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SEGMENT #1: Government Potential to Achieve Greatness.
By: Steve Hamill
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Over the past few years, Americans have become increasingly critical of government and cynical about government’s ability to “do good.” Despite these stereotypical views and criticisms, we see countless compelling examples to demonstrate that government can be all of these things and can indeed achieve greatness. We applaud the dedicated government officials and employees who work tirelessly for the overall benefit of the American public and would like to offer a helping hand by sharing real life examples of governments achieving greatness.
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There is no better time for government to exhibit greatness than the present. Governments, under intense economic pressures, are still expected to preserve life and public safety, as well as quality-of-life, public benefits that are often taken for granted. At least 48 states in the U.S. are facing a cumulative budget shortfall of $166 billion, or nearly a quarter of their budgets. More than ever, government at every level is faced with the burdensome challenge of doing more with less.
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This article is the first in a series that will examine the different ways that governments have been successful in delivering efficient, effective, fiscally responsible and innovative results in the communities they serve. The series, titled the Great Government Series, will demonstrate how incremental budget reductions and revisions to standard models of operation have the potential not only to close budget gaps but also to improve outcomes.
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The Great Government Series will explore the role that improved operating results, or (“IOR”) plays in the path to achieving greatness. IOR will be used in the series to refer to new knowledge, ideas, methods or innovations that have been used by one or more government agencies to increase productivity, reduce costs and improve the efficiency and effectiveness of operations, services and programs.
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A simple, yet innovative method of achieving IOR is through the use of cooperative procurement. Cooperative procurement (or piggy-backing off another government agency’s previously solicited contract) has been proven to reduce administrative and product costs, increase efficiencies and stretch shrinking budgets during difficult times. Cooperative procurement aggregates the purchasing power of multiple government agencies in order to drive down deeper discounts on goods and services. Cities, counties, states and school districts across the country are demonstrating IOR and greatness today by utilizing cooperative procurement.
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A 10% savings in the cost of goods and services was recently illustrated by the City of Los Angeles, which currently purchases its office supplies from Los Angeles County’s contract with Office Depot. Since 2006, the City has estimated savings and rebates of approximately $1.8 million based on the purchase of $18 million in office supplies. When the City was outfitting 4400 new workstations in its new Police Administration Building, it saved over $13.5 million by using Fairfax County, Virginia’s pre-competed contract with Haworth.
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Fairfax County also purchases its office supplies from Los Angeles County’s contract with Office Depot. The County received discounts of up to 72% on certain products and achieved rebates of nearly $700,000 in fiscal year 2009 alone.
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The State of New Jersey recently adopted the City of Charlotte/Mecklenburg County’s auto parts contract with AutoZone. Based on a projected purchase of auto parts for State fleet vehicles and equipment of $9 to $10 million in fiscal year 2009, the State is expected to save about $1.5 to $2 million by using the cooperative contract.
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Due to its budget constraints, the City of San Antonio was recently unable to replace aging construction equipment or procure additional equipment, therefore relying exclusively on renting equipment. The City currently utilizes four contracts for equipment rental, each with its own contractor and realizes a combined annual spend of $679,000. Through the use of North Carolina State University’s contract with Hertz Equipment Rental, the City is forecasting a direct savings of $132,000 annually or an approximately 25% decrease in costs from its current rental equipment contracts.
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Throughout the U.S., governments are demonstrating efficient, effective, fiscally responsible and innovative ways of meeting their constituents’ needs. Utilizing cooperative procurement is just one example of governments achieving IOR, even during difficult times.
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We view the Great Government Series as a collaborative and living effort. We welcome input from our government leaders and the public at large. If you have thoughts on great government or would like to share some examples of great government in your community, we’d love to hear from you. Please contact us at greatgovernment@uscommunities.org
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Steve Hamill is the former Assistant Chief Administrative Officer for Alameda County, California. He is the General Manager of the U.S. Communities Government Purchasing Alliance (“U.S. Communities”), a non-profit government purchasing cooperative founded by and currently co-sponsored by the United State Conference of Mayors (USCM), National League of Cities (NLC), National Association of Counties (NACo), Association of School Business Officials (ASBO) and the National Institute of Governmental Purchasing (NIGP). U.S. Communities assists local and state government agencies, school districts (K-12), higher education, and nonprofits in reducing the cost of purchased goods by offering managed access to competitively solicited contracts between suppliers and lead public agencies. In 2008, aggregate program sales exceeded $1.4 billion, with $200 million in estimated savings to participating public agencies.
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