MANAGEMENT EXPERT DAVID OSBORNE SAYS HUD'S REFORMS �COULD BE A MODEL FOR REINVENTION IN THE 1990s�

WASHINGTON - An evaluation of the Department of Housing and Urban Development's reinvention effort released today by management expert David Osborne says HUD's management reform plan �as it is being implemented today represents one of the most ambitious, fundamental, and exciting reinvention plans in the recent history of the federal government.�

�HUD today is a different place than it was a year ago,� writes Osborne, in a report by the company he heads, The Public Strategies Group, Inc. �In our opinion, if HUD continues down the road it is going today - and continues to refine its strategy along the lines suggested in this report - the agency that was a symbol for government scandal in the 1980s could very well be a model for reinvention in the 1990s.�

President Clinton said the report shows that the government-wide reinvention initiative spearheaded by Vice President Al Gore is succeeding at HUD.

�Vice President Gore and I have worked hard the past five years to create a government that works better and costs less, and HUD - under the leadership of Secretary Cuomo - is taking reinventing government to another level,� the President said. �While this report says that HUD could be �one of the great reinvention stories of our time,' the real progress is being measured in the places where it matters the most - in communities that are benefiting from the new HUD, and customers who are using HUD to help them make the most of their own lives. David Osborne is right: if it can happen at HUD, it can happen anywhere.�

Secretary Andrew Cuomo launched the reform plan called HUD 2020 in June 1997.

Osborne - the author of the book �Reinventing Government� and President of The Public Strategies Group (PSG) - undertook a review of HUD 2020 for the Department.

�David Osborne's evaluation shows that HUD has become a model of successful government reinvention and is delivering improved services to our nation's people and communities,� Cuomo said. �This report is a vote of confidence in HUD employees around the country who are pioneering new ways to do their jobs better.�

In his report, Osborne writes: �Overall, PSG believes that HUD 2020 is a sound, well thought-out reform plan. It is tailored specifically to solve long-standing structural problems, uses appropriate reinvention strategies for HUD's specific challenges, and addresses the agency's core problems.... we believe that it represents a well-conceived and aggressive set of reforms.�

�HUD 2020 offers a vision of a �new HUD' that is credible beyond reproach in terms of integrity, well-managed, and in tune with and responsive to the needs of communities,� the report says.

�At its core, the thrust of this (HUD 2020) plan is not a downsizing of employees but a fundamental rethinking and reorganizing of the way HUD does business - a serious and sweeping reinvention plan that could not only radically and permanently alter and improve HUD operations and culture, but could hold lessons for other large-scale reinvention efforts in both the public and private sector,� the report says.

Cuomo and Osborne spoke today at the opening of the new HUD Storefront Office at 801 N. Capitol St. in Washington. The 8,000-square-foot street-level office will be the model for similar consumer-oriented service centers in other cities where HUD offices are now located.

The report by Osborne is the second evaluation in recent months of HUD's management reforms. A related review released by Booz-Allen & Hamilton Inc. in March concluded that HUD has made �significant progress towards achieving the many management reforms that are critical to making the Department function effectively.�

Osborne's report has six key findings:

�The greatest strength of HUD 2020 is that it achieves a mission clarity that many public organizations fail to achieve.� �The HUD 2020 plan being implemented today does a superior job� of clarifying the Department's �purpose, strategic direction and roles.... This clarification is prominently reflected in the new two-fold mission statement - first, to empower people and communities; and second to restore the public trust. In PSG's view, the clearly defined business mission of the new HUD sets the Department on a clear course to address key problems it faces.�

�HUD 2020, when fully implemented, should provide dramatically better customer service in two ways.� First, by reorganizing HUD into two types of offices - �back office processing centers� to handle paperwork and Storefront Offices to connect HUD more directly to the people, groups, businesses, organizations and governments it assists.

Second, by creating �an entirely new breed of HUD employees� called Community Builders who �represent the first significant infusion of new talent at HUD in a decade and could be the prototype for a new public servant in the 21st century.� Community Builders focus on empowering America's people and local governments to take the leading role in improving lives and strengthening communities.

�HUD 2020, when implemented, should significantly enhance the agency's ability to protect the public trust in two ways.� First, by creating an Enforcement Center headed by an FBI Special Agent on detail to wipe out waste, fraud and abuse. Second, by establishing �the first nationwide inspection system for HUD properties� through a new centralized Real Estate Assessment Center.

�HUD 2020, when fully implemented, should fundamentally fix the Department's basic system in two ways.� First, by making �basic system and internal control improvements that will restore its financial and management credibility.� Improved financial management under HUD 2020 includes data cleanup, integration of financial systems, design of new internal controls, overhaul of the procurement system, consolidation and elimination of duplicative or obsolete systems and clear plans for resource allocation and budgeting improvements. Second, by hiring private contractors to perform certain functions when they can do so �more efficiently and effectively.�

�HUD 2020 has begun to foster a sense of innovation, entrepreneurship, and cutting-edge technology more characteristic of a private company than a public organization.�

�HUD 2020 as implemented can be a model for other agencies in at least two ways.� First, by creating a downsizing plan based on cooperation with unions and no layoffs. �In our experience it's a rare day that a public employees' union signs onto a plan that involves downsizing.� Second, by working in partnership with other federal agencies, private companies and local government HUD �sets a good example for the federal government to follow.�

The Osborne report recommends three ways to improve implementation of HUD 2020:

Clarify the role of Community Builders and empower them to have a greater role.

Enhance HUD's customer-oriented performance management efforts.

Continue improving communication with HUD employees.