The Most Entrepreneurial City In America

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Gaebler's personality only fanned the flames. He likes the limelight and is quick to engage in battle. Being a visionary, he is forever rallying his troops to new entrepreneurial frontiers -- talking, for instance, about the city as a corporation, himself as its chief executive officer, and the council as its board of directors. "It was a little scary to some of the folks outside, who heard my internal pep talk words and took them literally," he says. But that is the price you pay. "Would Martin Luther King have made any changes if he'd kept his mouth shut?"

Others, even Gaebler's staunchest supporters, see it slightly differently. "Ted just says stupid stuff," shrugs Greg Collins, one of his closest allies on the city council. "I don't know if it's a sign of immaturity, or what. He's got a lot of good ideas, but sometimes he just engages his mouth before he engages his mind."

The classic example came when Gaebler grabbed statewide television coverage by proposing to rebate $25 of Visalia's budget surplus to every citizen as a "share" in the city. The police, who wanted higher salaries and better retirement pay, were outraged. And the city council, which had never passed on the idea, was embarrassed.

"In most places," says Collins, "Ted would probably have been fired. But his value is in promoting his approach to government, and we thought that outweighed his blunder. So we slapped his wrists and told him not to do that anymore."

Although some in town believe he wanted out before the November elections, Gaebler says he and his wife had always planned to leave Visalia when their youngest child graduated from high school, an event that took place in June. Gaebler sees the job in San Rafael as one that will give him seven years or so to "transition" into a new career: writing, speaking, consulting, spreading his message.

Meanwhile, his handpicked successor, Don Duckworth, faces some serious internal problems. The staff Gaebler leaves behind is in the midst of a transition from the excitement of start-up to the plateau of sustained achievement. The novelty has worn off, people are stretched thin, and the strains are beginning to show.

In many ways, it seems, Gaebler fits the stereotype of a charismatic entrepreneur who can inspire people with his vision, but who lacks the patience to manage a success. His style is to throw a lot of balls in the air and let his staff handle what comes down. In Visalia, he defined his role as 90% "external" -- dealing with the council and the community at large -- and relied on three assistants to run the organization. "Ted is an idea man," says Carol Cairns, "not an operations man."

"If a person is going to be an external manager, then he or she should have the ability to allow people beneath him to make decisions," adds John Biane, the real estate manager."And that was not always the case."

A key factor, according to most management people, was that Gaebler's first generation of assistant city managers had moved on, and his new crop was not as strong or as much in tune with his philosophy. "They weren't risk-takers," says one staff member. "They didn't have a lot of interest in facilitating entrepreneurial behavior." Beyond the assistant city manager ranks, perhaps only two thirds of Visalia's 45 to 50 management people bought his approach, and only half of those really put it into practice. No one expected that Gaebler could completely transform his staffin seven years, but because his revolution was not complete, his most creative and enterpreneurial managers were also his most frustrated. Some were already running small bisinesses on the side, and one could almost feel their itch to get into the private sector and show their stuff.

"Ted works hard to find the best people, but he doesn't set up the reward system to keep them," argues Mike Ramsey. "He does a good job of creating an environment in which they can grow. It's when they succeed that they get frustrated."

Curiously, such criticism is probably a healthy sign.Visalia will never undergo a complete transformation from bureaucracy to enterprise for, at bottom, government cannot and should not operate exactly as a business does. If it did, democracy would go out the window. Government will always more too slowly for the real entrepreneurs, and it will no doubt lose some of them to the private sector. But as measured against the typical city government, the frustrations in Visalia are more symptoms of success than those of failure.

The proof is that the model is spreading. Already, Gaebler is invited to preach his sermon nationwide, and cities from Hampton, Va., to Pueblo, Colo., are imitating his programs. Lawrence Mulryan, the mayor who brought him to San Rafael, expresses the respect with which Gaebler's philosophy is increasingly viewed. "Traditionally, smaller cities have left the aggressive, entrepreneurial developments to the private sector, but frankly, we have to realize that that's not going to be enough," Mulryan says. "We recently got $12 million in redevelopment funds, and there's a lot of opportunity -- buying properties and assembling properties and reselling them -- to shape the destiny of our community.We need strong leadership to accomplish that."

"I always start my speeches," Ted Gaebler says, "by asking, 'Who in this room wants government to stay exactly the way it is?' I've never seen one hand go up, not at a Rotary Club, not at a PTA. And then I say, 'I gotcha, because that means you, like me," are agents of change."

"For years, I thought I was selling ideas," he muses. "But it turns out what I'm selling is hope."

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