Alarming Report: City Fiscal Conditions 2020

“Nearly 90 percent of cities will be less able in FY 2021 than in FY 2020 to meet the fiscal needs of their communities.”

NLC City Fiscal Conditions 2020

“In this environment, cities’ balanced-budget requirements and revenue-raising restrictions have translated to severe service cuts, extensive layoffs, furloughs and hiring freezes, and rollbacks in capital projects.“

NLC City Fiscal Conditions 2020

I know many cities in Florida that have pressed pause on a few capital projects. However, the only service cuts in Florida I have witnessed are related to services that can’t be provided because of the social distancing restrictions – they weren’t items that were stopped because of financial limitations. I also haven’t witnessed “extensive layoffs” do to financial restraints. I know some cities Furloughed part time workers, particularly in closed Recreation Centers, but for the most part it appeared Cities were doing their best to maintain employees.

Perhaps Florida’s Fiscal Year that starts in October has delayed some decisions when compared to cities in other states with a July start.

Policy makers certainly have difficult financial decisions to make that impact the livelihoods of employees, the services to the constituents and the infrastructure entrusted to them. The pandemic has created a drastic shift in the financial situation of 2020 and moving forward. Governments are usually quick to mobilize in the event of an emergency, which typically also includes more spending which is the case of the COVID-19 pandemic. Most governments aren’t organizations that will rapidly cut spending or reduce services, typically only doing so when there is little other choice.

The Infrastructure Challenge

What’s missing in the 2020 Fiscal Conditions Report is one of the more telling illustrations that were provided in past reports – Most Positive and Negative Factors. Perhaps this year it was difficult to compile the same data given the circumstances. Past reports have continued to indicate that INFRASTRUCTURE was consistently the most negative factor impacting budgets. This seemed to indicate that demands for infrastructure were still greater than the available funds on a grand scale. It’s certainly possible that a significant portion of that is related to cities pressing pause on needed maintenance during the Great Recession and even with 10 years of recovery, a majority of cities have yet to catch up. Pressing pause on Capital Needs while continuing to fund “normal government operations” will create a bigger infrastructure funding gap and create further financial challenges in cities.

Previous City Fiscal Condition Reports

Infrastructure Needs

2019 City Fiscal Conditions Report

54 Percent say Infrastructure Needs are Negative Factor (Rank #1)

Full Report – City Fiscal Conditions 2019

2018 City Fiscal Conditions Report

57 Percent say Infrastructure Needs are Negative Factor (Rank #1)

Full Report – City Fiscal Conditions 2018

2017 City Fiscal Conditions Report

55 Percent say Infrastructure Needs are Negative Factor (Rank #1)

Full Report – City Fiscal Conditions 2017

The Infrastructure Challenges Didn’t Disappear

There are many challenges and more questions than answers. Perhaps now is a good time to think a little outside the box. Talk to an expert that has assisted local governments with infrastructure challenges as cost of services continued to rise faster than their ability to raise revenue.

GET A FRESH PERSPECTIVE

Do you value creative ideas to chart a path forward in uncertain times? Would your team benefit from an outside perspective to challenge the status quo? Do you want to find cost savings now to prevent more painful cuts in the future?

Let’s talk and identify an opportunity to work together to optimize your communities financial future.

City Manager and County Administrator Think Tanks

In 2020, a few significant current events have dramatically altered the priorities and daily routines of City Managers and County Administrators. Why not join a Virtual City/County Manager Think Tank that will provide a real time platform to leverage other leaders questions, insights and experiences in a private forum specifically designed to help leaders develop solutions.

A diverse group of City Managers and County Administrators will offer perspectives from different viewpoints, groups are already meeting to discuss challenges.

This access to successful leaders in carefully cultivated and diverse peer groups could generate the ideas you need to improve performance in your City or County.

Download Full Report