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Thursday, March 14,2013

Financial Health Team wraps up work

Long-term, regional recommendations approved

by Sam Inglot

Thursday, March 14 — The city’s mayoral-appointed Financial Health Team has approved recommendations to alter city employee health care and pension systems and significantly change the way some city services are provided in an effort to stop chronic budget deficits. One suggests looking at selling City Hall.

The recommendations, which the 16-member team has worked on since September, will be presented to Lansing Mayor Virg Bernero and the City Council on Monday. Many of the recommendations could not be made unilaterally by the administration, leaving some up to City Council approval or through renegotiating employee contracts.

The goal of the recommendations is to turn the city into “Lansing 2.0,” said former mayor David Hollister, the head of the Financial Health Team. Following through with the recommendations would result in a “fundamental restructuring of city operations,” he said.

Hollister didn’t sugarcoat the city’s financial situation.

“We tried doing more with less,” he said. “That has reached its limits. Now we’re going to do less with less.”

Attorney Steven Liedel presented the long-term recommendations to the team. He said acting on many of the recommendations would take cooperation with city employees and the state Legislature.

The long-term solutions focused heavily on restructuring the city’s pension and retiree benefit system. Recommended changes to the pension system include adjusting the multiplier that determines benefits and increasing the eligible retirement age.

As for retiree health care, the team recommends the city evaluate moving to defined contribution retiree health care benefits from a defined benefits system. The team also recommends the city consider issuing bonds to finance the city’s unfunded liabilities for retiree health care.

For city employee health care, the team recommends substantial auditing of city employee dependents, starting a health and wellness program and a uniform health care benefit plan.

Hollister shared the team’s regional subcommittee recommendations. Regionalization recommendations include partnering with the Lansing School District in a shared administration building and information technology system with a shared chief information officer.

Overlapping with the long-term recommendations was the team’s idea to study whether the city should sell City Hall. The summary report states, “The City should immediately undertake a study as to whether city services could be more effectively delivered from another location, financed in part by the sale of the current City Hall property.”

Other regional recommendations include consolidating the county’s three district courts, a possible merger of Lansing and East Lansing fire departments and having the county sheriff run the city’s jails.

Both long-term and regional recommendations include privatizing “non-core functions” of the city, such as parking, trash pickup, ambulance services, accounting, information technology and cemetery and golf course maintenance. City employees would be able to bid on contracts as well.

The team recommends putting the Lansing Center and Thomas Cooley Stadium under the control of a “regional authority.” Although they benefit the region, both facilities are funded directly by the city, the team says. Similar ideas could be applied to city parks and the River Trail.

Hollister said the reports were 90 percent complete and minor language changes may take place over the weekend before they head to Bernero and the City Council.

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