July 18, 2011 By Wayne Hanson
Michigan -- which in 2008 the New York Times described as “ground zero in the national economic downturn” -- was in its fifth year of recession when the current economic troubles hit, and already had some of the worst unemployment in the nation.
Fortunately Oakland County, Mich., has a history of innovation, and while it has endured its share of hardship, it does not lack for leadership and bright ideas. Since 2005, for example, it has scored among the top 10 large counties (500,000 population or more) in the annual Digital Counties Survey conducted by the Center for Digital Government and the National Association of Counties. And since 2005, Phil Bertolini has been the county's deputy county executive and chief information officer. That combination of duties might seem unusual at first glance, but it is evidence that the role of the CIO has evolved from basic technologist to full partner in delivery of government services, and a testament to Bertolini's regard in the county. He sat down with Government Technology last week at NACo’s annual conference in Portland, Ore.
Revenues have dropped, said Bertolini, but new ideas are being tried to deliver services. “We’re creating a government cloud in Oakland County,” he said. “We’re going to provide applications out to other governments wherever they may be, even outside the state.” The idea is not entirely new, since the county has been providing shared services for more than 30 years, back to mainframe days.
“We’re going to partner with the private sector,” he said, “have them help us provide the cloud out to those external agencies, and then lower our costs of providing services. It’s win-win. They make a profit, we win on our costs, and other governments can simply consume technology instead of having to own and operate them. We believe that’s going to change the landscape for us.”
Bertolini said there is a social media side to service delivery as well. Last year, the county encouraged county employees to blog about good ideas to save money and work more efficiently.
Net Volunteers is a new program that brings in citizen volunteers, trains them and then those volunteers help keep the county’s message accurate and up to date. “If, for example, someone says something that’s totally untrue or they twist the facts, then someone gets in behind them and says ‘no, here’s the facts,’ and it changes the whole conversation.”
The county also worked with Michigan State University on a crowdsourcing project. “We can put ideas out there, and then the citizenry can give us their thoughts," he explained. "We put up the pilot and hired an MSU student to help implement it, and we have people now that are throwing ideas to us, and the rest of the community is chewing on them, or we throw an idea out to them.
“Instead of a board room where you put 20 people around a table to try and get ideas,” explained Bertolini, “now we get thousands of them. That’s going to be huge, because we know there are great ideas out there, what kinds of services are core and what aren’t.” He said that these are some very useful tools to help make the tough decisions.
A CIO Involved in Benefit- and Health-Cost Decisions?
Bertolini is not only deep into technology, he -- like many other CIOs around the country -- have taken on additional responsibilities far beyond the ordinary purview of IT. For example, he is one of five deputy county executives on the budget task force. “Every single budget decision we make is made in that room,” he said. “We have a three-year rolling budget, and we’re balanced for the next three years.”
While Oakland County has been cutting government since 2003, said Bertolini, it began managing benefits as early as 1986. So the county has paid off its retiree health-care obligations. The county no longer has a defined benefit plan for retirement, but a defined contribution plan. In 2006 the county stopped providing new hires with retiree health care -- they have health care savings accounts. “Then we went out with trust certificates and paid it off. We took a 30-year cost … at $62 million a year, down to 20 years at $42 million a year. So we saved $150 million.
“What hurt the auto industry was their legacy costs,” explained Bertolini, “their health care costs, their pension costs, sitting on the books. Now, when someone leaves Oakland County government, they take their retirement with them … they take their health care with them when they go, and they’re off our books.
“We also have a wellness program,” he said. “Our County Executive, L. Brooks Patterson, wanted to make sure our employees were healthy, so he said “I’ll give you a $100 gift certificate if you come in and get your blood drawn, so we can check your sugar, your blood pressure, etc. In its first year, we had almost 50 percent of our employees take advantage of that, and 15 percent were referred to hospitals because they had problems they didn’t know about. Now we have almost 60 percent of our employees doing it, and only about 5 percent are referred.” Four years ago, he said, the self-insured county paid $38 million for health care coverage for employees. This past year it was also $38 million, so health care costs were flat.
If you keep benefit costs under control, said Bertolini, you can then do other things as well. “All the way along, we’ve been using technology to help us to do those things,” he said, “so it’s been a good strategic fit for technology and government processes.”
This Digital Communities white paper highlights discussions with IT officials in four counties that have adopted shared services models. Our aim was to learn about the obstacles these governments have faced when it comes to shared services and what it takes to overcome those roadblocks. We also spoke with several members of the IT industry who have thought long and hard about these issues. The paper offers some best practices for shared government-to-government services, but also points out challenges that government and industry still must overcome before this model gains widespread adoption.