Facts
The United Operations Association (UOA) is a non-profit organization funded via contracts and membership dues received from the parent organization, The American United Operations Association (AUOA). The parent organization receives allocated funds from the United States government. It appropriates them through national agencies of the federal government, namely the United States Department of Agriculture (USDA) and the Environmental Protection Agency (EPA).
The AUOA relates to the state chapter of the UOA through cost-reimbursement contracts. These are multiple-year contracts that are reviewed on an annual basis for renewal purposes. The state chapter of the UOA maintains monthly logs that outline details of employee activities in the provision of contract-mandated services to state constituents. These logs are the basis for the justification of all cost reimbursements. The state UOA is required to raise and justify cost reimbursement logs that can amount to but not exceed the total amount appropriated by the national parent organization. If expenses exceed the contractual amount that is approved by the AUOA, they are dealt with at the cost of the state organization.
On the contrary, any amount that is not expended during the allocated contract period is deducted from the approved contract of the following year. Additionally, if a specific national agency administering the agreement fails to reimburse the parent organization, the state organization automatically fails to receive reimbursement. Nevertheless, in spite of this, the state organization is required by contract to continue fulfilling its obligations as mandated by the warranty.
Issues
The primary issue facing the state organization is the delayed disbursement of funds by the administering national agencies despite approval by Congress. This delay resulted from policies set in place by the administering agencies. Owing to its contractual obligation to continue carrying out its duties despite delays in funding, the state UOA covered the balance using credit facilities provided by the local bank, First National. The basis of the goodwill from the bank was that federal funding would eventually be disbursed and that it was also covered by a binding contractual agreement between the state organization and the national organization.
The National UOA had offered to loan the state UOA the deficit at an interest rate of 1% on condition that the state UOA provided detailed authorizations and financials every month. However, despite the state UOA adhering to these conditions, the national UOA found a reason to not disburse the funds to the state UOA. The local bank, therefore, remained the key source of supplementary funding for the state organization. The grant from the local bank presented a financial burden but ensured that the state UOA met its contractual obligations.
This arrangement was able to bail out the state UOA, but once the other programs began falling back in contributions, it grew to become a strained relationship with the local bank bouncing checks written on the UOA account. These events started a chain reaction in which insurance policies were canceled, supplies that were ordered were not fulfilled, office equipment was threatened with repossession, and employee payroll was put at risk.
Actors
The national UOA is the parent organization under which the state UOA operates. Therefore, the National UOA could provide the state UOA with the necessary funding to cover its deficits at a prime rate of 1%. This would enable the state UOA to continue meeting its obligations without experiencing financial burdens.
The local bank, First National, provided credit facilities to the state UOA enabling it to continue carrying out its obligations temporarily. However, once the contributions of other agencies began falling back as well, the relationship became strained, and the bank severed ties with the organization sending it into a crisis.
The administering agencies that were responsible for disbursing the funds allocated by Congress put in place a new set of policies that saw them fail to administer and disburse funds to the UOA. This forced it to seek alternative sources of funding to ensure that it met its contractual obligations.
Ted Jacobs’ congressional delegation was influential in pushing for the allocation and disbursement of funds to the state UOA. Through his contacts in Congress, Ted Jacobs was able to make principal parties at the national agencies to set in motion the process of releasing funds; therefore, the financial crisis was temporarily alleviated.
The state UOA board had the critical role of ensuring that the necessary funds were received. The board also had the responsibility of diversifying the organization’s sources of funding. Ted Jacobs questions how well the board members met their fiduciary responsibilities during the crisis and wonders whether they fulfilled their role in helping to find philanthropic public and private sources of funding as the organization had almost collapsed.
Application of Core Concept
The core concept addressed in the case study is the need for efficiency in the funding of public institutions as a pillar of efficient public administration. Efficient public administration ensures that it creates institutions and organizations that are predictable, stable, and flexible to react appropriately to challenges while ensuring the efficient delivery of services to the public.
The state UOA lacks these core concepts of public administration and falls into a financial crisis that almost leads to the failure of the organization. Although the situation is salvaged owing to congressional intervention, the damage dealt is too costly. The organization’s reputation is destroyed, and relations with its local financiers and stakeholders such as suppliers are strained.
Alternatives
Adoption of a mission-driven organization model
This is an effective alternative to the bureaucratic hierarchy organization model, which is an ineffective organizational strategy (Stout and Love). This can be achieved by flattening out the organization to reduce hierarchy, which results in a delay in the release of funds. More powers should be allocated to the national UOA to remove the reliance on the national agencies. This will shorten the process of releasing funds and limit it to an organization dealing with the specific field of public service provision.
Introduction of objectivity and inclusion in public policymakingpolicymaking
Objectivity will ensure that the policies put in place align with the objectives of the organization (Stout and Love). This will be achieved through the inclusion of stakeholders in the decision-making process by considering their input and opinions. State UOAs should be involved in designing policies that affect their operations, especially concerning funding, administration, and contracting.
Diversification of sources of funding
The state UOA needs to create partnerships with local stakeholders in their field of operation. Both public and private partners are important to ensure that the organization distributes its risk and reduces its dependence on funding from the national government. This will be done through the introduction of key performance indicators into board members’ contracts requiring them to bring on board at least one partner, individual, or organization.
Decision
The best alternative would be the introduction of objectivity and inclusion in public policymakingpolicymaking. The main reason behind the delays in receiving allocated funds was the introduction and adoption of new policies by the national agencies. These policies resulted in a break in the seamless flow of funds from the national government to the state UOA. This is why it was easy for Ted Jacobs’ congressional delegation to push for the release of funds.
The introduction of objectivity and inclusion into public policymakingpolicymaking will consider the critical input of stakeholders in the specific field when making decisions (Stout and Love). Inclusion ensures that the process of funds disbursement is timely and that funds are allocated where they are most needed. It will prevent wastage and also under-utilization, therefore, bringing more efficiency into public administration. Thus, the state UOA will become more stable, more efficient, and flexible enough to deal with its challenges.
Implementation and Its Obstacles
The process of introducing objectivity and inclusion in public policymakingpolicymaking will be implemented by constituting a policymakingpolicymaking body mandated by Congress. The body will be composed of representatives drawn from stakeholders of the organization. These will include board members of the UOA, congress representatives, and representatives of national agencies. Members of this body will be required to come up with policies while in consultation with the parties that they represent to ensure inclusion.
The major obstacles in implementation would be getting approvals to constitute the policymakingpolicymaking body. It would be a major challenge convincing the current stakeholders to abandon the current organization structure and adopt the new one owing to the bureaucratic model currently in place. Additionally, the involvement of several stakeholders and the consultation process may result in delays in arriving at a common decision that is acceptable to all parties when creating a policy (Crosby et al.).
Works Cited
Crosby, Barbara C. et al. “Public Value Creation Through Collaborative Innovation.” Public Management Review, vol 19, no. 5, 2016, pp. 655-669. Web.
Stout, Margaret, and Jeannine M. Love. “Integrative Governance.” The American Review of Public Administration, vol 47, no. 1, 2016, pp. 130-147. Web.