3---Networking – it builds connections and capacity building which brings stakeholders on board.

How Managerial Networking Can Improve City Budgetary Solvency

Managerial networking can help improve city budgetary solvency through a number of mechanisms. First, networking allows the diffusion of innovative policies or approaches to organizational problem solving and service delivery (Hicklin, O’Toole, and Meier 2009; Journal of Public Administration Research and Theory, 2017, Vol. 27, No. 3 453 Johansen and LeRoux 2012; Meier and O’Toole 2001; O’Toole and Meier 2004a, 2004b, 2006). Information about strategies that worked in other local governments or nonprofit organizations can help city managers to respond quickly to a budget crisis and avoid costly policy experimentation. For example, managers can learn from officials in neighboring local governments or managers from nonprofit service providers about new methods to increase the efficiency of service delivery, different mechanisms for charging for services, and other means of reducing expenditures that preserve their organizations’ ability to fulfill their service responsibilities. Additionally, contact with private financiers such as banks can facilitate access to information about new debt instruments or opportunities for debt refinancing at lower rates. Second, networking can help managers access the implementation and service capacity of external stakeholders (Meier and O’Toole 2010). Networks enable the pooling together of skills, institutional capacities, and financial resources of numerous organizations (Agranoff 2006; O’Toole 1997). External organizations can be mobilized to co-produce public services, reducing the pressure on city government budget. Service and religious organizations, and neighborhood associations, can supplement city services with programs targeted to their specific clientele. Third, networking can improve local community and state government support for city governments. Through greater engagement with the community, managers can mobilize support for tax increases, develop support for cutting spending for some services, or introduce new modes of service delivery that lower costs, among others. Managerial networking can also help managers to work in coalitions with other managers to advocate for an increase in state aid (Meier and O’Toole 2009; O’Toole and Meier 2004a). Fourth, networking can help managers buffer their organization from the effects of budget shocks (Meier and O’Toole 2003, 2009; O’Toole 1997). Managers who successfully develop ties with different stakeholders can protect their organizations from extensive micromanaging especially by elected officials, thus permitting managers to employ different buffering techniques (Meier and O’Toole 2001, 2003). To ensure that that the city government continues to perform its core task of delivering services during periods of fiscal distress, managers can employ buffering techniques including re-allocating budgets from less essential to core programs, controlling use of inputs including personnel, adjusting production based on peak demand periods, and rationing services, among others (Thompson 1967). Fifth, beyond buffering, managers can convince external stakeholders to provide them greater autonomy to implement more permanent organizational reforms. If the fiscal crisis is severe and prolonged, buffering will not be enough to improve fiscal health. Extensive organizational changes might be required including personnel downsizing, departmental consolidations, termination of programs or services, or closure of some facilities. Greater autonomy for managers enables them to carefully plan for these changes using their professional expertise and extensive knowledge of their organization’s strengths and weaknesses as well as clients’ needs (Meier and O’Toole 2003, 2009). Based on the previous discussion, it is expected that: H1: Managerial networking is associated with improving budgetary solvency.