Local in Ann Arbor

Reaching conclusions based on partial information

In our previous post, we made a prediction.  In discussing the Transit Master Plan (TMP) process currently being rushed through  Ann Arbor’s City Council and the Washtenaw County Board of Commissioners,  we said:

There will never be a countywide millage vote, and hence there will never be a referendum on whether we want to take these steps.

Further, we predicted that there will be a “soft” transition, in which the New Authority (established under Act 196; see our post AATA: Moving Us Where? The Big Picture for details) essentially takes over AATA’s operation long before the “closing”, or final transfer of all AATA assets.  These predictions were in the context of our statement that City Council would be taking an irretrievable step by approving the 4-party agreement and should not do so without a really thorough examination of the consequences.

Of course, from one perspective, all this was outrageous.  Where’s the proof, you might ask?  Of course, there is none.  These surmises are just that, a hypothesis, based on the best information available – but information that is sometimes fragmentary or inconclusive.  Here is a review of some of that information.

• The statements contained in two primary documents, the  4-party agreement and the Articles_of_Incorporation.  (These both now link to the full documents.)  Both are in draft form (the 4-party agreement dated January 4, 2012, the Articles of Incorporation undated but said to be the most current to be distributed).  Because they are drafts, they may be changed considerably.  But they are all we have to understand what is supposed to be passed by the City Council on January 9.  (History: I requested current versions from AATA but was refused on the basis that they were still in draft.  I was then able to obtain them from a confidential source.  These documents both bear signs of hasty editing and have some errors and inconsistencies.  Still, even partial documents do indicate intent, which is part of the puzzle.  The interpretation of the various clauses, like those in any legal document, can be argued on the basis of sequence and syntax.)

UPDATE AS OF JANUARY 6, 2012: THE ITEM IS NOW ON THE COUNCIL AGENDA.   Here are the new draft documents from the agenda:  Articles of Incorporation    4-party agreement

• The 5-year plan being discussed by the Financial Task Force.  We summarized some elements of this in our post, AATA: Moving Us Where? The Big Picture II.  Both the 5-year plan and 30-year plan are the elaboration of the TMP (which consists of 4 volumes on the Moving You Forward website).  They are based on a transportation model that the consultants, Steer Davies Gleave, have put together.  The model allows one to plug in times and values and predict costs.  It is clear from looking at this first 5 years that the intention is to move forward with the regional plan immediately.  Indeed, AATA has already gone into deficit spending in order to “catapult” themselves into the regional plan.  Although the timeline for the New Authority is 4 years long, they are not waiting for that process to play out.  Yet, in order to do what they have sketched out, they will need more money and more reach than they currently have.
• The internal organizational review now being conducted by AATA.  As reported by the Ann Arbor Chronicle, the AATA is spending $250,000 on a makeover.  Actually, only the first stage has been authorized, but the full amount is budgeted.  As CEO Michael Ford said “we (AATA) are going through a door” and they are preparing for a substantial restructuring.  That signals that they expect to move into a new mode, presumably the New (regional) Authority, in the very near future.  It is hard to imagine that they would expend this money and effort if they expected, for example, to wait for the results of a November ballot issue.
• Public comments made by major players.  Board chair Jesse Bernstein has been telegraphing for several months that he expects a scenario for financing a regional authority that does not include a millage ballot issue.  In just one example, at the u196 meeting (December 5, 2011), he said, “It’s way too early to talk about a millage.  We need to do this right, not quick.  If we don’t have our ducks lined up by November, 2012 could have a failure.”  (He earlier spoke of the Governor’s vehicle registration fee proposal as “icing on the layer cake”.  Michael Ford was quoted on WEMU (sorry, no record) as saying that other forms of financing could be used, including business and philanthropy.  And in AnnArbor.com’s account, Mayor Hieftje spoke vaguely of alternatives to a millage.  WATS Executive Director Terri Blackmore indicated that a millage would cause more townships to drop out.  And even DDA Executive Director Susan Pollay said at the same Financial Task Force subcommittee meeting that maybe a millage should be for a longer period, because they would need to “pay off bonds”.  These little verbal clues add up to a picture of what backdoor discussions may be saying.

• The remarkable push to put the agreements through, combined with the long timeline for conclusion.  If you are trained as a planner, which I am (one of many chapters not in my online bios), this stands out like a blinking light on an annoying website.  There has been a rush to get all this approved: January 9 (2012), Council approval of 4-party plan;  January 18 (2012), Board of Commissioners approval of the AOC.Then  4 years till the closing of the sale (transfer of assets).  The timeline graphic illustrates the scale.  4-P: 4-party agreement.  AOC: Articles of Confederation.  Deadline for inclusion on the August 2012 ballot: May 29.  Deadline for inclusion on the November 2012 ballot: August 28.  But they have given themselves until the end of 2014 for the deadline of a public vote, and until mid-2015 to “close” (clean out AATA’s assets).   Clearly they expect something to take a long time to complete.  And they give the Governor 3 years!  But then why push so hard to have everything settled in literally the first month?  Because they want to get on with things.

In a recent book on Bayes’ theorem (The Theory That Would Not Die…, by Sharon Bertsch McGrayne), a thought experiment is described that Bayes conducted to derive his theorem.  He sat with his back to a billiard table and imagines that there is a cue ball somewhere on the table (he doesn’t know where).  He asks a colleague to throw another ball on the table and describe only whether it is to the right or the left of the first ball.  This gave him a small bit of information with which to locate his ball.  The process is repeated over and over again, with more information accumulated with each throw, until a probability can be ascribed to its location.  The formula he derived is verbalized as: “prior times likelihood is proportional to the posterior”.  (Amusingly, the latest and best estimation is called the “posterior”.)  The mathematical extension of this idea has given rise to an entire field of statistics and probability theory, and to “fuzzy logic”.  But it also serves in concept as a basis for decision-making and estimation of the likelihood of  future outcomes.  In this approach, one continually takes in new information to test an initial hypothesis.  Over time the picture of “reality” becomes more clear but may also shift significantly to one side or another.  The key thing is to adjust one’s view continually, with each new bit of information, and never surrender to the temptation of falling in love with your model picture so that you close your eyes to new information.  In other words, you must always watch your posterior.

The TMP and countywide transit story is still unfolding, and it is a rich one with many facets.  It is difficult to predict accurately, since a large part of the puzzle is human behavior.  The important thing is that we must all keep our eyes open.  And watch the posterior.

Note: Ongoing posts about the TMP and other transportation issues are listed on the Transportation Page, as well as some references.

UPDATE:  Legislation has now been introduced that would permit introduction of local registration fees.  According to AnnArbor.com, Senate Bill 910  (which has a companion bill with identical content, so far, in House Bill 5312 ) has now been introduced. The Ann Arbor area’s local representatives have been active in this: State Senator Rebekah Warren introduced the bill in the Senate, and Representative Rick Olson introduced the bill in the House.

The amendment to the existing Michigan Vehicle Code (P.A. 300 of 1949), section 801, calls for an additional vehicle registration fee of $1.80 per $1000 of “list price” of vehicles.  (Section 801 also lists fees for farm tractors and motorcycles; it is not clear whether the amendment excludes those vehicles.)  It requires the Board of Commissioners to approve a ballot question and a vote of the residents of the county to pass the ballot measure before this local fee is collected.  The fee is then collected by the county treasurer.  Note that transportation authorities and road commissions are thus cut neatly out of the loop.

This entry was posted on January 5, 2012 at 10:09 pm and is filed under civic finance, politics, Transportation. You can subscribe via RSS 2.0 feed to this post's comments. You can comment below, or link to this permanent URL from your own site.