In the spring of 2009, California state legislators were facing a $26 billion budget gap – the worst such gap in the state’s history. Declining revenues forced the state to cut entitlement programs and promised aid to local municipalities. Very few county and city governments in California had the economic tools to withstand the kind burden being laid on them from the economy. The City of Santa Cruz was no different. For years leading up to the economic collapse, city officials struggled to deal with their own economic shortfalls, including a brain drain that took valuable jobs and a tax base to San Francisco or Silicone Valley.
To cover the $26 billion budget hole, the state of California proposed siphoning $2 billion in local property taxes, $1 billion of gasoline tax revenue meant for local governments and another $1 billion earmarked for redevelopment agencies. After the dust settled, though, the state took $2.1 billion in economic redevelopment funds promised to local governments, of which $3.7 million belonged to Santa Cruz. The city was facing a $9.2 million deficit and at the same time, the city’s roughly 55,000 citizens were growing increasingly impatient with continued reductions in city services.
“We were doing everything just to keep the lights on,” Peter Koht, Economic Development Coordinator for the City of Santa Cruz, said last week during an interview at the Web 2.0 Expo in New York City. The city was understaffed, without a budget and needed help in properly conveying to residents the realities of the situation. “We had to reset expectations of what [city government] can and can’t do,” Koht said.
But the local media, also dealing with financial problems, were doing very little to provide meaningful information about how city officials were looking to fix their budget mess, Koht said. The city’s message was getting lost in the haze of failures in Sacramento. To help inform Santa Cruz residents and tap into community ideas on ways to manage the impending cuts, the city built Santa Cruz City Budget. Through the website, citizens could see visual representations of how proposed budgets would be spent and how cuts were translating into lost jobs. But more importantly, the website was interactive. It encouraged citizens to collaborate and participate through polls and comment sections, and it hosted a blog for the Mayor, “to stay on top of the news cycle,” Koht said.
With the help of UserVoice, a San Francisco-based company who helps structure and manage online feedback, the city set up the website within eight days, spearheaded by volunteers and with no budget. The UserVoice forum collected ideas, reduced redundancy and structured a ranking system so the best ideas on how to fix the budget bubbled to the top. This was important in getting more participants involved and keeping the outliers from controlling the debate, Koht said.
According to the city’s data, nearly 8 percent of the city’s residents registered at the budget website, suggesting ideas and voting on solutions. Because of the ID requirements, there was no anonymous hate speech. And by allowing official responses from city officials in the forum, irrelevant suggestions were largely avoided, while constructive debate and conversations began to pinpoint a few areas of greatest concern. “The level of engagement was inspiring,” Koht said.
click for larger image
Another important aspect to the way Santa Cruz approached this project was releasing data on the city budget dating back ten years, along with comments from the independent city manager. Koht suggested this helped raise the dialogue to those who had a reason to be there. “We had CPAs and other experts from the private sector looking at our data, making suggestions about shared services, and redevelopment projects we had not previously considered.
“The energy was positive and solution oriented,” Koht said, “the community rallied around each other and the ranking system really helped us separate the wheat from the chaff.”
click for larger image
The experiment was largely heralded as a success by “government 2.0″ aficionados, and smarter government advocates. The technology used by Santa Cruz is spreading to other California cities for similar purposes. And the original WordPress plugin used to display the top suggestions on the city’s website is part of a broader open source strategy that will allow the technology to be shared with other municipalities. The city covered its deficit and showed its public how to constructively approach complex problems. But nearly 50 employees had to be cut, and another wave of pay cuts, pay freezes and furloughs have been doled out in response to the continued budget problems facing the state.
Koht says no one at city hall is thinking their financial issues have been solved, but the city is looking to move forward with an ambitious economic development scheme to keep local talent in the area, while pushing the notion of sustainability. They have initiated programs to make capital more accessible for small businesses by managing a micro-lending strategy. And the city is also looking to leverage partnerships with University of California Santa Cruz to create an ecosystem of support for start-up companies and high-tech internships.
“We run on social capital,” Koht said of the new Santa Cruz economy.
[pictures curtsey Peter Koht’s presentation at Web 2.0 Expo New York]
Craig Tobias
2 months ago
Web 2.0 certainly allows for greater participation by the masses into local government. I would call this Municipality 2.0. Allowing the citizens to participate in resolving budget short falls is not only prudent it makes shrewd political sense. No matter what choices are made someone is not going to be happy but at least local government can point to the fact that they let the masses participate and they considered the best and the brightest ideas which were presented by the citizens themselves. By allowing such participation it them makes it hard to accuse the local leaders of making decisions from ivory towers.
In the end who knows, there might be some innovative ideas presented which allows the City of Santa Cruz to save significantly.
JefferySmith
2 months ago
I couldn't agree more Craig, these tough times will make for more difficult decisions. But with more ideas along these lines, communities may begin to better gauge how to handle those difficult decisions. Long-live Muni2.0!
Tim
2 months ago
You quote city sources that say "nearly 8 percent of the city’s residents registered at the budget website."
For a city the size of Santa Cruz, that would amount to more than 4,000 registered users.
However, when I last checked the Santa Cruz Uservoice site in late October, the numbers hinted at much lower rates of participation. While the site doesn't readily expose the complete set of metrics, here are some pointers (data from October 21, 2009):
1) A total of 100 ideas had been posted. These ideas came from 32 registered users as well as up to 50 anonymous participants.
2) A total of 108 comments had been posted.
3) A total of 1,782 votes had been cast. Note that each user could award up to 10 votes. For example, the 32 registered users mentioned above cast 6 votes on average.
From looking at these numbers, I'd say there were only a few hundred participants. Only a small portion of them registered (created accounts). And whether all participants were in fact Santa Cruz city residents is not known (I bet many were but some of the voting may have come from outsiders, too).
Am I missing something?
JefferySmith
2 months ago
Tim – these are excellent points, and perhaps further clarification is needed – according to the UserVoice case study "Over 4,000 people viewed the site and top suggestions have been worked into the budget for 2010." Which is also the number implicitly quoted in the story. (8% was quoted, and as you point out that works to be around 4,000).
As for how those numbers were derived (registered, viewed, how many were non-residents) we'd have to see the site's analytics to be sure.
I'll see if I can get more info/verify registered vs. viewed/participated.
Tripp Babbitt
2 months ago
All:
We have found that sharing services usually results in increased costs. The design and management of work is the biggest lever for improvement. We assume things are optimal and then share services to reduce expenses, bad assumption. As service lessens in a shared services arrangement, more people are hired costing even more money.
Please read:
http://blog.newsystemsthinking.com/blog/shared-se...
http://blog.newsystemsthinking.com/blog/shared-se...
Regards, Tripp Babbitt
http://www.newsystemsthinking.com
http://www.thesystemsthinkingreview.com (government help)
Peter Koht
2 months ago
Hello there, first off, thanks for the insightful commentary here on the article.
The 8 percent figure is based on unique visits to the site (4,600) from Google Analytics. Like Wikipedia or other open conversational platforms, the majority of our visitors were readers, and the participatory segment of the audience was lower, but we were still excited about the level of participation that we saw, as well as the quality of the discussion.
Again, thanks for reading about this project, and for supporting our efforts to be a better, more responsive City.
California City Taps Social Media to Help Fix its Budget « Social Media at Work
4 weeks ago
[...] This past spring, Santa Cruz, California was facing a $9.2 million deficit. At the same time, the city’s roughly 55,000 citizens were growing increasingly impatient with continued reductions in city services. To help inform residents and tap into community ideas on ways to manage the impending cuts, the city built a website called Santa Cruz City Budget that let people see visual representations of how proposed budgets would be spent and how cuts were translating into lost jobs. But more importantly, the website was interactive. It encouraged citizens to collaborate and participate through polls and comment sections, and it hosted a blog for the Mayor. Nearly 8 percent of the city’s residents registered at the budget website, suggesting ideas and voting on solutions. CivSource has all the details here. [...]
Orçamentos Participativos Digitais | Blog do Vasco segurança pública, web 2.0, wikicrimes, wikimapps, crimes, redes sociais
3 weeks ago
[...] O tremendo déficit (cerca de U$ 26 bilhões) da Califórnia forçou ao aparecimento de soluções inovadoras. Santa Cruz decidiu engajar os cidadãos na discussão de como tratar o déficit da cidade. Decidiram criar um site onde os dados do orçamento dos últimos 10 anos foram expostos. Analistas independentes passaram a discutir as razões do ocorrido e, em conjunto com a sociedade, coordenaram um trabalho de definição de prioridades de investimento. Representações visuais e amigáveis foram fundamentais para que a participação das pessoas fosse possível. Várias seções de voto foram criadas no site para que as pessoas participassem e definissem o que consideravam prioridade. O prefeito, através de seu blog, comandou toda a discussão. Um detalhe que mostra o quanto as pessoas se engajaram no processo é o fato de que o site foi construído pelos próprios cidadãos e totalmente de graça. Os projetos foram classificados em ranking e os mais bem avaliados foram eleitos para serem implantados. Um matéria completa sobre essa iniciativa pode ser vista aqui. [...]