One Small Step Forward On Zero-Based Budgeting


Monday night the Park Ridge City Council had its first close encounter with the concept of zero-based budgeting (“ZBB”).  And as best we could judge from the video and commentary at Park Ridge Underground, it wasn’t exactly love at first sight.

Mayor Dave Schmidt raised ZBB as part of the “Mayor’s Report” because he claimed he wanted the topic discussed in a public forum rather than in private between himself and the City Manager.  After four years of behind-the-scenes wheeling and dealing by former mayor Howard Frimark, that kind of transparency is refreshing – even if it appears just a tad disingenuous by Schmidt, given his admission that he decided not to veto a recent amendment to the zoning ordinance after having private discussions with some members of the City’s Planning & Zoning Commission.

But progress toward open government, however incremental or inconsistent, is still progress.

Not surprisingly, City Manager Jim Hock expressed more than a few reservations about ZBB as an alternative to budgetary business-as-usual.  We can understand that, even if we don’t agree with it: No bureaucrat likes the idea of having to reinvent his/her particular “wheel,” and much less so when the “wheel” is one he inherited – with several spokes missing – from the mismanagement team of Frimark and former city manager Tim Schuenke a little over a year ago.  It also doesn’t help that Hock’s finance director is exiting, stage left, after the first of the year.

We’re not counting Ald. Frank Wsol (7th Ward) among ZBB’s staunchest proponents, either.  With the faux-ness of his “fiscal conservatism” having been revealed by his successful (so far) opposition to passing through increased water costs to water users, and by his unsuccessful (mirabile dictu) efforts to saddle us with a big new $16 million-plus cop shop, Wsol’s tepid endorsement of a “modified” ZBB was no surprise.

Fifth Ward Ald. Robert Ryan admitted that he doesn’t understand the concept of ZBB, so he shouldn’t be counted on for a “yes” vote, either.  And Ald. James Allegretti was MIA so his view on the matter could not be ascertained.  But given his track record of fiscal irresponsibility and plain boneheadedness, we’ll pencil him in for a “No” vote until further notice.

We were surprised by what sounded like an unqualified endorsement of ZBB by Third Ward Ald. Don “Air Marshall” Bach, who claims he wants a “business case” done for each significant City expenditure.  We can’t tell if Bach is just blowing smoke or if he has become a born-again fiscal conservative, but we’re not complaining – at least not for the time being.

Alds. Joe Sweeney (1st Ward) and Tom Carey (6th Ward) seemed to be in favor of the concept, but Ald. Rich DiPietro (2nd Ward) gave it his customary non-committal treatment, so he could be the swing vote on this issue.

Separating the wheat from the chaff is required for ZBB to be a success, which means cold-heartedly determining what City government ought to be doing with the taxpayers’ money and then coldheartedly prioritizing those tasks.  The key is to make sure we can pay for the things we truly need before we even think about things we merely want.

At the top of the “need” list has to be public safety, a/k/a police and fire.  But just because they are No. 1 on the hit parade doesn’t mean that those departments can skate through without cuts, or even systemic changes, to make them operate more cost-effectively.  In addition to police and fire, however, “public safety” is also provided by certain types of City Code enforcement, inspections, permits and licensing.

Next comes water and sewer.  Anything less than a 100% pass through of all water costs to consumers – on a usage basis – will be a clear indication that City Staff and/or the Council are not serious about ZBB or balancing the budget.  And given how sewer maintenance appears to have been neglected, just keeping that system up and running is likely to be an expensive proposition that may require the sacrifice of other services.

After that comes streets and sidewalks, the repair and replacement of which also have been put on a slower track over the years as money was diverted to other uses.  Part of that cost also relates to things like snow plowing and salting, which not only make it safer to drive on our roadways but also may have some effect on the rate at which those roadway surfaces deteriorate. 

Beyond that are a variety of services to keep the City functioning, including flood control and even tree trimming – especially where overgrowth poses a threat to power lines.  Determining how many, and to what extent, such services can survive given the City’s current revenues will be a challenge for Staff and the Council.

And for ZBB to be truly effective, in addition to justifying every dollar spent, those justified expenditures also should be measured against the price that those particular services could be purchased from the private sector or otherwise outsourced.  That way we can get a better sense of whether the City’s cost structure is lean or padded.

As with any reform of a program or system, the success of ZBB will depend primarily on the strength and tenacity of the leadership promoting it.  That means no compromises and no free passes given to any department or department head, or else ZBB will look like empty rhetoric that can be ignored.  And that also means each department head must be forced to take ownership – and personal accountability – for every ZBB recommendation and decision he/she makes.

Implementation of ZBB can bring a “New Age” of cost-effective management to City government, or it can be a worthless boondoggle.  Which outcome prevails will depend upon the folks at 505 Butler Place.