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In 2018, a regional ballot measure in nine counties in the San Francisco area dedicated $500 million of $4.5 billion in increased bridge toll revenue for Bay Area Rapid Transit (BART) to purchase new rail cars. Wisely, State Senator Steve Glazer said he wouldn’t support the expenditure if there wasn’t oversight over BART, so he put language in the bill that stated “this bill would create the Independent Office of the BART Inspector General . . .” It seems pretty clear to us what the word “independent” means, and we’ve been writing about the importance of independence of oversight bodies for years. But the sad tale of BART’s IG’s office is yet another example of the fight that many oversight bodies have had to wage for insularity from outside interference in their work. California has an unusual civil grand jury system which empowers citizens to investigate all manner of issues, and the Alameda (County) Grand Jury wrote a few months ago that, “From the beginning . . .BART’s board, management and unions demonstrated an unwillingness to support an independent OIG and erected roadblocks to its function.” A number of well-respected individuals agree with the Grand Jury finding, including Ann-Marie Hogan, senior advisor for the Association of Local Government Auditors and Elaine Howle the well-respected, recently retired, California State Auditor. The gist of the problem that Inspector General Harriet Richardson currently faces is the insistence on the part of BART’s management and its board that she must notify the unions to which BART employees belong anytime she does an investigation and notify anyone to whom she wants to speak for any purpose at all that they are entitled to union representation when the conversation is held. This is true in all cases, most of which have nothing whatsoever to do with the possibility of punitive action against the employee being interviewed. In an effort to clarify the situation, in February, Glazer put forth a second piece of legislation which set about clarifying the IG’s roles and responsibilities. It stated that the IG “shall have the independence necessary to conduct all of its audits . . . independence includes being free from impairments from the district that may restrict the office’s ability to conduct independent and objective audits or investigations and issue reports based on the results.” But the senator still encountered resistance to unshackling the IG. He “was not able to overcome the opposition of the district's labor unions,” according to a letter to the governor written by Howle. The president of the Bay Area Rapid Transit district sent a letter to California Governor Gavin Newsom requesting that he veto the bill. He did so on September 28. Why all the pushback? We can’t put ourselves into the minds of the members of the board and the management of BART to say for certain, but Hogan points out that “BART’s board members are elected, and they get contributions from the unions, and the same is true of the Governor.” Though Richardson has refused to comply with management’s insistence that the union be brought into all her investigations, this whole issue seriously impairs her ability to fulfill her responsibilities. For one thing, according to Hogan, “if every single meeting potentially required waiting for a union rep to schedule a meeting, that would completely slow down the work of the IG.” Complains Richardson, “We can’t complete investigations when employees aren’t free to just come and talk to us. There’s a lot of fear from employees because there’s fear of retaliation from their co-workers or management. They fear for their jobs.” What’s more, as Howle wrote “Requiring the BART IG to notify the union essentially deprives the employee the opportunity to determine whether he or she seeks representation. Furthermore, this could call into question the BART IG's independence and threaten the BART IG's credibility.” That’s how things stand now. As for the future, “we continue to hope that we can get some legislation through in the future,” said Richardson. “Meanwhile, we just try to educate people about the appropriate role of the IG.” #StateandLocalGovernment #CityandCountyManagement #GovernmentAccountability #GovernmentOversight #PerformanceAudit #PerformanceManagement #BART #BayAreaRapidTransit #CityandCountyofSanFrancisco #InspectorGeneral #InspectorGeneralIndependence #AuditorIndependence #IndependentOversight #CaliforniaCivilGrandJury #AnnMarieHogan #ElaineHowle #InpsectorGeneralHarrietRichardson #CaiiforniaStateSenatorSteveGlazer #AlamedaCountyCivilGrandJury #AssociationofLocalGovernmentAuditors #GovernmentOversightResistance #BartInspectorGeneral #ALGA

Increasingly, the old days of town hall meetings is giving way to electronic means for getting input from residents. Though this means of bridging the gap between decision makers and the people they represent first became common during the pandemic it’s here to stay. With that in mind, we found a new report from PublicInput, a leader in community engagement software for government, to be of particular interest. It showed the findings of a survey conducted in May and June 2022 that reflected responses from about 1,000 U.S. residents. As PublicInput’s founder and CEO Jay Dawkins said, “Surprisingly, only a third of residents reported being comfortable providing input at virtual meetings, so it’s important to consider meetings as one option among many for hearing from more voices.” The other options he had in mind included e-mail, phone, texts and social media. Here are a few of the key results from the survey taken from a press release announcing its publication: ● A large majority (71%) of respondents reported they are not being “asked” by government for their input or feedback. While governments have relied on both traditional and digital forms of notification to solicit public input, e.g., (news media, public notices, newsletters, website pages, and social media), residents are not aware of or monitoring those channels. Instead, residents prefer a direct, or personalized approach ● Residents want to be more informed before and after contributing their input or feedback to their local government. Nearly 18% of respondents said they do not offer input to their local government when asked. Of this group, nearly half (48%) said they do not provide input to government requests because they lack the information to contribute an informed response. ● Digital government outreach methods are meeting resident engagement preferences and may increase public input and feedback. Most respondents (70%) stated they were comfortable joining virtual public meetings. Furthermore, the survey findings suggest that residents are more likely to contribute feedback in online deliberations than they would in an in-person gathering. #StateandLocalGovernment #CitizenInput #CityandCountyManagement #PublicSectorData #PublicSectorDataAnalysis #PublicSectorDataUse #CitizenSurveys #ResidentInput #PublicInput #JayDawkins #DigitalGovernmentOutreach #VirtualPublicMeeting #TownHallMeetings #StateandLocalGovernmentDataManagement #Data

Several years ago, we worked with the Volcker Alliance to created a guide to resources about state budgeting intended for use by public officials, policy advocates, journalists, academics, and concerned citizens. ​ In late September 2022, the Alliance updated the guide, which will once again provide up-to-date sources of information to provide a clear-eyed state-by-state financial outlook. You can find it by clicking here: ​The guide provides a clickable map, which will lead you to a treasure trove of information about each of the fifty states. “Understanding a state’s budget is never a one-step process, but our State Budget Sources guide gives you a central starting point,” said William Glasgall, Senior Director, Public Finance at the Volcker Alliance. This resource links to budget sources for all fifty states as well as legislative analyses of budget bills and treasurers’ or comptrollers’ monthly state cash flow statements; capital spending plans; reports on public worker pension funding and returns; and reports by local and national fiscal research organizations, bond rating firms, and associations of state fiscal and finance officials. #StateandLocalGovernment #CityandCountyManagement #BudgetManagement #BudgetResources #StateandLocalGovernmentBudgeting #StateandLocalGovernmentResources #StateBudgeting #StateBudgetResources #VolckerAlliance #StateGovernmentBudgetSources #WilliamGlasgall #PublicSectorBudgeting #StateandLocalGovernmentPerformance

Over the last few weeks, we’ve been doing research into the challenges municipalities face when they want to hire a diverse workforce. One important step, it's clear, is to gather the data necessary to see how closely the demographics of the personnel in a city’s agencies – and the entity as a whole – mirror those for the city itself, and to use that information as a performance measure to guide the improvements the city is making in creating workforce diversity. Some places do an excellent job at this, and you’ll be able to read more about that in the column we’re writing for Route Fifty. But others don’t. The same thing is true for a host of other areas in which good data can be of help, but it's simply not gathered. All of which leads us to consider the following question: “Why Not?” Two reasons emerge. The first one is regrettable, though understandable: For localities, particularly smaller ones, there’s often an absence of the resources necessary to gather data or to establish and work with performance measures. Though this may be short sighted, we can certainly understand that there's pressure to use limited resources on direct services, like sanitation, pot-hole filling or public safety. It's a simple equation: Clean up the potholes and it’ll help you get re-elected. Measure the number of potholes and nobody will notice. The simple political reality of this was conveyed to us many year ago by the long-time mayor of Indianapolis William Hudnut, who said (and we’re paraphrasing here, as it’s hard to find notes from the early 1990s): “The real measure of my success is clear when people vote.” But the second reason is somewhat more troublesome and it's come up, in off-the-record portions of a number of conversations we've had over the years: Sometimes elected officials don’t want to gather data because they fear it will make them look bad. Here’s where the political realities of life run headlong into our quest to help states and localities provide better management and policy. We know that our philosophy may seem to be a little naïve, but we believe – or at least want to believe -- that people go into public service to make the world a better place. And standing in the way of the kind of data-gathering that can help inform that mission simply doesn’t help. As we wrote in our book, The Promises and Pitfalls of Performance-Informed Management, “Multiple examples show the success of performance management efforts,” to creating improvements in “the way services and programs are delivered.” What’s more, even from a purely political standpoint, undermining efforts to gather and analyze data can be counterproductive. Acknowledging and quantifying, the problems a city, county or state faces gives them the opportunity to boast about progress even if it’s not immediately apparent to the public. Consider, for example, the recent good news that childhood poverty rates had dropped from 9.7 percent in 2020 to 5.2 percent in 2021. While one out of 20 children living in poverty is still too many, the press publicized that change as unquestionably positive. But if nobody had been keeping the data in the first place, we think that most people would have been unaware of this dramatic improvement based only on personal experience. Going back into the time tunnel again, we recall how impressed we were in the early 1990s when Alabama’s leaders took a very poor grade in our evaluations of state government management capacity for the long-defunct Financial World magazine and compared them to our prior --- and even worse—evaluation. The state got some very positive reports in the local press by pointing to the improvement, with promises of more to come. Hiding from the truth doesn’t make it go away. But confronting the truth can help to change it for the better. #Data #PerformanceManagement #PerformanceMeasurement #StateandLocalGovernment #ChildhoodPovertyData #Diversity #Equity #MissingData #EmployeeDiversityData #PublicSectorHumanResourceData #HumanResources #StateandLocalGovernmentDataManagement #StateandLocalGovernmentPerformanceManagement #PublicSectorEquity #StateandLocalGovernmentHumanResources #RouteFifty #PublicSectorDataAnalysis #PublicSectorDataUse #PublicSectorDataAccessibility #CityandCountyManagement #PublicSectorData #StateandLocalEmployeeDiversity #HumanResourceData #HumanResourceHiringData

Yesterday afternoon, at the #ICMA’s annual conference in Columbus Ohio, an announcement was made about an exciting collaboration to advance the use of data in local governments through a new partnership and data network called Government Performance Action and Learning. (GPAL). Its principal founders are #Polco, an on-line community and employee survey company and the University of Wisconsin – Madison’s think-tank, COWS. Additional partners joining GPAL will include: the International City/County Management Association (ICMA), performance management software company Envisio, the Arizona State U, and the Hoover Institute at Stanford University. GPAL’s goal is to bring together comprehensive community information, providing simple to use indices and insights that will lead to improved performance. It is intended to allow leaders to see connections between disparate community data that, before now, only lived in siloed sources. For example, using the new GPAL tools, decision-makers could explore resident perceptions about traffic and how they relate to mobility and law enforcement metrics or the ways in which parks and recreation opportunities affect community health outcomes. “The data collected by our partners amplifies our historic data sets by giving context to quality-of-life ratings,” said Polco Senior Vice President of Innovation Michelle Kobayashi. “This new information gives leaders a more granular look at livability issues so they can make better, more informed decisions.” #StateandLocalGovernment #PublicSectorData #PublicSectorDataAnalysis #PublicSectorDataAccessibility #PublicSectorDataManagement #PublicSectorDataUse #PerformanceManagement #PerformanceMeasurement #CityandCountyManagement #ICMA #GovernmentPartnership #PublicPrivatePartnerships #GovernmentPerformanceActionandLearning #POLCO #Data #ResidentPerceptions #Envisio #HooverInstitute #ArizonaStateUniversity #CitizenInput #CitizenSurveys #POLCO #LocalQualityofLifeRatings #MichelleKobayashi #CommunityData #StateandLocalGovernmentDataManagement

In a day when one of the only sure things about the future of state and local finances is that they are unpredictable, a proposal issued by the Governmental Accounting Standards Board (GASB) earlier this summer is of particular interest. Earlier this summer, the GASB issued an Exposure Draft, titled Certain Risk Disclosures. The project focuses on two categories of risk that could affect the level of services a government is providing or its ability to meet obligations when they come due. The Board’s objective in this effort is to create disclosures which are intended to provide financial statement users with information about potential events and circumstances before a government experiences possible severe financial stress. This kind of transparent information can help provide the kind of information that’s vital to public sector leaders about the “what-ifs” of the future, to help inform their decision making and assessments of accountability. For a video that highlights key aspects of this proposal click here. At the conclusion, you’ll find a link that will allow you to actually read the full proposal as well as an electronic input form on the proposal that makes it easy to share your thoughts with GASB by its September 30th deadline. #StateandLocalGovernment #GovernmentalAccountingStandardsBoard #GovernmentTransparency #GovernmentTransparency #GASB #RiskDisclosure #StateandLocalGovernmentRiskDisclosure #PublicSectorTransparency #StateandLocalGovernmentTransparency #PublicSectorAccounting #PublicSectorFinancialReporting #Transparency #GovernmentRiskDisclosure #PublicSectorTransparency #GASBExposureDraft

​ ​ by Chris Fabian, CEO, ResourceX ​ ​​ To prevent a “climate catastrophe,” the focus of local, regional, national, and international government leaders has been to keep temperature rise in check – no more than 2.0°C increase above pre-industrial levels. Last fall, the 26th annual “Conference of the Parties” (COP26) summit in Glasgow ushered in global commitments to emission reductions, like the Local Governments for Sustainability launch of Race To Zero - a global campaign established to rally ambitious leadership from all sectors of society (including businesses, cities, regions, investors) to achieve carbon neutrality. At the local level in the United States and Canada, the Government Finance Officers Association (GFOA) has published best practices for disclosure as to how Environmental, Social and Governance criteria are now woven into bond ratings. Still, for all of local government’s well-intentioned urgency in goal-setting and planning for climate action, leaders must fortify their commitment with resources. Without considering the environment in the budgeting process, all the commitments to change will be little more than words. As the International City/County Management Association’s executive director Marc Ott makes clear, "while local governments – together with community groups, local nonprofits, and universities – have set aggressive goals in moving their communities to clean energy, they struggle to find ways to cover the capital and operating costs of implementing the changes." Luckily, there are cities that are transforming the budget process to align resources with climate action. Consider Pittsburgh, which established laudable goals to help with climate change. But with goals in hand, city leaders had to find a way to fund them. Grant Ervin, Pittsburgh’s Chief Resilience Officer, recalls a conversation with colleagues on the budget and finance side of Pittsburgh in 2017 “We were so excited about what we wanted to do, and they kept calling our projects ‘unicorn projects,’” recalls Ervin. “They spoke a whole different language: budget cycles and bond ratings. I realized we needed common terms, and synchronized timing. We needed a climate budget to meet our climate targets.” The City took this discovery to heart and applied it to the development of its 2022 budget. In the past, departmental budget requests would simply identify line items to increase or decrease. With the climate-focused budget, however, each request was tied to defined programmatic outcomes and detailed information on achieving the city’s climate goals. This allowed its Office of Management and Budget, in collaboration with the Sustainability and Resilience division of City Planning, to provide then Mayor William Peduto unprecedented insight into the city’s budget and its climate impacts. This “priority-based budget” identified 249 discrete programs, services, and activities across 23 departments and scored each against the city’s climate and equity goals. Through this process, Pittsburgh freed up $23 million from its existing operating budget and identified another $18 million in revenue opportunities. “Changing budgeting procedures can feel like an enormous task,” explains the city’s Climate Advisor Will Bernstein. “But in the end, the created tools actually streamlined work while simultaneously making budget decisions clearer for the mayor’s office.” Similarly, the City of Flagstaff, Arizona has applied a Priority-Based Budgeting framework to ensure budget proposals are evaluated relative to their alignment with the City’s Carbon Neutrality Plan (CNP), which is intended to establish neutrality by 2030. The big question: Will the city be able to continue to build the resources necessary to the fulfillment of the plan into annual budgets as did this year’s which approved 27 requests and over $2 million in funding directly to prioritizing execution of the CNP. (Truth in Advertising: Ervin and Peduto will both be speaking at our annual Priority Based Budgeting Summit in Denver, Colorado on August 10, 11 and 12.) Local governments – many with the best of intentions -- face a perennial disconnect between elected officials; sustainability, resilience, and equity offices; and budget and finance leaders in aligning resources with climate initiatives. Integrating climate considerations into operating and capital budgeting decisions across the organization, strengthens resource alignment with climate action plans. The application of program-level data through priority informed budgeting provides direct alignment between fiscal decision-making and climate action goals. It also provides the additional advantage of increased transparency and agility within the budgeting process by creating a shared language that connects departments to the finance and budgeting process. The combination of the strategic pursuit of climate preservation and innovative budgeting practices positions municipalities for opportunities at all levels within the organization. Whether cities are looking for climate mitigation solutions or economic development opportunities that benefit their climate action plans, program-level evaluation is key to the process. By programmatically defining every dollar of the budget, local governments can strategically fund cutting-edge climate work for the benefit of residents, community, and region. The contents of this guest column reflect those of the authors, and not necessarily those of Barrett and Greene, Inc. #PerformanceManagement #CityandCountyManagement #Equity #PerformanceMeasurement #PublicSectorData #StateandLocalGovernment #StateandLocalGovernmentBudgeting #PerformanceInformedBudgeting #ClimateAction #LocalGovernmentsforSustainability #RacetoZero #BestPracticesforDisclosure #EnvironmentalCriteriaandBondRatings #PublicSectorBudgetTransformation #PittsburghChiefResilienceOfficer #PittsburghClimateChangeGoals #ClimateFocusedLocalBudgets #SustainabilityandResilience #PriorityBasedBudgeting #LocalClimateGoals #LocalEquityGoals #FlagstaffPriorityBasedBudgeting #InnovativeBudgeting #ResourceX #CityofPittsburgh #ChrisFabian #MunicipalActionsforClimateChange

We’ve repeatedly heard the phrase: “People don’t leave bad jobs, they leave bad bosses.” This comment has been supported by loads of surveys over the course of time (although most of them tend to focus on the private sector, we’re confident that it’s true in governments at all levels.) The value of good supervisors has probably never been more important than it is in 2022, with states and local governments yearning for qualified candidates for a host of positions. It’s a seller’s market, and the days in which there were dozens of applicants for every government job are gone – at least for now. What’s more, at a time when remote work has become ever more common, the ways in which supervisors can build loyalty are changing. One way that good managers have always motivated employees is with praise. For some workers, praise is a narcotic, and that may not be healthy. But we’ve yet to run across anyone in any walk of life who didn’t enjoy being appreciated and hearing about it. Yet, in a remote world, the quick “thanks for a good job,” in the hallway of City Hall may now require the time and thoughtfulness to send a quick e-mail or a text. Certainly, even when people were working on the same floor of the same building, some managers withheld their words of encouragement. Those who were more generous with their sentiments now have to take an extra step to communicate their kind words. Back in 1936, Dale Carnegie, wrote How to Win Friends and Influence People, and his sentiments may seem dated and his language a big florid, but we believe he was right on target when he wrote “Praise is like sunlight to the warm human spirit; we cannot flower and grow without it. And yet, while most of us are only ready to apply to others the cold wind of criticism, we are somehow reluctant to give our fellow the warm sunshine of praise.” So, here’s our unsolicited piece of advice to government managers: There’s no need to give false praise. Self-esteem should be earned. But, where there’s an opportunity to compliment someone who works for you – particularly someone who may be having difficulties with their work – take it. It will, we’re sure, pay off in loyalty, productivity and maybe – though we can’t prove it – fewer employees to replace when they walk out the door. #PerformanceManagement #CityandCountyManagement #PublicSectorHumanResources #PublicSectorWorkforce #StateandLocalGovernment #BadBosses #PublicSectorHiringCrisis #RemoteWork #EmployeeRecognition #PublicSectorEmployeeRecognition #PublicSectorEmployeeEngagement #StateandLocalEmloyeeEngagement #DaleCarnegie #HumanResources #PublicSectorTurnover #GreatResignation #PerformanceMeasurement #StateandLocalGovernmentHumanResources #StateandLocalGovernmentWorkforce #StateandLocalGovernmentEmployeeRecognition #RemoteWorkinthePublicSector

Over the years in which we’ve been covering the evolution of performance management, it’s always been abundantly clear to us that great care needs to be taken in determining the right things to measure. We’ve long suggested that states and local governments need to consider the set of performance measures they use as a work in progress—and be prepared to refine and alter them on a regular basis. With that in mind, we were struck by a working paper, published by the Anneberg Institute at Brown University (to which we were alerted in an article in Education Week) that questions the value of linking school principals success to test scores. As the paper concluded: “We find that using contemporaneous student outcomes to assess principal performance is flawed. Value-added models misattribute to principals’ changes in student performance caused by factors that principals minimally control. Further, little to none of the variation in average student test scores or attendance is explained by persistent effectiveness differences between principals.” That’s pretty strong language. The Education Week article puts this finding into context with a quote from Brendan Bartanen, lead author of the study and an assistant professor of education policy at the University of Virginia. “This is not a study that says that principals are not important. Principals are absolutely important,” he said, adding that “we need to be very careful about trying to infer the performance of a principal on the basis of the [test-score] outcomes of students.” One of the paper’s major findings was that principals – while they hold a great deal of power over the functioning of a school – are not the primary drivers of test scores. As a result, they shouldn’t be penalized if test scores drop or rewarded if they rise, as is sometimes the case. As the paper said, “Specifically, while we find meaningful within-school variation in student test score performance when comparing across principals . . . this variation is driven by transient school factors that are likely to have occurred regardless of who was leading the school. Because these school factors exhibit some persistence across years, they create the illusion of principal effects. . . “ We believe that it’s inevitable that measures like this one are frequently used – without necessarily proving that they’re the best ones – simply because the data is so easy to come by. There’s a powerful incentive to the people who have the task of coming up with measurements to grasp at metrics that are seemingly meaningful and are easy to find without a more complicated process like seeking input. That’s understandable but it’s a flawed approach and is reminiscent of this old joke: So, a man came across a friend of his searching in the street for something he had evidently lost. “What’re you looking for?” the friend asked. “My wallet.” “Oh, and did you drop it on this block?” “No, I think I lost it in the alley, but the light is better here.” #PerformanceManagement #CityandCountyManagement #PerformanceMeasurement #AnnenbergInstitute #EducationWeek #SchoolPrincipals #TestScoreValidityinPerformanceMeasurement #MeasuringPrincipalSuccess #BrendanBartanen #TestScoresasaPerformanceMeasure #SchoolPerformanceMeasurement #PerformanceMeasurementPenaltiesandRewards #PerformanceMeasurementSelection #StateandLocalGovernment #StudentOutcomes #SchoolPerformance #SchoolPerformanceMetrics #BrownUniversity #PerformanceMeasurementPitfalls #StateandLocalGovernmentPerformanceMeasurement #StateandLocalGovernmentPerformanceManagement

by Marty Benison, Industry Executive Director for State and Local Government, Oracle ​ While the move to “Software as a Service” (SaaS) started prior to the pandemic, it accelerated when citizens needed to continue to do business with governments at all levels, but now they’ have to do so remotely. ​ This digital transformation is now ingrained in the fabric of most government organizations and is here to stay. This is good news. Moving systems to SaaS subscription models, taking advantage of artificial intelligence, robotics and the Internet has allowed government organizations to remain productive and is now positioning all facets of the public sector to better deal with the loss of millions of workers through retirement that is underway. ​ While risk mitigation strategy discussions have long been a standard part of strategic processes for state and local governments, it is important to recognize that digital transformations bring with it new risks and require a fresh look at mitigation strategies. A recent Route Fifty column, (by Katherine Barrett and Richard Greene), documents not only the financial consequences of government fraud but the loss of trust. When I was comptroller of Massachusetts, I frequently cautioned my team that reputations in government are hard earned but quickly destroyed. As their article points out, this reputational damage can quickly spread beyond one individual to a government as a whole. ​ The good news is that with these new technologies comes the opportunity to implement an Enterprise Risk Management system (ERM) which can help offset the chances of a government’s suddenly being publicized as the victim of a fiscal fraud. But what is ERM and what are the benefits of ERM? What Is Enterprise Risk Management? Enterprise Risk Management is a process that helps an organization to achieve its mission or the strategic goals that make up the overall mission without being derailed by the negative impacts of risk events such as internal and external fraud, cybercrime, or natural disaster. Left unmanaged, these events can prevent the organization from achieving its strategic goals. Implementing an ERM system will help to better prepare for risk events and when they do occur, ERM can help to limit their impact on government services. Keys To a Successful ERM Implementation There are a number of factors that will impact the success of an ERM implementation. These include: ​ Ensuring that top leadership are fully behind the project Choosing a high-quality Enterprise Resource Planning system that has an embedded Enterprise Risk Management platform Ensuring that staff see the ERM as a program that is easy and aids success, not one that adds work or aims to apportion blame Creating a culture that encourages and rewards the identification of risks and a transparent and balanced approach to risk acceptance or mitigation Ensuring that these factors are in place before implementing an ERM framework will help to increase the success of the program. The Benefits of Enterprise Risk Management Implementing an ERM program can provide a wide range of benefits for state agencies, which can include both qualitative and/or quantitative benefits. ​ Creation of a more risk focused culture When management increases the focus on risk, it results in more discussion about risk at all levels of the agency. This in turn means that risks are identified more easily and managed more effectively. Staff become more open to sharing risk information, which leads to better decision making around risk at all levels of management. Security and compliance are improved Ensuring that the agency’s Enterprise Risk Management application is well designed and well maintained helps to future-proof the security of the agency. This is vital to helping ensure that state agency systems remain protected against rapidly evolving cyber-attacks and unauthorized financial transactions. Choosing an ERM framework with automated controls will allow state agency management to access real-time evidence, making the compliance and audit process more efficient. Efficient resource usage State agencies without an ERM system may need to employ large numbers of people to manage and report risk on a day-to-day basis. Implementing ERM doesn’t entirely replace the need for this, but it can improve the efficiency of state government services by allowing critical risk management functions to be carried out consistently. When the ERM system is embedded in an ERP system, monitoring of moderate risks can be mostly automated. Processes can be streamlined and eliminating redundant processes in this way allows resources to be used more efficiently. Audit samples can be replaced with 100% real time audit for risk transactions. Improved perspective on risk ERM systems provide key metrics and measurements that assist the monitoring of risk vulnerabilities as they develop. Being able to track changes in this way allows early identification of changes to the agency’s risk profile, providing an early warning system for potential risk events. The data generated by the Enterprise Risk Management tools also empowers state agencies to make better risk-aware decisions. Standardized risk analysis and ERM reporting ERM provides a variety of data including the status of key risk indicators, emerging risks, and mitigation strategies. ERM risk reporting is quick, flexible, and detailed, which allows state agency leadership to develop a better understanding of the agency’s risk profile, thresholds, and tolerances. This in turn gives a better framework for evaluating risk, allowing better decision making at all levels of management. It will also vastly simplify compliance and audit storing all the current risk and mitigations in a single up to date format. Implementing a state level ERM framework can lead to better management of risk, which has many clear benefits, including empowering employees to take a more positive and proactive attitude to risk identification and mitigation. Will any technology eliminate all risks? Or course not. But, as the old saying goes, “the perfect is the enemy of the good.” ​ The contents of this guest column reflect those of the authors and not necessarily those of Barrett and Greene, Inc. ​ #PerformanceManagement #StateandLocalDigitalTransformation #PublicSectorFraud #GovernmentTrust #TrustinGovernment #GovernmentFraud #EnterpriseRiskManagement #StateandLocalGovernmentTransparency #RiskFocusedCulture #StateGovernmentEfficiency #PerformanceMeasurement #RiskManagement #StateandLocalGovernment #Cybercrime #Oracle #MartyBenison #SofwareasaService #RouteFifty #StateofMassachusetts #StateandLocalGovernmentLeadership #StateandLocalGovernmentFraud

Some years ago, when the phrase “big data,” was first gaining currency, we decided that before we embarked on any projects related to this new silver bullet, we should figure out what it meant. So, we got on the phone and spoke with a dozen smart people we knew in state and local government, asking nothing more than for a definition of that phrase. It turned out that we got at least six different variations on the theme, and there was no real clarity as to what big data really was. More recently, when we were interviewing an expert in the realm of artificial intelligence, the first question we asked was something like: “Can you define AI?” Our source was finally able to come up with a broad definition, but it took a good five minutes of going back and forth to accomplish that. The unquenchable thirst for the solutions to all things has led, we believe, to a tendency to throw around exciting glittery verbiage without any reason to be confident that everyone concerned knows exactly what anyone else is talking about. This doesn’t have to be the case. During an interview with Buncombe County, North Carolina County Manager Avril Pinder, for a column in Route Fifty she told us a story of her quest for clarity. She had a mandate for the county to become a “value-driven” organization. But before she leaped into that task, she and her team “sat down with commissioners in order for them to determine exactly what was meant by “values,” for the county. “And then we had the organization define those values,” she told us. Now, Buncombe County understands that when people are driving toward values, they’re aiming at respect, integrity, collaboration, honesty, and equity. Pinder didn’t stop there. She made certain that there were shared definitions, based on employee input, for what those individual words meant in the county. But Pinder’s quest to pin down shared definitions for important words and phrases isn’t common, as far as we can see. And that’s too bad. Lately, for example, we see the word “agile government,” being used with great frequency, and it’s pretty clear that a lot of people genuinely understand the meaning of that phrase. But we fear that it’s become such a common set of two words that a lot of people want to apply it to anything they’re working on, because what could be wrong about being “agile?” As we were writing that last paragraph, we decided to Google the phrase “agile government,” to see what we came up with. Here’s what popped up on the top of our screen: “Agile government calls for test-driving various methods and tools in a variety of realms—be it procurement, governance, or workforce—using sandboxes, policy labs, and other innovative techniques. Build a broader ecosystem. The necessary technical know-how often resides outside of government.” Or we could pick out about a dozen other definitions that are all just a little different. Even words and phrases that genuinely have clear, technical definitions are often misused out of carelessness or a disregard for precision. As we wrote, in early April, “When you see mentions of surpluses in the press right now, it’s more than likely that the word is being misused.” Our point? Surpluses don’t exist until the end of the fiscal year when budgetary dollars are left over, yet the word was being used back then to describe unanticipated revenues. We put up a post on LinkedIn about this B&G Report, and got the following salient comment from Terry McKee, director of procurement at Knoxville’s Community Development Corporation, “Unfortunately press releases and press conferences seldom define such terms. They should and reporters should research terms before mindlessly using them.” #PerformanceManagement #StateandLocalGovernment #PublicSectorData #ArtificialIntelligence #GovernmentOversight #CityandCountyManagement #StateandLocalMedia #BuncombeCounty #StateofNorthCarolina #CountyManagerAvrilPinder #GovernmentJargon #StateandLocalGovernmentJargon #AgileGovernment #TerryMcKee #CityofKnoxville #KnoxvilleCommunityDevelopmentCorporation #InconsistentDefinitionsinthePublicSector

Our friend and colleague Harry Hatry has long insisted that data is far more valuable when it’s disaggregated. In a January 2022 paper for the Urban Institute which we were honored to co-author with him, he maintained that performance data is particularly useful when you “compare the outcome values broken out (disaggregated) by demographic characteristics (e.g., by age group, race/ethnicity, gender, education level, and location—such as neighborhood, state, or other geographical location).” Much more recently, Michael Jacobson, director of Performance and Strategy at the King County Office of Performance Strategy and Budgets pointed us to an adage he once heard: "Aggregate to communicate and disaggregate to manage." These lessons are brought into start relief by a just released report by the Census Bureau that will stop us from ever thinking that the median population of states is a truly meaningful figure. The title of the report gets right to the point: "New Census Bureau Visualization Shows Broad Variations in Age." Consider Florida. Its median age in 2021 was 42.7, somewhat higher than next-door neighbor Georgia with a median age of 37.5. But does this mean that all of Florida is a place where retirees tend to go for low taxes and sunny weather? Not really, if you visit Leon County, with a population approaching 300,000. That county, home to the state capital, appropriately named for explorer Ponce de Leon, who is said to have sought the Fountain of Youth, has a median age of 32.1. By wild contrast, Sumter County, Florida, has a median age of 68.3, the highest of any county in the country. No surprise there. Sumter County is effectively little more than the home of The Villages, a master-planned age-restricted community with 130,000 people and virtually no children. Florida is not unusual, as the Census Bureau points out. Median ages ranged from county to county in practically every state. South Dakota, for example, had an extremely low median age of 23.0 in tiny Todd County, primarily home to Native Americans compared to 56.3 in Custer County. These age ranges are of consequence for a number of reasons. For example, when states distribute finances to counties based on their total populations, it might be wise for them to take the individual counties’ median ages into account. Consider the funding that went out to counties to help them deal with Covid vaccinations, particularly in the early days of the pandemic. Given the greater likelihood of hospitalizations and deaths among older people, it would have made simple sense to look at these disaggregated figures and spend more in the counties with higher median ages. Lumping people together into any monolith is often misleading, and age is only one example. A couple of months ago, Laura Zhang Choi, a Warren County school-board member testified to New Jersey legislators that the state would be well served by breaking down the component parts of New Jersey’s Asian American residents, according to an article in Verve Times. She pointed the legislators to New York City as a powerful example, and according to the article she told the legislators that, “about 11% of city residents suffer from diabetes, and the rate among Asian Americans is roughly the same at 12%. But a deeper look showed an alarming figure for Indian Americans, nearly double the city average at 21%. That information disappeared when all Asian ethnicities were lumped together.” The importance of disaggregation – for many other factors – was clearly spelled out in a recent podcast featuring Amy O’Hara, Research Professor in the Massive Data Institute at Georgetown’s McCourt School of Public Policy. As she explained, “When we think about the way that our communities are reflected in data, the biggest regular data collection is a decennial census. Every 10 years information is pulled together about every single resident in the United States. And for that information, in order to do apportionment, you say, how many humans are there in the U.S. and that’s adequate for that purpose. “But then, you really want to start breaking it down. What are the characteristics of these people? How many are male? How many are female? How many are old? How many are young? And you get these disaggregations of the data that were collected. The aggregate information is useful, but depending on what your policy question is, it’s not going to be useful enough.” #PerformanceManagement #StateandLocalGovernment #Equity #PublicSectorData #CityandCountyManagement #PerformanceMeasurement #DisaggregatedData #MichaelJaccobson #KingCounty #Disaggregation #UrbanInstitute #Covid #CensusBureau #PerformanceData #DataDisaggregation #KingCountyOfficeofPerformanceandStrategy #DataVisualization #StateofFlorida #StateofGeorgia #StateofSouthDakota #StateofWashington #StateofNewJersey #NewYorkCity #StateofNewYork #StateandLocalGovernmentPerformanceMeasurement #McCourtSchoolofPublicPolicy