in their fairly recently renovated facility.  Partially because of the regional and national economic downturn, and partially because of its increasing focus on acting as a community center, library usage has skyrocketed this past year.  According to the Library director, Metta Lansdale:
* With 482,000 visitors in fiscal year 2007-2008, the library saw a 63% increase in visitors over the previous year and is already
experiencing another 21% more visitors in 2009.
* In March this year, 56,600 people entered the Royal Oak Public Library facility, with an average of 2100 visitors per day. This is the highest daily and monthly visitor count in the history of the Library.
* Program attendance increased by 39% in fiscal year 2007-2008 over the previous year and in 2009 has already increased another 14%.
* Librarians answered 15% more information referral requests than in the previous year and in 2009 this activity has increased yet another 9% to date
* Lending transactions jumped 7% last year and another 8% this year so far.

Furthermore, with public contributions to the Friends of the Royal Oak Public Library and community service contributions of a team of Master Gardeners, the library was able to add a professionally executed mural painted in the grand staircase which leads to the renovated and expanded youth services department, and is working on installing a unique butterfly garden.  This space should help to offer advice to home gardeners interested in creating such an installation, and will help to educate children about their local environment.

Concerning a question likely on everyone's mind, after healthy debate in the community and the Commission chambers, the Library installed filtering for all but one public access computer in the library, leading to a nearly 50% drop in use of the public computers since this change was implemented.  Notably, however, since the economic downturn, this drop in usage has slowed significantly, with more users utilizing Library resources for entertainment, job hunting and business development resources and personal computer skill development.

Before I move away from City Hall and enter the home stretch - Promise! -please join me in expressing our gratitude and compliments to all the employees and volunteers who continue to keep our departments running smoothly, ensuring that our city remain the best of the best.

And now, a word or two about the public face of Royal Oak. As you may recall, the movie industry moved into Royal Oak with a very large presence last year due in a large part to the tax incentive offered by the governor and state legislature.

Three major productions filmed in our stunning little burgh, with other future projects scouting throughout the Royal Oak area for locations filming. The Lifetime production of "Prayers for Bobby" starring Sigourney Weaver, used Royal Oak as the main setting for their story. The equipment and staff of our own WROK was used in filming of a pivotal scene in set in City Hall. Many local businesses and public spaces were also used in the filming. The Clint Eastwood movie "Gran Torino", filmed a scene in Ted Widgen's Barber Shop on Eleven Mile Rd. The movie "Youth in Revolt" starring Michael Cera used a residential back yard for a scene.  In addition to receiving considerable publicity, all these local businesses and homeowners were fairly compensated.

We were complimented by all three movies' production companies on our willingness to work with them, and I in particular look forward to future projects set or filmed in our city.

In closing, I must emphasize that, should tax revenue and outside income continue to decline, it is likely that the sort of services the city is able to offer will continue to decline for the near future.  However, the fact that our real estate market maintains a degree of
stability is a positive indication that we will be able to weather this economic storm. We know what it is like, as a result of our last several years experience, to be pulled under by a rogue current, but we are nowhere near ready to sink into the dark abyss. Through dedication, sapient public policy, and patience and understanding on the part of our residents, we are determined to bob back up again and again.  With skill and a little luck, we hope to be a lifeline capable of pulling the rest of the region back up with us.

Ladies and gentlemen, it's no contest: we are, Royal Oak and we proudly display the standard of the Best of Detroit.

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