Articles by Stephen Goldsmith

Structuring Reform to Enhance Ethical Conduct and Democratic Accountability

When a community considers charter reform, the top priority should be democratic accountability. Addressing how the structure of government can best be enhanced to assure that future politicians will act ethically and in a manner accountable to the voters should be the foundational principle of reform.

Of course producing an honest and responsive government requires more than just legal reform. Government must be built on a culture of ethical conduct, citizen input, transparency and accountability. When the citizens trust the integrity of their leaders to provide honest information about policy choices, and other issues, public officials can more boldly lead. Thus ethics and accountability in government, and more specifically the public’s perception of their presence, plays a key role in government’s ability to recruit good candidates, and a region’s ability to build a community that produces a vibrant and successful economy.

These issues involve more than just how to stop a few crooks from abusing their public positions. True accountability involves combining the structures, training and leadership that raise standards, opens up proceedings in meaningful ways and produce the data on which the public entity can be held accountable to an involved citizenry.

From a regional perspective, misconduct in any entity in the area produces a negative image throughout community. Shelby County’s reputation cannot be insulated from the transgressions in Memphis which negatively impact the region’s reputation and relations. Forbes magazine’s article ranking Memphis third on its “America’s Most Miserable Cities” list, because of “an alarming rate of convicted public officials,” doesn’t just affect Memphis; this type of press has a very negative impact on the entire region.

The Catalyst

I applaud Mayor Wharton for introducing new Executive Order establishing standards of performance for a transparent and open Memphis City government and for his hard work in setting a high ethical bar in an effort to regain public trust. His efforts should be the predicate for the Charter Commissions attention. The Commission can produce true value by codifying these changes and others. The ethical structures of a city administration should not be dependent on a specific executive but rather legally mandated in a fashion that means they will apply whoever holds the office.

In addition, with multiple municipal entities and dozens of boards and commissions, the standards, training, and methods of enforcing them should be codified and applied to all individuals who exercise public authority in Shelby County. From what I have been told, there are over 75 boards and commission authorities in Memphis/Shelby County consisting of administrative governments, committees, taskforces, and districts that specialize in a broad array of functions that include: transportation, water, fire safety, emergency response, airports, regional planning, housing, sanitation, garbage disposal, local agency formation, risk management, environmental concerns, libraries, parking, county services, lighting, redevelopment and many others. A significant amount of money runs through these agencies/districts, and those associated with these efforts need to be included in the ethics, accountability and transparency reform initiative. The Commission can facilitate an entire overhaul of the system, and a comprehensive proactive implementation of ordinances, regulations, training, and enforcement.

The Charter opportunity then can serve as a catalyst that inspires the change needed to design and implement transparency/accountability programs and a strong ethical culture across a unified government. Through the new charter, there is significant opportunity to enact extensive standards and create a new Ethics Commission for the region that would focus on structuring a consolidated ethics codes, and well as utilize best practices from other jurisdictions.

A Better Platform

A new charter could contribute substantially to the region by creating a platform of ethical compliance that encourages good conduct through:

• A County wide agency with ethics responsibility.
• Comprehensive standards and effective enforcement mechanisms.
• A clear public records and open meeting requirement buttressed by an agency whose responsibility it is to make sure information is easily available and understandable to citizens, reporters and bloggers alike.
• A training plan and requirement for all individuals exercising public responsibility.
• An investigation and enforcement mechanism.
• An advisory opinion process for public officials with questions.

Ethics codes in cities throughout the U.S. contain, to a greater or lesser degree, a common set of requirements that include: restrictions on the receipt of private gifts; regulations on outside private employment and outside earned income including honoraria; financial disclosures provisions for public (including elected) employees; general conflicts of interest regulations; restrictions on private employment of former officials (revolving door rules); and laws against: bribery or other forms of pay to play; unauthorized use of public property and other resources; nepotism; use or disclosure of confidential or privileged information for personal gain and conflicting business relationships. All of these general requirements should be added into the consolidated ethics code.

Citizens Matter

Democratic accountability cannot rest only on the honesty of public officials; it must also incorporate procedures for informed and meaningful citizen participation. Therefore, the Charter should also include a simple and clear process for providing citizens and the media with information on how the public’s business is being conducted, including performance metrics, and disclosure of conflicting financial interests. In addition, a new system should cover all elected officials and public employees, members of commissions, boards, committees and other local agency bodies with decision-making authority.

As with the other areas, from an efficiency perspective, the benefits of consolidation will include merged procedures and processes for transparent and accountable government systems. Having one agency responsible for, and one place to go with questions about, ethics will produce benefits. The goal should be to have a centralized platform, catalogued and in an easily accessible format for all filings and reports. A unified approach would also allow for a better system of tracking all the opinions rendered and conflicts of interest regardless of jurisdiction.

Democratic accountability requires more than simple compliance to ethical standards. It also depends on an informed and active citizenry. The Commission can ensure high quality and honest government in the future by designing a platform through which information can be drawn. The information should include expenditures, service reports, contracts, ethical filings and performance tracking. A specific office should be tasked with “sunshine” compliance and to operate in a way that allows informed citizens, reporters and bloggers to access information. Today’s web 2.0 strategies facilitate reporting and tracking, as well as assessing weakness and analyzing gaps to best adapt and enforce ethical conduct.

Ethics Commission

Finally, dedicated public employees and the public both will benefit from a central place with county wide authority that facilitates reporting of abuses and suggestions for improvements. In a newly reformed ethics structure, a better system needs to be put in place both for misconduct reporting and whistleblower protections.

From my experience, the weakness in the ethics compliance systems in local government is not so much the actual ethics codes, but the lack of concern for its administration and enforcement. Thus, a central and independent regulatory agency is critical. In smaller governments those agencies are generally too small and insufficiently independent due to lack of resources; however, a new consolidated government does offer an opportunity to establish such an agency. The Charter Commission could include in the charter an Ethics Commission and an Office of Ethics and Integrity, for the region, empowered to review, interpret, and provide opinions, training and guidance. The office would counsel government employees and other public servants, contractors and the general public about ethics rules, as well as serve as a centralized source for document control, including housing database of disclosures and lobbyist reports, and managing necessary web tools.

In addition, it would establish procedures for transparency (including rules for open records and open public meetings) and a process from which members of the public could secure help when agencies do not provide required information.

The Charter Commission can facilitate and insure an enhanced culture of integrity by including a solution that increases opportunity for ethical behavior putting in place a structure that produces rules, regulations and standard operating procedures that become the hallmarks of a compliance-oriented ethics management strategy.

Bottom line, everyone should know what the rules of acceptable and unacceptable behavior are regionally, and how they are being enforced. A new charter provides a wonderful opportunity to rebrand and permanently enhance the region’s ethical culture.

Public Value and Better Government Services in Law Enforcement and Corrections

No issue is more fundamental to a vibrant community than its safety.

Work, school, worship, recreation, property values all rely on assumptions of safety. The Charter Commission is rightfully evaluating how safety might be enhanced in a reform effort.

I was in Memphis a few weeks ago and had an opportunity to testify before the Charter Commission, as well as to meet with several public officials, including Sheriff Luttrell and Mayor Wharton.  I was asked on several occasions if Indianapolis made the right choice by finally consolidating their police and sheriff’s department. 

In short, Indianapolis waited a quarter of a century after merging certain civil functions like roads and parks and economic development before merging the  police and sheriff’s departments. We originally avoided it for political purposes until it became clear that having one leader and one vision combined with the necessary efficiencies, produced gains in strategies that could help address safety questions. 

Memphis and Shelby County today have many law enforcement agencies (including corrections) overseen by four different government agencies with duplication of administrative functions and some lack of integration of specialized units. The leadership responsible for law enforcement and corrections include an elected Sheriff, a Police Director appointed by the Memphis Mayor, the County Mayor who is responsible for the corrections facility, as well as a Juvenile Judge, who is responsible for the juvenile detention facility.

While many factors affect a community’s level of safety—quality of leadership, choice of strategy, allocation and availability of resources, community participation, economic opportunity, law enforcement, corrections and education, among others –realigning crime fighting can in fact produce substantial value. Thus, it is possible to point to benefits from a consolidation that can lay a sound foundation for further safety advances.

These include the following:

• Unified Vision of Law Enforcement:  Bringing together all law enforcement functions under one department will result in a more unified vision and clarity of command.  This single voice and point of command should result in more effective tactical and strategic decisions, a safer community and reduced criminal conduct.
• A Single Philosophy and Mission towards Corrections: For a corrections and re-entry strategy to be effective, it needs to include approaches to offender management that begin at arrest and end at rehabilitation. The significant numbers of offenders under arrest at any one time obviously produce a high risk of future criminality on their return to the community.  To decrease the recidivism rate, it is essential for a community to have in place an integrated philosophy that includes pretrial, corrections and reentry. In Shelby County, consolidating the jail, jail east and the corrections facility should result in a common language and philosophy that is focused on re-entry, working with offenders from the start at booking, and preparing them months prior to their release for their return to the community.
• Better Manpower Allocation by Eliminating Artificial Boundaries: Although Shelby County area criminals do not observe boundaries, law enforcement agencies do. The elimination of geographic boundaries should allow for more effective allocation of resources to meet fluid law enforcement demands, leading to better response times, smarter policing, and a smoother organizational allocation of management resources. In addition, the important specialized functions like traffic, gang, and narcotics units will benefit from an expanded size in terms of geography and resources.  Further, crime control strategy should improve after consolidation as the merged information and intelligence functions will produce better data leading to improved intervention and regional strategic decisions.
• Better Use of Resources: Over time the combined departments should produce a more effective use of resources as duplications in service and management are eliminated and the freed up assets are transferred into critical crime control priorities, leading to a reduction in crime rate.  Further, consolidating departments will also allow for better purchasing power and unified planning for procurement and division of resources.

In addition, reform provides an opportunity to revisit not only the most efficient way of providing a service but the most effective as well. Currently Shelby County incurs the costs of supporting overlapping services such as in the areas of information and communication technology, desktop command and control, training, back office functions (HR, finance, recruitment, etc.) and other administrative and technical support functions. 

A good start would be to consolidate the many and highly fragmented 9-1-1 call centers into a single, larger, more professional and modernized approach that combines the five public safety answering points into one.  An integrated 9-1-1 system can provide better smoothing of peaks and valleys of demand, more opportunities for professional advancement and enhanced data collection, borderless service and management that will help to better serve the community.  

Consolidating functions and vision would create a once in a lifetime opportunity for innovation and strategic decision making.  The issue now is not so much just whether to combine forces but how to align them. Consolidating all corrections (with the possible exception of Juvenile detention) under the Sheriff seems like an obvious area of improvement.

Law enforcement should also be combined. Some consolidated cities put that function under the mayor to appoint the chief; others combine it all under the Sheriff. This choice is one more related to local conditions than to national policy. Regardless of where this leadership is placed the overall results of these realignments should be a safer community and in turn a higher quality of life. 

How Consolidation Can Produce Efficiency

To be successful as an entrepreneur, you have to constantly be looking at your business and asking, "How can it work better?" The same is true in government; only in government, the bottom line measures our success is improving people’s lives —their health, their schools, their career prospects, their neighborhoods, and, most importantly, their safety.

Consolidation offers Memphis and Shelby County governments a rare opportunity to reevaluate and restructure government to provide higher quality services at lower costs, deliver greater choice and more overall efficiency. Some very successful government reformers identify efficiency in government in very simple terms…we should do more with less by making government more efficient at the tasks it currently performs and by using savings to fund necessary enhancements. I agree with this concept, but it must be taken one step further. Reforming government should focus not just on lowering the costs of – but also on achieving higher performance, better outcomes and wiser uses for tax dollars spent throughout all levels of government. While doing more with less has become the new hallmark of government efficiency, spending less and delivering lower quality services isn’t a solution in itself. Spending less and delivering better, faster and cheaper levels of service is.

So often the problem with government is that once an agency, department, commission, board, program is created, it never dies–no matter how ineffective or inefficient it may be. Beyond the obvious consolidating of offices of the mayors and legislative bodies, consolidation offers an opportunity to abolish or realign the more than 80 existing departments, boards, commissions, agencies and functions that are no longer needed, or are redundant and do not offer a return on investment to the tax payers.

Mergers can improve the foundations of government and produce benefits to tax payers in other ways as well. As a former mayor of Indianapolis, I have seen first hand the benefits of consolidation. The City has enjoyed many advantages through merged departments and public service delivery, including technology upgrades that led to cost savings. Our Unigov reorganization process wasn’t easy, but in time, it has produced beneficial financial results in Marion County, allowing the city to undertake capital projects that might otherwise have been difficult to fund or maintain without consolidation. The entirety of Marion County has benefited significantly from the development and growth of its urban core.

In addition to establishing a stronger economic base, consolidation can free up resources from overlapping operating divisions ranging from road maintenance, sanitation collection, fleet operations, public works, corrections to regional transportation, finance-related services (accounting, billing, or annual audits), law enforcement, water/waste water, planning and zoning, social services, health care services and fire protection. Further, from an economic development perspective, synergies can also be achieved through areas of new investments in infrastructure or better use of specialized and latest equipment, tools and technologies that are currently needed by both jurisdictions but can not be afforded.

A new governance structure that reduces the number of public agencies, departments and commission will increase the likelihood of efficiencies if the Charter incorporates the following provisions:

• A strong mayor form of government. The best way for the general public to express its desire for more cost effective services is by holding the highest and most visible elected official responsible and then giving him the management tools needed to produce results. The mayor is not beholden to a particular constituency and can better balance the cost of services against the need for a competitive regulatory and tax structure necessary for job growth.
• Control over earmarks. Create a budget process that reduces the likelihood of legislative earmarks and gives the mayor line item and more traditional veto authority with a 2/3 override requirement. A committed council of course can play a critical role, but the line item veto will help insulate it against the tendencies of "logrolling" where special interests put together special appropriations.
• Strong internal auditing. The Charter should include the transparency requirements set out in the related paper on that subject and posted on the Rebuild Government website. The Charter should set up and require a strong internal audit office that certifies its reports directly to the Mayor and which must make public all its reports and recommendations.
• Citizen-friendly metrics and budget explanation. The Charter should require the Mayor to produce to the council during the appropriation process a citizen-friendly budget that shows it and the public not only total costs by department but also funded activities and the metrics by which the council and the mayor will hold the executive responsible for each.
• Broad citizen input. Each major department of the city/county government should have a board appointed by the Mayor and the council so that broad based citizen input and oversight will occur in all areas.
• Strong, professional financial management. The Charter should set up a strong office of the Chief Financial Officer (CFO), requiring the person appointed to such office to have qualifying financial experience. The CFO should be required to submit one and three year revenue forecasts and to certify for each budget and any additional program or appropriation whether forecasted revenues are sufficient to meet applicable expenses. This is a requirement in D.C. government for example.

Consolidating redundant operating divisions allows the synergistic combination of work flow, IT, HR and management systems. A professional procurement department that produces all its work online when combined with a contract management office of specially trained individuals will also help drive results. The Charter Commission can ensure these accomplishments by incorporating provisions set above.

Fewer agencies and government officials will make it easier for citizens and businesses to understand how to work within the system and save time and money. For example, a merged transportation department can increase responsiveness because one united department would be responsible for all roads, bridges, highways, rail, bike paths, traffic, parking, construction, etc. A single department, with a united vision and mission, would be responsible for joint efforts. Other areas for consolidation savings include: finance, law enforcement, corrections, fire department, and emergency services ((especially 911), health and wellness services, parks and recreation, community, neighborhood and planning, legal and compliance (ethics and governance), human resources, environment and sustainability, public procurement and aspects of zoning.

Consolidation is a valuable method for reevaluating and restructuring government. In its basic form, it can mean simply bolting together the existing structures into a single government unit. But simply creating a larger structure should not be the goal of charter review. The Memphis and Shelby County Metro Charter Commission has undertaken a mission of using the charter to redefine local government. In this way, the Commission can use its current review not only as an opportunity to merge the existing governmental units but to incorporate new structures that provide the region with more efficient, effective, transparent and ethical government. Under this approach the taxpayers and the local economy can indeed win.

Better, Smarter Economic Development

The United States is neither one national nor 3000 local economies; rather it's a group of about 100 regional economies, according to one of the country's leading think tanks, the Brookings Institution.

One of those regions is the Mid-South, and about three-fourths of the people, jobs, and economic activity of the Mid-South region is in Memphis and Shelby County.

Its Metropolitan Policy Program is based on the fact that "the United States is a metropolitan nation," with regions that serve as home to 85 percent of the nation's jobs. "They are our hubs of research and innovation, our centers of human capital, and our gateways of trade and immigration. They are, in short, the drivers of our economy. . . ."

When businesses make location decisions, they consider the region first before narrowing it down to specific sites.

The Memphis-Shelby County region now finds itself struggling in the bottom third of metro economies in terms of economic recovery. And as it comes out of the recession, it will not only compete against off shore entities, but also against the metropolitan economies of Jacksonville, Louisville, Nashville and Indianapolis, among other places.

Fortunately, enlightened city and county officials collaborated to put in place an excellent economic development blueprint, Memphis Economic Development Plan (MemphisED). However the region continues to face a number of fiscal and economic challenges that both are aggravated by the continuing loss of residents and businesses. In 2009, Memphis lost middle class families at a rate of three per day, and lost young educated people at an average of five a day. The region's percentage of college-educated people has dropped 15% over the past 7 years.

A regional approach to economic development often helps create growth providing the highest dividends for the economic development dollar. In the 1990s, when I was mayor of Indianapolis – a consolidated government – I was totally preoccupied with economic development, and more specifically, job creation. The decade before had not been good for cities as wealth, jobs, and people fled older cities into the suburbs and the sunshine states. People were not going to come to my city/county for its beaches, mountains or coastlines as we had none of them. They would only choose our community if it were competitive, providing a good quality of life and a sound business environment.

In the consolidated region, I had the authority to articulate and execute the unified vision. For example, after consulting with neighborhood and business leaders, among others, we fashioned an approach to balance suburban development and stabilization of the urban core. Within three years, we had completed a $1.5 billion rebuilding of the downtown that produced approximately 30,000 new hospitality jobs which we intentionally connected to underemployed individuals in the surrounding older neighborhoods.

The vision for economic development was generated by a broad group of interested parties throughout the region. However, execution flowed through one development commission, one mayor, and one council with a single regulatory environment that focused on achieving our development goals of building a better community. Consolidated economic development authority combined with a streamlined process allowed us to move quickly, decisively and directly, in order to produce jobs. This structure allowed the public to hold me responsible and allowed me in turn to serve as the chief economic development officer for the region.

From what I have observed, there are several existing organizations representing a wide-range of programs, partnerships, and initiatives that are already "on the ground" in Memphis-Shelby County. These organizations provide capable planning; however, from an execution perspective, messages are still getting crossed; and local community conflicts become somewhat obvious to the business community. As a result, there is some unnecessary overlap or redundancies, and in several cases, stakeholders have fallen into pursuits of their own visions for economic development that do not effectively support the region. Different governments and agencies are still focused on borders and boundaries, often creating a culture of confusion as to who is leading what effort, and who is responsible for what paperwork (planning, zoning and enforcement operations).

By rebuilding its government, Memphis-Shelby has an opportunity to create a leadership and governance structure for economic development that will produce unified authority, vision and significant economic development results. One simple advantage to transforming government with a focus on economic development is an opportunity to design a strong centralized business recruitment and marketing campaign, with no doubt about who is the leader and single-point of contact for prospects, as well as a unified approach to job creation and workforce development.

Businesses and individual entrepreneurs are drawn to regions by the following factors: reasonable cost of living, innovative and competitive business environment, cultural, entertainment and green assets, a vibrant community, quality of education, talent, and clean, safe neighborhoods. The Memphis-Shelby County economic development plan needs to go beyond just marketing and include a focus these additional issues including the revitalization of the city's core as and its neighborhoods where people feel welcome, safe and engaged.

While targeting new businesses is vital, it is also important that companies in Memphis-Shelby County have a single entity that is accountable for listening to their concerns, and working closely with them to resolve problems in such areas as financing, permitting, infrastructure improvements, zoning, congestion, safety. Companies must be able to secure answers and where appropriate resources in one place.

Right now, based on the regional viewpoint, the Charter Commission has a chance to give energy and velocity to MemphisEd with the mission of implementation in the following areas:

• Create a unified structure with one mayor and one council clearly accountable for overall short and long-range economic development planning that simplifies the processes as well as offering a clear non-bureaucratic path for investment and growth. The mayor of the city/county needs to be the representative of the entire area when soliciting a corporate CEO whether in the US or overseas or encouraging the start-ups that account for jobs growth in the past 15 years. One council, one permitting process and a single set of procedures will facilitate decision making as well.
• Establish a single county-wide Metropolitan Economic Development Commission that is subject to City Council override or approvals in regard to zoning and development matters.
• Allow for authority to continue with a county wide public private partnership that represents the city in economic development marketing, outreach and support of important transactions.
• Provide authority for the council and mayor to set up specialty development corporations at their discretion, such as the one for downtown.

Economic development consolidation would provide an opportunity for the new government to pool resources and to build a regional partnership for economic development that includes the academic community, business and trade groups – with a cooperative attitude, and a blended approach. In addition business leaders also need to be empowered to help the mayor lead regional economic development activities regardless of where they work or live.

Finally, the integration of economic development initiatives should in no way undermine neighborhood input and decision-making. Unified Indianapolis accommodates and includes various cities and towns that still provide meaningful input on their zoning issues and in some cases continue to conduct certain types of localized code enforcement activities. The new Charter in Toronto which "amalgamated" many governmental entities retained six Community Councils with a substantial role in "local planning, traffic, trees, sidewalks and recreation." Thus, there still needs to be a community voice within the united regional front.

As Memphis-Shelby County plans for its future:

• Productive growth that boosts innovation and entrepreneurship, generates quality jobs and rising incomes;
• Inclusive growth that expands educational and employment opportunities, reduces poverty, and fosters a strong and diverse middle class; and
• Sustainable growth that strengthens existing cities and communities conserves fiscal and natural resources.

Shelby County competes against other metro areas in the United States and around the world. Its success will depend on, not just, economic development transactions but on a sound foundation of high quality education, good infrastructure, an attractive tax and regulatory context and an appealing quality of life.

The new Charter can create a streamlined structure that will move the area forward in all of these areas, thus producing more jobs and increased opportunity.