Local governments look for ways to save money

A buying cooperative in west central Minnesota encourages cities and counties to buy materials like road salt, jointly, saving millions of dollars in the process.
MPR file photo

In west central Minnesota, a group of nearly three dozen cities and counties cooperate to save money on supplies and employee training.

"Let's get rid of some of these ego issues and these protections of turf and I can do it better than they can do it."

The Western Area City County Cooperative, or WACCO, started 15 years ago when local officials were searching for ways to trim spending. WACCO has saved its members millions of dollars.

The cooperative finds savings on everything from work boots to road salt.

"For instance with road salt, the savings for these cities and counties were anywhere from $7.00 a ton to $22 a ton depending on their location. So that can end up being significant," said Executive Director Laurie Mullen.

The greatest challenge wasn't finding financial savings, but convincing city and county officials and employees to share information and agree to buy the same products, according to Mullen who has been with cooperative since the beginning.

Mullen says when the organization started employees in neighboring cities often didn't even know each other. A big part of her job was simply building relationships.

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That's changed in part because the cooperative now coordinates training that brings employees together on a regular basis.

"Of course in the past, cities and counties had to send people away, that may have been down to the metro," explains Mullen. "But by bringing in training and doing it locally we're able to save those travel dollars and certainly I think there are networks that are built when these different entities attend training together."

Counties pay a $5,000 annual membership fee. Becker county Administrator Brian Berg said that's a relatively easy expense to justify to county commissioners. He said tens of thousands of dollars have been saved just in the sheriff's department.

"Every time we talk about this and we look at law enforcement, our sheriff says, 'Boy, we save a lot of money in cooperative training,'" said Berg.

But Berg believes Minnesota is far from maximizing government efficiency.

He offers snow removal as one example. It's a critical service in Minnesota, but is it necessary, he asks, to have state, county, city and township snowplows all operating in the same community?

Does it make sense for the state to have a maintenance garage just down the road from the county shop?

Berg said local officials have been talking a lot lately about consolidating services, and he believes the biggest barriers to cooperation are ego and turf protection.

"Our governing bodies just need to break down these barriers and say, 'Folks, what's best for our customer?' And let's get rid of some of these ego issues and these protections of turf, and I can do it better than they can do it," said Berg. "With the proper training and communication we can do improve these atmospheres. We can work toward this. It just has to happen. "

Berg believes cooperation among units of government won't happen unless someone takes the lead.

That role was once played by the Minnesota Board of Government Innovation and Cooperation. The board offered advice and small grants for communities to study and implement consolidation of services.

The board was recognized for innovation by Harvard University's Kennedy School of Government. But the board was eliminated during the state's last budget crisis in 2003.

Gary Pagel was the board's executive director. He says the board provided grants that encouraged local governments to study combining services, and helped local officials cut through government regulations that sometimes hindered efforts to work together.

"The creativity of local government officials is there. It's finding some way to utilize it," said Pagel. "It's tough for a city council member to take the bull by the horns and risk $20,000, $30,000 or $40,000 on a study of how we're going to combine a municipal service."

Pagel believes significant savings are possible by improving government efficiency in Minnesota. But he cautions that those savings won't help the immediate budget crisis, and that makes it hard to pay for cooperative ventures.

"We've got the problem today, and potential saving down the pike isn't as important. When you're looking at disaster today, you've got to solve this problem first and not worry about saving money tomorrow, "said Pagel. Another problem is that it's often hard to quantify savings. Governments often don't track how much is saved by consolidating services.

Pagel says that can make it difficult to convince lawmakers to invest money in programs that offer the hope of future savings.

The government purchasing cooperative in western Minnesota is successful because the members pay for a full time staff person to facilitate cooperation. Gary Pagel says when it comes to government efficiency, an old cliche rings true -- you have to spend money to save money.