Changes Inspired by Recession May be Permanent for Local Governments

Measures implemented by local governments to address the financial crisis, according to the report How it Plays in Peoria: The Impact of the Fiscal Crisis on Local Governments include:

• Left vacant positions unfilled (12%),
• Deferred capital projects (11%),
• Implemented targeted cuts in expenditures (10%),
• Increased existing fees for services (9%),
• Eliminated or significantly reduced travel (8%), and
• Frozen salaries (8%).

Two-thirds (67%) of the approximately 1,500 local governments surveyed said they feel the changes implemented represent a new way of doing business and will continue beyond the current fiscal crisis. More than half (52%) of respondents said their government’s strategic or long-range plan has been revised since the recession started.

“Effective management during a downturn can actually help local leaders identify opportunities for improved governance, with benefits that will pay off long after the recession subsides,” ICMA said.

Eighty percent of respondents reported that the financial crisis had either “moderately” (44%), “significantly” (30%), or “severely” (6%) affected their local government, compared to only 20% who answered “minimally” (19%) or “not at all” (1%).

More than half (52%) of respondents reported that their anticipated budget shortfall is greater than cuts made in the FY09 budget. Thirty-eight percent of respondents said the anticipated shortfall is the same as the enacted budget cuts, while only 10% reported it is less than the budget cuts.

The ICMA report includes stories of strategies implemented in Peoria County, Illinois; Salina, Kansas; Washoe County, Nevada; State College, Pennsylvania; and Richardson, Texas.

More information is here .