Problem
During recent times of economic boom and rapid development, public agencies across the country faced increased demands—and revenues—for services. Today, however, as a result of the current economic climate, local governments across Illinois
are experiencing significant declines in revenue sources including income taxes, sales taxes, building permit fees and interest income. With a growing gap between available revenues and increasing expenses, local governments must look at new operating approaches to solve major budget problems and reevaluate operating procedures, staffing levels and how services are provided.

Our Solution
The Village of Lindenhurst adopted several core operating philosophies and practices to guide its new business approach. These include:

• Process and Program Evaluation – Complete a detailed, ground-up review of municipal programs, organizational structure and how programs and services are provided.
• Process Reengineering – Based upon the findings of the operational evaluation, identify areas where processes can be improved and organizational structure changed to be more efficient.
• Consider Privatization Opportunities – Challenge the traditional operating model of hiring in-house municipal employees and consider opportunities for utilizing private sector firms to provide municipal services, particularly for demand-driven services. 
• Develop Long-range Financial Planning and Budgeting – Evaluate inputs (available staff time) versus outputs (actual time it takes to complete desired results) to determine needed staffing levels. In-house staff positions, service delivery methods and organizational structure should be driven by organizational goals and desired results. 

This new business approach resulted in the following:

• Public Works Department merger saved $247,560 in annual operating expenses. This does not include cost savings associated with reductions in facility needs, elimination of equipment duplications and other improved processes.
• Privatizing fleet maintenance saved approximately $114,810 in annual operating expenses. 
• Privatizing lab services saved $70,912 in annual operating expenses.
• Privatizing utility locating saved $35,220 in annual operating expenses.
• Privatizing building inspection and plan review saved approximately $105,221 annually in operating expenses. 

These initiatives yielded an annual cost savings of $573,723 and will save the Village roughly $2,868,615 over the next five years.

Why This Works
In today’s economic climate, government officials must evaluate operations and find new ways of providing the essential services people expect. With the support of elected officials and top-level management, the Village of Lindenhurst has taken
on a business approach to local government. In the process, the Village has maintained (or improved) services while saving significant taxpayer resources. Over the past two years Lindenhurst has made over $922,000 in operating cuts – 14 percent of its total operating spending – and avoided a 2010/2011 budget deficit of over $600,000 and cut its projected 2010/2011 deficit to $11,911.
Lindenhurst has seen the positive results by taking a new business approach to government and challenging the “that’s the way we’ve always done it” mentality. Other municipalities throughout Illinois facing rising costs and diminishing revenues would do well to utilize similar concepts and approaches.