As we enter the first season under the Lamont governorship, the changes and new direction of Connecticut may be unclear but one thing is certain—this Governor is a fan of regionalization, and he’s willing to offer a deal to the towns who pursue it.
So, what does that mean for all 169 towns/cities in the state? Is it time to get serious about shared services?
“I can’t afford to subsidize inefficiencies any longer,” Governor Lamont said, showing he is serious about working together. He added, “We can save hundreds of millions of dollars by working together.” Right now, Connecticut has 169 towns essentially operating by “Home Rule,” which allows each town to govern how they see fit, with their own charter and their own structure of government. As a result, we have 169 municipalities performing essentially the same municipal services and functions in 169 different, unique ways.
This has bred inefficiency on a statewide level. Lamont has stated he isn’t going to force towns and schools to make changes, but there will be incentives. “I support everybody’s feisty independence, but I’ve got to find ways to get everybody to work together,” he said.
In Lamont’s budget document, he pressed further. “Small local school districts that choose to have inefficient governance structures and too many expensive superintendents can no longer expect the state to bear the costs of these decisions.”
Although still early, based on Lamont’s campaign, it seems that towns that start to coordinate and share both basic and more complex functions could be compensated for the first year or two. It looks like smaller school districts could receive administration assistance if they opt to regionalize. On the flip side, those who do not begin sharing services may be penalized.
Under the new Lamont budget, should a small local school district choose to retain a superintendent rather than share one, the district’s Education Cost Sharing (ECS) grant made be reduced (after July 1, 2020). It should be noted that the initial plan does not yet define what is considered a “small” district.
The Governor also has plans to promote regionalization among the very small school systems, and has noted a way to entice more diverse teachers to classrooms. This could be done through student loan forgiveness for those who take jobs in “tough districts” and stay for at least five years. Connecticut lawmakers are already off and running with this concept, and as of February 1, multiple bills have been proposed to require school districts with small populations (or towns with less than 40,000 residents) to consolidate with other existing districts. Additionally, Connecticut’s House Speaker has stated that communities that don’t want to regionalize—or operate more efficiently—could be on their own when it comes to footing the bill.
Lamont’s new legislation is serious about setting expectations and “due dates” for providing data and starting the evaluation process for consolidations and shared services opportunities.
For municipalities considering shared services, yet haven’t made it a priority, this could be the time to get serious. Something as simple as exploring options would be a prudent first step, such as knowing what departments may be worth evaluating for shared opportunities. Is there a single department that struggles to offer solid services to constituents? Is there a municipal area that experiences high turnover, or has looming retirements in key positions? Are nearby towns or schools doing a “better job” in some areas? Is student enrollment declining with each year? These are all important considerations for municipalities to assess.
Keep in mind that sharing services is not about “cutting heads” or having bare bones staffing; Connecticut towns have already done this in an effort to operate as lean as physically possible. Sharing services is about doing better, offering more, working smarter and accomplishing more as a unified team. But for those considering it, the time is clearly now—our new Governor is saying so himself.
Lindsey Donato, CISA, PMP, is a manager with blumshapiro, the largest regional business advisory firm based in New England, with offices in Connecticut, Massachusetts and Rhode Island. The firm, with a team of over 450, offers a diversity of services, which include auditing, accounting, tax and business advisory services. blum serves a wide range of privately held companies, government, education and non-profit organizations and provides non-audit services for publicly traded companies. To learn more visit us at blumshapiro.com.