Doing Nothing is Costly

We’ve been discussing the “Do Nothing Council” (DNC) and how little they've done since taking office four months ago. Not only have they not introduced a single new or innovative project or idea, they failed to make progress on nearly all of the dozens of projects they inherited from the previous Council.

It’s not merely distressing to look at how little they’ve done, it’s important to realize that doing nothing can be expensive.

“Not only is nothing free, it turns out that even nothing costs something. Worse than that, nothing could be the most expensive thing you ever do. Or perhaps I should say, don’t do.” - Steve Keating.

Let’s look at some real-life examples of how the DNC is costing the taxpayers an enormous amount of money. Before we do that, let’s look back at last year and see how much money the previous Council saved.

• ALTON BOND. By deciding to pay off the Alton Parkway bond early, we saved the city $1,000,000 in interest payments.
• INTEREST INCOME. By revising the ways we invested our money, we earned $500,000 more in interest income.
• RAILROAD PROPERTY. By selling an unused and unsightly piece of property near the Railroad tracks we earned nearly $900,000.

All told, in 2018 along with Tom Cagley and Leah Basile we helped save the City more than $10,000,000. But it didn’t happen by doing nothing. Had we done nothing, none of these savings or increases in revenue would have happened. For example –

• The bond was sitting there for years. In my discussions with Keith Neves I wanted to come up with some ways to save money and he suggested we pay off the bond. I brought it to the Council and we got it done. But without the instigation, it never would have happened.
• Every month when I saw that we were earning less than 1% on about $100,000,000 we had invested I couldn’t understand how I was able to earn 2% and the City earned less than 1%. So I convened a subcommittee, we revised the rules, and our interest income tripled.

These savings don’t happen by chance and they don’t happen by doing nothing. So the City is $10,000,000 richer because Tom, Leah, and I were active in seeking solutions and making progress.

“I don't believe in a fate that will fall on us no matter what we do. I do believe in a fate that will fall on us if we do nothing.” ― Ronald Reagan

By doing nothing we would have lost the opportunities to gain more than $10,000,000. But the truth is that doing nothing is more insidious than that. Not only do you miss the opportunity to gain, you can actually lose. Let’s look at some real-life examples.

• CIVIC CENTER. When Tom Cagley and I left office the Civic Center was on time and on budget. Though the project is still on budget, the opening has been put back 3 months. At a cost of nearly $100,000 per month for rental payments, that means the City is going to spend an additional $300,000 we didn’t budget for.
• HOMELESS. Six months ago at my suggestion we engaged a social service agency to handle the homeless. They’ve been working alongside our Homeless Liaison Officer and I did research which clearly shows that the social service agency provides more coverage, gets better results, and costs $20,000 per month less. But this Council has yet to discuss the transition.
• PARKING ENFORCEMENT. In 2018 we added a parking enforcement officer and we doubled our tickets and towing. But the costs of parking enforcement through the Orange County Sheriff’s Department (OCSD) is enormous – over $200,000 per year per officer. Because of this cost, many cities use civilian enforcement, which generally costs half of what it costs to provide Police officers. We spend nearly a million dollars a year on our traffic and parking enforcement. A switch to civilian enforcement might save between $250,000 and $500,000 a year. But nothing has yet been done to develop an RFP to study this issue.
• FEE SCHEDULE. The much needed fee schedule study has yet to emerge, meaning we will probably not meet the desired goal to thoroughly evaluate this program prior to opening the Civic Center. That means we are charging for services based on a fee schedule which is 10 years old. Loss to the City is probably $500,000 per year.
• STREET SWEEPING. A joint street sweeping program with Mission Viejo could save us $50K a year, but it’s been pushed back for more than a year. We could have renegotiated our street sweeping contract from 52 times per year to 39 times per year and saved $50 to $100K per year, but the Council put this off until mid-2020
• PERFORMING ARTS CENTER. The much needed Performing Arts Director position has yet to be filled, meaning we will miss out on hundreds of thousands of new income.
• POLICE SERVICES. Analyzing the results of the multi-city study to reduce the costs of Police services while maintaining the existing quality could save us untold millions of dollars per year, but has yet to be discussed.

These are only a few examples of how doing nothing costs us money.

“The first step for everyone involved is to understand why doing nothing costs so much.” - Dr. John Sullivan

Some of these costs are one-time costs and others are recurring costs. The extra rental costs ($300,000) are non-recurring, and the costs for failing to have a new fee schedule ($250,000) and the delay in appointing a Performing Arts Director ($250,000) will (hopefully) become non-recurring. But if this Council continues to do nothing, then the extra costs of street sweeping ($200,000), working with the homeless ($240,000), and changes to OCSD ($500,000) will be annual losses. That’s $800,000 in one-time costs and $1,000,000 in annual costs. These figures are only estimates, and the real figures may turn out to be more or less. But any way you look at it, we are losing a lot of money as a result of this Council’s inability to do anything.

“It often feels easier to make no decision than a difficult decision. To maintain the status quo vs. shake something up. To stay the same vs. make any kind of change. It’s easy to pretend doing nothing is the safer path. The easier path. The less expensive path. The least risky path. But oftentimes, doing nothing is far more costly than making a change.” - Matt Heinz.

For years City Councils in Lake Forest did nothing. For a brief shining moment we demonstrated that an active Council could not only improve our quality of life, the City could profit handsomely. Now, here in 2019, we have slumped back into the do nothing mode.

ABOUT THE AUTHOR

Dr. Jim Gardner was on the Lake Forest City Council from 2014 to 2018 and Mayor in 2018. Under his leadership the City became the first debt free city in the U.S. with a population over 25,000 people and the first city to live broadcast City Council meetings that allowed residents to participate online (Click Here). Dr. Gardner is one of the organizing members of Lake Forest Community Action Network. You can check him out on LinkedIn and/or Facebook and you can share your thoughts about the City at Lake Forest Town Square on Facebook