You don’t have look very hard to see that the economic situation in the US has not improved. Declining tax revenues sources such as income tax and sales taxes have put most States in budget-slashing mode. The impact has seen 43 States report budget cuts in 2008. Hardest hit areas include sponsorship of public programs and state-run or subsidized facilities such as universities or prisons.

Government Budget Slashing

Heaviest Impacted Areas Include:

  • Public Health Care – 28 States implemented cuts affecting children or low income families health care.
  • Programs for the Elderly or Disabled – 24 States are cutting medical, home care and other services for the elderly or disabled.
  • K-12 Education – 27 States cut aid, resulting in fewer teachers, school days and programs.
  • Higher Education – 36 States cut funding resulting in huge tuition increases and reduction in faculty.
  • Prisons and State Facilities – 31/41 State and Federal prisons systems experienced cuts and 4 more are expecting cuts in the near future.

For some impacted areas the revenue shortfall has been addressed with funds made available from the federal government.

“States also are using funds made available in the federal economic recovery law passed in February to avert spending cuts. The law gave states roughly $140 billion over a two-and-a-half year period to help fund ongoing programs, including K-12 education, higher education, and health care. The money is addressing approximately 30 percent to 40 percent of states’ 2009 and 2010 budget shortfalls, and will be sufficient to offset about 20 percent or less of 2011 shortfalls. In state after state, it is abundantly clear that spending and service cuts in health care, education, human services, public safety, and other areas would have been much deeper had the federal funds not been available.”
Source: Center on Budget and Policy Priorities

Other areas have not been so fortunate. State, municipal and county governments have addressed the crisis with traditional bureaucratic panic instead of the planning needed help minimize future economic crisis. Most state and local governments have chosen to do one or more of the following:

State and Local Government Responses:

  • Reduce staff
  • Reduce or eliminate programs
  • Reduce Benefits
  • Raise taxes
  • Close tax and revenue loopholes

All of the above responses take a very narrow view of looking at ways to balance revenue versus expenses in that they address a revenue solution only. The missing component, as savvy business people will tell you, is addressing the expense portion of the budget through greater productivity and expense efficiencies. Maintenance, repair and operations generally range from 10% to 50% of any particular facility. Expenses include but are not limited to labor, maintenance, energy and parts. If you could cut these costs by 10-25% then fewer people would need to lose their jobs, fewer programs would need to be cut and perhaps taxes would not need to be raised as much.

CMMS Expense Solutions

One of the most cost effective measures a government facility can start is to install a hosted (SaaS) computerized maintenance management software (CMMS) integrated with mobile handheld technology. Ten advantages of a hosted CMMS when integrated with mobile handheld technology include:

  1. Asset tracking – organize and know where all assets are at all times
  2. Work order management – streamline work requests, professionalize scheduling, near elimination of paper flow
  3. 24/7/365 data access – secure online data available anytime, no IT investment needed.
  4. Reduction in reactive maintenance – managing fires instead of reacting to them lowers overtime and other unscheduled labor costs
  5. Increase in preventive maintenance – extend an assets life cycle and lower capital replacement costs, stop avoidable catastrophes.
  6. Inspections – regular inspections will identify small problems before they become major fixes.
  7. Increase life cycle of assets – will delay major replacement costs. Monies can be used to save jobs.
  8. Contract and warranty management – consolidate contracts, manage vendors.
  9. Work order history – be able to identify assets requiring abnormal repair time and costs. Identify cause and solutions.
  10. Lower energy costs – maintaining HVAC equipment properly will increase energy efficiency of units.

How else could you use a CMMS to lower expenses?