A Calmer Crestwood
Financial problems, political divisiveness, low moral — that was the old Crestwood

by Eileen P. Duggan

March 16, 2007

One year ago, Frank Myers stepped into a political firestorm and a financial quagmire when he started his job as Crestwood’s city administrator. Now he sees a black-ink bottom line, a calmer atmosphere, an energized workforce and a plan for the future.

But Myers is reluctant to take all the credit for the city’s change of direction.

“Being in local government for 25 years, I know that significant achievements are not done by an individual, they’re done by an assortment of people and that’s certainly the case in Crestwood’s turnaround story,” Myers said. “It’s taken courageous political leadership. It’s taken dedication of a challenged workforce.”

Myers said employees have been called upon time and time again to do more with less. He said they have stepped up and achieved phenomenal results.

“It’s taken the commitment of the community to try to get behind its city government by passage of Proposition S and by really enabling the city to begin to heal,” Myers said. “The community has truly allowed us to be successful.”

When Myers took the reins of Crestwood on Feb. 6, 2006, the city was in debt to the tune of a $2 million short-term loan and a $1.5 million line of credit that financed the city’s day-to-day operations. Citizens had lost trust in the city’s administration, igniting a bitter political battle that led to the election of a new mayor and the ouster of the previous city administrator and finance director — three years after the ouster of the administrator/finance director team before them.

Massive budget cuts had resulted in the loss of 23 jobs, salaries that stayed stagnant for three years, and lack of an agreement with the fire union.

Of all the “horrific challenges” Myers faced, his biggest concern was the loss of trust in the professional administration, said Myers. Myers himself had been forced out as city administrator of Matteson Village, Ill., in July 2005 due to warring political factions.

“I’m stepping into a community that really is rebuilding the foundation of trust in local government,” he said. “I’m reminded constantly by situations, circumstances and individuals how sacred a trust we have as public servants and how fragile that trust is. When the community has given its political leadership and its professionals trust, you’re able to have tremendous freedom to do a lot of things. But when that trust is lost, you do have to spend a lot of energy being deliberative at rebuilding that trust. I think we should be rebuilding trust whether we have it or not. We should always be about building trust in government.”

Rebuilding that trust had to begin with the financial situation. Myers started presenting quarterly financial reports at public board of aldermen meetings. As the staff had already been cut to bare bones, Myers found other ways to streamline work operations by combining jobs, eliminating vacant positions and reorganizing departments.

By reorganizing the police and finance departments and municipal court staff, the city is saving $250,000 annually, he said.

“We continue to look at our organizational structure and ways to improve the efficiency and reduce our bottom line,” he said.

The remaining 100 full-time and 11 part-time and/or seasonal employees were given a new challenge: find creative ways to save the city money. Employees offering the best cost-saving ideas would be publicly recognized and win prizes donated by local businesses. Workers began responding immediately, coming up with cost-effective procedures that are saving the city money, a nickel here, a dime there.

After issuing a request for proposals last year, the city selected a new health insurance broker, the Crane Organization, which restructured the employee health and benefits plan to save the city $60,000 last year.

Myers worked with the mayor, the aldermen, a citizens’ group and employees to gain voter approval of Proposition S, a sunseted tax increase designed to pay off the $3.5 million debt. After Prop S passed last April, Myers and his team began a search for a bank that would refinance the debt. Royal Banks of Missouri responded with a proposal to refinance the two loans into one lower-interest vehicle to be paid off in seven years with proceeds from Prop. S.

Over the past few years, the city staff had endured several back audits, including a state audit mandated by a citizen petition. Working with new finance staff and a new independent audit firm, “we have been very aggressive in re-vamping our methods and approaches to balancing our journal entries on a monthly basis,” Myers said.

He has set a target of having only one or two adjusting entries by the auditors, compared to more than 40 in previous years.

“We’ve made great strides in improving the accuracy and improving our accounting systems so that our numbers are, in fact, good numbers,” Myers said.

Based on the staff’s fourth-quarter report, the 2006 actual revenue for the general fund was 105 percent of budget and actual expenses were 96 percent of the budget. The net effect is $1.42 million in the general fund, he said. The routine 2006 independent audit, which began in early March, will provide final financial statements.

“That is simply remarkable for this community,” Myers said. “We have spent less and our revenue performance has been more. We could not have overcome our financial challenges without the passage of Prop. S and the overwhelming support of the community.”

Char Braun, who chaired the Prop. S citizens group, said she thinks Myers is doing “a great job.”

Establishing Trust

Myers also set about repairing the trust between the administration and elected officials. He meets with each alderman every 45 to 60 days to discuss their issues and concerns.

In addition to community and aldermanic support, Myers needed employee support to succeed.

“Morale in this organization was lower than I’ve ever seen anywhere when I stepped in,” he said.

The first step in raising morale was negotiating with the fire department and the board of aldermen to adopt a “Memorandum of Understanding” with the firefighters’ union, the first the city had had since 2001. All employees in all departments received their first raises in more than three years. He began meeting with employees one-on-one “preaching a message of hope,” he said. He worked with them on a strategic plan and building what he calls a “high-performing organization.”

Myers has mobilized the workforce into 24 multidepartmental performance teams charged with implementing a five-year strategic plan approved by the board of aldermen last fall. Through a three-day strategic planning retreat in September, the aldermen developed a 15-year vision for the community, reinforced by five-year goals. Those goals were further refined into a one-year action plan for 2007.

Each performance team reports monthly to Myers, who creates a monthly report to the mayor and aldermen. Myers then holds quarterly rallies to recognize progress and reward performance-team successes.

“I’ve seen the energy level of our workforce elevated tremendously,” Myers said. “We have much greater intergovernmental cooperation.”

“That’s the concept of building a high-performing organization that we’re engaged in here in Crestwood. These business principles are applied by major corporations across the country. It’s proven success, it works. It’s about creating a culture of excellence,” he continued.

The process through which the strategic plan was developed at first raised hackles among some citizens and even aldermen. Myers used executive discretion to approve an unbudgeted $8,000 expense to hire a professional facilitator to conduct the sessions. The board has included in the 2007 budget another session for this year.

Resident John Foote, who has often been a critic of the city’s financial dealings, supports the strategic planning results.

“This decision, backed by the mayor and board of aldermen, resulted in organized working programs to upgrade city infrastructure, promote livable neighborhoods and quality homes,” said Foote.

A member of a citizens’ committee that helped choose Myers, Foote is satisfied with the choice and Myers’ “productive” first year.

“He’s managed to bring the books back into balance; he has straightened out the problems with accounting; he gives leadership and direction to the workforce; and he works very well with the mayor,” he said.

With the first year behind him, Myers is focused on the future: “We have to develop strategies to make Crestwood the community of choice for southwest St. Louis County.”