The Persistence of Innovation in Government

The Persistence of Innovation in Government: A Guide for Innovative Public Servantswww.businessofgovernment.orgTable 3: Sources of Funding for 2010 SemifinalistsSource of FundingLevel of GovernmentApplyingSemifinalistsReceiving FundingAverage Percentageof Budget Providedby SourceFederal Government 9% 45% 56%State Government 39 47 54Local Government 52 47 64Private Sector 24 41Nonprofits 17 27User Fees 13 51Total 100 193N 127 127Source: 2010 semifinalist questionnaires.50 percent by local government programs. While only 10 percent of the semifinalists werefederal government programs, the federal government provided some funding for 45 percentof the semifinalists; state government provided some funding for 47 percent, and local governmentprovided funding for 47 percent. Some inferences may be drawn here.Since 52 percent of the semifinalists were from local government, and local government was afunding source for 47 percent, a segment of local government semifinalists received theirfunding entirely from sources other than local government. One quarter (24 percent) of semifinalistsreceived funds from the private sector and 17 percent from nonprofits, particularlyfoundations. The average semifinalist received funding from approximately two sources (thesum of the percentages receiving each type of funding). The last column of the table showsthe average percentage of the budget of the semifinalists provided by each source of funding.These range from 27 percent by nonprofits to 64 percent provided by local government.Clearly, the different funding sources are not providing token amounts, but rather major funding.Interorganizational collaboration now extends beyond merely participating on steering committees,which often was the case in the early 1990s, to active engagement as well as providingfunding. Because the federal government was not eligible to compete for awards in the 1990to 1994 HKS Awards, funding sources for that period were not compared to those for the2010 semifinalists. Nevertheless, shared funding has now become an important characteristicof collaborative innovations. This finding has implications for would-be innovators (where tolook for funding) and for potential funders (what they want to achieve by contributing and howto monitor progress).Table 4 shows that the average population reached by the HKS Award semifinalist innovations—202,000 in the early 1990s and 236,000 in 2010—and the percent of the target populationreached—slightly below 50 percent over two decades—have remained relatively constant.What has changed dramatically, however, is the average operating budget, which has increasedby 360 percent, from $5.9 million to $21.5 million. Slightly over half of this increase wasdue to inflation (67 percent between 1990 and 2010) and the 17 percent increase in populationreached. An initial explanation for the remainder of the increase would be that innovatorscan now tap more funding sources. In addition, as discussed under Finding Four below, thereis greater public interest in and appreciation of public sector innovation, which would supportdecisions by public servants and elected officials to increase funding for innovations.11