Carl Stenberg, professor of public administration and government at the School of Government, University of North Carolina at Chapel Hill, reviewed 246 stories summarized in the International City County Manager Associations News Briefings from April 2009 to April 2011. Stenberg’s review provides an interesting look  at how governments across the country are dealing with reduced funding and increasing costs.

246 case studies

96 governments took actions related to Personnel  (benefit reductions, furloughs, layoffs, pay cuts, reduced work week, retirement incentives)

85 addressed Core Services & Programs                           (department/ agency elimination/streamlining, position elimination, program elimination, service reduction)

41 Undertook Service Partnerships                                     (for-profit organizations, interagency, interlocal, non-profit organizations, volunteers)

24  have considered Restructuring                                     (form of government change, consolidation/merger/disincorporation)

What the above indicates according to Sternberg is:

“The relatively easy decisions have been made as far as salary and travel freezes; across the board budget cuts; temporary furloughs and layoffs; vacant position eliminations; fee increases; reserve fund withdrawals; maintenance and vehicle replacement deferrals; and minor service reductions. The low hanging fruit has been picked”.

“…most responses could be labeled conventional and incremental, instead of part of a bolder, more innovative and comprehensive approach.”

“Only 24 stories reported on initiatives in 16 states to make local governments more efficient, economical, and effective through city-county or city-city consolidation, downsizing the government board or changing the form of government.”

“Cities and counties are just beginning to consider strategies for reinventing themselves. As budget cuts at the federal and state level continue to impact local governments many managers and elected officials will need to “think the unthinkable” as far as eliminating core services, expanding interjurisdictional partnerships and jurisdictional realignment.”

What can local officials do to cope with the next wave of economic crisis?

1) Boundary Spanning – Expansion of services delivered in whole or in part through interlocal contracts and joint service agreements. Outsourcing appropriate services to non-profit organizations and private firms.

2) Consolidation/Merger – Especially fiscally hard hit communities could consider moving beyond service-sharing arrangements to functional transfer or consolidation. Local officials could maintain service levels and contain or reduce costs by both “thinking regionally and acting regionally.”

3) Partnering With States – Relationships between local and state governments could become more critical to successfully coping with economic crisis. State and local officials need to identify partnership opportunities.

What do you think about Stenberg’s point that local governments need a bolder and more innovative approach to addressing their fiscal crisis?