Detroit’s recent bankruptcy filing placed the issues many declining municipalities face directly in the public eye. Detroit’s experience is a large-scale and extreme example of what many cities, towns, and other municipalities face as their population and revenues begin to decline:
- The need to increase revenues and/or reduce city services to maintain fiscal health
- The breakdown of institutions – both governmental and non-governmental – that provide key services and the capacity to attract and retain businesses and residents
- Increase in crime
- Tough negotiations with public employee unions when contracts renew in times of economic difficulty
- Declining property values that promote more renting over home ownership
In many cases, the budget cuts that inevitably come end up creating a “not my job” scenario: for example, a resident visits a municipal office for some basic service, and ends up on the receiving end of some embittered speech by the office worker as to how they can’t do something because they are understaffed and the person who used to do that doesn’t work here any more, or now only comes in on Tuesdays or is on vacation and no one else knows how to do their job. While the employees’ frustrations are very understandable, as is the low morale of wondering who might be next (an organizational anxiety!), this begins to occur more and more broadly across the city, and basic helpfulness and basic services begin to fall through the cracks.
The downward spiral continues: those residing in, and doing business with the city begin to wonder what exactly their tax dollars are paying for – whether personal income, property, sales, use or excise taxes. It appears to them that government has abdicated its governance responsibility. This embitters residents against their own city, and it becomes a place where newcomers are greeted with a cynical, “Why do you want to live or work here?” Those who get out, do. Those who stay are stuck due to lack of other options. Most are not genuinely invested in where they live.
The depression becomes palpable.
Nevertheless, municipal redevelopment – breaking the spiral of depression and decline – is an issue of steward leadership. This steward leader’s challenge is working with deeply-entrenched, defensive systems within the city system that often believe they have a right to what they used to have (or have been able to hold on to up to this point), and are willing to throw the overall good (as well as other departments) off the bus to maintain their position. Often, leaders must please those interests to get elected, which just reinforces the insitutional defensiveness, silos, and turf wars as various parts of the organizational chart alternatively cooperate with “our guy” while dragging their feet when dealing with “their guy.”
This is, by any measure, a significant challenge. Steward leaders who work in these contexts often feel isolated and have trouble seeing over the edge of the trench they are dug into because of their municipality’s latest institutional battle. The steward leader, then, in that context, has to do several things at once:
- Offer hope and vision without pollyannas or panaceas
- Exhibit fiscal prudence while re-engaging public employees and residents in serving the community for the common good
- Making certain basic municipal services are maintained
- Build institutions (governmental and non-governmental; private and public; service and enterprise) that can carry the weight of making the municipality an attractive place to live, work and visit.
- Re-engage the government in the practice of good governance.
Matthew Thomas is a Senior Consultant, Design Group International. Matthew will be presenting a workshop on the Four Financial Confusions of Nonprofit Executives at the 2014 CLA National Conference in Dallas. He is also in process to finish his CCNL.
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