Mayor talking tough on budget

As reported in the Chronicle

By BRADLEY OLSON HOUSTON CHRONICLE
April 22, 2009, 10:00PM

Mayor Bill White said Wednesday he was considering hiring management consultants to cut millions from the city’s budget if his department heads do not find significant savings in their spending plans for the upcoming fiscal year.

“I’m sort of running out of time and running out of patience a little bit,” he told City Council members shortly after their weekly meeting concluded. “If things aren’t done properly, then I’m just going to do it.”

The city’s finance director has said the fiscal 2010 budget is expected to be flat, meaning the various departments will have roughly the same amount to spend as they did this year, a rarity even in the thriftiest governments. The fiscal year begins July 1.

It was unclear Wednesday whether White’s announcement was meant as saber-rattling for what is expected to be an unusually difficult budget season or if he is expecting to give McKinsey and Co., or a similar firm, the run of City Hall. He did not specify how much he wanted cut but indicated he would pay several hundred thousand dollars if it would reap millions in savings.

Executive approach
White long has touted his business bona fides and executive approach to governance, and even more frequently since announcing his candidacy for the not-yet-vacated seat of U.S. Sen. Kay Bailey Hutchison, who has said she may resign this year to run for governor.

Council members greeted the idea with praise. Many have been calling for more information about cuts department heads were planning.

“This is a message to the directors,” Councilwoman Anne Clutterbuck said. “If they don’t deliver on what the mayor or City Council have been asking them to do, then we’ll bring in somebody to do it for them.”

Councilman M.J. Khan also expressed support, saying he believed the city could achieve more “efficiencies” in its permitting processes.

City employees had a more measured response, noting that leaders of some departments had in the past week been asked to submit even leaner budgets than the administration previously requested. Several senior city officials said they were surprised by the suggestion that consultants were needed, given their intention to cut to the mayor’s specifications.

Leaders of the Houston Organization of Public Employees, or HOPE, which represents about 14,000 city workers, were caught off guard.

“We urged the mayor to not act unilaterally by hiring management consultants, who are not a good use of already scarce taxpayer dollars,” said Melvin Hughes, president-elect of HOPE. “Essentially, management consultants cannot ensure that quality public services can continue to be provided efficiently the way that frontline city employees can.”

Hiring freeze under way
Speaking to reporters after the council meeting, White stopped short of saying layoffs could be on the horizon but suggested many unfilled positions could remain so during the recession. Several senior officials said such a hiring freeze already largely had been implemented.

White also said using consultants in his administration was not unprecedented, since one company had donated its services to help restructure certain aspects of the Houston Police Department. Two areas ripe for consultants included outsourcing computer servers and billing and collection services in the Department of Public Works and Engineering, he said.

“We need to operate differently,” White said. “We need to have an enhanced and increased focus on organizational changes that would reflect the fact that the U.S. is in a recession.”