Faced with a $48 million hole in his budget, the new CEO of Atlanta – aka Mayor Kasim Reed – asked his commissioners to identify “three dumb things” their departments do or don’t do.
“We’re doing too many things in Atlanta,” Reed said in an interview. “We’re going to run our government in a radically different fashion.”
The former corporate attorney said his biggest surprise since taking office at the beginning of the year is the drain being placed on limited resources because the city is not organized efficiently.
For example, some departments have their own IT and HR operations, which could be consolidated. On the revenue side, the city has not been collecting money from Uncle Sam for administering some federal programs.
The phrase he’s cringed at the most: “It’s always been done that way.”
While it’s too early in his tenure to draw any solid judgment on Reed’s management style, a preliminary glimpse indicates he’s trying to take a business approach to organizing City Hall and tackling big financial issues.
The biggest issue of all – employee pensions.
“Pensions are easily the most significant threat to the city of Atlanta remaining a viable institution,” Reed said. “It’s worse than I thought during the campaign.”
If the issue is left unchecked, he said, Atlanta will be insolvent by 2017 or 2018. The capital of the New South could be without capital.
Last year, the unfunded pension liability ballooned to $1.5 billion. In 2001, it was $321 million.
To tackle the impending disaster, Reed advocates lower pension benefits for new employees. And he also wants city employees to join the Social Security system, which they are not part of now.
In another nod to business, Reed appears to believe in investing money to make money.
For example, he wants to beef up the police department by 100 officers, partly to prevent “damage to [Atlanta’s] brand” if crime were to increase. I put “brand” in quotes to emphasize it’s from the mayor, not the business columnist.
He does not agree with critics who have urged him to wait to increase the police force until after the economy turns around. By then, he said, businesses looking to locate here or hold a convention in town may go elsewhere.
Speaking of conventions, panhandling is no friend to the tourism business, and Reed knows that. He wants more cops on the street so some can deal with Atlanta’s unenforced panhandling ordinance.
“The police force is too small and the officers are running from emergency to emergency … so issues of quality of life are not being addressed,” Reed said. “We need the capability to do both.”
To try to raise tax revenue, Reed plans to appoint “an economic development czar to quarterback job retention and job recruitment efforts.”
Small business will be especially targeted. Down the road a little, he plans to ask the City Council for between $7.5 million and $10 million to set up a fund that can be used to offer tax credits and cash incentives to firms bringing jobs to Atlanta.
And he’s trying to deal with the cumbersome permit and licensing maze that businesses have complained about as a deterrent to locating here.
He said his staff is studying Cobb County, the “gold standard,” hoping to streamline and simplify the process.
It sounds good. But will it happen? Businesses have complained about the city’s bureaucracy forever.
“I’m willing to be measured by the results I get,” Reed said.
Elections have a way of doing just that.
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