COX AXES DETROITERS’ CONTROL OVER WATER DEPARTMENT

AFSCME Council 25 president Al Garrett joins Councilwoman JoAnn Watson, State Sen. Coleman Young and thousands of workers in Lansing rally against water take-over Feb. 23

•  ELIMINATES PEOPLE’S RIGHT TO VOTE ON SALE OF DWSD
•  Demolishes union contract protections, privatization ordinance
• Bars action by Michigan Employment Relations Commission, state courts, union grievances
• Diminishes access by Black-owned businesses and Detroit resident construction workers to DWSD contracts
•  Adopts politicians’  program to benefit the regional private sector 

By Diane Bukowski 

November 9, 2011 – Initial Analysis   

U.S. Judge Sean Cox, appointed to federal bench by George W. Bush, previously to local bench by John Engler; member of right-wing Federalist Society

(City  unions have called a press conference to announce legal action against Cox’s order Thurs. Nov. 10 at 1:30 p.m. at the AFSCME Council 25 headquarters at 600 W. Lafayette in downtown Detroit.)  

Detroit – U.S. District Court Judge Sean Cox severed Detroiters’ control over the Water and Sewerage Department (DWSD) by federal fiat Nov. 4, most significantly by bypassing the City Charter to eliminate the people’s right to vote on any sale of the department or its assets, and to negate the charter’s privatization ordinance.   

 The revised City Charter still maintains the right to a popular vote on the sale of both DWSD and D-DOT assets, as well as the privatization ordinance.

Under Cox’s order, the Detroit city council will only have the right to approve rate increases for Detroiters, not suburban customers, after the Board of Water Commissioners recommends them. His order gives most power over contracts to the Water Department director, who he has announced will be selected by the end of this month.  Cox vested most executive control over DWSD in that director, even bypassing Detroit’s mayor.

Cox has made Wayne County's Water Commissioner James Fausone chair of the Board of Water Commissioners; he also sits on the 4-member "Root Cause Committee"

Under still-standing City Charter provisions, the director serves “at the pleasure” of the Board of Water Commissioners. 

Cox, Bing, and tri-county executives reconstituted the Board last February to include three out of seven members from outside Detroit. They have veto power over contracts and rates because votes on those matters require a super-majority. 

While disenfranchising residents, Cox executed a broad-ranging attack on workers’ rights guaranteed by union contracts, Civil Service, and state law. He also targeted Black-owned Detroit-based businesses and resident workers, limiting their access to DWSD work by reducing or eliminating previously guaranteed credits in contract selection. 

Regional officials will thus benefit from being able to more freely hand out lucrative DWSD deals to their political cronies outside of Detroit

He did not explain how these actions would improve DWSD compliance with the federal Clean Water Act, which was allegedly the goal of the 1977 federal lawsuit under which he is acting, other than claiming they would streamline purchasing and hiring and firing processes.

DWSD's Lake Huron water treatment plant. DWSD is the third largest water utllity in the country. It provides water service to almost one million people in Detroit and three million people in 126 neighboring Southeastern Michigan communities throughout Wayne, Oakland, Macomb St. Clair, Lapeer, Genesee, Washtenaw and Monroe counties. It has 2,000 employees, 1,000 of whom are represented by AFSCME. Detroiters built and paid for the entire system through bond proposals.

 Cox basically separates DWSD from city government

“The DWSD, and all of the assets of the DWSD, shall remain a department of the City of Detroit,” Cox declared in his order. (Click on Sean Cox DWSD order 11 4 11 to read entire order.)  

However, Cox ordered that all functions performed for DWSD by other departments, including Purchasing, Finance, Human Rights, and Labor Relations, shall either be eliminated or brought in-house to DWSD, which will cause significant cutbacks, financial losses, and lay-offs in those departments. 

He fell short of “the more intrusive remedy” he had threatened. He appeared to be leery of court precedents he cited earlier which require the federal government to “narrowly tailor” any limitation or abolition of local government authority. 

Instead, he left many of the actions to a secretive “Root Cause Committee” that he appointed, whose recommendations he adopted. (Click on Cox Committee DWSD plan 11 2 11 to read Committee Plan.) 

Chris Brown, Detroit COO and Root Cause Committee member

The committee is composed of Mayor Dave Bing’s Chief Operating Officer Chris Brown (formerly of DTE and other private utilities), Wayne County’s representative on the Board of Water Commissioners, Walter Fausone (who has connections with water contractors), and Detroit City Council President Charles Pugh and President Pro-Tem Gary Brown, with similar ties. The committee reports to Cox’s Special Master David Ottenwess, an attorney who has specizlized in defending health institution from medical malpractice lawsuits.

Special Master David Ottenwess

In the order, he also appointed Fausone as chair of the Board of Water Commissioners, replacing Mary Blackmon of Detroit, and ordered the Board to change their by-laws in accordance with his decree. 

He mandated that the Root Cause committee will continue to meet IN SECRET to initiate further change. Pugh and Brown have even refused to share internal information from the Committee with the rest of the City Council, let alone the public they represent.

Cox ordered that the committee report back to Ottenwess by Feb. 4 with further changes, at which time he will decide if he needs to take more “intrusive” action. 

BROAD ATTACK ON WORKERS’ RIGHTS

The Committee stopped short of enacting outright attacks on union contracts, but Cox wasn’t so leery of incurring the wrath of labor.  He took his cue not only from the committee’s claims that union contracts stand in the way of compliance with the federal Clean Water Act, but from a 78 page “confidential” report issued by DWSD’s “Executive Management Team,” headed by Chris Brown, and secondarily by DWSD Deputy Director Darryl Latimer. 

“The Court has carefully considered all options and concludes that the least intrusive means of effectively remedying these impediments [produced by labor contracts] to compliance is to:  1) keep all current CBAs [collective bargaining agreements] that cover DWSD employees in force, but strike and enjoin those current CBA provisions or work rules that threaten short-term compliance; and 2) Order that, in the future, the DWSD shall negotiate and sign its own CBAs that cover only DWSD employees, and prohibit future DWSD CBAs from containing certain provisions that threaten long-term compliance. 

Cox attacked the bedrock of union contracts, seniority, in several ways: 

• He barred future contract provisions providing for workers laid off from other city departments to bump into DWSD. (After a city-wide lay-off of clerical workers in 1992, many ended up at DWSD and were able to advance within the city ranks as a result.)
• He ordered an immediate end to using seniority as the primary tool in promotions.
• He struck seniority rules pertaining to overtime work, saying instead “the most capable” workers should be assigned.

He attacked contract provisions guaranteeing job security for DWSD workers, most of whom are city residents. 

“DWSD CBAs shall not prohibit subcontracting or outsourcing and the Court hereby strikes and enjoins any provisions in current CBA’s that prohibit the DWSD from subcontracting or outsourcing,” Cox said. 

Documents with his order say that DWSD can operate with a reduced work force at the lower levels, but provide for higher pay for elite management team officials.

He ordered stepped-up “performance reviews” by supervisors, generally viewed by union members as arbitrary evaluations based on personal likes and dislikes, as well as increased disciplinary actions, with an extended time frame of three years for them to remain on workers’ records. 

He directly attacked the capacity of union officials to be released from the job to handle union affairs, limiting it to “grievance hearings and union negotiations.”  Contracts have always required that union officials be present during disciplinary actions, and allowed their release for preliminary consultations with workers and supervisors. 

Not satisfied with demolishing locally based worker protections, Cox also ordered the following: 

“The Court enjoins the Wayne County Circuit Court and the Michigan Employment Relations Commission from exercising jurisdiction over disputes arising from the changes ordered by this Court. The Court also enjoins the unions from filing any grievances, unfair labor practices, or arbitration demands over disputes arising from the changes ordered by this Court.” 

Procurement policy attacks Detroiter-owned businesses, resident workers

Cox’s order includes a separate DWSD Procurement Policy (click on Cox order DWSD procurement 11 2 11 for full policy) that will severely hurt the chances of Black-owned, Detroit based businesses to win contracts with DWSD. 

“In the procurement of goods or commodities, DWSD shall only use an invitation for Bis in which the price factor shall be the only factor considered in the award of a contract,” the policy reads. Cox claims that problems in DWSD with Clean Water Act compliance have been exacerbated by other “bureaucratic “ requirements. 

Price Equalization Credits for businesses in certain categories will be minimal: 

Brown and the DWSD executive management team further recommend that DWSD use contract procurement lists already in place with Wayne County and the State of Michigan, in their “Synopsis of Capital Improvement Program” report, instead of the City of Detroit roster. 

They also recommend the elimination of the use of Human Rights Department clearances (which guarantee that businesses utilize certain minimal standards of employment with regard to workers of color and women). 

Additionally, Mayor Kwame Kilpatrick’s Executive Order #1, which replaced Mayor Coleman Young’s Executive Order #22 after the passage of the anti-affirmative action Proposal 2, requires that 51 percent of workers on city-funded construction projects be Detroit residents. 

It is already practically ignored across the board, but Brown and team would outright bar any rules requiring residency of workers. 

His order also eliminates the requirement for Detroit tax clearances, which guarantee that contractors are paid up on property and income taxes owed to the city before approval.

(Bukowski retired from the City of Detroit after 25 years. For 20 years, she was an elected union official with AFSCME Local 457 and active in fighting privatization of city services and jobs, beginning with the privatization of Detroit General Hospital in 1980. She was a co-founder of the Coalition to Stop Privatization and Save Our City.)

Stay tuned to the Voice of Detroit for update on union press conference and other news and analysis of this attack on Detroit’s most valuable asset.