Gov. Kasich to change from big stick to carrot on a stick
Keeping the cost of government in check keeps money in your wallet, so pay attention to the good news coming out of Columbus later this month.
Ohio Rep. Matt Szollosi expects a midterm budget review bill to be introduced soon to coincide with the release of the report Beyond Boundaries: A Shared Services Action Plan for Ohio Schools and Governments. The report will recommend how to make better use of your tax dollar.
In that report, the Office of Budget Management is expected to recommend financial incentives for local government and schools to reduce costs by sharing services. The savings can be substantial, according to a preview of the report. Here are three examples:
$318 million over two years from pooling healthcare insurance for school districts and institutions of higher education;
$500 million between now and 2020 in capital and operating expenses by utilizing MARCS (Multi-Agency Radio Communication System) at a state-wide level;
$150 million from regional coordination of shared “cloud services” and development of regional data centers.
The message is: if you want to go it alone, pay for it alone, but if you work together the state will help financially.
This approach of voluntary shared services is better than the bully approach Gov. John Kasich tried last year when he and the legislature passed a bill to restrict bargaining rights in order to give local government and schools more flexibility in controlling costs. Voters soundly repealed that issue in November. It’s also better than a state-mandate forcing consolidation or a big-city led regional government plan that frightens nearly all small towns and townships. A shared-services strategy is a quicker route to the goal of less expensive government.
Mike Beazley, Oregon city administrator, believes local government must be proactive in seeking out these partnerships. “Change is going to be thrust upon local government. We have to get ahead of it and engage in these discussions or the state is going to decide for us.”
He says local government should focus on two areas, both of which have little impact on the quality of service delivered to you. The first is capital purchases; the second is what he calls “back of house costs.”
These latter costs are payroll, purchasing, bookkeeping and some administration functions. Many of these functions are computerized and could be handled by a third party.
Front line costs should also be scrutinized, Beazley said. For instance, if a city park is located next to a school, why can’t the same crew mow both? Liability, turf and union issues need to be resolved, but Beazley said, it’s better we do it than have the state do it.
Capital expenditures should also be open for discussion. Should every small community own an expensive piece of equipment such as a vacuum truck, or can a few communities share the cost of one?
This concept of shared services is not new. We have joint economic development zones, water and sewer districts, and reciprocity agreements for emergency, fire and police services. Beazley says local government and schools have to take shared services to the next level. Some are already doing that. Genoa Schools, for instance, has joined consortiums for purchase of gas, electricity, office supplies and health insurance. Annual savings average more than $105,000, according to Bill Nye, district treasurer.
Nye said the district is now looking at a joint fuel depot with the Village of Genoa.
Dennis Mock, superintendent, added, “It won’t be too long before we see consolidation of schools and asking the question, ‘Should districts share administrators and superintendents because of the dynamics of the economy?’”
Community leaders are discussing other ideas to share services. In Wood County, six police jurisdictions are looking to form a regional Special Weapons and Tactics team (SWAT). Rossford, Northwood, Walbridge and Lake Township are also looking at forming a joint dispatch service for emergency calls.
In Oregon, city officials will host a public hearing Tuesday, 7:00 p.m. in council chambers to get citizen input for a joint recreation district. Tom Susor, council president, envisions a public-private partnership to include the city, Jerusalem Township, Oregon City Schools, Cardinal Stritch and the YMCA. The rec district would be funded by corporate donations, fees and a levy.
Councilman Dennis Walendzak, recreation committee member, said the committee is looking at building a new complex on city property, near the current soccer fields. It would house a senior center, indoor soccer fields and other recreational amenities. The center could also house programs for art, music and theatre.
Shared service agreements are the wave of the future, dictated by a changing economy, an aging population and decreasing tax dollars. There are obstacles to overcome: legal issues, collective bargaining issues and fairness and trust issues. But, Beazley contends local government, not state government has driven up the cost of government. The state’s move to cut funds to local government can be a blessing. “The fact is maybe, we wouldn’t have had the political will to do this if the state wasn’t saying, “We’re taking away this money.’”