The state’s Office of Financial Management in June contracted with 91探花researchers to evaluate the benefits and risks of a possible state cooperative bank. , Evans professor of public policy, is co-principal investigator for the study with , former chief financial officer of Washington Mutual Inc. and an Evans affiliate associate professor. 91探花law professor also contributed, as did Evans School associate professor and Claire Baron, a graduate student in public policy and business.

The report sketches out possible models for a bank to serve cities, counties, public utility districts and state agencies, and explores them from the perspectives of Washington鈥檚 constitutional and statutory framework, capitalization, funding, governance and financial and credit risk.

Marlowe said the report makes no specific recommendations. Rather, it examines issues relevant to the intended purposes of such a bank and offers 鈥渢he best available evidence鈥� for what would be required for it to succeed.

The researchers write that a cooperative bank could improve jurisdictions’ access to funds for infrastructure improvements and broaden their investment opportunities.

Through a survey of Washington鈥檚 counties, cities, public utility, sewer and water districts, the team learned that many, but not all, needs are being met by private financial institutions and state programs. Of those who replied, 46 percent said they were “unsure” they would benefit from public cooperative bank membership, 聽32 percent indicated an interest in membership and 22 percent expressed no interest.

Alternatively, the report suggests, the state might address some unmet needs 聽by improving and better coordinating the 80-some existing financial programs to help Washington jurisdictions, which are administered by the state treasurer and departments of commerce, ecology, and health, among others.

The team presented its report to the state on Dec. 14. The state Legislature is expected to hold hearings on the matter during its 2019 session.

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For more information, contact Marlowe at 206-221-4161 or jmarlowe@uw.edu.

The council was in 1984 by then-Gov. John Spellman to advise the governor on local and state economic conditions as well as national developments that affect state policies, and has been by subsequent Washington governors. Its members also advise the governor on cash management and issuing and managing debt.

“Our main job is to meet with the governor and share our thoughts on whatever questions he would like advice,” Marlowe said. “Most of the conversation happens in the context of the state budget, and in particular the state budget forecast.”

The appointment dovetails with his own research and teaching in public financial management and public-private partnerships, which will continue.

“In fact the council routinely discusses many of the topics that are central to my research agenda,” he said, “such as state and local government infrastructure investment, bond market conditions, and other contemporary trends in public finance.”

Marlowe is the Evans School’s Endowed Professor of Public Finance and Civic Engagement, and serves also as the school’s associate dean for academic affairs. He is the author of more than 50 articles on issues of public finance, including state and local taxes, public pension liabilities, government accounting, public-private partnerships and more.

Marlowe wrote three volumes of a Guide to Financial Literacy for Governing Magazine, designed for newly elected or appointed public officials who may arrive in office knowing little or nothing about public finance. He is also editor-in-chief of the journal Public Budgeting & Finance.

The Governor’s Council of Economic Advisors currently has 11 members. Its members’ terms are at the discretion of the governor. Marlowe’s appointment was effective on Aug. 23 and is of indefinite length.

91探花economics professor emeritus has been on the council since 2011, and ends his term this year. Before him, 91探花economics professor emeritus , now at the University of California, Santa Barbara, served on the council before Bruce.

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For more information, contact Marlowe at 206-221-4161 or jmarlowe@uw.edu.

Marlowe is the author of , his fourth, published in August by Governing magazine.

The was a general primer on public finance, the was about managing a jurisdiction’s financial health and the was an overview of public-private partnerships 鈥� which are called P3s for short. The new fourth volume continues that discussion and is subtitled “Ensuring Public-Private Partnerships that are Built to Last.”

In the new guide, Marlowe writes that public-private partnerships “are here to stay 鈥� they’re now a core part of the state and local government infrastructure tool kit.” They’re also more “complex and intricate” than ever, he writes, now being used for projects including “social infrastructure” like courthouses, affordable housing, university research facilities, stormwater management and more.

Government staff, Marlowe writes, can manage financial aspects of public-private partnerships with good contracts, insurance and service agreements and they can control technical risks with good designers and design processes.

Policymakers, however, are harder to manage 鈥� sometimes they just change their minds.

“They can decide a P3 is longer a priority. They try to modify its core service delivery model. They can change the criteria to evaluate a P3’s success,” Marlowe writes. “All these changes are well within the purview of most state and local elected officials. If any of these happen, a P3 will quickly fall out of alignment and fall short of its objectives.”

Marlowe pens the financial guides with newly elected or appointed government officials in mind. They have the job, but many come to office knowing little or nothing about public finance. The guides are meant to help such officials better understand their role in the world of government finance.

The new guide features “Ten Tools of P3 Governance,” a set of techniques public managers can use to increase the chances that a public-private partnership will succeed. The list includes best practices such as key performance indicators, contingency payments and routine performance audits, among others.

Marlowe plans no further volumes of the financial guide 鈥� though he notes also that he’s said after volumes two and three as well.

“I do hope that someone else can take the financial literacy format and run with it,” he said. “There’s no end to the demand for thoughtful, credible, accessible explanations of public finance.”

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For more information, contact Marlowe at 206-221-4161 or jmarlowe@uw.edu. To access the guide, visit Governing magazine (email and zip code required) or contact Marlowe.

One entity, The Oak View Group, or OVG, proposes redeveloping the publicly-owned Key Arena, while the other, the Sodo Group, led by investor Chris Hansen, calls for a new, privately-owned sports arena in Seattle’s Sodo District, south of downtown.

The takeaway: Both plans would make use of about the same amount of city tax revenue, the analysis finds, but the Sodo proposal stands to return about three times as much to the city’s General Fund.

In May the Sodo Group commissioned a team led by , Evans School professor of public finance and civic engagement, to objectively analyze the public finance dimensions of the two proposals.

Joining Marlowe in the research work were Grant Dailey, Angela Pietschmann and Alex Schoemann, all students in the Evans School’s Master of Public Administration program. Pietschmann and Schoemann also are certified public accountants.

The research had the dual objectives of showing the public finance implications of the proposals 鈥� focusing on the city tax money each might generate and where that money would go 鈥� and giving civic leaders and the public a tool for studying the details more closely. “To that end, we have made our analytical model available, and we welcome feedback,” the authors write.

The analysis works with estimated ticket prices, concession sales, tax rates, parking patterns and other factors that would drive tax collections. Using a basic set of assumptions applied to both proposals, their model suggests:

• The Sodo Group’s estimated contribution to the City General Fund is about three times that of the Oak View Group. The Sodo proposal would generate an estimated $103 million in new tax revenue for the City General Fund over 35 years, the analysis finds; the OVG proposal would generate about $34 million. Both totals are adjusted for inflation.
• Both plans would redirect, or make use of, about the same amount of tax revenue.
• The Sodo group would contribute approximately $100 million in property taxes to local governments other than the City of Seattle. The OVG group would not pay property taxes because the renovated Key Arena would remain publicly owned.

“So far the debate about the OVG and Sodo proposals has focused on important issues like traffic, sponsorships and scheduling,鈥� said Marlowe. “Our analysis brings an additional perspective to that debate: what these proposals could mean for Seattle’s finances.

“Beyond that, and perhaps more important, we wanted to create a tool to help Seattle’s leaders and the public investigate these public finance issues for themselves. That’s why we’ve made our financial model freely available.鈥�

indicates that Seattle city leaders are leaning more toward renovation of Key Arena.

This analysis, commissioned and paid for by the Sodo Group, was conducted independently with no effort to influence findings or methods. Payment for the project was not contingent on findings.

• .

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This was based on a news release by , Evans School director of advancement and external relations. For more information, contact Justin Marlowe at 206-221-4161 or jmarlowe@uw.edu, or the research team at arenatax@uw.edu.

Public-private partnerships can be important and effective government financing tools, but public officials overseeing them must understand both the risks and whether the political will exists to carry out and maintain long-term projects, says of the 91探花 .

The advice is among the takeaways from Marlowe’s third Guide to Financial Literacy, titled “,” written for magazine and published late this spring by . Previous installments were published in 2014 and 2015.

“These are very complicated agreements with a lot of moving parts and a lot of assumptions,” said Marlowe, a professor of public finance. “You really need to do your homework 鈥� the government has to be prepared to do a lot of intense due diligence on the project” to improve the chances of success.

Public-private financing is not generally used for basic infrastructure such as roads and bridges, Marlowe said, but can be an effective tool where “there is a real need for innovation,” such as when bringing new technologies to bear on an infrastructure problem.

But they can also last several decades 鈥� longer by far than the tenure in office of most politicians or even staff members. Marlowe said it’s crucial that the government entity, whether at the local, county or state level, have “the political wherewithal” to succeed.

“When your private partners are looking at you as a potential partner they want to know that if a community commits to a long-term agreement, they’re going to stick with it,” he said, “even if the political winds change and public opinion shifts. They want to know their investment is secure.”

The guide focuses in particular on public-private partnerships where the private sector plays a key role not only in building infrastructure but also in its long-term maintenance as well.

“The private sector being involved in building roads and bridges is nothing new. Private partners operating and maintaining and managing those facilities for long periods of time is something relatively new,” Marlowe said.

The guide divides discussion of public-private partnerships, which it calls P3s for short, into three main areas:

• Defining such partnerships and what local policymakers might encounter
• Explaining the role of policymakers to “build the skillset,” and “build the mindset” to prepare their jurisdiction to carefully consider such opportunities
• Suggesting ways to structure agreements to maximize chances for success

In preparing this third installment in his series of financial guides, Marlowe studied dozens of different public-private partnerships across the United States. The Seattle area has a “mixed record” with such projects, he said. He cited relative successes such as the , where Seattle Public Utilities worked with engineering firm CH2M Hill for an innovative design using ultraviolet light, as well as for construction and long-term maintenance. The , too, is an effective public-private partnership, he said.

“A lot of what’s been happening in South Lake Union has been done through some interesting public-private partnerships,” Marlowe said. “We have also had situations where that political will has been called into question,” such as a recent Seattle City Council vote regarding development of a south of downtown. City leadership must grapple with issues of such long-term commitments much as their counterparts do across the country, he said.

Marlowe’s first guide, “,” explored the basics of public finance; the second installment, “” addressed maintaining financial health over the long term.

The intended audience for the series is state and local government officials, especially legislators and finance/budgeting staff. Such dedicated people seek office to bring change to their communities, Marlowe has said, but quickly realize that “they won’t change anything if they can’t speak the language of budgeting and finance.”

A core theme throughout the series, Marlowe writes in volume three, is that a jurisdiction’s money “should follow its mission.” The job of policymakers and staff, then, is to “set priorities 鈥� that mission 鈥� and make certain your government’s money aligns with those priorities.”

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For more information, contact Marlowe at 206-221-4161 or jmarlowe@uw.edu. To access the guide, visit Governing magazine (email and zip code required) or contact Marlowe.

• Watch a video of Marlowe discussing the latest volume of his financial guide:

https://www.youtube.com/watch?v=-IP0I8bWvyM

Also participating will be members of the , a joint venture between the Evans School and Washington State University that acts as a neutral resource for collaborative problem-solving in the state of Washington and the Pacific Northwest.

The conference, being held at the Westin Hotel and other area locations, is expected to draw as many as 1,300 participants from 50 nations. The overall theme will be “New Traditions in Public Administration: Reflecting on Challenges, Harnessing Opportunities.”

Its many events will feature scores of presentations and panel discussions, many featuring Evans School faculty and staff.

• will lead discussions on the future role of public service in American universities and on the .
• will lead a talk on public-private partnerships.
• Tamara Schaps, director of , will lead a discussion of integrating millennials into the public sector workforce.
• , associate professor, will discuss expectations in collaborative governance, and , professor, will talk on the choices and trade-offs public managers must make to solve complex political problems.

The Ruckelshaus Center will also be well represented. , center director, will present on fostering collaborative solutions to public policy challenges in the Pacific Northwest, and , associate director, will present on using collaboration to solve complex political problems.

More than 150 other sessions and workshops, many by visiting scholars, will take up matters as diverse as strategies for reducing unemployment of minority and low-income workers, public policy challenges in disaster management, 21^st century infrastructure challenges, and the role of nonprofits in fostering civil society.

Yet more sessions will focus on administrative and management practices, budgeting and accountability, diversity in public service, employment perceptions and practices, public records law, reducing Medicaid costs for states 鈥� and, perhaps unsurprisingly, even “emotional labor and burnout for civil servants.”

Formed in 1939, the American Society for Public Administration works to advance the “art, science, teaching and practice of public and nonprofit administration,” its website states, keeping in mind four core values: accountability and performance, professionalism, ethics and social equity.

Visit for a full schedule of conference events.

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To learn more about Evans School participation in the conference, contact J. Paul Blake, director of media and external relations, at 206-543-3958 or jpblake@uw.edu; for more on Ruckelshaus Center participants, contact Kern at 206-428-3021 or m.kern@wsu.edu.

To govern effectively you have to know the language. And while the language of campaigning is handshakes and hyperbole, the language of governing is money 鈥� taxes, bonds, pensions and inevitably, budgets.

The trouble is, many newly elected or appointed officials arrive knowing next to nothing about public finance, says , a public finance specialist with the 91探花’s .

“They don’t know the technical details, and more important, they often don’t know where to learn what they need to know,” said Marlowe. “Many policymakers find this overwhelming, and this is understandable.”

That’s why Marlowe, an associate professor, wrote the “” for , which published it as an insert in its July issue. The 34-page document breaks down the basics of government finance with chapters on the flow of government money, legacy costs such as pensions and investing for long-term stability.

Marlowe said the guide seeks to help policymakers better understand their role in the world of government finance 鈥� a more complicated process, he said, than simply following the law. In fact, the guide lists several cautions that may be a surprise to the newcomer to government. These include:

• A government can put a lot of money into its pension fund but still fall short of fully funding it.
• Balancing a budget does not in itself ensure financial sustainability.
• The ongoing federal deficit is a major threat to local and state fiscal health.

Candidates have always run for office on narrow, ideological platforms; that’s just politics.

But the current polarization 鈥� people working only with those of like minds 鈥� has never been worse, Marlowe said. It makes officials hesitant to admit any lack of financial expertise for fear of being vulnerable to political opponents.

Yet effective governing depends on asking the right questions, Marlowe said. Toward that end, the guide lists sets of “essential questions” in each chapter that new officials should ask and that budget directors or agency heads should be able to answer. These include details on direct and indirect costs, diversity in revenue, reserve funds, legacy costs, audits and more.

Marlowe said the document is intended for local and state officials and people recently appointed to top-level administrative positions in government agencies.

“The whole guide is predicated on the idea that there are thoughtful people out there who want to learn. They really want to know these things 鈥� they just don’t know where to start.”

Tellingly, Marlowe said when discussing the planned guide with the magazine’s advisory board, he started with the assumption that most officials had at least a basic understanding of the property tax process. He was told no, assume that someone just elected knows nothing.

“So, the guide starts at the beginning,” Marlowe said, and lays out what every elected official and senior appointed policymaker at the state and local level should know.

“Detroit reminds us that state and local finance is a high stakes, complicated business. When it’s done well, no one notices. When it’s not done well, the consequences are painfully real. That’s why good public finance governance is essential.”

The Guide to Financial Literacy was funded by , which receives support from sponsors including VISA, J.P. Morgan, Wells Fargo and others. Marlowe was paid for his contribution as an author.

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For more information, contact Marlowe at 206-221-4161 or jmarlowe@uw.edu.

• Watch a video of Marlowe discussing the financial guide, produced by the Evans School of Public Affairs:

http://www.youtube.com/watch?v=hst2ZHinFzc&feature=youtu.be