The State of Local Government in the Pandemic Era
Where Towns, Cities, and Counties Are Investing Now for the Future
By Matt Singer, CMO, OpenGov
Want the good news first? Local governments have done commendable work addressing urgent challenges to the way they work and serve their communities during the pandemic, while nearly all face revenue shortfalls, according to analysis of over 500 responses to OpenGov’s State of Local Government Survey.
The other good news is over 60% of local governments represented in the survey are either using or considering CARES Act funding and other grants to modernize their technology, processes, and enable staff. bAs always, however, there is more work to be done beyond meeting first-order needs.
The goal of the survey was to learn where towns, cities, and counties across the U.S. are investing now and what gaps they perceive across their technology, processes, and talent. Survey respondents represent 501 local governments, including 113 elected officials and executive-level public leaders, 238 public finance leaders, and 149 public finance staffers from small and large towns and counties across the U.S.
What is clear is that given operational needs, local governments must move quickly to align around initiatives and make critical investments if they want to take advantage of federal and state grant funding that is currently available to make needed investments.
Absorbing a One-Two Punch with COVID-19
From small counties to large cities, the pandemic has landed a one-two punch of both a healthcare and economic crisis. In response, local government finance leaders have focused on short-term solutions to bridge their revenue gaps while delaying decisions on more permanent cuts or tax strategies.
[One-third of respondents expect a 4-8% decrease in revenue and foresee moderate financial adjustments to their operations and another quarter expect their revenue to decrease less than 4% and expect minor adjustments. However, a third face a revenue drop of at least 8% and expects significant or major financial adjustments. Local governments with larger budgets appear to face more looming budget challenges.
First-Order Needs Focused on Getting Back to Work Virtually
Over half of respondents are taking important steps to modernize processes and technology to meet first-order needs for enabling remote work and virtual meetings. A third are also adopting cloud-based workflows in areas like permitting, licensing, code enforcement, and grant management to protect revenue streams and keep their local economies open for business.
Timelines have sped up for adopting cloud-based technology to keep governments open for business. This brings about an urgent demand for investments in modern technology and processes to support the changing needs of local government workers.
When There’s a ‘Will’, But Not a ‘Way’ for Change
While respondents have been busy building first-order resiliency, an “initiative gap” has emerged across the local governments surveyed, where strategies are not aligned to stated needs.
Initiative gaps emerge where respondents report that staff want to see upgrades in the technology and processes they use, and the way governments recruit, retain, and train their teams.
Technology: Respondents share that their existing technology underperforms in key areas such as: report building and sharing capabilities, remote accessibility, access to data, and integrations across solutions. Few say they are actively investing in upgrades in these areas.
Processes: Three-quarters report that they want to adopt modern technology that enables them to automate processes, but only 27% are investing to improve processes.
Talent: Experienced government workers are more concerned about the loss of leadership as “baby boomers” retire than their younger colleagues (46% compared to 24%). However, both agree that there is a significant training (72%) and recruitment gap to effectively upskill and backfill against talent gaps (66%).
As nearly two-thirds of respondents and their colleagues continue to work remotely, only 12% say they could support full-time remote work on a more permanent basis to retain talented employees and attract new talent.
To meet the next series of challenges, and take advantage of state and federal grants, local governments need a strategic vision for modernizing technology and processes to continue to support the evolving needs of their workers and their communities.
OpenGov encourages local governments to survey your staff to reveal where you may have gaps between needs, initiatives, and investments. Consider asking your employees how they feel about remote work and what their future needs and desires may be for this option. Finally, mobilize CARES Act funding as early movers have made significant investments in the way they work and serve their communities.
Download the report here: https://opengov.com/the-state-of-local-government-survey-2020/