Topic: Statesmanship in the Public Administration Context

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CHAPTER 3

The Interorganizational Context of Public Administration

 LEARNING OBJECTIVES

1. Understanding the relationships among the many groups—public, private, and nonprofit—that drive the effectiveness of public programs and affect the work of the

public manager

2. Learning about the federal system of government and the complexities of intergovernmental relations that result from federalism

3. Understanding how the relationship and power division between federal and state governments has evolved

4. Exploring the issues associated with privatization and contracting and public-private partnerships

5. Understanding the unique challenges of nonprofit organizations

 SUMMARY OVERVIEW

This chapter is concerned with relationships among public-sector organizations, an issue that has

become an increasingly important focus for public administrators at all levels. Given the

complexity of modern society, the work of a public administrator likely will involve an intricate

set of relationships with a variety of groups external to the administrator’s own agency, including

public, nonprofit, and private organizations. The chapter includes a comprehensive discussion

about the concept of intergovernmental relations (IGR), which the authors define as “the complex

and interdependent relationships among those at various levels of government as they seek to

develop and implement public programs,” and federalism, which is the relationship and division

of power between the federal government and state governments.

This discussion addresses the changing patterns of funding for public programs, which is

instrumental to an understanding of intergovernmental relations, and touches on the various

approaches to federalism that have been employed in the United States. This includes a

description of how recent presidential administrations, from Reagan to Obama, have approached

the relationship between the federal government and the states, and offers insights into the courts’

influence in this area as well. This chapter also addresses IGR from the perspective of states and

localities, including funding and the use of preemptions and mandates, and includes a discussion

of subnational relationships, including state-to-state, state-to-local, and local-to-local.

This is followed by an examination of the relationships between governmental and

nongovernmental organizations in the public sector, highlighting the role of the latter in the

policy process. As the authors note, not only have nonprofit, for-profit, and faith-based

organizations taken a leading role in delivering public services, they also play an important part in

bringing issues to the public agenda and influencing decisions about public problems. An

important theme running throughout this discussion concerns a description and an evaluation of

30 Chapter 3: The Interorganizational Context of Public Administration

Copyright © Cengage Learning. All rights reserved.

privatization and contracting and public-private partnership trends. This includes an exploration

into the rationale for these approaches and the challenges and benefits associated with each.

The chapter concludes with a consideration of the management of nonprofit organizations.

Because these organizations face distinct challenges, and because they play an increasingly

important role in defining and delivering public programs, an understanding of the way in which

these organizations operate is important to the public administrator in order to develop more

effective interorganizational or cross-sector relationships. In closing, the authors note that

because public programs in today’s society operate through vast and complex webs of people and

organizations, including public, private, and nonprofit, public managers need to develop the

ability to identify the network of people and organizations that is or should be involved in a

particular situation and assess the effectiveness of that network. Understanding how the various

people and organizations operate is a key to this ability.

 CHAPTER OUTLINE

 Exploring Concepts: NETWORKS AND NETWORK MANAGEMENT

I. THE DEVELOPMENT OF INTERGOVERNMENTAL RELATIONS

A. Dual Federalism

B. Cooperative Federalism

C. Picket-Fence Federalism

D. The Reagan and First Bush Years

E. The Clinton Presidency

F. The Bush Administration

 Exploring Concepts: TRANSFORMATION OF GOVERNANCE:

GLOBALIZATION, DEVOLUTION, AND THE ROLE OF

GOVERNMENT

G. Obama and Federalism

H. Judicial Influence

I. The State and Local Perspective

J. Funding Patterns

K. Preemptions and Mandates 1. Preemptions 2. Mandates

L. Subnational Relationships 1. State to State 2. State to Local 3. Local to Local

II. WORKING WITH NONGOVERNMENTAL ORGANIZATIONS

A. Privatization and Contracting

 Take Action: TAKING CONTRACTING SERIOUSLY

Chapter 3: The Interorganizational Context of Public Administration 31

Copyright © Cengage Learning. All rights reserved.

III. THE MANAGEMENT OF NONPROFIT ORGANIZATIONS

A. Operational Leadership

B. Resource Development

C. Financial Management

D. Board Governance

E. Board-Staff Relations

F. Advocacy

IV. SUMMARY AND ACTION IMPLICATIONS

 KEY TERMS

Block grants Grants in which the money can be used for nearly any purpose within a specific

functional field.

Capital grants Grants for use in construction or renovation.

Categorical or project grants Grants requiring that the money may be spent for only a limited

purpose; typically available on a competitive basis.

Charter Local government’s equivalent of a constitution.

Cooperative federalism Greater sharing of responsibilities between federal and state

governments.

Coproduction Using volunteer activity to supplement or supplant the work of government

officials.

Councils of government Oversight bodies representing various localities to help coordinate

local affairs.

Cross-cutting requirements Rules that apply to most grant programs.

Dillon’s Rule Municipalities have only those powers granted in their charters; cities are creatures

of the state.

Direct orders Requirements or restrictions that are enforced by one government over another.

Dual federalism Pattern in which federal and state governments are struggling for power and

influence with little intergovernmental cooperation.

Entitlement grants Grants that provide assistance to persons who meet certain criteria.

Formula grants Grants that employ a specific division rule to indicate how much money any

given jurisdiction will receive.

Franchise Exclusive award to one firm (or a limited number) to operate a certain business within

a jurisdiction.

Grants Transfers of money (and/or property) from one government to another.

Home rule Provision allowing cities greater autonomy over local activities.

Intergovernmental relations A term encompassing all the complex and interdependent relations

among those at various levels of government.

32 Chapter 3: The Interorganizational Context of Public Administration

Copyright © Cengage Learning. All rights reserved.

Interorganizational networks Pattern of relationships within and among various groups and

organizations working in a single policy area.

Mandate Order requiring a government to do something.

Negotiated investment strategy Bringing together representatives of all affected groups to set

priorities for funding.

Operating grants Grants for use in development and operation of specific programs.

Picket-fence federalism Pattern of intergovernmental relations in which the horizontal bars

represent levels of government and the vertical slats represent various substantive fields.

Preemption Federal government efforts to preempt an area traditionally associated with state

government.

Privatization Use of nongovernmental agencies to provide goods and services previously

provided by government.

Revenue sharing Grant pattern in which the money can be used any way the recipient

government chooses.

Special districts Local governments created for a specific purpose within a specific area.

Supply-side economies Argument that decreased taxes and government spending will stimulate

capital investment and economic growth.

Urban renewal Government program designed to provide cities with money for public housing

an urban redevelopment.

 WEB LINKS

The following are links to basic information about federal-state-local interactions:

USA.gov: (www.usa.gov).

The White House: (www.whitehouse.gov).

Governing magazine: (www.governing.com).

The following are links to data related to federal funding for state and local governments:

Statistical Abstract of the United States: (http://www.census.gov/compendia/statab/).

Office of Budget and Management: (http://www.whitehouse.gov/omb/budget/Overview//).

The following are links to information about innovative practices in government and

nonprofit organizations:

Alliance for Innovation: (http://transformgov.org).

Ash Institute for Democratic Governance and Innovation, Harvard University:

(http://www.ash.harvard.edu/).

Leader to Leader: (http://www.hesselbeininstitute.org/).

The following are links to information nonprofit management:

Aspen Institute: (www.aspeninstitute.org).

Hauser Center for Nonprofit Organizations, Harvard University: (www.ksghauser.harvard.edu).