CLI: Interviewer
Wyatt: Steven D. Wyatt, Moore County Manager

CLI: Okay, Steve Wyatt, County Manager from Moore County. Tell me a little bit about your background.

Wyatt: I grew up in the mountains. I am the son of a man who had to work sometimes three jobs to take care of the family. And I grew up around a lot of WWII veterans and listened to their stories. That really affected me a lot. Those guys were my heroes. I thought about what I could do to try to make the country a little bit better place, not politically correct, but really paid a lot of attention to national leaders.
As I was growing up, going through school in the ‘70s, frankly, Ronald Reagan caught my eye quite a bit. I was very interested in the things that he had to say. Make no bones about it, one of the things I remember, and of course it has all been rammed right back down our throat because of everything that has gone on here lately, but his thought or statement that government is not necessarily the solution. Government is the problem. There is no question that government is a problem but it shouldn’t and doesn’t have to be .It was during his fight to bring the country back, so to speak, that I had to make a decision about taking a stand.
I was in college. I had to make a decision. I had gone to college to be a psychologist, but, you know… When you get to college you are exposed to different things. I had always been interested in government and I was acing government related classes and economics and those kinds of things. So I got recruited into this field and really never looked back.

CLI: Where did you go to college?

Wyatt: I went to school at Appalachian State. It is the preeminent program for folks in city and county management, period.

CLI: You left Appalachian State. Where was your first government job?

Wyatt: I did an internship with the Town of Hamlet. I went to work with an Appalachian guy down there. Then I went with the Town of Chadbourn, as the manager there and then went to Polk County as a County Manager. I was the first manager ever to survive a transition in party control of the Board. I was hired by a Democrat and retained by Republicans. I showed them that I was not going to make political decisions. A manager shouldn’t—You have to work in a political environment. Good policy is good politics.

CLI: What would you say is something you did there? At some point you had to start taking innovative approaches. What was something you brought to the table?

Wyatt: I got there [Polk] and not unlike this county or unlike Chadbourn, they were broke. The first thing we had to do was—we couldn’t play favorites. You’ve got to collect taxes. If you are going to levy a tax, you collect that tax. If you are going to enact a law, an ordinance in our case, you are going to enforce that law or that ordinance. You are going to do it in such a way where it applies to everybody. You aren’t going to be selective in that.
What I did in those two small communities is we basically had to take apart everything that we were doing to try to save money—collect the fees, collect the taxes and save money. We went to once a week, curbside garbage pick up. We were able to cut the sanitation budget 40%.

CLI: You increased service and cut expenses?

Wyatt: Actually, I can’t say we improved service. We were going twice a week, back door. That is incredibly inefficient. So we got some grant money, actually, it was the last of the revenue sharing money. We bought everybody in the town a 90-gallon rollout and went to once a week curbside.
The council voted it in one time and then backed off of it. It took me about eight more months and cost us money in that lag period. I contracted out and I privatized some stuff. This was a Reagan type concept. What is the mission of government? What should government do? What should the private sector do? If the private sector can do it better or more efficiently, who is served? The public is served. I privatized the utility system there, basically.
It was a matter of survival, I’m not going to kid you. But we saved money and we met the requirements. It was controversial.

CLI: Moving forward from Chadbourn, You go to Polk County, what are some of the two or three challenges you face there versus simply just moving forward to Catawba?

Wyatt: There were huge challenges there in solid waste disposal. It is a county and not a city. It is something very different—the whole relationship. Working with the sheriff. There was no 911 in Polk County. It was just basic levels of government like public health, safety and welfare. Those are the basics. You’ve got to do the fundamental stuff first. We had to do everything to try to balance the budget.
This environment in county government is largely mandated. I mean, you are just hugely mandated from the state level on your budget. You are giving probably 50 percent of your tax levy right off the bat to the school system. You are operating on everything else. I started the first countywide EMS system, a 911 communications system. I put some plans in place to bring law enforcement up and meet jail standards. The biggest thing there was to trim expenses however best you could.

CLI: You added these new services. How much did you have to increase taxes in that period of time?

Wyatt: I didn’t increase taxes.

CLI: So taxes didn’t go up and you added these services?

Wyatt: We did a better job of collecting taxes. The fundamental question was for overall property tax against user fees. That is a public policy issue people have to deal with.
The biggest thing we saw there was our property tax collection—our rate was abysmal. You’ve got to remember that a tax break or a failure to collect on some people is a tax increase for everybody else. That is an issue of fundamental fairness.
But the biggest thing I can say in Polk County and Chadbourn, and I’ll talk about it here too, was a change in the organizational culture. People had to think differently. Every place I’ve been there has been a level of what I call the entitlement mentality. County government is a monopoly. There is nothing I can do about that. But I can work with the employees and change how they think about that. We aren’t entitled to anything. It is a public trust. We are entrusted by the public. We aren’t here to regulate people out of business. If people go out of business, we have not done our job. We are here to help folks.
The biggest compliment I’ve had here and in Polk County too was people’s change in the attitude.

CLI: We are getting into a concept that is gaining popularity called performance management. What you are saying is that you are changing from a sense of entitlement to expectations of service delivery, correct?

Wyatt: Exactly.

CLI: Would you say that Polk County was where you started trying to implement these kinds of changes?

Wyatt: And it was a matter of just absolute fundamentals. Actually, I’m really a pretty simple guy. You build things from the bottom up. You have a base and you go from there. The base is each individual employee you have who is either your best advocate or your worst enemy in the field.

CLI: How did you determine that your services were improving in the field?

Wyatt: In a small community, folks are not shy to let you know whether they are happy or not. They aren’t shy to let your commissioners or your town council know.

CLI: As you were implementing this could you see the culture changing by the number of phone calls you receive?

Wyatt: The number of complaints. Yes. That is anecdotal, but the bottom line was that people were happier. I don’t pay a lot of attention to what is written in the newspaper, but that is a gauge. You know, the letters to the editor. Those letters to the editor from regular people, from real people like senior citizens, retirees or whoever that has time to do those kinds of things is a pretty good gauge.
The best gauge I’ve got is what I developed in Catawba County called the “Winn Dixie Test”. That is, across from my office in Newton, there is a shopping center with a Winn Dixie. There are many times that I would have a department head come in with an idea or a problem and a proposed solution. I would ask them a question, “Does it pass the Winn Dixie Test?” They would go, “What in the hell are you talking about?” [LAUGHS] I said, “Let’s go over there to the Winn Dixie and we’ll convene a court. We’ll get three, five or seven people from the frozen foods section. We’ll line them up there and we’ll explain this to them. If it makes sense to them, we are in pretty good shape. We’ll do that because do you know who is going to have to pay this bill? They are.” That is the Winn Dixie Test. It is just a common sense solution.

CLI: Tell me a little bit about the transition from being a manager in Polk to an assistant manager in Catawba.

Wyatt: There is a huge difference. It is a different world. I went from a small, very politically tense situation to a community that is all about business. I’m also faced with the bureaucracy, there are over six times the number of employees. It was incredible. I hate the term paradigm shift, but everything shifted. It is a different world.
I had a huge issue right off the bat with EMS. The EMS employees were trying to form a union. They had sued the county. We had 30-some EMS employees that had fought to sue the county. They had an attorney that has made a niche suing the taxpayers. Thus he recruited these EMS folks to sue us. So I walked into that situation in the deposition phase. I ended up meeting with 30 individual EMS employees and saying, “What is the problem?” Simply put, they wanted somebody to sit down with them and talk to them and find solutions. We ended up settling individual claims because the county was in the wrong in how it calculated their overtime pay.
And then we focused on how to heal this relationship? The trust was gone. You do that one on one. That is what it took in that case—one on one.

CLI: So, you’re now an assistant county manager is Catawba. You’ve solving some problems with EMS, this seems to be where you really instituted one of the first performance management concepts.

Wyatt: The whole emergency services aspect. We were spending—there again, a whole lot of decisions were made over a long period of time that were made independent of one another. You had an emergency services delivery system that was an absolute mess. What we needed was a strategic plan to try to coordinate all of that. We put together a strategic plan and I don’t think any other county has ever done anything at that level. It basically took apart every service we were providing, how we provided it, how we paid for it and how it related to everything else. If you looked at a map of Catawba County with all the response districts, it looked like you had just thrown a plate of spaghetti on the map because of all the overlap.
One thing that you’ll be interested in was that shortly after I got there I was handed the problem with the jail. I was given the challenge of, “Our jail is full. We need to find a solution, but we don’t want to spend any money.” I said, “You’ve come to the right guy.” It is the kind of challenge I like.
I was aware, through my personal contacts, that we weren’t the only people in this ball game. I knew enough about jails to know that there are certain fixed costs whether you have a jail for 100 or 1,000 people, you’ve got a certain fixed cost. I was intrigued with the idea of doing a regional solution and sharing those fixed costs among many players. So I asked the chairman of the board, Bob Hibbitts to convene a meeting of seven or eight counties in the region, six of which I knew had jail problems. Support of the elected officials is paramount We could talk about it and see if we could do something that has never been done in North Carolina before. A mega jail if you will.

CLI: A regional jail?

Wyatt: Yes, a regional, multi-county jail. I got some interesting looks from sheriffs for instance. One of the first people I got to buy into it was the sheriff, David Huffman, a very practical, conservative guy. He said, “Steve, if you can make this work, I won’t stand in your way.” And then he became a large proponent.
Several counties eventually dropped out, but at the end there were two counties left standing. Catawba and Burke County went in the jail business together. I am confident when I say we saved taxpayers millions of dollars over the life of that jail. We’ve done it a couple of ways. One is sharing the operational costs of the jail 50/50. We ended up with a jail with excess capacity. We rented beds to other counties, to the feds, the state or whoever. We also delayed the need for Catawba County to build another jail in county.

CLI: How did you handle the staffing and personnel?

Wyatt: We formed a regional jail authority basically, with the sheriffs and county managers sitting on this. We hired employees—33 is how many employees it took. It would have probably taken about 60 if we had done it separately. It is not the government’s job to employ people. It is the government’s job to allow other people to employ people by keeping costs down. We were able to save a heck of a lot of money, and again, delay that need.
Our chief economic indicators pretty much have in inverse relationship to county government if you think about it. The demands on and costs of county government when things are not going well, go up: jail, mental health, public health, social services and all those things.
We did some other things too, with our county landfill operation. I had been joking for years that the day would come when we would dig up our garbage and sell it. We did almost that. We captured the methane gas that is generated by the decomposition of the garbage, put it into a generator, generated electricity and sold it to Duke Power. We were making money.
The commissioners had to make the effort to understand and then say, “Yeah, this is not without risk. But is it the best solution? Yes. It is the best solution.” We had two landfills—one operating and one closed. We set this situation up in both.

CLI: You could recover methane from a closed landfill?
Wyatt: The closed landfill failed because we had bad gas, as I coined the term. The gas was so contaminated it was tearing the generators up. It was eating the generators up. That was garbage from 40 years ago. We had everything in there.

CLI: You learned a lot in this process?

Wyatt: I learned a whole lot. I’m not an engineer but I know economics. And this thing paid for itself. I mean, we had to go out here and spend millions of dollars on these generators, but we were under mandate to remediate the methane gas anyway. We could flare it, but it is a product. Let’s go in there and get it. The green people loved it. I made everybody happy. The greenies over here and the fiscal conservatives over here. It was a win-win situation.

CLI: Tell me more about the performance management concept you are trying to bring in to Moore County. My understanding is you started in Catawba and it is still being used and improved. I know other people are looking at that as a model. In fact, you are using your own model here in Moore County.

Wyatt: First of all, it is absolutely a team effort. I don’t remember who initiated it. But there was a book written by Ted Gabler and Dave Osborne, I think called Reinventing Government.
I hate bureaucracy. Bureaucracy is not reality. A mentality of bureaucracy is just not right. Again, just because we’ve got this monopoly, who cares? It is just not right, so let’s break it. The rules say you do this. So what? Why are those rules in existence? If you can’t tell me why that rule is in existence, and don’t tell me it is because we’ve always done it that way, I’ll sit down and say, “Let’s chat.”
What you’ve got to do is challenge those old ways of doing things.

CLI: When you do that, it instantly makes you a change agent. Implementing change is difficult. Did you have the sense that you were going to be a target when you were trying to do this?

Wyatt: This job is half missionary, half mercenary. This is where I get the strength, right there.(Wyatt places his hand on his Bible) That is the bottom line. I can be the meanest pit bull in the whole den if I have to be.
Government is all process oriented. Who cares about process? Do the people from Winn Dixie care about the process? What do they want? They want results. They want outcome.
So we came up with what we called outcome based budgeting. They call it reinventing government or reinventing budget. But I call it outcome. That is the bottom line. I’m a bottom line guy. I’ve got 600 people here. I’m bottom line. You hire the best people, you train them…
When you go into a business, what do you want? You want your needs met. If you don’t have those needs you’ll go someplace else. The problem [in government] is that you don’t have any place else to go. Counties and cities are monopolies.
We’ve got this obligation and these opportunities. So when you talk about outcomes, it also gives you the opportunity to look at how your business processes. I hate terms like empowerment, but that is what it does. I’ll give you a perfect example. We had to cut business deals with all our departments. We had to put something in it for them. Do you know what works with people? Incentives. Do you know what a good incentive is? That would be money. It works for everybody.
Don’t kid me. I mean, recognition does work, absolutely. Recognition works and reward works. I have found that if you will measure it, recognize it and reward it, people will try to do it. My child will do that. My dog will do that.

CLI: When you implemented this, your county manager, elected officials and staff had to buy into it. Were you able to see results, were you able to save any money?

Wyatt: Sure we were able to save money, keep the tax rate down and invest money. It comes back to this empowerment of the individuals.
The Health Department is a real-life example. Again, I want to focus on the fact that this was a team effort. Now, was I a maverick saying do this and do this? When they wanted to soften it up I said, “No. If we are going to follow this concept, let’s push it! Let’s push the limits.” Did I push the limits? Yes. That is what I do. Health Department. We cut a deal with them where if they save money in their budgets, they can use some of that money to reward employees, reinvest in services—

CLI: Use it in any way.

Wyatt: Use it any way, basically. So, okay, this starts trickling down to staff. Hazardous waste disposal: Pay by the pound for hazardous waste disposal. Our employees had never had any incentive before to question what they’re putting in that little red bin with the funny marker on it, right? Now they are. And they realized they were throwing away packaging and paper, not only the needles and the bloody stuff and they thought, wait a minute. We’re paying by weight for disposal.
By thinking about what they were doing they were able to save money and buy more vaccine or reward the employees.

CLI: You linked government waste to their bottom line at a personal level.

Wyatt: Yes. And again, give them some incentives. One of the great challenges in any government is recognizing and rewarding people. That in itself is a huge challenge. Money works. But you’ve only got so much money. The old bureaucratic model says that everybody gets a 2% or 3% raise. Well, you know as well as I do you’ve got some people who are just happy to be here from eight to five, and you’ve got other people who are tearing it up. You’ve got everybody in between. Well, what are you paying them for all this time? The golden rule is not treat everybody alike; it’s do unto others as you would have them do unto you. I would like to be rewarded when I bust my tail and come up with good answers and good solutions.
So one of the things that we had to work on too is to devise, again, put these outcomes together and then reward people for going there. And we can do it with the same money. Sure, cost of living is going up, okay. We’ll do a COLA to cover that, and then we’ve got enough money to give everybody in the organization a 1% increase. Not a lot of money, but if you’ve got enough money to give everybody a 1% increase, what if you took that same amount of money and gave it to your top 10 performers.
What does that do? It compresses it. This is the reward. This is the high tech visual presentation. If this is the reward you have out there, you compress it and push it together, and focus it, you could really reward 10%-20% of your people.
I’m going through our performance evaluation; I’m giving each department a block of money. You can give your top performers one, two, or three percent, but you only have this much money.” Golly gee whiz, you’re in business. You’ve got some hard decisions to make as a manager.

CLI: Let’s now move on more into Moore County.

Wyatt: All right, well, let’s talk about health care, because I know you had called about health care. Health care in the country is problematic. The costs are problematic. From what I understand, nationally, medical inflation according to Kiplinger, is going up 12% to 14% a year.

CLI: We’re referring to health insurance for county?

Wyatt: That cost is going up. I saw that cost going up tremendously. I jokingly said to the employees, and I did it for a strategic purpose, to get them ready, because if you make them think that anything is possible, they’re going to be willing to think differently and to accept different things. So 10 years ago I said that the day will come when Catawba County would just hire it’s own doctor, hire a couple of nurses, set up a shop, and there’s your health care and this would save a ton of money. So this is my way, and they know now, and these people here know now, too, choice generally is going to equal cost. If you exercise more choices, you’re going to pay more for those choices. And that’s health care.

CLI: The more choices you are forced to pay for, the more it’s going to cost you as a government agency?

Wyatt: When I was a kid, my dad had a hospitalization plan for his family, but when I got sick it came out of his pocket.

CLI: In other words, going to the general practitioner would cost you, but if you went in the hospital, you were taken care of.

Wyatt: Yes. But what we have now is a system that we’re used to in the country that pays a part of all your bills. Used to be, if I needed a prescription, my dad, he’d go pay for it. But now if I got run over by a truck, we pay 80/20. But we’ve got a different mindset now, so that’s changed. Here are the drugs that county employees use. And here’s office visit costs. These are the office visit costs we have in this year and here’s the average cost to us. You add $20 co-pay to that (which employees pay). Here are the drugs. Huge amount of drugs, and the cost per prescription. [presents list to interviewer] Again, these choices are generating cost. It’s a multi-pronged problem. You’ve got drug costs that are incredible. You’ve got treatment costs that are incredible—

CLI: And office time missed.

Wyatt: The whole thing, all of that—lost work —half a day, all day. I became really interested, if you’re going to invest money up front, and look to see what we can do—again, you take it apart. I’m convinced that we can save money on our routine office visits, like sinus infections, flu, migraines, got a funny mole here, whatever. Is there a more cost effective way to dealing with those issues? I became convinced that there was. And it kind of goes back to an old concept of the company nurse.
So I floated the concept of the county hiring a nurse practitioner under a doctor’s auspices, and setting up primary wellness care for minor routine-type incidents, to try to cut down part of that cost. I also, interestingly enough, about the same time, floated the idea of buying prescription drugs from Canada.

CLI: For the county?

Wyatt: With the county buying mail order. You’ve got a lot of folks who are on maintenance drugs.

CLI: Did that idea fly?

Wyatt: No. Here’s the thing: it’s illegal. Why is it illegal? Well, the FDA says it is; it’s not safe. What do you mean, it’s not safe? Where are all the dead Canadians?

CLI: Same drugs—

Wyatt: And they’re made in the USA. But again, that’s one problem that hopefully will change this year because it can save people money.

CLI: So are you implementing that program here?

Wyatt: We’re trying to. Our costs per employee are incredible. Our health care costs for employees are going up 20% a year.

CLI: And arguably you have some of the best health care in North Carolina.

Wyatt: We do, we have a fine health care facility here. But at 20% a year. That comes out of the taxpayer’s pocket. And I have told the county employees that I’m not going to stand up here in front of the county commissioner’s and ask for a tax increase to pay for the county employees’ health care plan, because you’ve got a lot of folks in this community that don’t have any health care, and you’ve got a lot of folks here without work, and believe me, you’ve got plenty of folks here paying plenty of taxes. So before we do that—and I told them I’m not going to do that—I’ve met with almost every employee; 600 employees.

CLI: How does your elected body feel? Are they open to this idea, this concept?

Wyatt: I believe, they know that they’re going to have to do some things differently.

CLI: Okay. Let’s move forward bit, look at some of the innovative approaches you’re taking.

Wyatt: We’re doing performance management. Our budget is performance management.

CLI: Already? OK, name two or three challenges you see and also any type of new idea that you think is also going to become more prevalent.

Wyatt: We’re going to have to have some serious discussion that leads up to a solution on how we pay for government services statewide in North Carolina.

CLI: And is that because you think it’s an unsustainable system moving forward?

Wyatt: It’s a system that is fraught with problems at the local level, and it’s fraught with problems at the state. Just look at how the state of North Carolina has struggled each year over the last five, six years. And have there been fundamental solutions enacted? I would say no. I say the state of North Carolina with its partners in city and county governments are going to have to decide not only how you pay for what, but who does what, who is responsible for it. The system we’ve got has problems. If you don’t see the path of the problems that the state, cities, and counties are having, you’re not paying attention.
Now, these are the birth pangs of a huge problem, and we’ve got to go back. We may have to do the whole thing over again, and just decide who is going to be responsible for what. Public education is a perfect example. We have an absolutely convoluted system of paying for that. Three or four counties right now are headed into lawsuits, apparently, with their local school boards over school funding. We [Moore County] fund at a level 21st or 22nd highest in the whole state. Everybody can’t be above average.
Property tax, I would argue to you, is the most hated tax. I think there are two disadvantages to being in the county government. One is people have to write a check for the property tax, and the other thing is they know where you are. You’re not someplace else; we live here. We don’t go off someplace; we live here. But it’s also a fairness and equity issue. How many people are pulling, how many people are riding? Obviously there are some people who don’t have much to contribute and I understand that. But are they better citizens if they contribute a little bit? Probably.
Citizenship has responsibilities. That’s one of the things I think we’ve got to get back to: citizenship has its responsibilities.

CLI: What else?

Wyatt: I’m concerned about the level of court involvement I see. And the, what I call, judicial activism, if that is the right word. I’m concerned about that.
Because in the situation we’ve got right now you could have a judge ordering the board of commissioners to levy a supplemental tax. Judges aren’t elected to levy taxes. County commissioners and city counsels are. Now if the judge or the state wants to look at giving school boards the authority to levy taxes where you have one group that is responsible for the policy and the financial impact to the citizen, that is fine. But the commissioners, under this system are supposed to be the check and balance.

CLI: So you still find yourself pushing the envelop for a few years and still looking for innovative approaches to things?

Wyatt: Yes. I think my reputation in this state is as a problem solver and somebody who is willing to get his nose bloodied and fail.