Monday, June 26, 2017

A bit of good Mi-Connection news...David Auger to stay on as CEO

The tenure of Mi-Connection CEO David Auger has been one of the few bright spots in the whole saga of the municipally owned cable company, so when Auger announced last year that he would be retiring, that was going to surely leave a big leadership gap in the company.  Adding to the uncertainty, little to nothing had been said about the search for his replacement.

With the announced end date of June 30th rapidly approaching, last week aShortChronicle asked the public information officers for Davidson and Mooresville if there was any update.  Monday, that update came in the form of a press release on the next Mi-Connection Board meeting later this week.

Here it is (emphasis added)...

The MI-Connection Board of Directors will hold a meeting on Wednesday, June 28 at 6:30 p.m. in the Davidson Town Hall board room to appoint and re-appoint board members, elect officers for FY 2017-2018, approve minutes from the April meeting, and approve the final recast of the FY 2017 budget. This meeting was originally scheduled for Thursday, June 29. This meeting is open to the public.

Additionally, the MI-Connection Board of Directors requested that David Auger continue in his CEO role for the foreseeable future and he agreed. Auger was originally scheduled to retire June 30.

The next quarterly meeting of the MI-Connection Board of Directors is scheduled for August 24 at 6:30 p.m. in the Davidson Town Hall board room. This meeting is open to the public.

While it is definitely good news that Auger will stay on for the time being, it also makes one wonder if the reasons why included not able to find a good replacement.  Looking at the Mi-Connection overall situation it is not hard seeing that being the case.

If you just looked at the bottom line, the company looks like it's still in need of a turnaround specialist.  However, that would be too much of a simplification.  Under Auger's tenure the company has attained EBITDA percentages at or above industry averages.  Earnings Before Interest Taxes Depreciation Amortization is a measure of operational performance.  The Auger years have seen operations brought back in house from an outsourcing vendor.  The outstanding debt has been refinanced.  The company has also achieved high penetration rates in new developments like the one at Langtree.  Effectively, David Auger has been the turnround specialist and operationally he has achieved a lot.  At this point, the proactive steps to fundamentally improve the company that can be taken have been.

What is hammering the bottom line is servicing the outstanding debt.   Other than selling the company, the only way out of that debt burden now is a risky, long hard slog of significant growth through competition in a marketplace growing more competitive by the day.

It is not hard to see it being difficult to find someone who wants that job.

Thursday, June 22, 2017

Mi-Connection comments raise the recurring question..."What is the plan?"

At the June 13th Board Meeting, there were some interesting public comments from citizens.  That's always a good thing to see.  One comment from Joe Seferyn of Davidson regarding Mi-Connection has been getting some traction on social media.  Seferyn asked a number of questions about plans for the system in light of the ongoing losses.  aShortChronicle has obtained a written copy of Mr Seferyn's comments in their entirety for your reading pleasure.

Mr. Mayor, Members of the Board:

On behalf of the tax payers in Davidson, I would like to offer comments on the situation regarding MI-Connection and its effect on the town budget and the tax payers.  (By way of background, I worked for 35 years in leadership positions in the voice, data, video and cell phone industry, so I have some knowledge about these issues.)

In the budget review presented by Pieter a few weeks ago, sadly the issue of MI-Connection got no attention.  It is shocking that a million dollar line item in the budget received no discussion at all.     

Since Mooresville and Davidson purchased the company about 10 years ago, the cost of the losses to the Davidson tax payers is over $10 million dollars.  Also, Mooresville has probably lost another $30 million dollars.  Let’s call it what it is--a financial disaster that has a huge negative impact on the town budget. 

Based on my experience, these losses are likely to increase over time, and perhaps escalate due to current negative trends in the industry and intense competition.  
The company keeps touting their growth in customers.  I have been trying for months to find out how many more customers they would need to achieve profitability.  The company has said it’s too complicated to determine, but I know that is just not true.

Without a plan to break even, what is the point of continuing to waste a million dollars a year on a company that has little hope of achieving profitability or even surviving!

Also, tax revenues are increasing due to continuing new construction as well as rising home values.   But, there doesn’t appear to be any effort on the part of the Town Board or the Town Manager to reduce or eliminate the trash fee that was imposed to cover the losses.

The attitude of acceptance of these losses is quite troubling!

The tax payers in Davidson deserve prompt answers from the Board and the Town Manager to the following questions:

1.  Are you going to do a detailed review of the MI-Connection status, develop a plan of action and share the results with the tax payers.

2.  Are you going to ask MI-Connection for a written documented plan to achieve profitability?

3.  How can you consider raising taxes to pay for a new town hall or going further into debt on a new bond issue, while wasting a million dollars a year on a company which may not be financially viable nor  has a plan to succeed?

4.  Why can’t you reduce or eliminate the trash fee that was imposed to pay for the losses?  This would give the tax payers a small return on their $10 million dollar lost investment.

5.  How many more years are you going to spend over a million dollars a year to keep this company afloat without a clear path to profitability?  Some might say continuing on this path would be reckless and financially irresponsible! 

6.  Should the taxpayers of Davidson expect to lose another $10 to $20 million dollars of their hard earned money on this company?  This eventuality is very concerning!

It would seem this is exactly the outcome we will get without a major change in direction.  Wouldn’t those millions of dollars be better spent improving Davidson?  Perhaps the time has come to shut this company down, cut our losses and stop the bleeding.  

There are other sophisticated voice, internet and video providers in the local market today, so the existing customers would not be left without service and would very likely have lower monthly bills.  

The tax payers of Davidson urge you to take decisive action and do this quickly so as to eliminate further losses to be passed on to the tax payers.

Thank you for the opportunity to offer comments

Clearly, after 35 years in the business Mr Seferyn has the background to make informed comments.  That's 35 years more industry experience than any of the Town's elected officials possess.  So, what were the responses from elected officials?

Near the end of the meeting, Commissioner Anderson, seemingly exasperated at having to even mention Mi-Connection, responded that taking Mr Seferyn's advice of shutting down the system by saying "we can't just dump it now because we'd go bankrupt".

That would seem to be quite the exaggeration based on at least one faulty assumption.  That assumption would be that shutting down the system would mean simply closing the doors and walking away.   Obviously that's not true. Instead, shutting down the system would obviously involve selling off the assets.  With the towns owing roughly $65 million as Commissioner Anderson stated, even if selling those assets only brought in 50% of that total it would leave Davidson owing $9.75 million to cover the shortfall based on its 30% responsibility for the company.  That's less than the $11.5 million Davidson will have paid in subsidies through FY2018 since buying the company.

All that taken together makes the claim of bankruptcy because of a Mi-Connection liquidation seem highly unlikely.

On the other hand, Commissioner Anderson did allude to something that probably is accurate which should disturb taxpayers more than the false threat of bankruptcy.  Anderson said Mi-Connection had taken "a couple of hits this year with competitors coming in".  This is the spectre that has been out there since the beginning and was even mentioned in Mr Seferyn's comments that Anderson seemed to be trying to refute.  Competition has always been the main concern from the towns' decision to enter the cutthroat telecom industry.

aShortChronicle recently raised questions in this post regarding the stall in the decline of Mi-Connection subsidies in the FY2018 budget.  If competition is heating up and the company is taking hits, there is absolutely no reason to think that will slow in coming years.  If the subsidy required stays at $1 million per year (or possibly more), Davidson may have little to lose by liquidating the company now.

Commissioner Graham followed Anderson by saying he agreed with Anderson's comments and added that "the questions that were asked are the questions we do ask of Mi-Connection", but because they are in a competitive situation the Board doesn't always ask them in public.

Mayor Woods, the only elected who actually voted for Mi-Connection back in 2007, chimed in with "our method is to encourage citizens to use the service."

None of the electeds answered Mr Seferyn's questions, and therefore it looks like the public still gets to know very, very little about one of its largest expenses.

Commissioner comments start at minute 87:15 of this video.

Wednesday, June 21, 2017

CATS 48x and 77x bus route changes coming on Monday

The two CATS Express Bus routes serving North Mecklenburg will experience some changes this coming Monday.  According to the "alerts" page on the CATS website the routes will change as follows starting this coming Monday, June 26th.

77X North Mecklenburg Express

Morning express inbound trips:  Route 77X will start at the Davidson-Gateway on street park and ride lot, continue via Griffith and Main to the Cornelius Town Hall, continue via Catawba Avenue past Smithville Park, turn onto Statesville Road and continue to the Huntersville-Gateway Park and Ride lot.  After the stop at Huntersville-Gateway, route 77X will continue to I-77 and travel to Uptown Charlotte.

Afternoon outbound trips: Route 77X service will operate the reverse of the above.

Mid-day  trips: Route 77X service will operate between Uptown with a terminus at Northcross Park and Ride, making an intermediate stop at Huntersville-Gateway Park and Ride.

48X Huntersville Express

Morning express inbound trips:  On Monday, June 26th, route 48X will begin at the Northcross Park and Ride Lot.  After the stop at Northcross, the 48X will enter I-77 and travel to Uptown Charlotte.

Afternoon outbound trips: 48X service will operate the reverse of the above.

On Wednesday, July 5, 2017 Route 48X Huntersville Express will be extended to the new Cornelius Park and Ride Lot at 20300 Sefton Park Road.  Customers will be able to park at either  the new Cornelius Park and Ride at 2033 Sefton Park Road or the Northcross Park and Ride starting on Wednesday, July 5th.

According to a CATS representative at the Uptown Transit Center Wednesday, schedules with any time changes will not be available until Friday so if you ride either of these routes pick one up then.

Mobility Plan RFP underway

Davidson has another RFP underway, but unlike the Beaty Street RFP which has caused a lot of controversy, this one hopes to address an issue many (maybe even most) can agree on - Mobility.

The Mobility Plan RFP was posted to the town website with a date of June 12th.   Responses are expected by June 30th.

While Davidson has done a lot of mobility related studies in recent years including the Walks and Rolls Plan and various downtown parking studies (3 since 2011 by aShortChronicle's count), this RFP is for putting together an overall guide around mobility similar to the Town Comprehensive Plan.

"The Davidson Mobility Plan will propose transportation enhancements, programs, development policies, and projects to enhance connectivity for all modes of transportation in town. This plan will also evaluate and incorporate traffic management strategies / programs, evaluate car / bike sharing programs and investigate other innovative transportation solutions. This plan will serve as Davidson’s comprehensive transportation plan and be used as a guiding document for mobility as the town grows. Projects recommended as a result of the Davidson Mobility Plan will be prioritized and funding will need to be determined and allocated."

According to the town, unlike the Beaty Street RFP which was initially sent to a pre-selected group of developers, this RFP went to a wide audience.  According to a response from town staff
"no firms received the Davidson Mobility Plan RFP directly.  It was listed on the NC Planning List Serv, the town’s website, and Charlotte's RFP website."

As for a tentative timeline for vendor selection, the Town "will select a vendor 2-3 weeks after receiving the applications. This may change depending on the number of applications received and NCDOT timelines."

The plan is expected to cost $125,000 with $25,000 coming from the Town of Davidson as local match funding and $100,000 from the CRTPO / UPWP.  The Unified Planning Work Program (UPWP) is a Federal program administered locally via the CRTPO that doles out money from the FTA.  (No, more obscure transportation planning acronyms could not be put into that sentence.) 

As is typical for Davidson, the plan covers way more than automobile mobility.  As a nod to that fact, the order of the sections in the requested response is as follows: Pedestrian Mobility, Bicycle Mobility, Mass Transit, Roadways, Parking.

There is also a section for "emerging technologies". for covering things such as:
• Additive manufacturing (3D printing)
• Advanced analytics
• Automated vehicles
• Hyperloop
• Infrastructure inspection robots
• Innovative concepts for protecting pedestrians, bicyclists, and motorcyclists
• The Internet of Things
• On-demand ride services (transportation network companies)
• Unmanned aircraft systems (UAS)
• Pedestrian Safety and Promotion

Davidson has a long history of spending money on things of questionable value for the town.  While the overall concept of a Mobility Plan seems like a good idea, this last section provides ample opportunity for that unfortunate tradition to continue.  Can anyone else hear Davidson Commissioners justifying "infrastructure inspection robots" or an "unmanned aircraft system" to monitor the Town greenway network?

As with all of these types of things, Davidson says it wants lots of public input and the RFP requires input sessions and input from stakeholder groups as part of the plan buildout.  However, as has been seen with the Beaty Street RFP, saying the Town wants public input and listening to and accepting that input can be very different things.

Monday, June 19, 2017

Our Town Cinemas looking to expand at Sadler Square

Davidson's Design Review Board will hear a proposal  this Wednesday to expand the Our Town Cinemas at Sadler Square as part of a small expansion of the shopping center on Griffith St just off Main in downtown Davidson.

The plan proposed by ADW Architects would expand the theater in both directions to include the entire west side of the shopping center.  According to the application, the nail spa and kitchen and bath design store would move to new spaces constructed on eastern side behind the dry cleaners and facing Waton Street.

See the below schematic for a layout.

The project would happen in 4 phases to enlarge the theater and concession area towards the back of the shopping center, build the new retail space facing Watson St for the existing tenants, then finshes off with more theater space after the existing tenants move to their new spaces.

Here are some elevations of how the new space would look.

Outdoor Concession Seating

View from Watson St

aShortChronicle contacted Bob Lauer of ADW to verify details for this post.  Lauer is a principle with ADW Architects.  He also is involved of the operation of Our Town.  Lauer chairs the DRB, and as such he will not be voting on this proposal.

The DRB meeting is Wednesday 7pm at Town Hall.

It's a nice place to visit, but..

Uptown Charlotte can be an interesting place.  Unlike some who don't ever enjoy heading into the city, yours truly doesn't mind it at all.  I particularly like the "randomness" of it.  It's stuff you don't see every day, and it's interesting.

Guy playing a random
piano left on the street.

Acrobat in a giant ring

Kid playing bagpipes
(he was really good)
Giant pile of trash
(now that's urban!)

Then I get to come home and enjoy what Davidson has to offer.

Lemonade stands
Cows off the back deck
Wild blackberries picked
right down the street
They are different places for a reason, and while Uptown Charlotte is a nice place to visit - as the saying goes - I wouldn't want to live there.  So, for the life of me I can't understand why the leaders of "official Davidson" don't seem to get it.  They seem shocked that people are upset, even angry, over what is happening with development and how fast it is happening.

Even more so, people are shocked at Davidson Town Hall being a facilitator, even instigator, of these changes (Catalyst Project, Griffith Street Hotel, RAP mass rezoning, Beaty Street RFP).  People are tired of the condescending retorts about NIMBies or people wanting to pull up the drawbridge to keep people out when it comes to ideas emanating from Town Hall.  Instead, the public wants a laser focus on protecting what Davidson has to offer rather than a seeming desire to make it into a mini Charlotte.

The people living here now who are fighting these changes, don't ever want to say about this town, "it's a nice place to visit, but...".  Instead, they want to just want to make sure they can say, "it's a nice place to live".

Saturday, June 17, 2017

Scaled back DPD camera proposal gets green light

aShortChronicle told readers last week about a proposal by the Davidson Police Department to install cameras and licence plate readers around town.

On Tuesday the Board passed a slightly scaled back proposal to do just that.  The proposal will place cameras and licence plate readers at the "ingress and egress" points around town which will allow the DPD to know who is coming and going to and from town whenever there is a crime.   The original proposal also involved a few cameras internal to town, but those did not make the cut.

Here's the dollars and cents as presented on Tuesday by Town Manager Jamie Justice and Finance Director Pietre Swart.

The bulk of the funding comes from the existing FY2017 DPD budget as well as FY2017 contingency funds set aside by the Town for just such things that come up during the year.  Only $20k is being pulled from the town savings (aka fund balance).

During Commissioner comments, Commissioner Graham referenced the recent break in off Davidson Concord Rd as an example where this tool could be useful, noting its ability to let investigators know who is entering town at 4:30 in the morning.  Commissioner Fuller, who had initially expressed reservations with the cameras when the idea was presented in May, relayed that after having met with Chief Miller and senior DPD members, Steve Ingram and Jay Stokes, he had changed his opinion and had his civil liberties concerns largely addressed.

After Commissioner Fuller motioned to approve the camera budget amendment, it passed unanimously 4-0 with Commissioner Cashion absent.  No date for the project implementation was set.