What Happened?
Muskegon, Michigan, is consolidating its municipal building inspection services by outsourcing the activity to a private provider.
The Goal
The Muskegon Lakeshore Chamber of Commerce conducted a shared services study in 2011 that generated about 16 recommendations of where operations could be merged for more efficient operations at a reduced cost. One such suggestion centered around the consolidation of municipal building inspections – but the localities in Muskegon County were unable to devise a plan that was efficient and affordable.
SafeBuilt, a private building inspection provider, offered Muskegon and many its member municipalities the ability to outsource the task. By expanding into a variety of inspection services, the company is able to complete the tasks at a lower cost. Muskego County has since enjoyed:
- Uniform enforcement of regulations
- Cost savings of $115,000 in the first year
- More efficient administrative processes
- Consistent inspection fees
The County is looking into extending its outsourcing contract to incorporate new service offerings that fit with consolidation goals set below.
Starting At The Schools
Muskegon County is no stranger to consolidation strategies. The countywide consolidation study conducted last year also laid out steps for merging together a wide range of school district operations including transportation services and curriculum providers. Combining the services of many providers to the local school district was more than a suggested, as the district is at risk of generating significant debt if spending is not changed. Therefore, the 11 school districts were instructed to operate the following tasks jointly:
- Human resources
- Human resource managers
- Business services
- Payroll
- Purchasing and accounts receivable
- Invoicing and accounts receivable
- Banking, investment and cash flow management
- Grant management and financial projections
- Curriculum and instructional services
- Technology services
- Transportation
- Maintenance
- Custodial and grounds keeping
- Cafeteria operations
- Board policy services
- Student data collection and analysis
The study recommended school leaders develop three and five-year plans for adopting cooperative services and ensuring quality is not sacrificed for efficiency. Because the schools would only be consolidating nonacademic services, each institution could maintain its individual identity at the student and faculty levels.
The County had more casual consolidated services in place among its school districts in the past. For example, districts were sharing special education supervision, installation of fiber-optics networks, administrators, substitute teachers, bus drivers and several third-party contracts.
Nothing quite as formal and structured as is recommended by the study, however, had been implemented. In creating a more widespread adoption of consolidated services, the school district could enjoy more significant savings, as well as improvements to operational efficiency.
The County opted to handle the consolidation initiative at the local, district-level rather than rely on state-level officials to determine the contract’s fine print. The greatest challenge facing school district leaders is determining which services can be shared between without running the risk of overloading staff with responsibilities and workload.
Sharing The Load
Gov1 has conducted research into shared services strategies to identify what works and what falls short in planning and follow-through.