Motivated by the national economic downturn and Illinois’ fiscal crisis, management of 18 northern Cook County and Lake County municipalities worked together in fall 2010 to develop a new business model, drawn from familiar concepts we’ve known for years – the powers of bulk purchasing, and working together instead of working independently. The administrations work together to purchase shared services and commodities in a concept referred to as the Municipal Partnering Initiative (“MPI”).
There were obstacles in the first year for staff to compromise on service levels, write new bid specifications, and develop a joint bid process with many different opinions and perspectives on how it should be done. However, there was strong management support to overcome these obstacles and eleven construction and public works programs were jointly bid in 2011. The economies of scale translated into savings—achieving between $389,500 and $529,500 in savings in the first year of the program. As important, it allowed administrators to unearth savings in their budgets to plan for additional work and cultivate relationships and sharing of best practices between municipalities.
Once resistant to the fear of the unknown and changing the “way we’ve always done it”, the municipalities witnessed the benefits of the program and the opportunity for more to be done together. The group has grown public works and construction bids with 16 joint projects in 2012 to a total of 23 projects in 2013 with more than 25 municipalities participating (see attached chart). With the concept proven and a strong partnership developed, the communities began to challenge themselves to explore additional areas for collaboration—what else was possible?
The administrators began to discuss other areas for collaboration that could potentially result in savings, reduce duplication of efforts, and bring in a broader group of qualified vendor proposal responses. This open discussion and continued support has led to new initiatives into professional service areas including a Shared Services Information Technology (IT) Assessment and Consortium. If private sector corporations could have consolidated IT environments with multiple divisions and locations all across the world, the administrators questioned what could be done together rather than each municipality having its own separate environment. To learn what they didn’t know, 13 municipalities joined together for a joint IT assessment. Among the many improvements and opportunities identified, the greatest potential for savings was for shared IT operations. A group of communities has proceeded with a Request for Information process to learn how one IT provider could serve multiple communities and leverage those shared efficiencies. Next steps in the process will be to address consolidation of infrastructure and disaster recovery.
Other professional service areas that recently have been sought out together include:
- Inspectional Services RFP: Five communities partnered on an Inspectional Services RFP in early 2013 to attract a larger firm that can provide organizational flexibility to the communities to supplement and staff as workload requires.
- Auditing Services: Six communities participated in a joint RFP for auditing services that resulted in a large pool of respondents and a savings of over $30,000 in 2013 for one community alone.
- AMI/AMR - Meter System: A group of municipalities is preparing an RFP for the joint purchase, installation and shared infrastructure of an Advanced Metering Infrastructure (AMI) to replace current aging meter systems.
The municipalities continue to brainstorm and explore other potential partnering opportunities, including a new initiative to assess and explore fleet shared services.
From the MPI’s experience, the following are important to sustaining and growing a regional partnership:
- Transparency: Transparency and sharing of information is critical in order to monitor value, share best practices, and dispel any misconceptions.
- Teamwork: The MPI is based on partnership, with each community contributing to different projects and sharing ideas and practices to challenge each other’s ways of doing business, with the shared end goal of continuous improvement and savings.
- Leadership: Continued management support and participation is critical, especially as the economy begins to recover and the initial economic impetus to partner fades.
Once thought to be almost impossible to compromise on service levels, develop bid specifications, and coordinate schedules, working together is now becoming the “way we do business” and no program, large or small, is off limits. With this changed mindset and an ongoing successful regional partnership, the opportunities are endless.