Grading the Cities introduction THE GOVERNMENT PERFORMANCE PROJECT Report Card: New Orleans Revenue Rank: 33 Form of Government: Mayor-Council Mayor: Marc H. Morial (took office 1994) City Council: 7 members (5 elected by district, 2 at large) FINANCIAL MANAGEMENT: C- New Orleans’ bond ratings are perennially low, and the city always seems to be flirting with financial crisis. Most of this is not the fault of local officials. Take, for example, the state-mandated homestead exemption, which eliminates property taxes on the first $75,000 of any owner-occupied residential property (a $100,000 home is taxed as if it were worth $25,000). New Orleans loses about one-quarter of its taxable property base as result of this limit, and there are no signs the state will remove it anytime soon. The city tried to get some additional property tax revenues last year, but city voters refused to go along. The budget office tends toward conservative forecasting, and does five-year projections each year. Anything left over at year’s end becomes a fund balance, but such balances are rare and tiny. Some longtime fire fighters belong to a pension fund with no money in it at all: The council must appropriate money each year to pay the benefits. A newer fund for other fire fighters is in better shape. The city also has a weakness in contract monitoring. This function is left to the departments, which vary widely in their abilities. There is minimal central oversight. HUMAN RESOURCES: F In 1998, voters here defeated a $35 million tax increase aimed at providing the same amount in raises for all city employees. As a result, the city imposed a general hiring freeze, laid off workers and eliminated unfilled positions to balance the budget. This would have been bad enough for morale, but at about the same time as the layoffs, raises were approved for some of the highest-paid, unclassified political appointees. New Orleans does not have formal work force planning, a skill that could be very helpful here. Officials say the city “has never made this planning a priority,” as budget constraints have “hampered or discouraged efforts by the city to make long-term projections on human resource needs.” There is no performance-based pay for New Orleans’ employees. Performance evaluations exist, but they are so generous as to be virtually worthless. In 1997, fewer than 1 percent of employees were deemed as needing improvement. The fire department gives nearly every employee an outstanding rating in every category, even when the employee has been disciplined. Hiring is conducted under a broadband system that allows departments to choose among several dozen applicants for many of its positions. It’s a good idea, but it’s often irrelevant. Given a shaky job environment, terrible pay levels and no financial rewards for performance, as one official puts it, “we often need to hire all those that apply.” INFORMATION TECHNOLOGY: B- New Orleans IT has come a long way in the last few years. The city has a tight set of standards in place, enforced by a central IT office. Though a few old stovepipe systems are still in place, most technology complies with the standards pretty well. Departments have an online connection to a financial information system, and last year the city implemented a personnel and payroll information system that will enable it to do online processing of personnel changes, automatically compute retroactive pay and allow direct deposit of pay checks. With the notable exception of its police component, the citywide Web site is weak. It’s cluttered and slow. There is little information about constituent service, budget priorities or how to do business with the city. CAPITAL MANAGEMENT: B- New Orleans has a pretty solid capital planning process. It focuses on several factors, including whether a project’s costs make sense in terms of its scope; whether the project conflicts with policy or overlaps with other department requests; and whether there are any difficulties with long-term funding. The city produces monthly reports with output from its project management software. It has good information on project cost and schedules, and tracks deviations from plan. The city doesn’t have sufficient information about the condition of its buildings, and concedes that it is somewhat behind on performing necessary preventive maintenance (which comes out of operating budgets). MANAGING FOR RESULTS: D+ At one time in New Orleans, the mayor’s office centralized performance data collection, and used it to guide the individual agencies. But the city decided it didn’t have enough money for staffing and eliminated the function. The agencies never made up the data gap that resulted, and at the present time public documents do not reveal any regular use of performance measures. “Budgetary restrictions have inhibited our ability to do the long-range planning and evaluation that other cities do,” says one high-level official. Measures are used internally, officials say, and they’ve made aggressive efforts to track complaints in the areas of sanitation and police. But neither outcomes nor outputs are included in the budget or on its Web site. The strategic planning process has been delegated to the City Planning Commission, which tends to focus more on physical planning than on service delivery. However, a new draft plan, which came out last July, is broader and looks like an improvement. It was developed through a citizen advisory committee, including representatives of all New Orleans’ neighborhoods. Assuming the new document gets Planning Commission approval, the city will have a comprehensive strategic document for the decade ahead. AVERAGE GRADE: C- Copyright © 2000, Congressional Quarterly, Inc. Reproduction in any form without the written permission of the publisher is prohibited. Governing, City & State and Governing.com are trademarks of Congressional Quarterly, Inc.