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Stronger Public Sector Budgeting

Stronger Public Sector Budgeting: Webinar Takeaways

By | Customer Stories, Finance Officer's Desk, Insights | No Comments

Yesterday, I had the pleasure of moderating an incredible webinar about public sector budgeting: “Budgeting for Success Amid Uncertainty.” Veteran Finance Directors Bill Statler (retired from San Luis Obispo, California); Boulder City, Nevada’s Finance Director Hyun Kim; and OpenGov’s VP of Government Finance Solutions Mike McCann (retired from Ukiah, California) each shared their perspectives based on their professional expertise and experiences as local finance directors.

Nearly half of all U.S. states are facing revenue shortfalls this year. As governments actively face the near-term prospect of either an economic downturn or the one of the longest growth periods in our nation’s history, the panelists discussed the natural challenges associated with budgeting effectively in such uncertain economic environments –both strong and weak environments. The session melded theory with practice, focusing on providing insights and solutions. In an era compelling governments to constantly do more with less, they noted that modernizing public sector budgeting and planning approaches would be critical to achieving success.

Preparing for the Next Downturn

Bill Statler spoke specifically to strategies for preparing for the next economic downturn. While most local governments have recovered from the Great Recession and have experienced recent growth, future downturns and other uncertainties are inevitable. Those organizations that are planning now are best-equipped to succeed through future challenges. “If you can’t prepare for these in the best of times, when can you?” Statler posited.

He honed in on specific challenges, including economic outlook, unaddressed infrastructure needs, and pensions and retiree health care. To address them proactively, he suggested five strategies for ensuring long-term fiscal health:

  1. Engage your community and align resources with priorities. “At the end of the day, it’s not about the numbers, it’s about the community,” Statler said. The governing body must lead the way while engaging the community early.
  2. Use your favorable results for one-time purposes. Fund capital improvements you deferred and address unfunded liabilities. He said, “Today is your base,” which means there is no catching up. Operate from your current reality and minimize program expansion until your infrastructure plan is caught up and liabilities are sufficiently funded.
  3. Implement fiscal policies. Fiscal policies (such as balanced budget, CIP management, minimum fund balance, etc.) are preventative and curative. According to Statler, they are your “guiding North Star,” providing continuity and articulating organizational values when the organization is under less stress. “If you have a notion of where you want to be, your chances of getting there are significantly enhanced.”
  4. Plan for the long-term. Financial planning forces you to think about factors that affect your fiscal health. Forecasts provide a powerful context to gauge how you are doing, and how best to frame policy decisions for what lies ahead.
  5. Create a contingency plan. What is your strategy? A clear response plan and guidelines, communicated to both residents and internal staff, will enable you to respond to adverse circumstances smoothly. Identify triggers for implementing the plan and engage employees early on when seeking solutions.

Planning for Change, a Case Study

Hyun Kim spoke of how Boulder City, Nevada has navigated post-recession dynamics to while striving for long-term fiscal sustainability. His federally-planned city – originally founded to house Hoover Dam construction workers – grappled with how to do more with less while also anticipating an inevitable growth slowdown. While tourism provides opportunities, Boulder City faces aging demographics that can’t fund growth in perpetuity due to strict growth ordinances.

Beyond demographics, Kim spoke of very practical budget process concerns. He arrived in his position in the middle of its budget season, and he was unfamiliar with the City’s existing Enterprise Resource Planning (ERP) system. Thus, he faced firm budget deadlines amid ever-shifting circumstances such as ongoing labor negotiations and personnel shifts – all while trying to navigate a new ERP system.

He discussed the benefits of long-term planning and leveraging non-traditional approaches within the public sector. For instance, by leveraging cloud technology, he said his team has realized operating and cost efficiencies. In addition to other workflow processes, his team started using OpenGov’s cloud-based budgeting solution, which he said allowed him to leverage existing ERP data through a simpler interface. Whereas static spreadsheets would be stale by the time they made it to council, the new software provided solutions that were “living” – allowing for automatic updates, collaboration, and a faster online process. “We were able to see changes being made in a centralized spot from various departments. It saved our weekends,” he said.

Empowering Stronger Public Sector Budgeting

Mike McCann concluded with brief remarks from his own perspective as both head of OpenGov’s in-house team of finance experts on the Government Finance Solutions team and as a veteran finance director himself. He explained that he joined OpenGov for its mission – to empower more effective and accountable government. That mission exists to help everyone in the industry. He noted that the effort is centered around designing a set of solutions focused on the budget as the heart of government. As capabilities are added, the outcomes increase in turn.

If you were unable to join the live webinar on March 21st, be sure to watch it yourself for more takeaways and first-hand perspectives from seasoned professionals in the field.


Autumn Carter leads Government Affairs at OpenGov.

4 Ways to Increase Data's Value to Your Organization

4 Ways to Increase Data’s Value: Hoosier User Takeaways

By | Customer Stories, Events, Insights | No Comments

Earlier this month, eighteen public sector Hoosiers from eight local Indiana governments gathered for an OpenGov user session in Westfield, Indiana’s Grand Park Event Center. Together, my colleague, Adam Stone, and I facilitated the discussion, but the attendees – comprised of treasurers, controllers, IT Directors, municipal clerks, and elected officials – drove the discourse. Topics of the day centered around where they see governance challenges and technology best practices they can leverage to help address them. We especially focused on how to increase data’s value to their organizations.

Here are four key tips and takeaways identified by the Indiana User Group:

1. Empower Department Heads with Relevant Data and Flexible Reporting

Common among discussed challenges was frustration with legacy ERP systems when seeking to share information easily internally across departments. Attendees noted that while the notion of public sector transparency often seems to apply externally, it can also apply internally. Many department heads feel the rely on a few staff members who have the ability to access ERP systems and generate reports.

A more flexible solution, however, can increase data’s value by permitting integration with existing ERPs, enabling more up-to-date, on-demand data in a central location accessible to managers. Flexible reporting options give them what they need when they need it. The group noted that often, department heads have difficulty finding time to understand their own financial data. “If you don’t know your numbers, you don’t know your business,” noted one attendee. The group shared how internal dashboards and non-financial visualizations could help educate department heads, leading them to “own” and “know” their numbers, thereby resulting in more informed decision-making.

2. Increase Data’s Value by Context

It is certainly critical for internal stakeholders to be able to access and understand a city’s financial data – Adam referred to this as the “framework of operational reporting,” whereby data is consumed internally. However, external understanding is just as important. Budgets can be cumbersome, and throwing mountains of data and figures out to the public without accompanying context can result in serious misinterpretations. And ultimately, budgets simply don’t work without external buy-in.

The key is to present financial information in context, reducing questions and alleviating concerns. The group discussed the value of “saved views,” which help frame data views around commonly asked questions or high-demand information. For example, cities can direct residents to exact data points when there are inquiries about what type of services the Board of Public Works supports. Saving views for the top 10 queries from the public is an easy and effective way to reduce time responding to public information requests.

Another context-building strategy we discussed was implementing a landing page that presents written answers to frequently-asked questions and links to the transparency platform. “How to” videos for citizens are also useful components of landing pages, as the videos can educate the public on everything from the nature of the general fund to how to drill down into department-level data.

3. Answer Council Questions in Real Time

Unsurprisingly, many participants had experienced or witnessed council budget sessions during which answers to questions were unavailable. While most said they had never considered using technology as a tool in that situation, most agreed that doing so could be one of the easiest ways to answer council questions in real-time. Through interactive drill-downs and easy-to-understand illustrations of the data, that information would become easier for presenters to find and for council members to understand on the spot. The enhanced engagement could also build trust between council members and staff. One participant noted of the OpenGov Platform in particular, “I definitely want to open it up during council meetings; that’s my goal.”

Another described how his council’s use of technology after the city started integrating technology into its workflows. Introducing a transparency initiative had begun largely as a way to keep a campaign promise. “But the finance department very quickly started using [the platform] selfishly to get to our own data,” he said. The finance department was already working to increase data’s value within their team, but realized they could make it meaningful for the council. “You can quite easily determine what council members’ hot points are based on the questions they ask. For example, one member was very concerned with our municipal airport. We finally created saved views and then at a council meeting just showed them all how to access the information.” He concluded, “It goes a really, really long way to improving your relationship with those individuals and also instilling trust.”

4. Use Maps to Place Data in the Context of Communities

No communities in attendance said they had utilized technology solutions for parcel reporting, but all agreed that a great deal of parcel-level information that is very meaningful. We all work and live within geographic boundaries, so it can often make sense to view financial and non-financial data within that context. We can take the data we already have and include an address that relates to it. Effective technology solutions can automatically map that. That enables the creation of visualizations like service delivery across residential, commercial, and industrial parcels, which can inform analyses. Maps can also help inform economic development policies and aid in compliance with geographic grant allocation guidelines.

The group discussed how they could map their capital projects, adding in their Chart of Accounts codes to link historical costs and future projected costs all in one visualization. They could also work on linking Chart of Accounts codes to crime, traffic, building permit, demolition data, and more. One attendee left the group particularly excited by the possibility of being able to show the growth of residential and industrial properties through mapping.

Throughout the session, participants saw the utilization of new technology platforms shift from transparency-only solutions to those that could effectively solve day-to-day operational challenges. One attendee noted, “I knew OpenGov was a great tool, but during the meeting, I realized just how much it is going to be able to do.”


Meredith Behm is a Customer Success Manager at OpenGov.

Boston Future Open Data

The Open Data Future: Interview with Joel Natividad (Part I)

By | Insights | No Comments

Editor’s Note: On the eve of the one-year anniversary of OpenGov acquiring open data leader Ontodia, we spoke with Ontodia’s Founder and OpenGov Director of Open Data Joel Natividad about the future of open data. Joel is a member of the CKAN Association’s Steering Group, a true innovator, and an influential thought-leader in the field. Here, he discusses open data’s meaning, relevance, and the path forward towards greater usability.

Part I of our interview, below, explores the concept of open data and its future. Part II will continue the conversation by exploring open data’s future use and implementation.


 

PART I: Understanding Open Data

 

How do you define open data?

The common or classical understanding of open data is that it is data published for transparency purposes. Many of us are familiar with the McKinsey Global Institute study, which cited the potential of open data to create $3 trillion in value in the global economy. To date, we haven’t really captured that potential.

Part of the reason we have not reached that level of potential is that the main mistake made during the first generation of open data: it was not enough just to publish data. We found that the reality is not simply, “publish it and innovation will come.” Having gone through the first generation of open data, we’ve learned the hard way that people don’t really care about raw, hard data. The emphasis needs to change so that we are using “open” as a verb – as in “opening data.”

And what does “opening data” actually look like?

The purpose of open data is not just for the sake of public transparency, but its value is also in driving decisions inside of government. By treating open data as a strategic asset, you make the data cleaner and more operational. That increase of utility is the future, and it’s an internal cultural shift as well, whereby government is not only the publisher of the data, but also the beneficiary.

Opening data creates a ‘data of record’ source for all government departments, internally first, and then to share among peers. Often, governments view open data initiatives as another unfunded mandate: government personnel aren’t sure what the outcomes are, or fear they may accidentally share sensitive information. If governments make actively using and sharing open data part of their normal workflow, everybody benefits. The staff benefits, the council benefits, the public benefits. If you increase open data’s utility, you increase its relevance, and that is where things are heading.

What are the main drivers moving open data toward the future?

One of the things you find now, especially from the leading thinkers on 21st Century government like the Sunlight Foundation, the Government Center for Excellence at Johns Hopkins, and others, is that open data is a means to an end. The key point is that the end goal is performance management. How do you do performance management? You cannot do it without open data. Governments cannot perform well without this basic ingredient of clean, open data. At OpenGov, we are looking at it in the same way.

Joel Natividad - Future of Open Data

So what are examples of using open data for performance management?

We see the best way to operationalize open data to enhance performance is to correlate spending with outcomes. With Ontodia, our core competency was finance. If we correlate and measure financial data against other data, we gain an insight of spending versus outcomes. This drives a feedback loop and enables governments to explore how they are operating; to assess whether they are efficient. They can also benchmark against other entities of the same size. What are they doing? How are their costs lower than ours?

Unlike in the private sector, the beauty of the public sector is that it actually encourages people to share notes. Not just for competition’s sake, but to learn from each other. Take Pepsi and Coke, for example. They are in competition and would never share the secret sauce. In government, that’s not the case. We want to talk to each other.

How do non-government organizations like OpenGov fit into the future of open data?

We offer the critical participation component. We work from the open-sourced, standards-based project CKAN (Comprehensive Knowledge Archive Network), which is the predominate solution for large governments. I say “large governments” because before OpenGov, you needed hackers to stand up CKAN-based open data portals. We are essentially productizing CKAN, and including value-added applications that allow municipal-level personnel – especially non-programmers – to concentrate on opening the data, rather than running a data portal. Our standards-based solution allows for innovation and enables conversation among cities.

The good thing is that, in general, people now agree that governments should treat data as infrastructure. When municipal systems were first built, they weren’t built with open data in mind. They weren’t designed to have common linkages or data standards. But that transition is underway, and OpenGov is facilitating that transition.

Is it currently possible to measure or quantify tangible benefits of open data?

Right now the easiest way to measure the return on investment or open data’s payback is in calculating the costs of complying with Freedom of Information Act (FOIA) and public records requests. Those requests are often onerous, redundant, and expensive. Through the utilization of open data, you can dramatically reduce your FOIA processing costs. That’s an easy one.

I always go back to prioritizing data and ensuring a linkage to the budget. If we operationalize data and correlate it to the budget, it will absolutely help cities achieve data-driven government. It’s not just a nicer way to understand the budget or get away from dealing with ERP reports. While there’s no easy measure of it, if you connect the data to high-value budget priorities, it leads to operational efficiencies.

Does the public have a responsibility in an open data “ecosystem”?

Yes. Part of the open data challenge is educating the public about that responsibility. For example, as Analyze Boston’s open data initiative enters its second phase, it includes a public education campaign. That is part of making data useful. If you think back to when 311 was introduced, it gave the public a way to interact with government using digital means. Software consumed the first generation of open data. But to make it both useful to and used by the common consumer, I think you have to correlate it to the budget. Then people will start to care.

What if, instead of giving people a piece of paper that shows how much they need to pay in property tax, we give them something that shows just what they are getting in return? That’s why I’m so excited about the potential of tying financial data to budget data. We can quantify for people – at a neighborhood level – how much the city has allocated on their behalf for infrastructure and other services. By completing this picture, citizens will come to care about open data. Ultimately, this will help to restore the lost trust in government.

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