Sharing Management Capacity: Is There a Federal Responsibility?

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F'or local and state administrators the 1980s promise to be a decade of doing more with fewer dollars. In all too many jurisdictions public managers are confronted by growing service needs, diminishing real levels of federal aid, public demands for fiscal restraint, and a rapidly shrinking dollar. Under such conditions, they may feel somewhat like the Red Queen in Alice's Wonderland-obliged to run faster and faster in order to stay in the same place. In these circumstances, effective financial management becomes essential to the maintenance of acceptable service levels. The Financial Management Capacity Sharing (FMCS) program of the U.S. Department of Housing and Urban Development (HUD) is one of the more recent and ambitious federal efforts to assist in the management improvement of state and local governments. The program, established in 1977-78, is one of educational outreach. Through the use of publications, conferences, telephone inquiry services, workshops, and face-to-face consultations, FMCS is intended to help local and state managers adapt workable practices that will improve their financial management systems. This article is based on a two-year assessment of the program conducted by the authors and a panel of the National Academy of Public Administration.' The lessons learned from the FMCS experience are significant to future efforts to improve management capacity at the state and local levels, as well as to the question of the appropriate federal role in providing such aid.