The Top Four Challenges State & Local Governments Face in 2022

As we start moving towards to a post-pandemic state, we need to prepare for the top challenges state and local governments are facing in 2022. Avenu’s CEO, Paul Colangelo, spends a great deal of time working with government leaders across the country and has a keen understanding of the challenges that lie ahead.

Learn more about the insight Paul has gained and shares from a recent interview.

What are common challenges being faced by state and local governments today?

1. Human Capital

Finding people with the right skill set to replace an aging workforce is one of the biggest problems in our industry. In many cases, state and local governments have more jobs than applicants. There is a rising number of employees who are retiring or approaching retirement and the baby boomer population is far larger than the younger generation behind to replace it.

Viable strategies for the government sector include competing with the private sector for talent and to consider looking outside their local geography.  Replacing employees who hold critical institutional knowledge requires finding people with the right skill set and ability to learn versus having tenured experience. Of course, this means providing a stringent program that thoroughly educates, trains and equips them to be successful in their role.

Both strategies require preparing for a hybrid or remote workforce. COVID-19 forced people to adjust to working remotely, but as we transition into a post-pandemic state, much of the workforce has preferred the hybrid work model. The pandemic ushered-in the remote workforce and leaders understand that it is here to stay. While the pandemic imposed the remote or hybrid economy, it was going to happen anyway with technology enabling this capability.

The good news is that numerous studies show that remote workers are more productive. According to a survey by Airstriker, researchers found that on average, telecommuters “worked 1.4 more days every month, or 16.8 more days every year than people who worked in an office. The study found that working from home not only benefits employees by eliminating their daily commutes, it also increases productivity and leads to healthier lifestyles.”

2. Digital Transformation

Much of government is still weighed down by paper and by antiquated processes that are not efficient for their staff nor convenient for citizens. Part of the challenge posed by the coronavirus pandemic was its impact on workflow. Social distancing regulations and health concerns shut down government offices and interrupted daily operations. Almost overnight, governments had to adapt to a remote workforce needing digital access to documents, databases, and vital IT infrastructures.

That’s why building a crisis-resistant digital government makes a difference. First, government agencies must have a digital strategy. Those that had a strategic plan in place for shifting to, implementing or expanding digital operations could effectively adapt to the challenges of COVID-19

Digital workflows and storing documents electronically save employees time to access what they need to do their job and enables government employees to track a project’s progress, automatically notify the correct people once a milestone is reached and create reminders, so tasks are not stalled due to interdepartmental miscommunication. Digital forms, filled out by the public and employees, automatically populate databases with information, reducing the need for manual data entry.

Digital transformation also let’s organizations better serve their constituents by providing them with 24/7 access to information and forms that they can complete when and where convenient for them. Citizens are accustomed to intuitive and efficient services they receive from the private sector and expect from their government.

3. Alternative Sources of Revenue

Governments are responsible for providing vital services to their constituents and being good stewards of the taxes they legislate and are challenged with looking for alternative sources of revenue. Often times, through compliance and auditing, and through more efficient tax/license administration programs they can find the additional revenue simply by collecting taxes that are being underpaid. Across the country, local governments have found that automation could provide a much-needed boost in efficiency, and even unlock hidden revenue. That’s because automation can transform costly, time-consuming, and error-prone manual labor tasks, like data entry and paper filing, into quick and efficient automatic processes

In today’s world there is data mining software and web-crawler technology that helps perform gap analysis between current revenues in specific tax base against total revenues owed in addressable market. Automated tax and license administration programs makes it easier for businesses to pay their taxes and reduces human error on how much they owe. Compliance and auditing programs can also uncover taxpayers who are mistakenly underpaying as well as discover businesses who may not be paying at all or may be paying the wrong jurisdiction. Certainly, business licenses and short-term rentals are very popular areas that many governments are focusing their efforts, but it is important for officials to think outside the box and look at every type of local tax that is collected.

4. Increase Citizen Engagement

In 2020, it was vital for governments to focus on the essential services that citizens needed. Now that we are rounding the corner from the pandemic, it’s important to increase the ways and frequency that we engage with citizens. Technology and social media are great ways to connect with citizens and promote community programs and activities.

What do you see on the horizon that state and local governments should prepare for or get excited about?

Ransomware is increasing at an alarming rate and cybersecurity is a critical topic that needs to be addressed in all organizations. It is important not only to secure and protect your data and infrastructure, but it is also necessary to have a disaster recovery plan in place and ready to go should something happen. If you wait after the fact, it’s too late.

The pandemic taught everyone many lessons on how to evaluate business operations, managing work/life balance, and how to prepare for unexpected disasters. I think reinventing the workforce is not only something governments are embracing but something that we will find great benefit in as we tap into a wider array of talent.

Looking at ways to connect with constituents and increase citizen engagement more broadly is something we must embrace, and the way technology is evolving certainly makes it easier to meet the expectations of modern citizens.

And of course. undergoing digital transformation. This will help governments execute their mission and provide services more efficiently, transparently, and cost-effectively. It’s a win-win for government and the people they serve.