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10)    Increase the use of municipal performance monitoring and benchmarking to improve service delivery
Performance monitoring systems are a critical tool for municipalities trying to identify areas where they could deliver services more efficiently or effectively.  Municipal service monitoring and benchmarking programs have become much more common over recent years.  Known under a variety of names (e.g., Somerville’s program is called SomerStat), these “Stat” programs all use data to evaluate municipal and departmental performance. Somerville has run its successful SomerStat initiative for close to three years, and reports $10 million in realized or anticipated savings.  Similar programs are operated in Amesbury and Springfield.  

Performance measurement allows policy makers, managers, and citizens to evaluate the quality and effectiveness of government services. Performance measures include inputs (resources used), outputs (program activities), efficiency measures (ratio of inputs to outputs), and outcomes (the actual results of programs and services).  Performance measures allow comparison of performance across departments within a municipality as well as comparisons across multiple municipalities.  They can also be used to set performance objectives upon which incentives can be based.  Stat programs also entail an ongoing series of integrated meetings during which municipal leadership and management review performance measures, evaluate the success of previous decisions and commitments, and establish a new set of performance objectives for each individual department and the municipality overall.  

Stat programs require the commitment of municipal leadership, specifically the chief executive officer with managerial authority over departments.  While there are many models, most Stat programs also require training and sometimes specialized software.  Technical assistance and financial support for software and training are also necessary for more widespread adoption of Stat programs; both software and training could be procured regionally.  The state should also support the development of a best practices guide for Stat systems and should establish standards for performance measures, so that they can be compared regionwide. 

10.a    The Legislature should fund an incentive program for municipal Stat systems

10.b    Municipalities, with assistance from MAPC and the Collins Center at UMass Boston, should adopt appropriate elements of Stat programs to improve municipal performance

11)    Use dispute avoidance and resolution systems to control costs on municipal capital projects
Conflict and disagreement is an inevitable part of the workplace, especially on municipal construction projects due to the large number of entities and individuals involved.  Conventionally, disputes between contractors and municipalities often escalate and result in legal action.  Delays, increased costs, legal fees, and acrimonious relationships result, none of which bring positive results to the municipality involved.

Conflicts can be dealt with through appropriate dispute avoidance or settlement systems.  Alternative dispute resolution (ADR) systems seek to resolve disputes and find mutually satisfactory settlements without litigation, at a fraction of the cost in money and time.  ADR systems may include the use of a “standing neutral” who meets regularly with project participants to address and help resolve disputes as they arise; or it may involve the use of mediation to help parties try to resolve their disputes before resorting to litigation.  

Municipalities should consider budgeting 0.25%-0.40% of the total project cost for a formal project-specific ADR process. Bid specifications and contracts between the municipality and land owners, designers, and contractors should include terminology requiring at least mediation of any dispute before litigation.  An even better approach would be for municipalities to initiate an ongoing ADR process that promotes resolution of conflicts or disputes as they arise.  Development and implementation of such an ADR process should be done by using a mutually acceptable outside independent resource working with the stakeholders.  The state can help to promote the use of ADR by requiring its use on construction projects that rely on state subsidies, such as transportation projects or school construction.  

The use of an ADR specialist is distinct and complementary to the project manager now required for municipal construction projects over a certain size.  Dispute avoidance professionals have specialized training that project managers rarely have.  Rather than focusing on day-to-day coordination and guidance, dispute avoidance specialists focus on conflicts among the project participants, which may from time to time include the project manager. 

11.a    MAPC should collaborate with Massachusetts Office of Dispute Resolution to develop and implement a program to help municipalities use ADR on municipal construction projects

11.b    Massachusetts School Building Authority should encourage municipalities to incorporate ADR into school construction/renovation contracts.

12)      Increase the use of enterprise funds for fee-based municipal utilities
Municipalities can recover costs for some specific services through the use of enterprise funds.  An enterprise fund is a separate accounting and financial reporting mechanism for municipal services for which a fee is charged in exchange for goods or services. It allows a community to demonstrate to the public the portion of total costs of a service that is recovered through user charges and the portion, if any, that is subsidized by the general fund.

With an enterprise fund, all costs of service delivery--direct, indirect, and capital costs--are identified. This allows the community to recover total service costs through user fees if it chooses, so services utilized by a limited number of residents are not necessarily subsidized by the entire municipality.  Enterprise funds also provide more useful management information because revenues, expenses, and performance are accounted for separate from the general fund.  Enterprise accounting also enables communities to reserve the "surplus" or net assets unrestricted generated by the operation of the enterprise rather than closing it out to the general fund at year-end.

Services that may be treated as enterprises include, but are not limited to: public utilities (water, sewer, stormwater, trash disposal); health care (ambulance service, nursing homes); recreation (skating rinks, pools, golf courses); and transportation (airports, dock and wharf facilities.)  A community may not establish enterprise funds for normal government operations or services such as public safety, inspectional services or cemeteries.  Public utilities are excellent candidates for enterprise funds because they can be used to ensure that customers are paying for the full cost of service delivery, including the costs necessary for ongoing maintenance, upgrades, expansions, and conservation programs. 

12.a    Municipalities should establish enterprise funds for public utilities

13)    Increase use of senior citizen volunteers for municipal functions
Municipalities may establish a “property tax work-off program” for taxpayers over 60 years old.  Under the program, participating taxpayers volunteer their services to the municipality in exchange for a reduction in their tax bills, up to $750 per year.  Because the hourly rate of reimbursement is the state minimum wage and there are no benefits or unemployment contributions, this may be a cost effective strategy for certain labor needs.  Additionally, many seniors bring specialized knowledge and a wealth of experience.  Their assistance could be valuable in schools, health centers, bookkeeping departments, and a wide array of other municipal offices.

13.a    MAPC and allied organizations should collect best practices for property tax work-off programs, and encourage municipalities to adopt them

14)    Facilitate the creation of new municipal electric utilities
Municipalities may be well served by the creation of new municipal electric utilities, which offer lower rates and more responsive service than their investor-owned counterparts.  Statewide, there are 41 municipal-owned electric utilities (Munis), which combined serve roughly 15 percent of Massachusetts residents.  However no new municipal-owned utility company has been approved since 1926, partly due to concern that the existing electricity provider could block creation of the entity by refusing to sell its distribution equipment to the city or town.  Section 107 of Green Communities Act requires the Department of Energy Resources to study the fiscal impact, viability, statutory and regulatory barriers and long-term results of establishing and operating municipal-owned electric utilities in Massachusetts. 

14.a    The Legislature should pass legislation to facilitate the creation of new municipal-owned electric utilities

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