Thursday, January 22, 2004

Get the Mayor

Herenton is not as popular or as unpopular as you might think.

Posted By on Thu, Jan 22, 2004 at 4:00 AM

Make no mistake. The name of the game now is "Get the Mayor." As in, get him out of office. Things are that bad between the mayor and the City Council and a growing legion of Herenton opponents.

City councilman Jack Sammons and his pals at The Commercial Appeal have called for a "Watergate-style investigation" of the mayor's role in the selection of lawyers and underwriters for a $1.5 billion TVA bond deal with MLGW. They have likened the mayor to Richard Nixon and Bill Clinton. And they probably thought twice about Saddam Hussein.

Both the councilman and the newspaper are far too experienced and cautious to go Watergate based on an anonymous e-mail, as was reported last week. Anti-Herenton lawyers, bond firms, and MLGW officers have been loading them up with "evidence," you can bet on it. The next step will be a demand for a federal investigation, assuming that prosecutors (who have been putting the screws to defendants in two other political corruption cases for more than a year) are not already in the early stages of one.

Just four months ago, it seemed that Willie Herenton could be mayor of Memphis for as long as he wanted to be. The city's first elected black mayor. The city's first mayor to serve four consecutive terms. Mayor for life -- and now mayor for the moment. What happened? Some historical perspective helps explain.

First, Mayor Herenton is neither as popular nor as unpopular as is widely believed. In 1991, he upset incumbent Dick Hackett by 142 votes in an election in which 247,973 people voted, or 65 percent of the electorate. Last October, Herenton beat John Willingham three-to-one, but only 104,688 people voted, a 23.7 percent turnout.

That's a lot of apathy. The signs began popping up four years earlier. In the 1999 election, Herenton's opponents on the ballot got 54 percent to his 46 percent. But there were so many of them that Herenton won easily. Under pre-1991 rules, he would have been in a runoff.

The 1991 election amounted to a crusade, with then-Congressman Harold Ford Sr. playing a key role and other black politicians, ministers, and voters almost unanimously behind Herenton. Last month, a majority-black City Council rejected four Herenton nominees for director jobs.

But Herenton is not as unpopular as this controversy suggests. Politics is always an either-or choice. There is no evidence that Sammons, Rickey Peete, Tom Marshall, or Carol Chumney could beat Herenton one-on-one. Sammons, Willingham, and Joe Ford are among the elected officials who have learned the hard way that their appeal is limited. Only Harold Ford Jr. or A C Wharton have the stature to challenge Herenton.

The weekly drumbeat of anti-Herenton letters to the CA reflects a suburban demographic which new editor Chris Peck is targeting. What a coincidence. When these missives go beyond the standard "Memphis is going to hell under Herenton" message, the "facts" cited are often wrong. On Tuesday, for example, a Memphis police officer from Bartlett wrote about "increasing crime." In fact, between 1996 and 2003, rapes declined 27 percent, robberies 29 percent, business robberies 9 percent, aggravated assaults 15 percent, and homicides 24 percent. Our source? The Memphis Police Department and, speaking at a breakfast gathering last week, District Attorney General Bill Gibbons.

In 1996, the editors of this newspaper gathered mayors Herenton, Hackett, and Wyeth Chandler together for a photograph and three long stories.

Chandler advised Herenton to be a strong mayor, to conciliate individual council members but keep the council as a body at bay. "You're the one who's got to be the cook," he said. "Not those other folks in the kitchen."

Hackett followed that advice and stuck mainly to goals that were achievable. Herenton's proposals, on the other hand, made great headlines but nearly impossible policy: consolidate city and county governments, abolish the school board, sell MLGW, rebalance city and county taxes. And far from conciliating individual council members, Herenton has antagonized and insulted them.

The present focus on Herenton's supposedly Nixonian exercise of political influence in the bond deal is absurdly myopic, partisan, and narrow. The $25,000 steered to a Little Rock law firm wouldn't pay the food and bar bill at a major East Memphis Republican political pony-up, and everyone on the council knows it. But no one said politics is fair.

Chuck Daly, one of the basketball coaches honored at the Grizzlies game Monday, once said something very wise about leaving the Detroit Pistons after winning two championships. "Sooner or later, they just stop listening to you."

After 12 years, that's what's happened to Mayor Herenton.


Thursday, January 15, 2004

Poison Pill?

Surprise severance package for Morris and MLGW executives could cost millions.

Posted By on Thu, Jan 15, 2004 at 4:00 AM

Herman Morris didn't get to the top of Memphis Light, Gas & Water without sweating details and knowing which way the wind's blowing. When it became clear years ago that there was a quiet rift between him and Mayor Willie Herenton, Morris -- an attorney for MLGW for nine years before being named president -- got the board to approve a unique package of severance benefits for himself, other officers, and MLGW employees in case they lost their jobs.

When the mayor decided last month not to reappoint Morris, the Flyer requested details of MLGW's severance and benefits policy from the utility company and the city. Documents show Morris is seeking severance, pension, outplacement, sick leave, and vacation benefits worth $1,171,286. The Commercial Appeal reported in a front-page story Tuesday that "Morris bows out with $205,000." That is less than one-fifth of his total proposed severance and benefits package.

Under his proposal, Morris would agree not to sue the city, disclose proprietary information, or solicit existing or prospective customers from MLGW or Memphis Networx. Morris also would agree to "forfeit" $113,267 of compensatory time "earned through business travel on weekends, storm restoration, and out-of-town meetings" and 58 percent of his unused "sick leave days," worth $127,425 by his calculations.

The greater impact of the 15-page Severance Benefit Personnel Policy is that it applies not just to Morris but to other top executives and hundreds of employees. Several managers with longer tenure than Morris could be entitled to packages worth well over $1 million if they "voluntarily enter into separation and release agreements." In other words, if they quit, they define the terms.

Herenton was stunned when he learned details of the severance provisions two weeks ago. He called them "vulgar" in a meeting with MLGW board members in his office last week and scolded board members for being derelict in their duty. He earlier made an oblique reference to the severance provisions as "something troubling I learned yesterday" when he met with City Council members last Tuesday.

The stealth severance deal was adopted without discussion or publicity by the board effective January 1, 2001, and revised November 18, 2002. Morris' five-year term expired in 2002 but he continued to serve as president through 2003. He proposes that a few days of his vacation days be bumped into 2004 so his service will total 15 years.

Part of Morris' proposed package could be money he contributed to MLGW's pension plan. The summary doesn't say exactly how much, if any, Morris contributed. Instead, it uses a multiplier to bring the figure to $513,937. In addition to that, Morris proposes that he be paid another $518,926 "representing the difference between the value of a normal pension based on 15 years of service and the amount of the multiple of contributions refunded by the pension plan."

Parts of the proposal are unusual, although Morris is hardly the only public employee to exploit the complicated array of city, county, school-board, and MLGW pensions and retirement policies. MLGW officials responded to the Flyer with a one-paragraph faxed statement saying, "MLGW employees are eligible for severance benefits under a policy that covers both management and bargaining unit employees."

Several things about MLGW's pension/severance plan bother the mayor, who was sharply criticized himself 13 years ago for "double-dipping" his pension after he resigned as school superintendent.

The concept of severance pay for appointed public officials whose terms expire is "something I have never seen in government anywhere in America," Herenton said. Storm restoration pay is another puzzler. The mayor, police director, and several other division directors are generally considered to be on call for emergencies around the clock as part of their duties. The pension multiplier is a third area of concern.

Herenton is in an awkward position to criticize the policy since he appointed Morris and all five board members and is supposed to get regular briefings from them. In reality, however, his relations with MLGW have been strained for several years. In 1998, Herenton made an aborted proposal to the City Council to consider selling publicly owned MLGW to a private utility. MLGW executives have been on guard ever since. The breaking point came when Herenton blasted MLGW management in remarks to the council and told Morris that he and the board would not be reappointed. Herenton would like to replace Morris with Joseph Lee, director of the Division of Finance and Administration. But the council balked at Lee and wants a national search instead.

Barring a legal challenge, Herenton's hands may be tied by the severance surprise. It applies to employees and officers appointed to full-time positions who lose their jobs due to downsizing, change in control or ownership of MLGW, or -- as in the case of Morris -- expiration of their appointed term. At least 12 MLGW managers make more than $100,000 annually, and some of them have worked longer than 15 years.

In the corporate world, an anti-takeover provision is known as a poison pill. Herenton is familiar with the tactic from serving on the boards of First Tennessee and Holiday Inns years ago. "We did that to insulate management," he said. "This is a corporate model applied to a public agency."

The severance policy specifically addresses several shake-up scenarios, from privatization to merging MLGW with another government entity. One clause talks about reorganization as an authority and consolidation of city and Shelby County government. Neither of those would be considered a change in control.

In a column in The Commercial Appeal last week, former MLGW president William Crawford proposed reorganizing MLGW along the lines of the Memphis and Shelby County Airport Authority. Herenton, however, has something quite different in mind. He believes MLGW has become wasteful, overpaid, and "an island unto itself."

"For years MLGW has wanted me to support them becoming an authority," said Herenton. "I would never go for it. This is why it is so important to me to get Joseph Lee in as president. I want someone with the same philosophy I have of the relationship of MLGW to city government as a whole. [MLGW] just absorbed a $27 million budget reduction without making personnel cuts. That conveys to me that there is a lot of fluff."

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