Let's Talk Privatization

Posted on February 28th, 2010

In her interview with Mile Square View, Mayor Dawn Zimmer was asked if she considers any municipal services ripe for privatization or outsourcing. To her credit, the mayor revealed that she's in the process of reviewing several areas of government for privatization. We'd very much like to hear what those areas are. Unfortunately, however, the mayor refused to share that information. She indicated that she'd only discuss potential areas for privatization after "a decision has been made."

This reticence, in our view, is misguided. For starters, the people should know what the mayor is thinking. Moreover, simply mentioning that a municipal service is under consideration for privatization can lead to efficiencies--even if those services are never ultimately privatized. City employees might suddenly realize they don't need quite so many supervisors, for instance. Or smoking breaks, for that matter.

Mayor Zimmer should go even further, and clearly demonstrate that municipal services are costing too much. The most effective way to do that is to simply request price quotes from multiple vendors. Let's find out what private firms can do, at what cost. This would expose, in specific terms, how much we're currently overpaying for municipal services. City employees would then have to compete.

Flint, Michigan, provides one example of this phenomenon. After the mayor received bids from private firms, the union found ways to collect trash for $1.4 million less. As a result, the city decided not to move forward with privatization. The same municipal workers collected Flint's trash. They just did it faster, smarter, and cheaper.

Like Flint, the City of Indianapolis found that sometimes merely threatening privatization prompted city employees to work more productively. Often, however, using a private firm makes sense. Indianapolis saved $15 million when it privatized trash collection. Closer to home, Jersey City under Bret Schundler found ways to save money via privatization. So did Steve Lonegan, in Bogota.

One area Mayor Zimmer ruled out for privatization was the library. We hope that she reconsiders this stance. There is certainly no harm in at least studying privatization, and receiving bids from vendors. The mere process might uncover inefficiencies that current employees could rectify. Or we might find that a private firm could run it at a much lower cost. Explaining her opposition to privatization, the mayor offered her belief that our library is significantly underfunded. In reality, that's all the more reason to consider some form of privatization. A firm could potentially invest some of its own capital as part of a privatization deal. At a minimum, reduced overhead costs would free up tax dollars for needed improvements or purchases.

In the midst of our city's fiscal crisis, there's no reason not to explore privatizing or contracting out municipal services wherever practical. As other cities have demonstrated, there's no reason to stay mum on which services you're thinking of opening up to competition. On the contrary, it sometimes pays to think out loud.

Update: A few have argued that state law doesn't allow privatized library management. As we pointed out in the Revolt forum, however, Jersey City did exactly that. If they could do it, why couldn't we?

Posted in Commentary    Tagged with Dawn Zimmer, Privatization


Forde Prigot - March 1st, 2010 at 10:24 AM
How are Library funding levels determined? Is it determined by the mayor, the council, or some other entity?

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