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HomeMy WebLinkAbout1- Part I-Presentation for 2-15-2012 CITY OF PORT ARTHUR MANAGEMENT AND PERFORMANCE REVIEW UPDATED DRAFT FINAL REPORT The Mercer Group, Inc. February 15, 2012 Part I – Citywide Assessment PURPOSE OF THE STUDY •Identify key issues and opportunities to improve service delivery and reduce costs. FINDINGS AND RECOMMENDATIONS •Finding: The 2020 Vision document has not been formally adopted by the City Council and key elements have not been incorporated. •Finding: Few City Departments assess strategic operational issues and prepare functional business plans. Mission statements are usually in place, but goals, objectives, activity levels and performance measures are not. •Recommendation: Implement a full-scope strategic planning process based on the Mercer Model. FINDINGS AND RECOMMENDATIONS • Finding: Some actions of the Pleasure Island Commission create financial liabilities for the City and are not offset by revenue sources from which they can be paid. Day-to-day functions are closely related to the City’s Parks and Recreation Department. •Recommendation: Abolish the Pleasure Island Commission and merge services within City government, with responsibilities assigned to the Parks and Recreation Department. FINDINGS AND RECOMMENDATIONS •Finding: The Economic Development Corporation is currently a Type A organization under Texas State Law meaning that all revenues derived from the one-cent local option sales tax must be used for Economic Development purposes. •Finding: With the exception of the Executive Director, the current EDC staff does not have experience and background in economic development. This impacts the ability of the EDC to effectively carry out its proactive mission. FINDINGS AND RECOMMENDATIONS •Recommendation: Establish a Type B EDC which allows for a specific split of sales tax revenue that can be used for both economic development and infrastructure improvements. •Recommendation: Change the staff mix in the EDC to hire and retain staff with proven backgrounds and experience in economic development with duties to aggressively and proactively pursue business and industry expansion, as well as the recruitment of new business and industry. FINDINGS AND RECOMMENDATIONS •Finding: Even though there has been a recent improvement in revenue from payment in lieu of taxes from a local industry, the City continues to face a difficult financial situation. •Finding: The budget document is largely an object account/line item layout without future projections of revenues/expenditures and there is little or no analytical staff to look for needed alternatives/cost savings. •Finding: Revenue enhancement will require a stronger will to impose/collect fees and charges, including delinquent warrants, some of which should be written off and more recent ones pursued. FINDINGS AND RECOMMENDATIONS •Recommendation: Rethink service levels being offered with an eye towards reducing them to achieve budget-balancing cost reductions for the future. •Recommendation: Revise the budget process by instituting performance budgeting, five-year operational budgeting with the first-year being the trial budget for next year, and create a Budget Analyst position. FINDINGS AND RECOMMENDATIONS •Recommendation: More aggressively apply cost-based fees and charges to expand non-tax revenues across all funds and Departments, with policy-defined waivers and discounts. •Recommendation: Write-off aged delinquent warrants and pursue newer, collectable warrants via an outside collections agency. FINDINGS AND RECOMMENDATIONS •Finding: City Departments tend to take a relatively informal approach to managing the workforce and work activities, particularly in maintenance operations. This approach is unusual for a City of 53,818 population. The Mercer Model for Managing the Numbers is not fully implemented and not fully supported by automated data collection and reporting tools. •Recommendation: Completely implement the Mercer Model for Managing the Numbers and support it by automated data collection and reporting tools. FINDINGS AND RECOMMENDATIONS •Finding: The application of technology at the City/Department-level is evolving in a positive direction as evidenced by the upgrade of the SunGard Naviline system and purchase of the Police CAD system. IT systems and support, however, are not fully mature and modern when compared with similar communities. •Finding: What is lacking tends to be in Departments – technical IT support services, as well as hand-held data collection devices, maintenance management/work order systems, scheduling systems, human resource management system, and the like. FINDINGS AND RECOMMENDATIONS •Finding: There are a few IT needs at the City-level – full implementation of the SunGard Naviline system and determination if three IT positions are sufficient to support City-wide systems. •Recommendation: As the IT Strategic Plan is updated in 2012, focus on IT support and Departmental needs in order to bring the application and support of technology in the City up to industry-standards. FINDINGS AND RECOMMENDATIONS •Finding: Although the building blocks of sound HR functions are in place (e. g., policies and procedures, job descriptions, compensation plan), some need to be updated. In addition, Departments indicate the hiring process needs to be improved to identify fully-qualified candidates in a timely manner. •Finding: The City has an average annual General Fund workforce cost of $78,742 per worker and $70,235 in the Enterprise Funds. The General Fund cost per FTE has increased 21.4% since FY 2008. Comparable data for other regional Cities is difficult to obtain due to limited data in budgets. •Recommendation: Update aging HR policies and procedures, resolve hiring process issues, and work to contain the workforce cost per worker in the City. IMPACT OF OUR RECOMMENDATIONS •We believe implementation of our recommendations will increase efficiency and effectiveness, enhance revenues and reduce costs. •In addition, the recommendations in the report will strategically place Port Arthur in the forefront of public management as the City evolves and develops for the future. COST SAVINGS •On the expense side, net cost savings from implementing our recommendations will be approximately $1 to $5 million over the next five years, depending on the City’s interest in tackling tough service level and productivity issues. Some key ideas are: •Assess the cost-effectiveness of in-house vs. contract operations of facilities and programs •Enhance operations management practices (“Managing the Numbers”) to measure workforce productivity and activity costs •Evaluate all vacant positions for continuing benefit to the City •Close and sell some City-owned and operated community centers •Reduce service levels in City Departments REVENUE ENHANCEMENT •On the revenue side, the City needs to transition to cost-based user fees and utility rates, as well as aggressively collect fees, rates, and receivables. Some key ideas are: •Implement aggressive collection efforts, where still viable, on outstanding warrants and other receivables •Increase utility rates and user fees to cover the full cost of service with a formal policy on discounts and waivers for youth and low-income persons •Implement new user fees where commonly applied in other local governments •Continue to aggressively re-negotiate agreements with surrounding industry for increased payments in lieu of taxes •Aggressively pursue a long-term agreement for sale of water to the LNG facility •Increase rental rates at City facilities like the Civic Center •Bill for private and public insurance in City health services EXCELLENT SUPPORT FOR OUR WORK THANK YOU FOR THE OPPORTUNITY TO SERVE THE CITY OF PORT ARTHUR ON THIS PROJECT!