This is my last minute input; my last chance to address the reorganization issue before the City Council begins to discuss the public input and vote on the reorganization issue- which is scheduled over the next week or two I believe. Any more comments/discussion from list members? What would you like to see in a reorganization of city government? Be sure to contact your CC member if you have comments or suggestions.
In general I support the McKinsey recommendations to combine the planning and development functions of the city. McKinsey suggests many ways to reduce bureaucracy, improve accountability and streamline city services-- all in an effort to do more with less, and make city government more responsive to city residents, business and property owners. As usual, the devil is in the details. Many of the details involve the property taxes associated with maintaining our municipal infrastructure and providing municipal services. I realize that tax increment revenues in Mpls. have been reduced by about one-third, or roughly $25 million per year through 2009 as a result of state tax reforms, and traditional MCDA revenue is also down. While city debt service can be met, community development program budgets must be reduced. The Library tax levy authorized by referendum will be phased in over 20 years beginning next year and will reach about $10 million annually by 2007. This is exclusive of schools, county, and special tax districts. The Mayor and City Council have agreed to set the maximum annual property tax levy not to exceed an 8-percent annual increase for budget years 2003-2010, inclusive of the levy for the Independent Boards, and including the voter-approved library referendum. Property values will continue to appreciate, exclusive of the local-levy cap, and the limited market value (for taxation purposes) will be phased out by 2007. These budget constraints set the stage for any city reorganization, and emphasize the importance of reducing redundancy and duplication of effort, while reducing the costs associated with delivering basic services in Minneapolis. Given the fiscal reality, I'd like to address nine areas that I think are important in any reorganization, especially pertaining to NRP, since it enjoys such strong political support across the city. 1. NRP/NCP-- I think McKinsey is on target with the NCP concept. The NRP is funded by MCDA as a community development program, and accounted for about 6% of MCDA funding in 2001. The NRP is a joint powers organization established by state law. The city is not required to continue funding NRP, and that is part of the political decision associated with the proposed reorganization. As part of the joint powers agreement, Hennepin County and the Minneapolis Public Schools share 15-percent of NRP annual funding, and each is represented on the NRP Policy Board, along with representatives of the City Council, the Park and Library Boards and various state, community, neighborhood and labor organizations. I think the NRP serves a valuable function in Minneapolis by getting neighborhood residents involved in the planning process, and I agree with the NRP Policy Board that neighborhoods should have reliable funding that they control. I support election of representatives to any NRP or Neighborhood and Community Planning Policy Board and appointment to any advisory bodies. I think funding allocations should include every neighborhood in the city, based on an objective measured need. I do not, however, think NRP funding levels should be increased beyond those currently projected (i.e. $15-$18 million annually). Neighborhood organizations, for all their value, are steeped in personalities and politics, burnout and turnover of volunteers, and inconsistencies as to capacity and timeliness. Elected representatives of neighborhood organizations are not elected in a conventional general election, and their authority and accountability may justifiably be questioned. NRP represents a relatively small, yet significant and important, percentage of annual City development funds, but they are limited� even reduced in Phase II planning. I think the NRP process can be strengthened by adding formalized support (professional planners) from the Planning/Development staff to facilitate neighborhood develop of local action plans in conformance with the city-wide Comprehensive Plan, while incorporating neighborhood direction and desires into the Comprehensive Plan. Thus, while neighborhood-controlled planning budgets would not increase, the local planning process would be enhanced through the added assistance provided by professional planning staff assisting at the neighborhood level. Neighborhood and citywide planning goals should evolve in a symbiotic fashion; creating efficiencies of time, place and budget. This type arrangement will promote accountability and planning consistency at the neighborhood level, while preserving local control. I think it is important that we preserve active neighborhood participation in the planning and development process-- it helps build community and builds leadership capacity at the neighborhood level. At the same time, we must recognize the value and utilize the expertise of our professional city and urban planning staff. NRP process inefficiencies can be reduced and the overall process supplemented by other planning-oriented budgets within city government as part of the reorganization. It should be possible to reduce overall planning/development process inefficiencies, as priorities are redirected from large, central downtown commercial developments toward smaller and more numerous housing, commercial corridor, small-business and mixed-use developments where more neighborhood input is required. MCDA and Planning should be merged along the lines of the McKinsey recommendations. Planning/development overhead would simply shift from the relatively few larger (previously MCDA controlled) projects, to the many smaller development opportunities (previously more a part of NRP/Planning's sphere of influence). 2. CPED-- I don't think the City Council should be the governing agent/board of MCDA or any superceding/reorganized development body (i.e. CPED or NCP per McKinsey). Eliminate the 13-14 bosses syndrome and establish a more centralized management structure where reporting relationships, responsibility and accountability are clear, and a consistent planning process is in place. This would allow the Mayor and City Council to identify major goals and top priorities, help develop and approve budgets, plans and processes, and oversee appeals as needed. The Mayor and City Council would serve more of a CEO and Board of Directors role in City governance, with CPED being responsible for the overall management role in planning and economic development. Responsibility and accountability for meeting the major goals and top priorities falls to CPED and is further delegated to major department heads via the strategic planning process where functional objectives and strategies are developed and implemented. This concept, as outlined by McKinsey, makes a lot of sense to me. The Mayor and City Council as the lead management and policy development team (CEO/Board) holds overall responsibility for City management, while the CPED Director becomes the operational head for day-to-day management and control responsibilities. While this structure could be viewed as restrictive by City Council members, since it would place a level of management between them and the operating department heads, I think it represents a stronger organizational structure in that it facilitates a more focused and efficient municipal operation. 3. Development Services-- I don't think that simply combining internal and external development support functions will accomplish much. I think all processes (permits, licenses, inspections need to be reviewed in an effort to simplify and improve process efficiency from a time and materials, and control perspective-- from the initial point of process input to the point of project completion. The recent Block E fiasco demonstrates most clearly the need for significant process change in the planning and development function of city government. Given that the Block E development was approved by the Planning Commission in May, 2000, contingent upon the developer, McCaffery Interests, meeting certain specific conditions, I feel the developer did not act in good faith with the City of Minneapolis. Many of the specified conditions were not met and the developer claims that change approvals were obtained from City staff persons in different departments. I suggest the developer was disingenuous and was simply gaming the fragmented planning and development process of city government to benefit their own self-interest and that of their tenants. To the detriment of city residents and taxpayers, after investing some $40 million of public funds in the project, it is absolutely unacceptable that previously stipulated conditions of approval, like the exterior escalators on First Avenue, street-level public restrooms and a public thoroughfare from Hennepin to First Avenue, were stripped from the development. Minneapolis taxpayers should be able to feel confident about their public investments and feel assured they will get what they bargained for. Hopefully the reorganization will close such loopholes in the near future. In the development arena, increases in the tax base are dependent upon private investment (debt and equity) and competitive, quality infrastructure being available (quality schools; competitively priced housing; streets, sidewalks, sewerage systems, parks, etc.) to support/justify the initial investment. City government should focus on the appropriate common infrastructure components of the equation at a level consistent with realistic property tax revenue projections. Use limited city funds to support quality public infrastructure that will entice private investment. Fiscal reality and the need to deliver basic city services in a cost-effective manner are the process drivers. Everything else is ancillary to the mission and subject to adjustment. 4. Housing Development-- This is the area where McKinsey�s reference to non-physical �opportunity development� is key to success. The needs are so great that it is incumbent upon the City to work with other private and public entities, including the federal government, to achieve success in a timely fashion. Affordable housing should represent a component of virtually every commercial development effort in the City where public funds are committed. Attention needs to be given to the new strategy that allows affordable units in a given development to be allocated �elsewhere� (to another project sometime in the future)� with such funds being directed toward an affordable housing fund, with locations, etc., to be determined at a future date. Stress mixed-use, higher density corridor development! Work closely with Metro Council and others as allies. Strive for more Section 8 authority and work with landlords throughout the city. 5. Business Development-- The City currently supports neighborhood associations via the MCDA, and should do likewise with neighborhood small business associations-- it doesn't take a lot of money, and it fosters goodwill. The City should also maintain a good relationship with Chamber of Commerce, and actively solicit input from business as to how the City can improve the business climate. Both large and small business and the ancillary jobs they create are the lifeblood of Minneapolis. They provide disposable income and a growing tax base. Don't subsidize businesses with city-backed loans. Maintain good working relationships with the business community, and subsidize infrastructure that facilitates a good business environment. Interest rates are at record-low levels so use the private sector for business financing, the SBA, etc. Work with/coordinate job training and business planning and education functions through Metropolitan State University, Mpls. Community and Technical College, the University of Minnesota, private educational institutions, the private sector, the SBA, etc. The MPS and MPS- Community Education could also facilitate education and job training programs aimed at getting/keeping people employed. This is another vast opportunity area for the City to facilitate and publicize the programs available, without providing direct subsidies to business owners. The private sector gets paid to take risks in financing new and existing businesses-- the taxpayer does not. Collaborate on innovative strategies to attract high-tech business and knowledge workers; focus on infrastructure needs. Stress mixed-use corridor development! 6. Human Development-- Eliminate or reduce City programs that are redundant with County and State initiatives. The City should help facilitate County/State and other private/public initiatives, consistent with limited property tax revenue streams. 7. Public Works-- Public works is largely a job shop and should be a project-based operation, exclusive of the planning function where capital improvements should be coordinated/planned within the CPED structure. 8. Budgets-- There is tremendous need for a formal capital budgeting decision rule methodology to be developed and implemented citywide. Such decision rules should be used to determine which capital projects go forward at what point in time� a method to prioritize capital projects based on a planned budget. Financial ranking methods and priority weighting methods should be incorporated in order to get the best �bang for the buck� and stay within budget. Similarly, an acceptable band of annual TIF-based projects should be established and maintained, consistent with reasonable revenue streams and other capital budgets. A consistent budgeting and financial analysis methodology should be established across departments where conventional concepts like discounted cash flow analysis are incorporated in the decision rules. Improve coordination between MPL, MPRB and MPS. There should be a formal coordination between planning and budgeting in an effort to continually improve efficiencies and do �more with less� from a taxpayer perspective. A CLIC-like function holds value for capital budgeting, but an emphasis needs to be placed on all departments developing and using a consistent, structurally balanced approach to budgeting, where annual operating and capital requirements are in balance�i.e. a new capital project isn�t approved without consideration of ancillary incremental operating costs. 9. Quality systems-- Systems thinking and continuous process improvement concepts should be components of all organizational and operational decision-making within the City. Reduce institutional barriers to efficient development and structure incentives that foster desired development strategies to meet citywide goals. Solicit private sector ideas, involvement and assistance wherever possible. Adopt a disciplined approach to finance and incorporate a structurally balanced (capital and operating) city budget process. Michael Hohmann Linden hills www.mahohmannbizplans.com cc Mayor and City Council _______________________________________ Minneapolis Issues Forum - A Civil City Civic Discussion - Mn E-Democracy Post messages to: [EMAIL PROTECTED] Subscribe, Unsubscribe, Digest option, and more: http://e-democracy.org/mpls
