How one city is looking to future-proof its budgeting process

“It was a Wednesday evening at nine o'clock [and I was standing in] the frozen food aisle of my supermarket,” recalls Ron Holifield, interim executive director of the Alliance for Innovation, a nonprofit association of local governments. On the phone was David Cooke, city manager of Fort Worth, Texas, and he had just come out of a budget meeting. “He said to me, ‘We really don’t know how to make great budgets or make the best use of data.’ He was talking about Fort Worth, in particular, but also local government in general. He went on and said, ‘Well, I want Fort Worth to become the model for how to use budget and research and data analytics in the country, and I want you to help me figure out how to do it.’”

Not long afterward, the Alliance of Innovation connected Cooke and his team with innovative thought leaders in the field of budgeting and data analytics. Today, they are busy trying to make Fort Worth a national model in these areas through an effort called the Fort Worth Lab.

As Cooke told us, “We need to go at it, to have a long-term perspective, use data in analysis, and then allocate scarce resources to create the best outcomes from a public policy standpoint.”

The initiative, although still relatively new, is already helping Fort Worth officials make thoughtful budgeting decisions. For example, one of the city’s major goals is to improve public safety. That’s particularly important, Cooke says, as it currently has higher than national averages for both property and violent crimes. “So, when we think about safety we may think about more cops,” he says. “But if you have a city with an inventory of 80,000 streetlights and 50,000 of them are out, then that leads to criminal activity. But with the data we’re collecting, we know where all the violent crime is occurring and can increase the streetlight inventory, which may be more help and less expensive than hiring more police.”

Budgeting is essentially a planning process, and the need for superior long-term planning is abundant in Fort Worth. Its population grew by about 19,000 people between 2021 and 2022 to 957,000, making it the fastest growing city in the nation. “In five years, we’ll have added 100,000 people. And we need to build that into our capital and operating planning, especially for infrastructure,” says Cooke, detailing the planning, permitting and construction timeline. “That’s a four-year process in most places, and that stuff can sneak up on you.”

The city is moving along on eight different fronts over the next two years, which is the civic equivalent of former President John F. Kennedy’s 1961 vow to land a man on the moon in a decade. The eight fronts include implementing priority-based budgeting; improved use of data analytics and benchmarking; comprehensive planning; a strategic investment plan and bond program; departmental strategic planning; “sunrise” reviews; use of Lean Six Sigma principals; a Government Finance Officers Association Rethinking Budgeting fellowship; and strategic foresight studies done with the aid of futurists.  

An undertaking of this magnitude will be tough to pull off. But the city’s leaders make a good case that it’s got a shot for two reasons: The city has an unusually collaborative ethos, with the city council and the city manager working closely together. And Fort Worth has a running start thanks to many years in which it has carefully gathered data about many of its activities, so it is well positioned to begin using it more effectively.

Phase one of the project involves three departments: police, human resources and transportation and public works. These were selected, according to Cooke, in large part because “they are well positioned from a data collection standpoint. All three collect a lot of data.”

Equally important, the three departments were game for this kind of major undertaking. “We didn’t want to force this on anyone,” says Cooke, who is already considering the water department and libraries for the second phase of the initiative using the lessons the city has learned from the previous one.

Of course, not all agencies are jumping with excitement about the potential of this effort, and since the city wants to tackle the departments that have the greatest chance of success first, those agencies will be put on the backburner for now. The fire department, for example, may be one of the toughest nuts to crack. “So many changes have occurred in the universe, and I don’t think we’ve ever impacted the fire department,” says Cooke. “We still build fire stations. We put fire trucks in them, and we have people called firefighters. Yet the workload that is related to putting out fires is less than 3% of the calls that come in. But we don’t organize it that way because they’re not the most interested in change, and you have a collective bargaining unit, so some of the items that need to be changed may require going back to the table with the union.”

All of these initiatives are being advanced under the leadership of the city’s Interim Chief Transformation Officer Mark McDaniel, who took the position in February. He developed the Fort Worth Lab’s eight initiatives, which were approved by Cooke and presented to the city council in May. “It happened very quickly,” McDaniel says. “When I came in there was a lack of staff, there were vacancies, and really, we were crippled for a while. But though it’s an uphill climb, we’re ramping up and implementing all these different new components and reinventing the budget and research functions.”

The city has also taken steps to move forward on priority-based budgeting, which makes funding considerations based on individual programs and services rather than allocating cash to whole departments. To facilitate this effort, it brought in the private-sector firm, ResourceX, which is recognized as a pioneer in the field.

Fort Worth will identify the goals of the council and then prioritize projects that fit in with those goals. The city will also measure whether every service it provides is in alignment with the funding it receives and consider enhancing it if not. As Chris Fabian, founder and chief executive officer of ResourceX, says, “I think their ambitions are much grander than most of the clients we have, and we’ve been really impressed by the high level of buy in there.”

So far, Resource X has identified 128 distinct services for this process, with a budget of about $500 million. It has evaluated those programs using hundreds of metrics to show the level of linkage between the services and the council’s goals. This can be a powerful tool in budgeting, but Fabian concedes that it doesn’t “eliminate decisions that are driven by reasons outside of the data we collect, including politics.”

Meanwhile, Fort Worth is working to expand its comprehensive planning, reports McDaniel. “We do a citizen survey every other year, and we’re going to introduce a business survey in between. We’ve just hired a consultant who is going to help us use this information to include robust public engagement in our long-term budgeting plans.”

Then there’s a burgeoning collaboration with the Government Finance Officers Association’s Rethinking Budget initiative to help the city hire interns from local universities to work on different budgeting projects. “We’re working on it,” says Shayne Kavanagh, senior manager of research for the association, “and creating the training curriculum GFOA intends to introduce nationally.” Given Fort Worth’s broader efforts, GFOA selected it to pilot this program and roll out the first internships in the fall.

Will all these efforts work? Even the optimistic Cooke recognizes that they won’t. “Overall,” he says, “some of the stuff that we’re doing is going to stick and some of it won’t. What I hope is embedded in our organization is an ongoing curiosity about improving outcomes for future generations.”