KOAT Channel 7 did one of its so called “Investigative Reports” regarding the 15 year old 2003 gross receipts tax called the “public safety tax” and placed on the ballot and approved by voters.
The Channel 7 “Investigative Report” was more of a “City Hall” hit job that was false and misleading.
You can view the entire Channel 7 report here:
Under state law, the Albuquerque City Council can enact increases in gross receipts tax on its own without any public vote.
In 2003, the tax was placed on the ballot because then Mayor Martin Chavez and others at the time had made the commitment not to raise taxes without a public vote to secure public opinion and backing, even though they had the authority to do it without a public vote.
According to the Channel 7 report, during the last 15 years, the tax raised $500 million and has cost the average Albuquerque household approximately $4,000.
The problem with the $4,000 figure is you must assume only households paid the tax, no one has moved, no one has left the city and the population remained the same during the last 15 years.
The truth is that the gross receipts tax generated 25 cents for every $100 purchased by virtually all consumers over the years.
Back in 2003, city leaders, including then Mayor Chavez, the City Council and the Albuquerque Police Department (APD) told the voting public all the money generated from the “public safety tax” would go to hire more police and make the streets safer.
A specific promise made was that APD sworn personnel would be increased to 1,100 officers.
Channel 7 went out of its way to find a small Albuquerque business owner for 30 years, who claimed they voted for the “Public Safety Tax” 15 years ago and the business owner had this to say in the report:
“Crime is ramped in this community and I have lived here my whole life and don’t see it getting any better right now. … I have iron bars on all of the windows and doors. I have video surveillance and I have security throughout the entire building.”
The four-month Target 7 investigation supposedly revealed that voters never got what was promised, but that part of the report is clearly false.
PUBLIC SAFETY TAX ADVISORY BOARD PROMISED, NOT CREATED
One accurate fact reported by the Channel 7 Investigative report related to the “Public Safety Tax Advisory Board”.
According to the Channel 7 report, four years after the 2003 vote, “a group of concerned citizens became suspicious” about how the tax money was spent and they approached then newly elected City Councilor Isaac Benton.
According to Benton:
“I was approached by people who had concerns about it. … Concerns about whether it was doing what it was intended. … We didn’t get a lot of applicants to create the board. It didn’t gather a lot of steam. … It kind of foundered and was forgotten honestly”
Instead of demanding an accounting from the Chavez Administration or requesting an audit by the City’s Independent Internal Audit Department, Benton sponsored an ordinance creating a “public safety tax advisory board” to watch over the spending of the tax.
In the 2009 annual city budget, the City Council reported that it actually established the board, even though it was never formed.
In 2010 the City’s Independent Internal Auditor’s office discovered the board had not been formed when it audited the revenue being generated by the 2003 tax.
In 2010, the Independent Internal Audit Department recommended that the council make more efforts to recruit members, but nothing happened.
Channel 7 reported that when it looked on the city’s website during its investigation, it listed all of the boards and commission but under the Public Safety Tax Advisory Board it said “more information coming.”
CHANNEL 7’s NEGATIVE SPIN REPORT
The Channel 7 Investigative report was false or misleading on many levels.
The report was a damaging and inflammatory “spin” on where the unspent 2003 public safety tax revenues went.
Following is an extended quotation and narrative made by Doug Fernandez in his report:
“According to the FBI uniformed crime report, the police department never hit 1,100 officers, which was promised by city leaders in 2003 when they were pushing for the tax.”
“Instead billions of pennies from your purchases were put into the city’s general fund. That fund is the city’s main checkbook.”
“For years the city budgeted for that many cops even though it never came close. The police department would revert money it hadn’t spent back into the general fund. In 2017, the city reported to the FBI it had 833 officers and its crime rate was the highest in 16 years.”
“The city would then use the general fund to pay for visitor centers, baseball fields, swimming pool renovations and the future home of Top Golf.”
“The general fund also paid millions in raises for city employees. Not just for cops and firefighters.”
“Garbage truck drivers, street workers, health inspectors and politically appointed executives all got double-digit raises.”
“The average city employee has received a 27-percent raise since the tax was passed.”
“Just last March, the city council passed another public safety tax even larger than before. This time it never went to voters nor was there any legislation requiring oversight such as board to make sure it was being spent correctly.
“The new tax hits you with another 38 cents per $100.”
“However, in December the council passed legislation requiring that the mayor report how the new tax is being spent.”
True to form, Channel 7 made sure they had someone vouch for their “reporting” by getting Paul Gessing, executive director of the ultra-conservative Rio Grande Foundation that condemns all taxation.
Paul Gessing took the Channel 7 bait to “pile on” to condemn the city taxation and make a statement that was misleading at best when he said:
“When the city of Albuquerque voters decided to raise taxes on themselves to pay for public safety, they didn’t get what they voted for … They got the opposite.”
The truth is the taxpayer did indeed get what they voted for as pointed out below.
When it comes to the tax being used for city hall employee salaries, the same small Albuquerque business owner Channel 7 interviewed expressed the following opinion:
“How nice for them. My salary hasn’t increased that much. … We weren’t told that. We weren’t told it would go to salaries. We were told it would go toward public safety, which means they lied to us and that’s not OK.”
The average city employee is paid $36,000 a year.
Albuquerque City Councilor Brad Winter, who is the only city councilor who was on the council when voters passed the tax, had this to say:
“I don’t know if you will ever be able to prove that it was spent for what it was supposed to be spent for … We got to be accountable for where that money is going, and the red flags show we are not as accountable as we should be.”
ANALYSIS AND COMMENTARY
An outside observer no doubt would say the report reveals just how sinister and dishonest city hall is with taxpayer money, which was the obvious result Channel 7 wanted to get from its viewers.
In political circles, the Channel 7 News Report is defined as a “political hit” piece to inflame public opinion, this time against city hall and taxation.
It was Channel 7 News Anchor Doug Fernandez who appeared on air and reported the Channel 7 “Investigative Report”.
The station no doubt thought that Fernandez as the news anchor would give the report far more credibility, but it did not and he should have known the truth.
Doug Fernandez joined the Action 7 News team in August 2002, and as such should be familiar with the truth on how the 2003 Public Safety Tax was spent from 2003 to 2009 during the Mayor Chavez years.
FALSE OR MISLEADING REPORTING BY CHANNEL 7
The news report was represented as a “four-month Target 7 investigation” which is very embarrassing considering the serious false and misleading statements in the report.
The Channel 7 report was false when it reported:
“According to the FBI uniformed crime report, the police department never hit 1,100 officers, which was promised by city leaders in 2003 when they were pushing for the tax”.
The truth is that after the 2003 enactment of the tax, the Chavez Administration undertook an aggressive police recruitment program to grow the department that included billboards and other types of advertising and recruitment efforts and extensive hiring incentives such as sign on bonuses, college debt reduction payments and mortgage down payments.
The truth not reported by Channel 7 is that APD reached the 1,100 sworn police officer level in 2009 after struggling to grow the department and to keep up with retirements, adding new equipment, fleets of cars and training.
In 2009, all because of the 2003 tax, the Albuquerque Police Department (APD) was the best paid, best trained, best equipped, best funded department in its history.
In 2009, APD was fully staffed with 1,100 sworn police officers.
In 2009, APD response times had been brought down below the national average and violent and property crime rates in Albuquerque were hitting historical lows.
In other words, taxpayers were not lied to and got exactly what they paid for with the 2003 tax contrary to the opinions of Paul Gessing and contrary to the Channel 7 Investigative news report.
MAYOR BERRY’S APD
On December 1, 2009 Mayor Richard Berry became Mayor of Albuquerque and was elected again in 2013 serving two full terms and leaving office December 1, 2017.
It was in January, 2010 that number of police officers employed began to decrease for 8 consecutive years from 1,100 to 850 under the Mayor Richard Berry Administration.
In eight (8) years, under the public safety leadership of Mayor Berry and the likes of Darren White as Chief Public Safety Officer and Chiefs Ray Schultz and Gordon Eden and Assistant Chief Robert Huntsman and their appointed Deputy Police Chiefs, APD went from 1,100 sworn police all the way down to 853 sworn police.
In 2017 when Berry left office, APD response times and the city’s crime rates were at historical highs with calls to APD taking hours instead of minutes to respond to even violent crime calls for service.
The numbers of police dropped because of the Berry Administration failure to recruit new officers and failure to keep up with excessive retirements.
Contributing to APDs problems was that in 2013, a Department of Justice investigation resulted in a finding of excessive use of force and deadly force by APD which resulted in a federal consent decree against the city mandating numerous reforms.
Excessive use of force and deadly force cases by APD cost taxpayers $60 million in settlements all mostly paid during the Berry years.
It was in 2017 that the City Council reduced funding to APD from 1,100 sworn police to 1,000 because of the Berry Administration’s failure to keep up with retirements and grow the department.
The Channel 7 Investigative Report is at worse false or at best misleading when Doug Fernandez said:
“The police department would revert money it hadn’t spent back into the general fund. … The city would then use the general fund to pay for visitor centers, baseball fields, swimming pool renovations and the future home of Top Golf.”
IGNORANCE OF CITY FINANCES
The Channel 7 Investigative Report showed an obvious ignorance of city taxation and city finances and how they work.
Under the law, virtually every city department is required to revert back to the city general fund with no exceptions moneys that have been appropriated but not used by the department.
Under city financing policies, no department, including APD, is allowed to keep “unspent money” in any given year and it is mandated by law that it revert back to the general fund for the upcoming fiscal year budget.
No separate accounts akin to “savings accounts” can be set up for the city departments that allow them to spend remaining funds as they see fit at a later date.
All budgets and all appropriations must be approved by the elected City council.
The Channel 7 report is false when it reported that the public safety tax money was reverted by APD to the general fund to pay for “visitor centers, baseball fields, swimming pool renovations”.
The truth is that projects like “visitor centers, baseball fields, swimming pool renovations” are funded by “general obligation bonds” or “revenue bonds” passed by the voters or city council and not the general fund revenues from gross receipts tax.
With respect to the funding for “the future home of Top Golf”, that city financing came from an economic development incentive fund set up years ago within the City Economic Development Department.
It is likely that all of the 2003 tax revenues did go to public safety, police and fire, and that the money generated substituted or supplemented existing budget expenditures over the years, ebbing and flowing with the needs of the departments of police and fire.
The Channel 7 Report negatively embellished the facts when it reported:
“The average city employee has received a 27-percent raise since the tax was passed. … Garbage truck drivers, street workers, health inspectors and politically appointed executives all got double-digit raises.”
Saying that the average city employee “has received a 27% raise since the tax was imposed” during the last 15 years is false or misleading in that you must presume someone has stayed employed for the full 15 years.
People come and go with the city, positions are added or eliminated, and wages must be negotiated with the unions.
The truth is that garbage truck drivers, street workers, health inspectors received small 1% or 2% pay increases at the most over the years with no pay increases at all for a number of years, especially during the 8-year Berry Administration when it unilaterally suspended negotiated contracts.
However, during the 8 years of the Berry Administration, politically appointed executives did get double-digit raises with the most egregious raise being the salary of Berry’s Chief Administrative Officer Rob Perry who went from being paid $150,000 a year to almost $200,000 a year.
2018 GROSS RECEIPTS TAX INCREASE
The Channel 7 report contains the following statement:
“Just last March, the city council passed another public safety tax even larger than before. This time it never went to voters nor was there any legislation requiring oversight such as board to make sure it was being spent correctly.”
The truth is that the City Council has the exclusive authority to raise taxes without a vote as well as dedicate revenues as it sees fit, without any oversight board required.
The city council also has the authority, by virtue of its authority over the city budget, to re dedicate funding when not spent as the need presents itself.
Elected City Councilors have the duty and responsibility to exercise oversight authority over all city funding and that is what they are elected and paid to do.
There is absolutely no need for an “oversight” board like a “public safety tax advisory board” if the City Council does its job. .
The City also has an Independent Audit Department that can be called upon to review and trace expenditures.
In the Channel 7 report, City Councilors Brad Winter and Issac Benton essentially admitted that the City Council failed in its oversight of the 2003 tax revenues, which is what the yearly budget process is all about.
City Councilors Brad Winter and Issac Benton revealed their incompetence as elected officials with their comments to Channel 7 when they said there is a need for a “Public Safety Tax Advisory Board” and saying they do not know where money they have voted to appropriate has been going.
In March, 2018 the City Council approved raising the gross receipts tax by three-eighths of a percentage point in order to deal with a $40 million shortfall as a result of 8 years of spending cuts and downsizing city government in order to avoid any and all tax increases.
The gross receipts tax increase bolstered the city’s income by an estimated $50.3 million in 2019 and $57.3 million in 2020.
Mayor Tim Keller signed the tax increase going against a campaign promise he made to get elected of putting any tax increase on the ballot for voter approval.
When the City Council enacted of the gross receipts tax in March of 2018, it dedicated 70% of the revenues for public safety needs.
What Channel 7 did not report is the Keller administration is spending $88 million dollars, over a four-year period, with 32 million dollars of recurring expenditures to hire 350 officers and expand APD from 878 sworn police officers to 1,200 officers in order to return to community-based policing.
With the 2018 tax increase, the Keller Admiration has negotiated with the police union significant APD pay raises and bonuses and an aggressive hiring and recruitment program offering incentives to join or return to APD.
APD is projected to have 980 sworn police by July of this year having added approximately 100 sworn to the force.
Repealing either the 2003 or the 2018 tax increases as some suggest would have a disastrous effect on public safety, APD and Fire especially, the $88 million APD expansion program, the $35 million in nonrecurring expenses, not to mention equipment needs for both departments and the longevity pay bonuses for APD and the very generous pay increases.
CHANNEL 7 INVESTIGATIVE PRODUCER WAS CITY EMPLOYEE
When you review the online version of the Chanel 7 report on the TV web site, it reveals T.J. Wilham was the “Investigative Producer” for the report, meaning he is the person that did the research for the report and perhaps even wrote it to be parroted by Doug Fernandez.
Nine years ago, T.J. Wilham was a reporter for the Albuquerque Journal.
Channel 7 frequently refers to “our partners at the Albuquerque Journal” in reporting the news.
It is more likely than not that Fernandez and Wilham have known each other for some time.
Nine years ago, T.J. Wilham, after being the Albuquerque Journal city hall reporter for a number of years, was hired by Mayor Richard Berry as his “Public Information Officer” and his pay in all likelihood more than doubled.
Wilham was employed by Berry Administration for a full 8 years, being paid at least $75,000 a year or more from 2009 to 2017.
When Doug Fernandez reported that “ … politically appointed executives all got double-digit raises” he failed to report that his coworker T.J. Wilham was one of those politically appointed executives who was not only given a significant raise but a nice promotion.
Early in 2017, Wilham was appointed by Mayor Richard Berry as the APD Real Time Crime Center Director despite having no law enforcement background and was given an increase in salary.
Soon after the election of Mayor Tim Keller in 2017, T.J. Wilham left city hall and went to work for Channel 7 in mid-2018, but the reason for his departure from City Hall was never reported upon by any news agency resulting in speculation that he did not leave voluntarily.
For many years, the “Investigative Report” has been very popular method with Channel 7 to try find and report on government corruption.
It is all too common for “Investigative reports” such as this one to take things out of context, mislead the public, and not disclose relevant facts nor report accurately all the facts, and overtime the TV news agency loses credibility with its viewers and their ratings drop.
None of the Albuquerque News stations is immune from using the same tactics of investigative reporting with the other stations essentially adopting the tactics of Channel 7.
No person and no government has the authority to tell any news agency who to report on, what to report on, when to report, how to report, what methods to use to get a story or to disclose news sources, unless they break the law, which is what the first amendment to the constitution guaranteeing freedom of the press and speech is all about.
The Channel 7 Investigative Report without any doubt is protected free speech under the First Amendment to the Constitution.
The first amendment guaranteeing freedom of the press and of free speech are the most critical freedoms needed to keep this great country great.
This country has always been great because our freedoms and those freedoms have always protected us from tyranny.
However, the general public and viewers have the right to demand accuracy and full disclosure.
The Channel 7 Investigative Report on the tax increases was not “fake news” at all but it was negligent and misleading news reporting.