Jay Ash, city manager of Chelsea, Mass., holds an LED streetlight unit, one of which the city bought in bulk with Boston and other nearby cities, which saved the city $250,000 on the purchase and will save an expected $80,000 a year in electricity.(Photo: By Josh T. Reynolds for USA TODAY)
In a post-recession budgetary crimp, Chelsea, Mass., City Manager Jay
Ash has seen the light. Chelsea is joining with big neighbor Boston to
buy greener LED lights for the city's 1,400 streetlights. Doing so may
save $250,000 to buy them and $80,000 a year in electricity to power
Across the country, cities, counties and other local
governments are combining services, from 911 call centers to basic
purchasing, to capitalize on the economics of scale and offset declining
revenue since the Great Recession. The recession technically ended in
2009, but pressure on cities has continued. A September National League
of Cities (NLC) report predicted that this will be the sixth consecutive
year of declining revenue for local governments.
are under tremendous pressure to find new ways to maintain and expand
services to residents who want those services," says Ash, whose city's
$135 million budget has grown by 1%-2% annually since 2008, compared
with 4%-5% before the recession hit in 2007.
Ash says that when he
came into government 30 years ago, "the last thing you would have done
is call across your municipal border for help. Today, it is expected."
He discusses ways to combine community health services with leaders of two neighboring suburbs.
are starting to notice the stress on city budgets. A USA TODAY/Gallup
Poll, taken Oct. 13-14, found that 34% of respondents said their local
governments have cut back on services since the 2008 financial crash.
Fifty-one percent have noticed no difference, and 9% said they believed
more services were being offered. The survey of 1,015 adults has a
margin of error of +/-4 percentage points.
The NLC's survey of 324 financial officers in cities over 10,000 in population (http://www.nlc.org/cfc2012)
found that more than four in 10 had seen cuts in aid from state
governments over the past year. Almost half had reduced the size of
their workforces. The federal Bureau of Labor Statistics reported in
September that more than 14 million people work for local governments,
down 476,000 since 2008.
The NLC's survey also projected that
revenue from property taxes would be down by 2.1% this year and that
income tax revenue would be down almost 1%. Sales tax revenue was
projected to grow by 2.4%. Forty-three percent of respondents in the
survey said their cities had raised fees, and 25% reported reduced
spending on parks, recreation and libraries.
Ash says Chelsea has
been able to maintain basic services, actually increasing police and
fire ranks by 14% over the past decade, while cutting clerical and other
positions in city hall by 12%. Since the recession, Chelsea has tapped
rainy day funds and put off capital expenditures on roads, bridges and
sewers. It's a common refrain around the country, and postponed
maintenance worries officials.
Citizens "don't see the drain systems, don't see the water lines," Ash says.
governments got a momentary boost in 2009 through federal stimulus
spending. Since then, mayors, city councils and managers have braced for
what policy analysts Bruce J. Perlman and J. Edwin Benton describe as a
"going it alone" future. Federal and state governments, which also face
financial challenges, have cut aid to local governments.
a University of New Mexico professor of public administration, and
Benton, a University of South Florida government professor, say local
governments have relied mostly on "quick-fix" strategies such as
freezing hiring to cope with tight budgets.
They surveyed 580
city and county officials and found that about a third expected revenue
in their jurisdictions to return to pre-recession levels.
are a lot of pressures (to combine services), but there has not been a
notable shift to it as of yet," says Perlman, formerly chief
administrative officer for Albuquerque. "That said, I am willing to go
out on a limb and say that is the next step. What has happened to local
governments is the fat has sort of been wrung out, and so there is
nothing else left to do. So collaboration is the next step."
Abels, a former city manager in DeLand, Fla., says the Great Recession
has been a "primary catalyst" for much of the consolidation underway,
especially in public safety. He predicts that service sharing between
local governments will expand to health care and roads as cities
confront backlogs in infrastructure needs.
Abels says he's worried
that citizens and city officials will become complacent and believe
local governments will return to pre-recession conditions, when there is
ample evidence they won't. He says many jobs being created are low-wage
and low-benefit, which will increase demands on public services while
limiting tax revenue to local governments.
"Even though there are
indications that the recession is ending, I don't think the local
governments have yet hit bottom," says Abels, who teaches public
administration at the University of Central Florida.
and state aid likely to be scarce, he says, "local government is going
to have to become innovators in some social programs."