by Mike Sharkey
Staff Writer
Daniel Davis asked for it and Monday morning Dominic Calabro and David Smith provided it.
“It” is an audit by Florida TaxWatch, a nonpartisan, nonprofit research institute best-known for being an often outspoken government watchdog.
While City Council President, Davis asked TaxWatch and its president and CEO Dominic Calabro and chair David Smith, to have TaxWatch perform an audit of the City’s entire budget in an effort to identify inefficiencies and possible savings.
Smith, who is CEO and president of PSS World Medical, Inc., said TaxWatch takes the business approach to government budgets. In looking at Jacksonville, Smith said the city’s consolidated form of government works for it in some capacities, but against it from a budget perspective. He used his own company — which has seven branches within it — in an analogy that describes Jacksonville’s problem. He said having all the different budgets within one budget — police, fire, JEA, general fund, etc. — is like each of his divisions buying their own toilet paper from a different provider. That scenario, he said, doesn’t make sense (or cents) in the private sector, but it’s an example of how a fragmented budget can hurt government.
Through private donations, Smith said about $200,000 was raised and the Davis-requested analysis was performed. According to Smith, there is room for improvement — potentially a lot of room.
“We found tens of millions that could help fund initiatives that would help fight crime and help the community without cutting services,” said Smith.
Calabro said the report did find millions in potential savings and also provides implementation tips. He also said, overall, Jacksonville is well-run.
“This study confirms that Jacksonville has one of the best run local governments in Florida,” said Calabro, whose organization is based in Tallahassee. “But, we all know that good managers can always find ways to reduce even their low costs because of their proficiency, vision and commitment to outstanding service. The recommendations in this report can save the taxpayers of Jacksonville tens of millions of dollars.”
Smith said because TaxWatch isn’t tied to any agency or organization, it can be a little more critical and check on the progress of its recommendations with a little more zeal. Unlike many of the studies commissioned by various city agencies over the years that were never implemented, Smith doesn’t think City leaders can afford to ignore the TaxWatch study.
“With our agency, we are not beholden to the City and we do follow up,” he said, adding the current economic situation should dictate changes associated with the TaxWatch study. “We are in a real crisis and the people of Jacksonville have to make tough decisions. There is a real need for real solutions.”
Smith said the mayor’s office was cooperative throughout the process and provided the data used in the study. Mayor John Peyton said he appreciates the study and the work done by TaxWatch.
“While I am proud of the work we’ve done to ensure that we are the very best stewards of the taxpayer’s dollar, we are always looking for ways to drive even greater efficiencies,” said Peyton. “As the report indicates, the recommendations made by TaxWatch will require additional analysis to implement and I look forward to working with the City Council to review items outlined and determine how they can be implemented during our term in office.”
Council Auditor Kirk Sherman said his office worked with the staff of TaxWatch to provide whatever was needed and he thinks a lot of good will come out of the report.
“We will follow up and it’s good to have an outside opinion,” said Sherman. “Hopefully we will put together a task force on implementation, which is key. We helped with the coordination, but did no real work so to speak.”
According to the report, the following “near-term” recommendations could save the city nearly $10 million:
• Reducing the City’s Social Security tax costs, which could potentially save over $3.2 million.
• Further realizing sales tax exemptions on construction materials, which could potentially save approximately $1 million.
• Reducing the cost of city elections by moving the local elections to a fall cycle that coincides with state and federal elections (would save over $3.4 million each election cycle); discontinuing the practice of paying return postage on absentee ballots in all elections (more than $50,000 per election); and limiting early voting to fewer sites (approximately $250,000 per election).
• Improving cash management which could have earned an average of $3.5 million per year in interest over the last five years under a different investment strategy.
The following “long-term” recommendations could save tens of millions of dollars:
• Avoiding unsustainable growth in expenditures.
• Reducing risk of future employee benefits obligations.
• Leveraging organizational strengths and purchasing power, which could save more than $20 million if a “modest” 1 percent savings goal were realized.
• Enhancing employee recognition and reward program to promote and reward an employee culture committed to cost savings and cost avoidance
• Managing for results.
• Managing facility cost.
• Leveraging technology.
• Maximizing competition and outsourcing best practices.
• Maintaining an active audit committee.
• Financing of motor vehicles.
The report also suggests the creation of a task force “with an actionable agenda” for implementing various cost-saving ideas and efficiencies.
“We can identity the cost-savings opportunities, but it is up to the city management to implement the changes needed to achieve savings,” said Calabro.
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