Mark Moses is an author and municipal finance consultant. He’s a former municipal CFO/Treasurer and industry consultant with 29 years of financial management experience. Throughout his career, he was a Senior Finance Advisor for Regional Government Services Authority, where he provided assessment and consultative services to municipal agencies throughout California. He was also the West Coast Regional Director for Innoprise Software and the Chief Financial Officer for the city of Stockton.
Additionally, Mark recently published a book, The Municipal Financial Crisis: A Framework for Understanding and Fixing Government Budgeting.
Here’s a glimpse of what you’ll learn:
- Mark Moses explains why many cities are slow to update financial systems and consequently face potential bankruptcy
- The purpose of Mark’s new book, The Municipal Financial Crisis: A Framework for Understanding and Fixing Government Budgeting
- When politics interfere with the city budget
- The complicated roadmap of policies, permits, and ordinances
- The dangers of scope creep
- Common problems that city governments have yet to solve: homelessness and cannabis distribution
- Why adding more layers to bureaucracy isn’t the best way to solve a problem
- Rethinking city budget planning
- What positive steps can cites take to readjust their focus?
- How to get more involved with your local city government and start making a change
In this episode…
It’s no secret that most city government financial systems are a mess. Rather than evaluate and change old practices, officials just add on layer after layer of new requirements. Is there any way out of the maze of antiquated systems and traditions?
Mark Moses has a few ideas about the solution. That’s why he’s published his new book, The Municipal Financial Crisis: A Framework for Understanding and Fixing Government Budgeting. After years of advising governments throughout California, he knows exactly what works — and what doesn’t work — for city government financial services.
In this episode of Watching Paint Dry, Greg Owens is joined by Mark Moses, author and municipal finance consultant, to discuss solutions for city budget planning. Mark explains how many city governments have made a mess of their financial systems, why politics interferes with budgeting, and options for re-evaluating your city’s budget.
Resources mentioned in this episode:
- Mark Moses on LinkedIn
- Munifinanceguy.com
- Mark’s email: Mark@Munifinanceguy.com
- The Municipal Financial Crisis: A Framework for Understanding and Fixing Government Budgeting by Mark Moses
- Greg Owens on LinkedIn
- Katrina Stephenson on LinkedIn
- McCarthy Painting
- McCarthy Painting Contact No.: 415-383-2640
- McCarthy Painting Email Address: info@mccarthypainting.com
Sponsor for this episode…
This episode is brought to you by McCarthy Painting, where we serve commercial and residential clients all around the San Francisco Bay area.
We’ve been in business since 1969 and served companies such as Google, Autodesk, Abercrombie & Fitch, FICO, First Bank, SPIN, and many more.
If you have commercial facilities in the San Francisco Bay Area and need dependable painters, visit us on the web at www.mccarthypainting.com or email info@mccarthypainting.com, and you can check out our line of services and schedule a free estimate by clicking here.
Episode Transcript
Intro 0:02
Welcome to the Watching Paint Dry Podcast where we feature today’s top leaders, industry experts and more to discuss issues affecting facility managers and property owners. Now let’s get started with the show
Greg Owens 0:22
Hello everyone, this is Greg Owens with another episode of Watching Paint Dry. Where we have been interviewing facilities managers, property owners, the consultants and all the people that support this entire I think it’s like $3 trillion industry and this podcast like all the podcasts are brought to you by my company McCarthy Painting. We are located here in Marin County, California and service the whole San Francisco Bay Area we we’ve been involved in some really fun projects here lately of doing some mall complexes we might do a Tesla What is it the retail store which is that that’s looking really exciting to go and do in San Francisco. And we’ve been doing work for Chase Bank sng carpet and many many other companies to find out more go to info at McCarthy. You can go McCarthypainting.com or email info@McCarthypainting.com to find out more about my company. And this is gonna be a fun interview for me because I have Mark Moses who’s I’ve known for quite a few years now. What do you think Mark? Is it 786 or seven years? Yeah, yeah. And this and mostly through the through a mutual sort of hobby of ours and that is martial arts. We both go to Aikido of Temple pious right here in Corte Madera, California and practice Aikido under Wendy Palmer Sensei and, and so this will be fun to get to know you on a different level. And marks. You’ve gotten like some interesting and unique experiences your your former CFO and treasurer and very involved in sort of the finances of cities, and city government, and that whole entire sort of industry sort of back that is so important to all of us citizens of America here and throughout the world. But we’re all really focused on
Mark Moses 2:32
American cities. Yeah, and just going back even further, my, my early career was in banking and real estate investments and consulting small businesses. So before I started working for cities, I got a bit of a private industry orientation and feel that I found a lot of people in local government don’t, don’t have that frame of reference. And say, I went on to be an assistant finance director, a finance manager, CFO, basically, higher level administrative and financial management functions for a number of Northern California cities, one special district early in the career, and I’ve been consulting cities for about the last decade.
Greg Owens 3:23
Right, CZ sort of have a working knowledge of a lot of things that go on within that bureaucracy of city of city government. And we and I as a painting contractor, I’ve done work here for the city of Noe Valley for San Rafael city of Centerville little tiny bits for the federal government. And then, you know, as a non union painting contractor, I don’t go anywhere near anything in the city of San Francisco. Right. And you come it’s a complex I mean, I’m reading through your book and this is this is this is what you this, you burst this book, this year 2022 The Municipal Financial Crisis: A Framework for Understanding and Fixing Government Budgeting, which is it’s it’s something that’s so needed right now as we watch city after city after city get in trouble
Mark Moses 4:18
throughout the country. Yeah, and, and also, it’s not just the ones that are in the headlines for bankruptcy or near bankruptcy or bankruptcy scares. It’s really all cities in some way are, are driven by the dynamics that I described in the book. And, and those dynamics really lead to what you might characterize as scope creep where there’s no end to what they take on. Nothing ever falls off the table in terms of there’s a resistance of giving up things even if only one person or a hypothetical person might benefit from it. And so cities are strangling themselves with their desire to satisfy more and more needs. And it’s, it’s an undisciplined process of decision making that is, is really explained explains why you see the potholes, you see the infrastructure degradation, and really why you, most people are paying more and more and receiving less and less things that used to be covered under local taxes, or now you’re paying fees for rising fees for just a couple decades ago, those were all kind of included as part of the, quote, tax package. Right. Yeah, it is.
Greg Owens 5:47
I mean, I, as I read through your book here, it became more and more, in a lot of ways overwhelming to see how, how a city can actually start to change, right? Like does. That reminded me my, my dad, I’ve told you about this, my dad is was a New York City fireman, right. And New York City, fire department itself. Just one department, like the fire department is so complex, and there’s so much budgeting money and budgeting concerns and retirement plans and things that are great people that are grandfathered in, and decisions that were made 20 years ago that make no sense right now, are still being carried out. Right?
Mark Moses 6:35
Yeah, there’s there’s no natural pathway, we want to call it a cleansing process or a, a, there’s no refresh, there’s no reset in, in these organizations, whereas in private industry, you’ve got, first of all, you have more natural turnover and private industry. So you get a flow of people. So you get different ideas, different talents, things that add that that helps keep things from, from settling or roots growing too deep. When you make bad decisions, you know, you don’t do too many of those or you fail, and then you’re never heard from again, sometimes you’re a little mix, you know, maybe hang on for a while, and somebody acquires you. But the point is, you, you don’t breed a legacy culture, that the way cities do. And when you think about it, I mean, and that’s really a big part of why you may wonder, why is the city’s website so far behind? Or why are they so behind in their practices? Look how long it took, before the DMV would make appointments even Right? Or before? I know, it’s a big deal in one of our local cities here. And we’re in County, when they announced and this is about this is about seven years ago, they announced that they had IVR. And it was like IVR technology, you know, in 2013, like what a concept, like that’s been around in private industry for decades. And yet, it’s a big deal in its local government.
Greg Owens 8:14
But so define define, I define IVR for our listeners, oh, that’s the
Mark Moses 8:18
interactive voice response, when you can call in and write SEO, press two or or find out just through a series of prompts. Find out the status of your, your building permit, for example. Right, right. And so, you know, we tolerate that, right, you know, when you, you know, you look at the technology when you order something from Amazon, or Macy’s, or whoever. And then you go into a city website, where you need a different ID for every department you deal with, if if you can even deal with that department, through the web. And so, you know, what explains that? Well, you know, in competitive areas, you have to be sharp, you have to stay sharp, and even if cities make a lot of good decisions from time to time, it’s still that edge, right? It doesn’t take much to to fall behind in the world. And when you have again, when you have a legacy culture that goes on for decades it’s you lose that edge. And again, you can you can do a lot of things right and still wake up and be decades behind the rest of the world. And that’s really what’s happened to our cities. Yeah,
Greg Owens 9:38
it’s a Elena I know I just lost so my Amora small company in painting company here in Marin County, and and we lost a couple of key employees right but my as the owner of the company, as sad as I am to see them go and how like, Okay, now we have a burden of having to take on this extra work. I’m also like, excited about the opportunity to make some new changes, and just sort of like, bring in some new technology because the next person that comes in doesn’t know any better. And so then we can we have an opportunity to change some of our systems, and kind of grow from that. Right. And, you know, and I’m, there’s a lot of excitement, because then I get to bring in that new blood, and I hear what you’re saying, I guess in, in, in a city, sort of in one department of that city, like say, finance, where you are working in or I mean, budgeting and, and, you know, paying the bills, and all that kind of thing for the city, there’s probably legacy old systems that are in there, that it’s always been done this way that if you bring in a new person, they get brought in and put down and like, well, this is how you have to pick up this piece of paper and bring it over to this thing and print it and send it out.
Mark Moses 10:51
Exactly. And people i They, they identify their, their work with the specific tasks that they do, they don’t think of it as, oh, I pay the invoices. For the city. It’s like, No, I log in here, I go to this report, I run this I do that they you know, the jobs are reduced to tasks, not a general areas of responsibility, especially when the same job is held for decades. You know, there’s kind of a sweet spot I found where I worked for one agency that was engineering driven. And they would change out their finance system every five years, just because they were restless. And they always felt like they had to be improving. And nothing ever settled. And they overdid it to that extent. But one lesson I learned was nothing ever got really settled and fixed. Because they were always in this changing mode.
Greg Owens 11:50
Interesting, because it was just sort of part of their culture was just to change at every fight. Yeah,
Mark Moses 11:54
because they would tear down things. And yeah, engineers like project, right? Everything’s a project, everything can be renovated and improved. So they would look at it and say, oh, yeah, we can do better than that. Let’s tear it down and, you know, do a renovation. And they did that with their treatment plant. They did it with the software. And so and when you look at it, you know, probably from a financial point of view, it was, you know, it was kind of overindulgent in terms of all the improvements and all the projects. And so it was not necessarily the kind of way or they didn’t make the kind of decisions you and I might have made if this were a private utility, in terms of how often these things are done. But there was a real lesson there in terms of if you keep things moving, they don’t settle that deep. But I contrast that with cities where the, you know, they’ll have the same systems for decades to where, imagine situations where no one, no one working there could even remember the previous system that they had, they had before the current system and you know, right,
Greg Owens 13:05
like, I was done before you this system, and everybody’s like, no idea.
Mark Moses 13:11
Yeah. And so they don’t know, they don’t know any other have no other frame of reference actually. Bad and what other respects, often they would carry over some of the legacy procedures from the old system into the their system and never shed them. But the point is, they never knew another way. thing. So there was just no frame of reference for change. So they, they couldn’t even conceptualize what what change might be like. And so yeah, in those kind of environments, and yeah, when when I lost staff, whether they were, no matter how good that staff was, if they were top performers or bar performers, there was always an opportunity to, to review how the work was done. And we made all kinds of progress even after losing a really good person in, in witnesses I worked for recently. And so the big cities have these different pressures, right where the hiring process is exceptionally long. And so you try to hold on to people as long as you can, and desperately because you know that if they leave, it’s gonna be months before the positions filled. Or you may have to justify the position again, or the city’s in financial trouble. There may be a hiring freeze. So it’s a it’s a clunky, clunky operation. One place, it’s very rare that you have all positions filled simultaneously in a in a city organization. And so, it kind of makes you wonder, Do they even know how many people it takes to run the operation? They never have a stable number.
Greg Owens 14:59
You Interesting. Yeah. So they might not even know what, what their needs are when it comes to people. Exactly. Yeah. So help me understand like, so the city like Mill Valley or Sausalito, where you’re at is, well, how many I don’t even know how many employees that the city could possibly have, like small cities like that throughout?
Mark Moses 15:22
Yeah, well, first of all comparisons are difficult, because there’s no generic city organizational structure. And you can have the, you can have seven people that are officially in the finance department. But you can bet to those people who may be cashiers that are supporting the building and planning department, and may do very, you know, may only do incidental things, maybe they might do business license, but they may be shared with other departments. But I mean, in a, I’d say, in the, I mean, in the Marin County cities, you’re going to have, you know, anywhere from three to 10 people in a in a finance department. Right. But again, they’re organized very differently in terms of what they really do.
Greg Owens 16:16
Yeah, I mean, I, you know, as a, as a painting contractor, and more. So I’m a general contractor also. And when we get involved in permits, I know I have like a cheat sheet that I have to look at for each town, because each town has a little bit different system. Right. And I know like, and for a city like Noe Valley, it’s, it’s only a few steps, but for the city of San Francisco for us to get a perk parking permit. And this is before COVID, they, I have a feeling named change things and gone online, more so with COVID, you know that and that kind of forced him, which is great, I used to have to go, I’d have to go into one building. And I’d have to go like the floor five, and take a number, and then wait, and then my name would be called, then I give them that this the information they need. And then I’d have to go take go over to another part of the building, take another number Wait, then sit down with a lady that would then look at like what my request is, she would then approve it. And then I had to go back around to another spot where I would pick another number, wait, and then pay for it. And you know, that’s a complicated situation, right? It’s more complicated, because when you walk in the like, the reception and the security guard don’t actually know what you’re supposed to do for a parking permit. They tell you to go to floor five, right? And then you got to figure it all right. So I would be I would go with a book, right, like in the old days now on my iPhone, because they would be it would be a long process to get a couple of parking spots.
Mark Moses 17:51
Mm hm. And all those processes just, again, they they evolve out of decisions made from the past, there’s rarely, rarely significant reviewed to those processes, and they just kind of layer on, it’s like, somebody says, Oh, we should collect this information. So then they revamp the form and collect another piece of information from you. But and, and internally, me I’ve been in discussions about, but what about the customer experience? How does the customer you know, what happens when the customer calls in? And how many places do they have to go? And so, I mean, believe it or not, these discussions do take place, it’s just very difficult for them to get traction every once in a while a city will pull it off. And they’ll they may be designing a new permit center, and they may actually design a one stop shop. And in give you a little better experience. I’ve been in a couple cities like that where I was pleasantly surprised when I went to get my own residential permit that how easy it was and they so somebody thought that through there but but that’s not common. What’s more common is layer upon layer of procedures that are really all driven by internal considerations and, and boundaries between internal departments that that no one should really have to be, you know, figure out yet you do in order to navigate through the system. Yeah, no, absolutely.
Greg Owens 19:28
So Mark, why this book at this time in your career?
Mark Moses 19:34
Well, I was extremely frustrated with how much time is is spent wasted. Talking about things as if they’re going to improve a city’s financial position, yet do not really address the the central drivers of the city’s financial situation. And I think some of it, there’s probably a deeper conversation here. But just to allude to it, some of it, I think, is this, the fact that you’re in a political environment. And so that’s definitely going to color everything that that happens. So there’s there’s definitely this world of political perception. And then you’ve got a real reality of, you know, the financial, at least the financial reports have very specific rules, not a lot of flexibility, how you report things, they’re not malleable, they’re either there’s, there’s a structure and standards to how financial reporting is done. And then there’s, there’s, there’s also the reality of, you can only spend money once you can’t spend it 234 times. And so, you know, those worlds can easily conflict when, when budget is basically a politically driven activity. And yet, you still have to account for everything. And one of my measures is a city’s internal health is done they do they budget, the way they account and account the way they budget. And so is there like a tie? Is there like a link between these worlds?