Earlier this year, 20-year city veteran Dwight Dively, who had managed the city’s budget office for 16 years, told colleagues he was leaving the city to take over the King County Office of Management and Budget. Back in December, then-mayor-elect Mike McGinn relieved Dively of his duties overseeing the city’s annual budget, putting him in charge of a new department of executive administration and fleets and facilities. At the time, I flagged the change as a demotion. Dively was replaced by Beth Goldberg, former deputy finance director at the county.
Yesterday, I sat down with Dively at his office on the 52nd floor of the Seattle Municipal Tower to talk about his time at the city, his thoughts on McGinn, and his plans at the county. What follows is an edited transcript of that interview.
PubliCola: You’ve been at the city for more than 20 years, working under four mayors. Before McGinn reassigned you, did you have any intention of leaving the city? Would you have stayed on at the city if McGinn had decided to keep you in your former role?
Dwight Dively: I wasn’t looking to leave. Had he asked me to stay on as budget director, I would have stayed.
PubliCola: Can you tell me a little about your early interactions with McGinn? Did he talk to you before he reassigned you to the new position?
[Ed. note: Dively did not directly address whether he found out about his new assignment before McGinn announced it publicly).
Dively: I did talk to him [about other matters] before he told me that what he wanted me to do was a different job. I honestly don’t know if he had decided to reassign me [at that point] or not. He asked for a briefing on the stuff we do at the [budget] office. He initially asked us some very intelligent questions about what our process was, and whether that process would get at some of the more substantial changes that he wanted to make, particularly with regard to how you staff the city.
PubliCola: McGinn announced early on that he would be cutting 200 manager and strategic advisor positions, which he initially characterized as “political appointees.” [McGinn later backpedaled on that announcement]. Did you play any role in that decision, and did you provide any advice prior to the announcement?
Dively: I played no role in that proposal. When the idea came up, I tried to give him some context. I did tell him that the premise—the idea that these were net new political advisors—was simply wrong. Most were converted from other titles. I explained that many of those were positions that had other titles before and were given new classifications, in many cases because of the need for more salary flexibility, and some that were funded by Bridging the Gap [transportation levy] dollars.
I was trying to get him to understand that, yes, you have to look at the number of managers and supervisors, but don’t approach it using information that just isn’t right. I and others explained that to him, but he wanted to proceed with the [cuts]. And ultimately he backed off. It took some time, but he eventually realized that his assumptions had been incorrect.
PubliCola: Your reassignment to DEA and fleets and facilities was widely viewed as a demotion. How did you see it at the time?
Dively: It could be a promotion, a demotion, or lateral, really, depending on what you’re valuing. Is the budget process a really influential process? Absolutely. Is the job he asked me to do less influential? Absolutely. On the other hand, one manages 35 people and the other manages 550 people. So it really depends on your perspective. Influential, less influential, bigger job, smaller job. On reflection, I decided I have more strengths in the budget and planning area than I do in the administrative area.
PubliCola: In what kind of condition are you leaving the city, and what advice would you give Goldberg [who will have to patch a $50 million budget shortfall next year]?
Dively: This recession has been far more severe and damaging than any since the last Boeing bust. It will be a difficult budget, but I’m not sure that it’s worse than what we were dealing with in 2002 to 2003.
I’ve tried to give [Goldberg] ideas about things that work well and things that work not so well.
PubliCola: You’re widely credited for keeping the city in better financial shape than the county and state, both of which have consistently faced even bigger budget shortfalls, relative to the sizes of their budgets. What do you take credit for, and to what else do you attribute that difference?
Dively: I will take some amount of credit for some of the specific things the city has done that were my idea or that helped create the situation we’re in: Having as much money in the rainy day fund as we do, having a triple-A bond rating, and improvements in our financial policies.
But the reason the budget is in better shape than the county and the state is only partly because of those things. The nature of the city’s budget means that the city’s budget is going to be more [flexible] than the county or the state. Cities in our state, not just Seattle, have a wider variety of revenue sources available to them. And you have more discretion—[for example], to decrease how many police or fire officers you have.
At the county, revenue sources are much narrower. And many services are mandated by the state. When you get into an economic meltdown at the state, the revenues just fall apart. There are huge areas of the budget that are absolutely driven by how many people show up. Education and health care are the duties of the state—they can’t just say “no, we won’t provide those services.”
PubliCola: Given the challenges at the county level, how do you plan to fix their much larger budget crisis? The state legislature has shown no inclination that it wants to provide counties with new taxing authority.
Dively: It’s very challenging, but the opportunity is, if you can think about doing government in a different way, you then can make the case [to the state legislature] for the resources we need.
Once you demonstrate that you’re operating efficiently and you’re using your resources wisely, and there’s still a bunch of unmet need, then you can [make the case to] get the revenue sources to pay for that. Over time, I think we may be able to get some of those tools.
The county does have a structural problem. Property tax growth is capped at one percent, and you have demand for things, like jail beds, that goes up much more than that every year.
PubliCola: In the same way that you’re credited with keeping the city’s budget in check, do you think Beth Goldberg deserves any of the blame for the disastrous budget situation at King County over the past few years?
Dively: I honestly don’t know. I haven’t tracked the details of her time at the [county] budget office. I will say, though: The person in charge of the budget office always gets too much credit when things go well and too much criticism when things go badly.
