The definition of insanity is doing the same thing over and over and expecting different results.

I sat through part of the District 8 Community Meeting on the Budget Monday night. I was surprised at the media coverage (four channels were there, I think), but as Lloyd LeCuesta pointed out to me, it was the first community meeting following the City Manager's release of her Preliminary Budget Reduction Proposals.

As advertised, San Jose's budget situation is much like last year, and the year before that, and the answer is still the same: budget gaps can only be closed with service cuts or tax increases. The proposal this year is a doozy:  eliminate nearly 900 positions, most of them occupied. Chop 160 sworn police officers and 86 sworn positions in the Fire Department. Close branch libraries four days per week. Close twenty-one community centers. Reduce park maintenance and service. Kill Christmas in the Park...the list goes on and on.

The proposal also includes some significant legerdemain. The proposal saves Office of Cultural Affairs staff jobs by "[reallocating] 1.30 positions in the Arts Program from the General Fund to the Transient Occupancy Tax (TOT) fund."  It also eliminates the Healthy Neighborhoods Venture Fund (HNVF), moving the $10 million in ongoing tobacco settlement income to the General Fund, taking food out of the mouths of seniors to close the budget gap caused by burgeoning pay and pension requirements (wave bye-bye to the $670,000 HNVF Senior Nutrition Program). Ah, the magic of fund accounting at work!

It reminded me of an article on governmental budgets that someone sent me a while back. The gist of the article is summarized in a chart from The Price of Government: Getting the Results We Need in an Age of Permanent Fiscal Crisis by David Osborne & Peter Hutchinson (New York, Basic Books, 2004).

The Old Budget Game versus the New Game

 Old Budget Game versus the New Game

	Cost/Agency-Based Budget	Budgeting for Outcomes
Starting point:	Last year as the base “entitlement.”	Price of government: how much citizens are willing to spend for services.
Focus:	Add or subtract from base	Buying results that matter to citizens from competing offers.
Addition:	Autopilot increase = new base entitlement..	Since there is no base, there is no adding and subtracting.
Subtraction:	“Cut” from new base.
Submission:	Justification for needs and costs, plus extra.	Offer to deliver results at the set price.
Incentives:	Build up cost and make cuts hard.	Produce the most results that matter, at a set price.
Analyst’s job:	Find hidden or unnecessary costs.	Validate offers or find better choices.
Elected official’s job:	Choose to cut services or raise taxes, and get blamed (or blame someone else).	Choose the best offers in order to get the most results for citizens at the price they will pay.
Debate:	What to cut; what to tax.	How to get even better results.

© David Osborne and Peter Hutchinson, The Price of Government: Getting the Results We Need in an Age of Permanent Fiscal Crisis (New York, Basic Books, 2004), page 66.

 The article and book essentially advocate the application of zero based budgeting (something used by corporations in trouble) to government. This forces discussions about what services are core, and what are "nice to do, but not required." As the article points out it "is an approach that is based on collaboration, transparency, and delivering the services that matter most to the public....[It] does not enable the players in the budget to become better at the game; it changes the rules of the game."

To cling doggedly to the current process is insane. It's time to try something new.