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An urban report card rating how well 35 of the nation's cities are managed probably won't be holding a place of honor on Mayor Anthony M. Masiello's refrigerator.

The landmark study, described as the most comprehensive survey of city government ever done, ranked Buffalo and New Orleans at the bottom of the list.

Buffalo and New Orleans each got an overall grade of C-, the lowest marks in a report card in which more than half the cities received B's.

The study looked at the nation's 35 cities with the largest revenues, ranging from New York City to Kansas City, Mo. Buffalo barely made the cut at No. 34.

Phoenix went to the head of the class, the only city awarded an overall grade of A in the study, done by the Maxwell School of Citizenship and Public Affairs at Syracuse University and "Governing Magazine." The Texas capital city of Austin received the only A-.

But even big cities with long-standing urban ills such as Detroit, Washington, Philadelphia and New York City got higher grades than Buffalo.

The report noted that each of those cities, which had been close to the financial brink, seem to have learned from past mistakes and put in strong controls. New York City earned an overall B average.

The study graded each city in five categories, with Buffalo receiving two of the only eight Ds given. Buffalo got a D in how it manages people and a D in managing for results, a category judging how closely a city comes to putting its plans to work.

Buffalo got C's in financial management and information technology, and a C- in capital management.

The study, part of the Government Performance Project funded by the Pew Charitable Trusts, involved detailed questionnaires to each city, followed by interviews with key staffers in each city.

The authors put a positive spin on Buffalo's poor performance.

"And how about the handful of cities who brought home the worst report cards? While receiving C's and even D's, other municipalities are taking difficult but necessary steps to turn themselves around.

"Take Buffalo," the authors say. "It got a D in people management and a D for its ability to manage results. But overall, Buffalo received a C-, which reflects positive momentum to put better management systems in place.

"A charter revision approved by voters in November formalizes recent improvements, such as five-year financial forecasts and tracking of revenues and expenditures as each year unfolds."

The study points out that Buffalo's biggest problems may be caused by New York State.

"State labor laws constrain Buffalo's ability to control salaries and pensions for uniformed workers," the study concluded.

The point was not lost on the Masiello administration.

"The report actually reinforces something the mayor has been stressing annually," said Masiello spokesman Peter Cutler.

"Every year this administration goes to Albany and says 'Look, we have a problem as it relates to union contracts, pension funds, other state-related mandates. It affects our ability to manage the city financially. Please repeal them or modify them.' And nothing happens.

"We're at C-," Cutler said. "We could be higher if we had relief from these mandates."

But New York City is part of the same state. Why does Buffalo get a D in human resources while New York City gets a B-?

"The State of New York has handcuffed the personnel process in every one of its large jurisdictions," the study reports, "but New York City works around the situation."

Masiello, who just received two national awards from the National Conference of Mayors for a housing rehabilitation program in the University District and the city's newly privatized water system, was not pleased with the report card.

"I'm not happy with a grade like that," the mayor said of the study.

But he said the report recognizes the causes of some of Buffalo's problems and does not reflect all the improvements the city has made.

"Our services have improved dramatically in the last six years," Masiello said of his time in office. "Our taxes are very competitive, our quality of life factors are very high here."

Kevin Hardwick, an associate professor of political science at Canisius College, said older cities in the Northeast fare badly in a study like this, especially cities in New York. Buffalo was the only upstate city studied.

"Local governments in New York State," he said, "are hamstrung to a great degree by both the State Constitution and the laws the State Legislature has passed over the years to implement the constitution.

"New York has the Taylor Law and binding arbitration," Hardwick said of the law controlling fire and police departments as well as schools. "Arbitration has not been good to municipalities in New York, not only the cities, but school districts."

Buffalo's strongest grades were only C's, in finance management and technology.

"When the current administration took office in 1994," an accompanying article in "Governing Magazine" notes, "Buffalo had a looming deficit about twice the size of the one that actually had been reported. The first priority was getting the city out of the financial gutter."

The study noted that Buffalo's bond ratings have since improved, an indicator of the city's financial strength, although the rankings show that of the 35 cities, Buffalo shares the lowest rankings for Standard & Poors (BBB) and is among the lowest from Moody's Investors Service (Baa2).

In information technology, the study reported that Buffalo's efforts were helped by 27 new computers in the past year, but said the city does little to train technology workers.

"Training for (information technology) specialists has been a real disaster here," the study reported. "This is the first year in six that any training money ($30,000) at all has been made available in the budget. The only preparation managers have received has been on their own time."

Even so, the study reported, "it's a little surprising to discover that much of Buffalo's technology is pretty good."

Buffalo received a C- in capital management, but the study authors said part of the problem was the Common Council adding projects with little chance of success, and said the new charter provisions will introduce five-year plans.

Human resources was the city's worst grade, a D, which is not surprising to the authors because until the charter revision was approved, Buffalo never had a Human Resources Department.

"Almost anything would be an improvement," the study notes. "Under the old system, training has been minimal. There has been no mechanism for evaluating employee performance. Even when excellent workers have been identified, there has virtually been no way to reward them. And although Buffalo does try to predict future retirements, one staffer describes this as a 'plug the holes in a sinking ship' system."

Masiello agrees with the study's authors that part of the problem stems from the state's tight controls over municipal workers.

"I want the Taylor Law reformed so I can manage and reward my employees better," Masiello said.

Buffalo got a D in the category of managing for results.

"Buffalo never has had much commitment to strategic planning," the study found. It sees hope in charter revision changes that moves the Office of Strategic Planning to the mayor's office and encourages the setting of performance targets.

Masiello pointed to the recently adopted downtown strategic plan and a comprehensive master plan that will soon be ready.

Cutler, the mayor's spokesman, said the problems identified in the report are not unique to Buffalo.

"If the report had analyzed other upstate cities, it would probably have shown the same thing; it's a systemic problem," Cutler said. "We're not taking it as overall knock on the city."

FLUNKING : Governmental management in Buffalo is ranked at the bottom of 35 cities in an analysis by Governing magazine:

The Top Five

  CITY           GRADE 
Phoenix A
Austin A-
Indianapolis B
Minneapolis B
Virginia Beach B


  CITY           GRADE 
Buffalo C-
New Orleans C-

Buffalo's grades, by category:

Financial Management: C
Human resources: D
Information technology: C
Capital management: C-
Managing for results: D

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