Although not officially released yet, the October 2nd Inspector General’s report on the 2009 New Orleans budget process (previously leaked to the press) is now available to read on NolaStat.org:

Review of the Budget Process of New Orleans

Months of NolaStat policy research have produced many of the same conclusions about the city’s budget as can be found in the OIG report. The process of yearly performance reviews as part of an annual budget cycle are insufficient for managing government performance. Achieving annual performance goals while observing fiscal discipline requires regular review as part of a weekly or bi-weekly process. This is the lesson from Baltimore’s CitiStat process, and many other cities that have implemented “stat” processes.

When Martin O’Malley became Baltimore’s mayor in 2000, he found that, “If information was used to make policy changes, they came about as a result of yearly reviews. Implementation took months, or even years. By the time a contemplated change was in place, the conditions that prompted the shift might no longer be relevant.”

Even as an annual performance management process, New Orleans’ “Budgeting for Outcomes” process — initiated in 2008 — sounds good on paper, but is meaningless in its implementation.

After a comprehensive read of the 2009 budget, here are some of the most important findings:

1) Many offices have no measurable outcomes indicated other than a description of what the office does. There were 62 offices in which no outcomes were offered. Instead, a disclaimer was used as a placeholder, “Measures to be developed in 2009.”

2) The budget process offered the community no opportunity to participate in the creation of funding priorities, yet the budget said that “the Mayor, in consultation with community leaders, department heads, and the City Council, establishes the results for the next year.”

3) The budget document makes repeated claims about Mayor Nagin’s commitment promoting “accountability, responsibility, transparency and inclusion in all levels of government for the benefit of all citizens.” The Mayor’s commitment would be laudable if it were followed up with demonstrable actions. His low approval rating is a measure of his credibility in following through on such commitments.

4) There are no mechanisms in place for actually measuring outcomes. The Mayor’s four overarching funding priorities are: Public Safety Recovery and Livable Communities, Opportunities for Youth High Performing Government, Recovery and Livable Communities, High Performing Government. Were there a process instituted for measuring and reporting to the public the city’s performance in these areas, we might expect to see reports issued for the declared goals. Yet even when statistics are reported, certain departments — such as the NOPD — have such tarnished records that their integrity in reporting credible statistics will require independent auditing. Consider whether the city has reported any meaningful, credible statistics tracking the performance of these indicators for the four funding priorities:

• Violent and total crime rates
• Number of cases accepted for prosecution by the District Attorney
• Fire Insurance ISO ratings
• Emergency preparedness and response rate
• Youth participation in recreation and employment training activities
• High school graduation rates
• Decrease in youth crime and gang violence
• Amount of public and private investment in the 17 Target Zones
• Improvements in neighborhood code compliance
• Number of net new jobs in targeted industries (biomedical, port, aerospace, digital, tourism, entertainment)
• Health index
• Customer service standards established and met, including redress
• Clean audit of all funds, including federal, state and private funding
• Workforce paid competitively as measured by the Southern Regional Average

5) One last finding as part of the NolaStat policy research merits attention. The Mayor’s office was asked to explain a new entity described in the budget document. The Mayor’s office hasn’t answered a now months-old NolaStat public records request asking for an explanation of what the “IT Council” is, and what it has accomplished. The budget says that the IT Council is responsible for a “zero dollar initiative to increase customer service.” As an example of the Mayor’s lack of “accountability, responsibility, transparency and inclusion in all levels of government for the benefit of all citizens,” the mayor’s Chief Technology Officer, Harrison Boyd, hasn’t answered why a $6 million amendment to the $40 million Ciber contract was issued a few months ago. The total $46 million contract is probably one of the largest technology contracts in New Orleans’ history. It might be the largest professional services contract ever in New Orleans’ history, yet the Mayor’s office continues to refuse to provide details about what the contractor is doing. If the Mayor has a “zero dollar” goal to increase customer service, the public should be getting a lot of customer service for that $46 million, and it should be offset by budget reductions in other IT operations.

These NolaStat findings are completely in agreement with the findings reported by the New Orleans Inspector General’s office. Among the key conclusions in the IG report are the following:

1) “The citizens of New Orleans have been short changed by the decision to appropriate funds for a major portion of the City’s recovery plan through nondescriptive language buried deep in the 2009 Operating Budget.”

2) “The 2009 Operating Budget includes more than $668 million in Special Revenue Funds … [but] most of the recovery funds are appropriated simply as line items with no program descriptions and almost no information about how the funds will be used.”

3) Across-the-board cuts were criticized by the OIG review as being like “taking a blow torch to the family car.” Strategic financial management requires cutting programs that are ineffective, not cutting programs with proven, measurable records of answering high-priority needs.

4) “Descriptions of some programs funded in the Operating Budget are so vague as to be meaningless. The Operating Budget does not include organizational charts or provide a clear picture of how departments are staffed or operated.”

5) The OIG identified $10 million in savings found in the Mayor’s office. New Orleanians pay $32 more per citizen than residents in a ten-city survey.

6) “New Orleans is remarkable for its high costs for sanitation services.” New Orleanians pay $134 per resident compared to an average cost of $69 in an eight-city survey.

7) “New Orleans budgeted the least per person for parks and recreation in a nine-city average — $33 per person, compared to $65 per person in other cities. The city spends twice as much on trash as it spends on recreation.

8) “New Orleans budgets $384 per person for police compared to a ten-city average of $318 (Cincinnati and St. Louis spent more per person).

The combined NolaStat and OIG analyses of the 2009 budget both underscore the need for the next mayor of New Orleans to enact a NolaStat policy reform which schedules performance measurement and review into a weekly process to increase service quality, efficiency, and equity, while spending scarce revenues more wisely, thus replicating the success experienced by other cities that have implemented data-driven “stat” accountability reforms.

Related: Bruce Eggler, “New Orleans inspector general office’s report blasts city’s budget process,” The Times-Picayune, October 4, 2009.

Tags: City Budget, City Council, Civic Participation, Office of the Inspector General

This entry was posted on Tuesday, October 20th, 2009 at 10:30 am and is filed under Public Records. You can follow any responses to this entry through the RSS 2.0 feed.