KATHY POSNER RUNS CHICAGO NUMBERS GAME
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THE CHICAGO GOSSIP
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THE CHICAGO GOSSIP
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Kathy Posner In ChicagoOne of the ways that Mayor Rahm Emanuel is cutting spending by the City of Chicago is by “downsizing” city government. In everyday English, this translates to firing 517 city employees. Because there are fewer employees, the portion of the budget that deals with salaries and benefits was adjusted down from what it was in the previous year. But how accurate is the adjustment?
If you remember, we learned in Emanuel’s transition plan that I wrote about (“Health care costs for city employees are growing far faster than the rate of inflation and outstripping growth of Chicago’s revenue. In 2011, taxpayers will spend nearly $500 million on health care costs for city employees, their families, and retirees. In Chicago, just 4% of government employees generate more than 60% of the City’s health care costs.”
Maybe taxpayers will luck out and the people fired are part of that 4% set of employees that costs taxpayers 60% of the health care expenditures. I wonder if anyone in the budget department has analyzed that. Perhaps the city is saving more money than they anticipated!
One of Emanuel’s $25 million revenue generating ideas is to sell sponsorship and advertising rights on recycling carts, garbage trucks, snow plows, light boxes and bridge houses. Old idea that just doesn’t work. Let me remind you of their failure.
I wrote a blog on July 28,2010, “Bridging the Budget Gap, about how the Chicago City Council had “passed an ordinance allowing Fresh Picked Media the opportunity to sell corporations the right to decorate, through a sponsorship agreement, one of 14 (those with the highest traffic usage) Chicago River bridge houses for $1 million-a-year-per-bridge. The sponsoring company would be allowed to hang the decorations for the month-long period preceding four major holidays --- Halloween, Christmas, Easter and 4th of July. The exact wording of the ordinance is to ‘utilize certain Chicago River Bridge Houses and the Riverwalk development project as venues to advertise and promote tourism, special events, holidays and commerce in the City of Chicago.’”
Then on January 12, 2011, I wrote “Bridging the Budget Gap Part 2” about how Fresh Pickle Media’s pitching of selling bridge advertising did not come anywhere close to producing the revenue that was promised.
I wrote, “We were told back in July that the city could expect to net $10.5 million dollars because each bridge would gross $1 million for the four-month-period at each of the 14 decorated bridges. WRONG! According to the Sun-Times, the brochure lists the most expensive bridge at $140,000/month or a total cost of $560,000.
Wait! We were told $1 million per location. Wabash and State Street bridges are going for $280,000 each. So if the most expensive bridge costs $560,000 and the other 13 bridges cost $280,000 each that is a gross of $4,200,000 or a net to the city of $3,150,000. The last time I checked $3,150,000 is not $10,500,000! Where will the net difference of $7,350,000 that the ad agency promised when they got the deal come from? I guess they are in a bit of a pickle!”
It is now 14 months since the bridge house advertising plan got raised. Have you seen any ads on the bridge houses? NO!
I wrote about Emanuel’s idea of garbage truck advertising on January 11, 2011 and after running the numbers concluded that, “Maybe Right Guard deodorant will put something up, but what company wants their ads on a garbage truck? Smells like a fishy plan to me.”
The 2012 budget of Emanuel has some good ideas and some bad ones. It’s his first try at this, so I will cut him some slack. If he just had his fiscal gurus people follow my blog, maybe they would understand the numbers a bit better. But as a Jonathan Swift epigraph ("Thoughts on Various Subjects, Moral and Diverting) said, "When a true genius appears in the world, you may know him by this sign, that the dunces are all in confederacy against him." Sometimes I just feel that’s the way it is because nobody is ever listening to me!
If you remember, we learned in Emanuel’s transition plan that I wrote about (“Health care costs for city employees are growing far faster than the rate of inflation and outstripping growth of Chicago’s revenue. In 2011, taxpayers will spend nearly $500 million on health care costs for city employees, their families, and retirees. In Chicago, just 4% of government employees generate more than 60% of the City’s health care costs.”
Maybe taxpayers will luck out and the people fired are part of that 4% set of employees that costs taxpayers 60% of the health care expenditures. I wonder if anyone in the budget department has analyzed that. Perhaps the city is saving more money than they anticipated!
One of Emanuel’s $25 million revenue generating ideas is to sell sponsorship and advertising rights on recycling carts, garbage trucks, snow plows, light boxes and bridge houses. Old idea that just doesn’t work. Let me remind you of their failure.
I wrote a blog on July 28,2010, “Bridging the Budget Gap, about how the Chicago City Council had “passed an ordinance allowing Fresh Picked Media the opportunity to sell corporations the right to decorate, through a sponsorship agreement, one of 14 (those with the highest traffic usage) Chicago River bridge houses for $1 million-a-year-per-bridge. The sponsoring company would be allowed to hang the decorations for the month-long period preceding four major holidays --- Halloween, Christmas, Easter and 4th of July. The exact wording of the ordinance is to ‘utilize certain Chicago River Bridge Houses and the Riverwalk development project as venues to advertise and promote tourism, special events, holidays and commerce in the City of Chicago.’”
Then on January 12, 2011, I wrote “Bridging the Budget Gap Part 2” about how Fresh Pickle Media’s pitching of selling bridge advertising did not come anywhere close to producing the revenue that was promised.
I wrote, “We were told back in July that the city could expect to net $10.5 million dollars because each bridge would gross $1 million for the four-month-period at each of the 14 decorated bridges. WRONG! According to the Sun-Times, the brochure lists the most expensive bridge at $140,000/month or a total cost of $560,000.
Wait! We were told $1 million per location. Wabash and State Street bridges are going for $280,000 each. So if the most expensive bridge costs $560,000 and the other 13 bridges cost $280,000 each that is a gross of $4,200,000 or a net to the city of $3,150,000. The last time I checked $3,150,000 is not $10,500,000! Where will the net difference of $7,350,000 that the ad agency promised when they got the deal come from? I guess they are in a bit of a pickle!”
It is now 14 months since the bridge house advertising plan got raised. Have you seen any ads on the bridge houses? NO!
I wrote about Emanuel’s idea of garbage truck advertising on January 11, 2011 and after running the numbers concluded that, “Maybe Right Guard deodorant will put something up, but what company wants their ads on a garbage truck? Smells like a fishy plan to me.”
The 2012 budget of Emanuel has some good ideas and some bad ones. It’s his first try at this, so I will cut him some slack. If he just had his fiscal gurus people follow my blog, maybe they would understand the numbers a bit better. But as a Jonathan Swift epigraph ("Thoughts on Various Subjects, Moral and Diverting) said, "When a true genius appears in the world, you may know him by this sign, that the dunces are all in confederacy against him." Sometimes I just feel that’s the way it is because nobody is ever listening to me!
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