Management Partners, Inc. presented their 114-page Fundamental Services Review report to Washoe County’s Organizational Effectiveness Committee (OEC) this morning which identified 64 recommendations designed to save the county nearly $30 million. The OEC is comprised of local citizens who serve as leaders in their industry and are appointed by the County Commission to act as an advisory board to the Commissioners and the County Manager. County Commission Chairman John Breternitz is a member of the OEC and was present at today’s meeting.
Management Partners, Inc. is an independent, national consulting firm with broad expertise in local government operations. They were hired to conduct a review of Washoe County’s operations in response to a request for proposal that was issued at the direction of the Commission earlier this year. The goal of the review was to identify opportunities to increase county efficiencies and reduce costs while positioning the county for a financially sustainable future, culminating in a report with recommendations which would ultimately be submitted to the Commission for possible action. The Commission asked that the OEC provide oversight in this effort to ensure input and review by this group of business leaders before being presented to the Commission.
In response to declining property tax and sales tax revenues as a result of the on-going recession, Washoe County has reduced spending by $154 million over the past five years to meet budget deficits. This has resulted in nearly 20% reduction of the county’s workforce. Facing the challenge of identifying even more savings in the long-term, the County Commission directed staff to engage an independent consultant to find further opportunities for sustainable cost savings. Specifically, the County needed to find $5 million of sustainable savings for the 2011-12 fiscal year, with an additional $10 million in the 2012-13 fiscal year.
“The low-hanging fruit is gone,” Management Partners’ President and CEO Jerry Newfarmer told the OEC today. “I’ve never seen such a bare tree in my life,” he said referring to Washoe County’s current budget situation and organizational structure. Mr. Newfarmer praised the county’s actions to date, stating that the county has already accomplished many of the cost-saving strategies they typically recommend. He further complimented county staff for their hard work and innovation and said, “There is no waste, fraud or abuse here that we found.”
Difficult Process. Newfarmer, himself a former city manager, told the OEC that counties are extremely complex organizations, and that the two month period in which his firm conducted the project was less than usually dedicated to a project of this magnitude. In spite of that, he did note the participatory nature of the review including receiving input via an on-line survey and confidential emails from employees as well as one-on-one interviews with department heads, elected officials, senior management, and the citizen OEC members. Newfarmer stressed that fundamental service reviews are iterative processes, and encouraged additional data, corrections of fact, and further input to be sent to Asst. County Manager John Berkich by July 25th at firstname.lastname@example.org and it would be taken into consideration.
Newfarmer also said that the report categorizes the 64 recommendations into five categories (not in ranked order) with identified potential annual savings for each:
Changes to the Organization Structure $9,981,700
Changes in Staffing & Compensation Practices 1,502,000
Changes to Business Processes 2,411,000
Changes to Service Delivery Metholodogy 4,189,000
Other Changes 9,462,000
Total Potential Savings $27,545,700
Newfarmer noted that each recommendation is assigned a letter of A, B or C to indicate its implementation level and/or difficulty:
Category A: These opportunities can be implemented by the Board of County Commissioners and/or Management. They total $17.3 million in annual savings.
Category B: These opportunities can be implemented by the County but require the additional concurrence of separate elected officials or employee organizations. They total $8.2 million in annual savings.
Category C: These opportunities can be implemented by the County but require support of outside entities such as the state or federal government. They are the hardest to implement. These total $3.4 million in annual savings.
Opportunities Identified. The 64 recommendations identified are too numerous to list in this press release, but attached is Attachment A from the report which summarizes those recommendations by category of opportunity and implementation. The full report can be found on the county website at www.washoecounty.us and accessed directly from the website’s frontpage. Today’s 2.5 hour-long meeting will also be posted on the county’s video-on-demand feature found on the county’s website.
Next Steps. At today’s meeting, the OEC unanimously voted to forward the report to the County Commission for their consideration. The report will be on the Board’s August 9th meeting agenda, and again scheduled on their September 27th meeting agenda for possible action on what, when and how to implement any of the recommendations, giving them six weeks to thoroughly digest the report.
The Fundamental Services Review was done at a cost of $78,000, with $4,100 raised so far in private funding to offset the cost. Newfarmer told the OEC that in his experience, he has found that for every $1 million in savings identified, $100,000 of subsequent analysis and implementation planning is required.
http://www.co.washoe.nv.us/repository/outreach/e5nn_summary.pdf for more info