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Chris Thompson · Cost of Government in Northeast Ohio
July 14th, 2008
Today several partners, including the Fund for Our Economic Future (my employer), issued research done by the Center for Governmental Research in Rochester, NY, that details what governments in Northeast Ohio spend on various services.
The research examines local government revenues and expenditures for hundreds of governmental entities in Northeast Ohio’s 16 counties. You can access the reports, raw data and summary charts at the CGR web site, live.cgr.org/NEO/.
The research is not prescriptive — it doesn’t tell governments what to do. But it will be used in a wide variety of efforts under way that are examining what changes are needed to make government more efficient and effective. Such efforts include a new 9-member commission that will recommend changes in Cuyahoga County government by early November to the state, and the 21st Century Government Initiative that is taking off in Stark County. The Canton Repository’s take on the research can be found here. And hopefully it’ll be used by the broader public to help them evaluate the efficiency and effectiveness of their local governments.
This research is an important step, but by no means the final step, in a very important conversation that the region must have about the structure and effectiveness of our governments. I look forward to seeing the change it helps prompt.
July 14th, 2008 at 12:07 pm
Chris, is there any extant data, similarly arranged, on the spending of and for secular nonprofits? I’m thinking the conversation ought to go forward considering all societal costs & benefits, and productivity in general–that is, for a dollar spent on services for the public good, what’s the result?
While we’re at it, we might as well include the money spent on political parties and unions. Is there anything I’ve left out that would have an effect on the productivity equation?
July 15th, 2008 at 3:41 am
Chris:
Have you noticed that CGR’s “local government expenditure” totals for Cuyahoga County seem to include 100% of the Metrohealth budget (rather than the $30 million it gets from the county) and 100% of Tri-C’s budget (rather than the $80 million it gets from its levy)? Also that “Electric Utilities” (i.e. CPP) and “Air Transportation” (Hopkins) are included in local public expenditures, though they are city enterprise funds supported entirely by customers?
And of course 100% of county public assistance spending is included, though the vast majority of this spending is actually Federal and state programs and the amount is determined mainly by the size of the client population.
My quick-and-dirty recalculation of CGR’s 2002 numbers, adjusting for these distortions, puts Cuyahoga County’s per capita public expenditures just slightly above Columbus, slightly below Minneapolis-St. Paul, and just $200-300 (i.e. 5-8%) higher than Indianapolis/Marion County.
Whether this is right or not, however, the CGR “analysis” seems pretty slipshod. Not to mention out of date. I’m not sure I understand why FEF is taking it so seriously.
July 15th, 2008 at 12:15 pm
Bill,
I will share your insight and observations with CGR and see if adjustments would be appropriate. We assumed going in that once the data was made available for public review that there would need to be some changes and alterations. We also were sensitive to the age of the data, but we decided to make it available to the public for several reasons, including: 1. The more recent 2007 data will be available soon, but nonreporting is a real issue with the Census for 2007 and we’re hoping publicity on this report will spur reporting by governments. 2. The state’s new 9-member panel on the future of local government in Ohio can use this data for its work, and, we hope, determine that better data is needed and encourage better state level reporting. 3. Begin to set the expectation that the public should have better access to information regarding how their governments spend money.
CGR does detail the impact of the federal and state pass through issue in its research. Remember, that the same issue applies in other regions, as it does with variations in “enterprise funds”. For example, the CGR reports highlight how Indy’s water system has been privatized, and therefore those costs don’t show up in the research.
Tim, I’m not aware of any data on nonprofit spending in Northeast Ohio, but it may be a subject of future research for the Fund.
July 15th, 2008 at 1:39 pm
Chris and your colleagues at FFEF, Thanks for providing this valuable service to the community. Local and regional government seems rooted in Tammany Hall days, when government jobs were rewards for political loyalty and keeping elected officials in office was more important than serving the public. We need to change that culture, and lower the financial burden of the public sector on working citizens. That great sucking sound you hear? That’s the hole in your wallet through which tax dollars are inhaled by the government maw.
July 15th, 2008 at 3:43 pm
Chris, I believe that the story with the Indianapolis water system is not that it “has been privatized”, but that it was privately owned until 2002 (which I suppose is why it’s not in CGR’s 2002 data) when it was taken over by the city/county government and is now being run by a different private operator under contract to a public Waterworks Board. See http://www.indianapoliswater.com .
Anyway, I’m glad CGR and the FFEF are aware of the serious difficulties in making meaningful comparisons with these numbers. Unfortunately that awareness isn’t reflected in the charts I’ve looked at, or in the “quotable” generalizations laid out in the executive summaries (e.g. pages 3 and 4 of the Executive Summary for Cuyahoga County.)
And I’m having a very hard time with the notion that GCR “methodology” sticks the non-taxpayer-funded budgets of entities like Metrohealth, Tri-C, and Public Power into these totals without explaining what they’re doing in big red footnotes, Water systems are different because they’re mostly public enterprises, Indianapolis aside. But urban public electric utilities, big public hospitals and levy-funded community colleges are definitely not that common, and their entire budgets (as opposed to the portions subsidized by local taxpayers) are big tickets. This isn’t a subtle distinction.
July 15th, 2008 at 3:51 pm
Bill: Think you caught them fudging the figures.
These “expert” studies always reflect what the buyers of the studies want and then produce for the news media propaganda dressed up as expert evidence that the same buyers use for their purposes, typically lowering their taxes and cutting services to the rest of the people.
Government BAD. Private business GOOD.
July 15th, 2008 at 5:23 pm
Roldo, BAD government BAD. GOOD government GOOD.
July 15th, 2008 at 6:52 pm
Roldo,
While I don’t expect my assurances will persuade, I can tell you that we did not tell the researcher how to conduct the study or what outcomes we wanted. Indeed, had we done so we would have had dramatically different results of the research. Some individuals involved in sponsoring the research are disappointed that it did not confirm their preconceived notions related to government spending, business growth and fragmentation of governments. Some were disappointed that it didn’t clearly assert a dramatic cost savings from “consolidating” government.
What the research does provide people with is a better understanding of how much governments spend, where they spend it, and where their money comes from.
The research can be used to inform important conversations regarding the shape and structure of our government. Those conversations are happening throughout the region. The Fund for Our Economic Future isn’t controlling those conversations. We are simply trying to provide information that people can use to improve the economic competitiveness of this region. And as the Minneapolis region demonstrates, that doesn’t mean one has to cut government services.
July 15th, 2008 at 7:20 pm
As President of the Fund, I would like to reinforce Chris’ comment that the Fund does not have a pre-ordained “answer” to how the provision of government services ought to be organized. With over 100 members from red and blue counties representing foundations, universities, corporate giving programs, and individuals, there is no consensus view as to what is “best.” Indeed, we’ve not even tried to have that conversation since we believe it is up to the public to sort that out.
We are trying to respond to the call of the public in Voices & Choices — and to the recognition that government has a very real and important impact in the health of an economy (which can be both positive and negative). It is critical that this $16 billion collective annual investment by all of us be understood and directed according to the will of the people and (hopefully) the vision of its leaders.
July 15th, 2008 at 8:21 pm
J: Bad private sector BAD, too?
Chris: I wouldn’t think that the outcome be formalized for the study group. Just that it’s known who is requesting data and what their ideology is.
July 15th, 2008 at 8:32 pm
Roldo, of course. Low integrity is low integrity, in whatever sector of society it exists. High integrity business people, of whom there are legions, welcome the exposure and bringing down of low integrity business people more than anyone, because they tar us all.
Governance exists not just in government.
July 16th, 2008 at 12:48 am
J: I’m glad you agree.
All you have to do is read the Wall Street Journal to know that there are legions also of bad, if we may use that simple term, business leaders. They come by the gross.
As to the purity of such studies, I’ll refer to Bill’s original post.
July 16th, 2008 at 1:34 am
Please note that these ones who are anti-Tammany Hall and pro-private sector themselves hang off yet another teat, all of which needs scrutiny.
Finger pointers need to be wary of the backblast.
July 16th, 2008 at 6:52 pm
Roldo, I think you’re confused about the numbers based on reportage, which tends to focus on exceptionalism. Your statement that “there are legions also of bad,” is like saying that all mayors are liars because of what Kwame Kirkpatrick did in Detroit.
In my experience, the mix of good and bad, selfish and selfless, noble and debased, greedy and generous, doesn’t vary much from one sector of society to another. So stop the business bashing and do something useful, like trying to understand and explain what it is about a system–like country government or corporate governance–that is flawed such that it encourages the bad behavior that lurks within the human genome.
July 16th, 2008 at 9:27 pm
Your logic is faulty. And your choice of Kwame K reveals something about your thinking.
And if you would read 40 years of my work you would know that I’ve been active documenting both county commissioners (of both parties) and business leaders here for their cozy relationships and deals. And doing it face to face, depending heavily upon being there to watch and observe and using as much documentation as possible. If you don’t care for the point of view that’s fine but the record is there.
July 17th, 2008 at 12:35 am
Roldo, you missed my point. It’s not about the individuals, but about the structures and systems that enable bad behavior to emerge, and even reward it–for a time usually, until it catches up with the person.
And my logic isn’t faulty at all. Good and bad lurks within all humans, and a combination of our ability to exercise self-control, and the environments in which we operate encourage the traits that emerge from us each. It is no different in business than in government, or in non-profits. Integrity (and its absence) is not exclusive to one political party, one background, one ethnic group, or one choice of careers. I know people of low integrity in each world. There are plenty of examples of scandal in each world. I chose Kwame Kirkpatrick because he is a self-righteous Democrat. It happens that he operates in a system of low accountability, which is why he spent taxpayer money from a bankrupt city trying to cover up a personal peccadillo–which, proving my point, caught up to him anyway.
We aren’t going to change human nature, but we can design systems of governance in business, government, and the non-profit world that encourage good behavior and discourage bad behavior.