There
is a time bomb waiting to blow up in our faces — in Rochester, in Pittsford,
in Hamlin, in Webster, in Gates, in Mendon….
The time bomb is the county’s
financial situation, severe now, and growing worse. Last year and this year,
the county faced major budget deficits. It covered them by, among other things,
using a one-time infusion of money: its share of the state’s settlement with
the tobacco industry. Next year, the county is likely to face an even larger
deficit, and there’ll be no cigarette money available to rescue it.
And county government isn’t
alone. The City of Rochester is projecting a deficit of $41.2 million next
year, a figure that could grow to $110.1 million in 2008. Many of the county’s towns,
villages, and school districts are also under pressure.
That pressure will build as
costs increase — for employee health insurance, for Medicaid, for schools,
and probably for social services.
Monroe County residents will
face dramatic cuts in services — fewer police, fewer Sheriff’s Road Patrol
deputies, fewer firefighters, fewer teachers, larger classes, closed parks,
deteriorating roads. Support for the arts, for the zoo, for the library, for
museums, will be slashed still further.
And these aren’t the only
problems. Rochester’s Center for Governmental Research reports that the metro
Rochester area — Monroe and its six neighboring counties — lost nearly
10,000 jobs from the first quarter of 2002 to the first quarter of 2003.
Greater Rochester was second only to Binghamton in job loss, and the loss
continued in the first quarter of this year, says CGR.
From the beginning of 2002 to
the beginning of 2003, says CGR, “the Rochester metro area ranked 268th out of
284 metro areas” in the nation in employment growth.
The shrinkage is a sign of the
weak Upstate economy, which will continue to impact the property-tax base and
sales-tax receipts.
And as the local population
ages, things could get worse, if the area continues to hemorrhage young adults,
its future wage-earners and home-buyers.
For the second
time in less than a year, a group of community leaders have warned that Monroe
County is in serious financial trouble — and that bold, quick action and
long-term structural changes are essential.
The latest warning comes in a
report from the Council of Governments — representatives of the city, county,
towns, and villages — and a group of business leaders called the Rump Group.
Building on a study by the Center for Governmental Research, the report spells
out the problems facing the county and its municipalities and school districts.
The city and county are facing
major deficits “despite large cuts already made in the last year by both
governments that totaled over $40 million,” says the report.
And, it says, while a national
economic recovery “will certainly help,” it won’t solve the problems. The
county and local governments must move quickly to cut costs and save money now.
And, says Rump-COG, the community must study options for long-term, structural
solutions.
Rump-COG deliberately timed
the release of the report for the early stage of the county executive campaign,
to “contribute to the financial management discussion” in that campaign, and
with the hope of having an impact as local governments start working on their
next budgets.
Short term, says Rump-COG,
there are few options. Greater Rochester already has the third highest
property-tax burden in the nation, and one of the highest sales-tax rates; tax
increases would make the region even less competitive. Increased state and
federal aid won’t be the solution either, says the report, since both levels of
government have their own financial problems.
Rump-COG also argues strongly
against cutting services to save money. “In an era where quality of life and
levels of service are selling points in a competitive market,” says the report,
“cutting the type or level of public services can be counter-productive.
Reducing service levels in the long run has the potential to degrade a community’s
quality of life and viability, making it a less attractive place to live and do
business.”
For near-term savings, that
leaves two options, says the report: to “operate more efficiently… providing
services better, cheaper, faster” and to reduce the impact of “unfunded
mandates.” The mandates are services that the state requires localities to
provide but doesn’t fund, and regulations that increase costs for local
governments.
Although Rump-COG suggests
that there could be immediate savings from reducing mandates, it’s not likely
the county could get out from under any of those mandates overnight. In
addition, the public may feel that some of the mandates are important, and
local governments might be pressured to continue to provide them, state-mandated
or not.
More likely for immediate
savings is Rump-COG’s recommendation for “efficiency” — if the county, city,
towns, and villages embrace it. This would mean expanding the kinds of
“cooperation and collaboration” that the municipalities already participate in:
buying supplies and materials together to get reduced prices, sharing
maintenance facilities and services. The report recommends, for instance, that
all local governments work together to buy insurance.
The report also says there
could be immediate savings by reducing social-services costs and by more
municipalities working together on water service. (The latter will be
controversial; the city operates its own water system and has been loath to
transfer it to the Monroe County Water Authority.)
Much
of the media coverage has overlooked the significance of the Rump-COG report:
particularly the significance of its long-range recommendations and the
potential they offer.
The report is not as bold as some
might like. And given its authors — a group of business leaders and the
mostly Republican leaders of the county’s municipalities, its recommendations
have a certain point of view. But it’s an unusual, important report; there’s no
sugarcoating of the problems, no touting of the community’s rich resources, no
hollow boasting about job creation, no bragging that Monroe County’s financial
situation is better than that of its Upstate neighbors.
And while the specific
recommendations are limited, Rump-COG states that the report is “intended to be
a starting point.” Whether the community moves aggressively from this point, or
continues to move slowly and cautiously, nibbling at the edges of the
opportunities, will depend on many things, political partisanship, mistrust,
and vested interest among them.
Already, politics is tugging
at the report and attempting to co-opt it. Some elected officials have insisted
that the report repudiates Mayor Bill Johnson’s call for a study of
consolidation; others say the report does no such thing.
Perhaps such wrangling dooms
the progress that could grow out of the report. But the potential for progress
is there, written into the report, if local elected officials, business and
other community leaders, and grassroots activists can see beyond their own
narrow interests.
Rump-COG notes that
“cooperation and collaboration” offer the most hope for short-term savings,
because they don’t require changing governmental structures. But the report by
no means slams the door on more extensive changes. It cites the need for
“eliminating duplicative functions, structures, and approaches that waste
public dollars.” It notes that there is a community history of moving “in
varying degrees toward full consolidation of services through one regional
agency,” citing water, sewers, public-safety training, and the 911 system as
examples.
“Because they are likely to
require structural changes, i.e. changes in fundamental laws and/or the way one
or more local governments are organized,” says the report, “consolidation
opportunities are more likely to require a longer time horizon to produce
cost-savings, i.e., savings will happen in the long run (after a year or
more).”
Rump-COG emphasizes that the
community must focus on both short-term and long-term measures. “While it is
tempting to focus only on those short-term opportunities which can be achieved
through cooperation and collaboration,” says the report, “structural changes in
the way certain functions are provided are likely to offer significant
opportunities for achieving cost efficiencies.”
One of the broadest forms of
consolidation would be to merge city and county governments. (That would not be
the most extreme form; it would be possible to merge city and county
governments and leave town and village governments intact.) But Rump-COG
declined to consider a city-county merger.
“Without more detailed study,”
says the report, “it is not clear what level of savings might be achieved from
such a merger in Monroe County.” And, the report says, a city-county merger
would encounter so many “legal and political challenges” that any savings would
take place in the distant future.
“Therefore,” says the report,
“the Group believes that the community would be better served by focusing on
the functional cost savings proposed in this report at this time.”
Those “functional cost
savings” include a couple of major items:
• That the community “rethink
the way fire-protection services could be provided in the future.”
• That the community
“streamline and consolidate economic development services.”
The report doesn’t go into
detail about either, but handling those functions at the county level could
improve quality in both areas. Whether consolidation would save money is a
different question. When the community considered metropolitan police in the
1980’s, studies indicated that there would be no cost savings, at least
initially. The reason: City police salaries and benefits were higher than those
of some suburban forces. All would have to be brought up to the higher level,
as would the level of service.
But significantly, Rump-COG
says that cost savings isn’t everything. “While creating a consolidated
economic development agency for the community might well reduce costs,” says
the report, “equally important is the need to create a single unified approach
to marketing and economic development activities.”
The responsibilities of such a
metro economic-development agency would have to be defined, and the idea could
be a politically controversial one. Even if such an agency were in charge only
of attracting business and industry from outside the county, it would be a step
in the right direction. But more effective, and more valuable to the community,
would be for that agency to be in charge of alleconomic development in the county, helping resident as well as
out-of-county companies find the right site to locate or re-locate.
That might require changes in
the way the community shares its tax base. Currently, the City of Rochester and
each town and village must fight over new development as they struggle to
increase their tax base. Often, the “new” development isn’t new at all; it’s
simply a company already located in Monroe County, moving from one municipality
to another, taking its taxes with it. (And often, getting a tax break in the
process.)
But under the right
circumstances, with the right protections for individual municipalities,
consolidating economic-development departments and efforts could end that
inter-municipal competition, a competition that is expensive and that diverts
the energies of governmental staff from more important, more fruitful
development opportunities.
Like the study
that preceded it — the November 2002 Blue Ribbon Report on Monroe County
Finances, commonly known as the Richards Report — the Rump-COG report was
carefully non-partisan in tone. But it was bound to be drawn into the most
volatile issue of the County Executive campaign: some form of metropolitan
government, proposed by the Democratic candidate, Rochester Mayor Bill Johnson.
Indeed, before the report was
released, a portion of it was leaked to the Democrat
and Chronicle. And the Republicans’ candidate for county executive, Maggie
Brooks, told the D&C that the
report “represents a resounding defeat of the mayor’s metro government [idea]
and validates the cooperation and shared services approach that the county has
been taking for the entire community for a long time now.”
Brooks’ assessment, however,
oversimplifies the report. Furthermore, there are numerous types of metro
government, and Johnson has simply said that the community should discuss the
possibility. He has not proposed a specific form of metro government.
In fact, far from rejecting
any form of metro government, the Rump-COG report specifically endorses one type:
a two-tier form of government recommended in the early 1970’s by a blue-ribbon
group called GRIP-NAPA (Greater Rochester Intergovernmental Panel — National
Academy of Public Administration).
GRIP-NAPA’s concept was to
create two levels of government: Individual local governments would deliver the
services that were most appropriately delivered at the local level. An
“area-wide” government would deliver services needed by the general population,
services that could be delivered most efficiently and most effectively by a
single, larger government.
The Rump-COG report notes that
since GRIP-NAPA, there’ve been many consolidations of services. And, the report
says, “many additional opportunities remain to reduce the cost of providing
local government services by using efficiencies of scale without reducing
service quality.”
“The strategies to achieve
these savings,” says the report, “are to cooperate, collaborate, and
consolidate, within the framework of the two-tier model of regional
governance.”
As the
Rump-COG report says, there’ve been important consolidations of services since
the GRIP-NAPA report. Most of them, says the report, “have occurred
incrementally, on an evolutionary basis.” But many of GRIP-NAPA’s
recommendations have been ignored, as has the basic concept of a true two-tier
metro government.
The Rump-COG report opens the
door for the community, at a minimum, to look at the services that could be
provided more effectively — and perhaps less expensively — by the “first
tier” of a two-tier government.
You could argue that Monroe
County already has a two-tier form of government, with the county handling some
services, and the city, towns, and villages handling others. But Rump-COG
recommends expanding what we have.
Perhaps as significant as its
specific recommendations is that — like the November Richards report —
Rump-COG makes it clear that the Community of Monroe is in crisis, that we
can’t wait much longer to deal with that crisis, and that we can’t deal with it
in the same old ways.
The report could serve as an
important discussion point in the county executive race, helping candidates and
voters focus on opportunities rather than slogans and fear. That will require
temperance and thoughtfulness from the candidates and their political parties,
attention from voters and special-interest groups, and major space and air time
from the media.
For the community, the
convergence of the financial crisis and the election offers a unique
opportunity: to participate in planning the county’s future. The county and its
municipalities can’t escape dealing with the crisis. It’s far better to draw in
the public, through the election campaign and craft well-thought-out solutions
than to respond piecemeal, in panic.
This article appears in Jul 23-29, 2003.
