Government growth vs. overall growth

Contact:
Molly Johnson
Fund for Our Economic Future
216-456-9806
mjohnson@futurefundneo.org

For Immediate Release
 

Northeast Ohio’s Rate of Local Government Spending is 70 Times the Region’s Population Growth, 2.8 Times its Inflation Rate and 2.4 Times its Economic Output
Findings Published in New Report on Efficient Government and Collaboration; Opportunity Abounds for Local Governments to Collaborate

CLEVELAND (May 26, 2011) – Efficient, effective local government’s role in improving Northeast Ohio’s economic future is the focus of a new report issued today by Advance Northeast Ohio, the economic competitiveness agenda of the Fund for Our Economic Future. An accompanying website also launched today: www.efficientgovnetwork.org.

The report, titled Opportunity Abounds: Local Government Collaboration Can Be a Building Block to Economic Competitiveness, illustrates the current status of government spending versus other economic indicators using data provided by the Center for Government Research (CGR). CGR assesses the cost of local government on Northeast Ohio and compares it to regions across the country.

“More than ever, government efficiency and collaboration are relevant and timely topics in our region,” said Robert Jaquay, vice president of the Fund for Our Economic Future and associate director of The George Gund Foundation. “We are beginning to see the positive results collaboration can bring, including significant savings to protect vital services and ensure our communities invest in innovation and education to create jobs and keep the region competitive in the global economy.”

Among the key findings of the Opportunity Abounds report:

• A startling comparison between the rate of growth for local government spending and key economic indicators including population growth, economic output and inflation. Research shows that the rate of local government spending in Northeast Ohio is 70 times the region’s population growth, 2.8 times its inflation rate and 2.4 times its economic output.


• Government fragmentation costs the region: Across the region’s 16 counties, 868 separate government entities spend $20 billion to run themselves. That is the equivalent of one government for every 4,000 citizens and more than 10% of the region’s economy.


• Northeast Ohio is experiencing a Growth Gap: Our region’s population has grown 1% and our developed land has increased by 60% over the past few decades resulting in the Growth Gap – the difference between population and physical growth. Translation: higher taxes, declining services, and far fewer dollars for the investments in education, innovation, and business attraction critical to a more vibrant future. We are subsidizing the region’s economic destruction by adding physical infrastructure at a rate that is out of whack with our flat rate of population growth.

“Northeast Ohio residents have made it clear that more efficient local government is a regional priority,” said Brad Whitehead, president of the Fund for Our Economic Future. “Progress has been made, but there is still much work to be done to curtail and consolidate local government spending. The Opportunity Abounds report uses research to illustrate the current situation and offers ideas from the Fund to help the region reach efficiency goals and be more competitive.”

The Fund for Our Economic Future has supported numerous regional efforts, such as the EfficientGovNow contest, to foster more efficient and collaborative local government.

Based on report findings, the Fund’s and others experiences, three action items will be pursued in partnership with Advance Northeast Ohio.

• A common financial reporting system for all local governments that will enable residents and officials to view transparent and accurate assessments of the relative efficiency of the delivery of government services.


• A network of local government officials and other stakeholders that will collaborate to develop plans and actions that result in more shared service delivery.


• Local, regional and state-wide resources and incentives that provide financial, policy and technical assistance for local government collaboration and efficiency initiatives.

###

ABOUT THE FUND FOR OUR ECONOMIC FUTURE
The Fund for Our Economic Future (www.futurefundneo.org) is a collaboration of more than 100 foundations, organizations and philanthropists from across Northeast Ohio that strengthens the region’s economic competitiveness through grantmaking, public engagement and research.