Bruce Nye: What does budget reform look like?

Bruce Nye is a board member of Make Oakland Better Now!. Budget reform will be on the agenda at the joint Make Oakland Better Now! and East Bay Young Democrats meeting on Sunday, February 20, 2011, 2:00 p.m. at Lakeshore Avenue Baptist Church, 3534 Lakeshore Avenue (directions). All are welcome.

Part I

At Make Oakland Better Now!’s February 20 meeting, we will be looking at ways our city could reform its budget process to make city government more responsive and more cost-effective. In posts this week, we will be focusing on two reforms: Performance Based Budgeting and “Price of Government” Budgeting. Both reforms have been used successfully in other cities.

Performance Based Budgeting

Oakland has been talking about performance based budgeting for nearly ten years. In the Budget Advisory Committee minutes from November, 2002 (DOC), it was noted that the City Council had committed to begin performance based budgeting by fiscal year 2005. And changing to performance based budgeting was part of the city’s “Moving Oakland Forward!” strategy (PDF) in 2003. Despite these discussions, the city has yet to make performance based budgeting a reality.

While there are many variations of the performance based budgeting model, they all have these features: Departments, divisions or other government units accept measurable goals for the budgetary period. They are given resources to achieve those goals. And at the end of the budgetary period, its leadership is evaluated on whether and to what extent those goals were met.

Here’s a comparison: Oakland’s 2009-10 and 2010-11 budget for its Public Works Department is here (PDF). In this budget, the department’s performance goals are described as follows:

  • Improve livability through sustainable practices for cleaning and maintaining streets, trees, sidewalks, parks and facilities.
  • Maintain the City’s infrastructure to meet current and future needs of our neighborhoods, support development and reduce the City’s exposure to liability.
  • Create a sustainable City through implementing green buildings, renewable energy and efficiency projects, alternative fueled vehicles, and recycling/solid waste services.
  • Leverage existing resources by seeking grants, public private partnerships and by enhancing volunteerism and sponsorship opportunities.
  • Foster collaborative opportunities with other agencies and individuals to improve service delivery.
  • Continue focusing on high-quality service and customer satisfaction to be the ‘provider of choice’ for our customers.

These are all lofty goals. But none of them are measurable.

Now let’s look at the City of Milwaukee, Wisconsin, a city with twice the population of Oakland. Here is Milwaukee’s Public Works, Infrastructure Services Division budget (PDF). Even in its executive summary, the budget document is specific and sets out measurable goals:

OBJECTIVES: Enhance transportation options and existing infrastructure. Reduce energy use in city operations by 15% by 2012.

STRATEGIES: Reduce local street replacement cycle to 65 years.
Increase capital maintenance of local streets. Improve bicycle and pedestrian access citywide. Complete installation of the LED traffic control signals and follow the development of LED street lights. Retrofit buildings to increase energy efficiency.

The sections that follow tell the reader all the details, of what will be accomplished, many of them quantitative, and what it will cost in terms of staffing, salaries and wages, benefits, equipment, etc. If the system works as designed, at the end of the budget period departments and divisions report on how well they met their goals with the resources they were given. This helps citizens and city policy-makers decide if tax dollars are being spent efficiently and in conformance with the city’s goals and priorities.

Performance based budgeting is on the agenda (PDF) of City Council’s Finance & Management Committee at 11:00 a.m., February 22, Oakland City Hall, Sgt. Mark Dunakin Room, First Floor. City staff seems less than enthusiastic about performance based budgeting (PDF). Make Oakland Better Now! supports it, however, and urges Oaklanders to come out in support.

11 thoughts on “Bruce Nye: What does budget reform look like?

  1. livegreen

    Thanks for this post Bruce. I have a feeling existing policy was written by staff, in a way most convenient to them and their jobs, and then the City Council just rubber stamped it.

    The bureaucracy would want something general and safe, that gives them the most amount of leeway and least amount of specific goals, that would hold them accountable.

    It is time for the City Council to take back the reigns and the initiative, so there is movement and visible progress.

  2. Scott Law

    Thanks Bruce for your work and the Make Oakland Better Now team. However, I will probably not attend this meeting despite my high interest and the vital nature of this topic.

    A quick glance at the website for East Bay Young Democrats show the usual suspects in leadership with “progressive, justice,” blah blah, all from UC Berkeley except one from Santa Barbara, zero background in economics, business, public administration or God help us, accounting.

    I have been to or watched a dozen or so “budget” meetings for the city in the past 10 years and they are all the same – lets scare the electorate with dire consequences and then go for tax increase.

    Right now, with the city functionally bankrupt, any discussion other than drastically reducing salaries and pensions of all city employees making > 75k is a complete waste of time.

    You might want to bring up one item that Sandre Swanson can do to help the city – introduce legislation to repeal AB3008. This was the gift from Wilma Chan/Perata, etc that lowered the required retirement age of
    “public safety employees” to 50. ie Fireman, Police, Prison guards, probation officers, etc.

    This was probably the single most destructive legislation to the city governments since collective bargaining in the 70′s. What the assembly and senate can pass, they can repeal, at least for the future. Lets see how the EBYD leadership reacts to that one….

    Good luck. Sorry to be cynical

    Scott L

  3. Max Allstadt

    Scott,

    That’s absolutely not true. The East Bay Young Dems website must be out of date.

    Among the EBYD leadership is Rebecca Saltzman, who is very involved in Oakland issues and who is a serious policy wonk specifically about Oakland issues. The same can be said about Jonathan Bair, who is also a new member of the leadership.

    Also, and this is important, Nathan Stalnaker, who is on the board of MOBN with me and Bruce, is also part of the East Bay Young Dems leadership. Nathan has worked on an audit of CEDA with Courtney Ruby’s office.

    Also, Richard Fuentes, who is the Policy Aide to Ignacio De La Fuente, who is the Chair of Oakland’s Finance Committee, is a member of the EBYD board.

    It’s just not true that EBYD doesn’t have leaders that represent Oakland.

    Add to that the fact that MOBN board members who worked on this policy research include Nick Heidorn from Oakland’s Budget Advisory Committee, and Jim Blachman, who does financial forecasting professionally.

    Then add that we’ve got Courtney Ruby speaking. We’ve got John Russo speaking, when John was on the Council, he railed against reckless pension policy. And we’ve got the chair of the Finance Committee speaking too.

    MOBN and EBYD have put together a serious amount of thought and research and expertise in one place. I highly recommend you attend.

    Many hours of volunteer research and many hours of policy debate went into what will be presented on Sunday. More than I’ve seen at any Oakland event I’ve ever attended, frankly. If you don’t come, you’ll really be missing out.

    MOBN is not messing around. We’re absolutely serious about creating real change. We’ve got big ideas about fiscal policy, and they’re vetted and viable. No more smoke and mirrors. We’re also working hard to get feedback, and to organize political support to make sustainable finances a reality for Oakland.

    This is a critical time. It is a major opportunity to fix the mess, and it may be the last chance to turn us away from the cliff we’re headed for.

    Also, we aren’t going for a tax increase. We’re not stupid. We know it won’t happen, we know the votes aren’t there, we know that trust has been abused. We’re looking at pretty much everything but a tax measure on the ballot. Please come. It will be worth it.

  4. Scott Law

    Max

    thanks for response. It sounds like a lot of work went in to this. Maybe I have the wrong site. Here is the bios of the people I have extracted form EBYD, with …. for omitted phrases in the interest of brevity.
    I did miss that one person is from Cal State LA and another from UC San Diego, but I think my original post still stands…

    Apologies to the group since this is too long. But I don’t see a single person on this list qualified to speak to cutting union employees salaries and benefits to the extent needed to come close to avoiding bankruptcy. I don’t mean to disparage the efforts and good will.. but this is a rock that will be very hard to move
    without earthquakes cracking whole Democratic cabal that runs Alameda county.

    http://www.ebyd.org/site/2010/12/ebyd-elects-2011-executive-committee/

    **************
    Rebecca Saltzman is the Associate Campaign Director of The Next Generation, a full-service campaign consulting and management, and issue advocacy firm, specializing in environmental and progressive issues in the Bay Area and across California. Prior to this, Rebecca worked for four years as Chief of Staff of Americans for Safe Access (ASA), the largest national member-based organization promoting safe and legal access to cannabis for therapeutic use and research.
    Outside of work, Rebecca is a public transit and smart growth advocate. In 2008, Rebecca chaired the No on KK campaign committee in Berkeley, helping to defeat this anti-transit ballot initiative with 77% of the vote. She writes a blog,……. Rebecca serves as an associate member for the 16th Assembly District on the Alameda County Democratic Central Committee and the California State Democratic Central Committee.
    Rebecca graduated with a BA in Sociology from the University of California, Berkeley, where she co-founded the school’s chapter of Students for Sensible Drug Polic

    *************
    Jason Overman continues his service to the East Bay Young Dems this year as Vice President. He also serves as the Bay Area Deputy Regional Director for California Young Democrats, and is a former elected delegate to the California Democratic Party.
    A lifelong progressive committed to social and economic justice, Jason got an early start in politics. ……He moved to California in 2003 for college and made history when he was elected to the City of Berkeley Rent Stabilization Board in 2004 at the age of 19, becoming the youngest person elected in the city’s history. Representing approximately 100,000 constituents, he worked to advance the cause of affordable housing for low income and working families.
    Professionally, Jason currently works as the Communications Director for Oakland City Councilwoman Rebecca Kaplan. ……
    Jason earned his B.A. in Political Science and Sociology from the University of California, Berkeley.

    ***********
    Igor Tregub is Vice President of Finance. He was previously EBYD’s Parliamentarian, and currently holds an Associate Membership in the Alameda County Central Democratic Committee.
    Elected in November 2008, Igor Tregub serves as a Berkeley Rent Stabilization Board Commissioner……. Mr. Tregub is also the former chair of and current commissioner on the Berkeley Commission on Labor, through which he led the passage of the City of Berkeley’s Sweatfree Procurement Ordinance.
    Professionally, Mr. Tregub is an engineer with the Department of Energy. …..Area Regional Council of the Progressive Jewish Alliance, and chairs the Resolution Committee of the California Young Democrats. Mr. Tregub graduated from UC Berkeley in 2008 with degrees in Mechanical Engineering and Political Science

    ***********
    Andy ???? has worked on a variety of legislative races and initiative campaigns including Tuition Relief Now, Hancock for State Senate, and Buchanan For Assembly. A community organizer and grassroots activist, …… and recently completed his senior year at UC Berkeley.
    Currently Andy works for the Courage Campaign political issues committee. In addition to his position in EBYD Andy serves as the Communications Director of the California Young Democrats LGBT Caucus.

    *****************

    Richard Fuentes manages the legislative process for Oakland City Councilman Ignacio De La Fuente and is a constituent liaison to District 5. Prior to joining the Council Office, he served as the Senior Development Officer at the Mission Economic Development Agency. Before joining the non-profit sector, Richard worked for the City of Santa Ana in the Economic Development Division as an Economic Development Representative and for the City of Huntington Park in the Community Development Agency as a Planning and Residential Rehabilitation Consultant.
    . Richard holds a Bachelor of Arts in Political Science from California State University, Los Angeles.

    ***********

    Jennifer Pae is the Northern California Chair of the CDP Asian Pacific Islander Caucus and Commissioner of the Oakland Community Policing Advisory Board. ……was recognized by her colleagues, the East Bay Young Democrats, with the first “Kick-Ass Youth Advocate Award.”Jennifer is a strong advocate on behalf of her community because of her experiences in a working class family, raised by a single immigrant mother. Jennifer worked her way through college at UC San Diego where she led campaigns to expand access to higher education and improving campus safety policies by organizing events to prevent violence against women.

    ***********
    Frieda is currently a Senior Project Manager at Barbary Coast Consulting, a public affairs firm specializing in strategic communications, community outreach, and government affairs. At Barbary Coast, she works with nonprofits, businesses, schools, and government agencies on issues ranging from solar advocacy campaigns and education to land use.Prior to joining Barbary Coast, Frieda was a Project Manager with Americans for Nonsmokers’ Rights (ANR) and the ANR Foundation ……..focus on the need for local smokefree indoor air policies. There, she provided technical assistance to more than twenty states and provinces, assisting them in strategic planning, grassroots mobilization, GOTV, and media outreach – and her campaigns won. Frieda was also a technical assistance liaison for the Robert Wood Johnson Foundation’s prestigious Tobacco Policy Change Project.
    Frieda is an elected delegate to the California State Democratic Central Committee and state Senator Loni Hancock’s representative on the Alameda County Democratic Central Committee. She has been an active board member of the National Women’s Political Caucus –….Young Professionals Finance Committee for San Francisco DA Kamala Harris’s run for Attorney General. In the summer of 2009, Supervisor Keith Carson appointed Frieda to be District 5’s (Oakland, Piedmont, Berkeley) Commissioner on the Alameda County Human Relations Commission.
    Frieda graduated cum laude from the University of California, Santa Barbara with a B.A. in Political Science and double minors in History, and Women, Culture and Development

  5. Max Allstadt

    yeah, that’s out of date. They had elections very recently, I was there.

    Trust me, I’ve been to three meetings about this event, and I’ve been on the phone about it constantly. We’ve gone out of our way to do a thorough analysis of multiple situations.

    We also had a lot of communication with our elected guests about their presentations. I also was directly involved in coordinating the co-sponsorship between EBYD and MOBN, because I’m one of two MOBN board members who is also a Young Dem.

    Nathan Stalnaker, mentioned above, is the other. Nathan wrote a blog recently about our impending pension bomb. Check it out: http://oaktalk.com/2011/02/15/what-is-the-“pfrs”-obligation-and-how-should-oakland-address-it/

    What we are aiming to deliver is a presentation that is at once compelling, concise, and comprehensive.

  6. V Smoothe

    Scott –

    I am confused by your apparent anger over the co-sponsorship of Make Oakland Better Now!’s February 20th event by the East Bay Young Democrats.

    I know many of the EBYD executive committee members well, and your assessment of their backgrounds and experience is off base. But even if it were true that none of them had the backgrounds you seek, I see fail to see how their willingness to help promote Make Oakland Better Now!’s event and bring more people to it would negatively impact the quality of the meeting this Sunday. They are not the ones speaking at the event – speakers include City Auditor Courtney Ruby, City Attorney John Russo, and City Council Finance & Management Chair Ignacio De La Fuente.

    Make Oakland Better Now! has clearly put a great deal of energy into researching municipal budget best practices such as establishing a rainy day fund, methods of funding pensions, performance based budgeting, and reform of the budget process. Oakland is lucky to have citizens concerned enough to volunteer their time to do this tedious work. I applaud their efforts and am very much looking forward to Sunday’s meeting.

    In any case, I would like to see the comments on this post focus on Bruce’s information about performance based budgeting. Your apparent hostility to the Democratic party is not really relevant.

  7. Igor Tregub

    @Scott: In addition to what everyone has already said regarding the experience of EBYD members in the policy realm, I will add that our EBYD secretary, Ipsheeta Furtado, specifically has a background in accounting and small business entrepreneurship.

    I invite you to attend this Sunday and weigh in about how to make the budget priorities of our municipalities more accessible and in line with the needs of the public. If you wish, you can quiz the members and officers who will be there about their knowledge of the budgeting process. As you will surely agree, there is no substitute for a firsthand, in-person assessment.

  8. Scott Law

    Great response Max, I stand corrected. Was misled by the title “2011″ Leadership…

    Have more confidence now that this session could be productive. Might drop by after all, there is always hope. Good work

    By the way, the word is the mayoral transition team is not going well for serious budget strategy. The mayor’s approach seems to be how high a parcel tax could possibly be that would pass and fiscal fantasies about pot farm receipts

    Regards, and thanks for the insight

    Scott L

  9. len raphael

    I don’t see membership in young dems = mental lockstep with the state and muni arm of the national and local Democratic Party.

    In a one party state like ours, you gotta be a democrat, and so you start out as a young democrat if you want to be active in politics.

    what mystifies me is this focus on the techniques and technical process of government budgeting.

    is that a backdoor face saving approach to muni union leadership to accept huge cuts in previously negotiated wages and benefits for current employees?

    or mostly a way to educate voters to reach certain conclusions opposite to union friendly ones they’ve held without questioning for many years?

    doubtless it’s much more technically difficult steering the finances of a financially staggering city than one that’s fat and happy.

    No margin for error on projecting those cash flows or you can’t meet payroll.

    which is why i assume that Dellums and Lindheim most have had some very skillful budgeting people to have paid it’s bills for the past four years.

  10. V Smoothe

    Are you joking, len? The projections have been so consistently bad for the last few years that they have had to come back to the Council to readjust the budget almost constantly. At one point, we were having to do adjustments every two weeks!

  11. len raphael

    there are internal projections and there are public projections.

    Oakland doesn’t have the equivalent of a non partisan cbo congressional budget office to reality check the public budget assumptions used for satisfying the legal requirement that we have a balanced budget.

    4 years ago it was obvious that the city’s projection for real estate transfer taxes was absurdly optimistic. but that wasn’t a technical error by budgeting people but a political decision by Lindheim and Council that they were going to hope for the best.

    Unfortunately for all of us but not for the careers of the officials and pols, they didn’t plan for the worst while hoping for the best.

    Can i prove that? No. But i remember the body language of the budget staff whom I grilled on that very subject at the time as they sat next to Lindheim and Jane B. Staff looked uncomfortable.

    Jane B’s response to my question about unfunded medical retirement costs, was “it’s a problem but we’re not sure how big”.

    Our budget disaster has always been a political problem. Not a technical one.

    -len raphael, temescal