Reason Foundation

http://reason.org
http://reason.org/blog/show/louisiana-privatization-bills

Reason Foundation

Out of Control Policy Blog

Louisiana Republicans Introduce Bills to Replicate Massachusetts's Pro-Union, Anti-Privatization “Pacheco Law”

Leonard Gilroy
May 9, 2013, 7:36pm

My latest column offers a critique of two bills introduced in the Louisiana legislature that are modeled after the Massachusetts "Pacheco Law," which is widely regarded as the most onerous and stringent anti-privatization law in the country. Here's a brief excerpt:

Two proposed bills introduced in the Louisiana legislature—and passed by a House committee earlier this week—raise serious barriers to fiscal responsibility, as the bills would effectively shut down the ability of the current and future governors to use the proven tool of competitive contracting to lower the costs of state government.

House Bill 240 (sponsored by Rep. Kenny Havard) and House Bill 519 (sponsored by Rep. Cameron Henry) are two alternative versions of a “Privatization Review Act” designed to place significant hurdles in front of routine, sensible privatization efforts used by governors of all political stripes across the country. Given the similarity to a 1993 law enacted in Massachusetts at the behest of government employee unions—and which has stymied privatization efforts in that state for two decades since—a more appropriate title for the proposed Louisiana bills would be the "Louisiana Government Employee Protection Act."

Specifically, HB 240 and HB 519 would prohibit agencies from entering into privatization contracts without prior legislative review and approval, and they would subject routine contracting decisions to onerous pre-procurement and contract review processes clearly designed to protect state employee jobs and elevate the interests of government employee unions over those of taxpayers at large.

The proposed bills are modeled nearly word-for-word after Massachusetts’ “Pacheco Law” (named for its legislative sponsor) that “has basically shut down all privatization efforts in state government,” according to an April 2013 Boston Globe editorial, which also noted that, “the purpose of state government isn’t to be a jobs program, particularly one that turns a blind eye to opportunities for savings.”

[...]

In January 2011, the Globe's editorial board wrote that the anti-privatization Pacheco Law “doesn’t just keep government agencies from saving money by hiring outside contractors to perform certain services. It also sends a broad message: In Massachusetts, the demands of special-interest groups — in this case, public-employee unions — can outweigh the obligation to run government efficiently."

Louisiana taxpayers would be right to question why some of their own state legislators are trying to replicate the law that has been so counterproductive in the Bay State for decades. Does Louisiana really want to become a profligate, big-spending state like Massachusetts and remove proven cost-cutting tools from the toolbox?

Read the full article here.


Leonard Gilroy is Director of Government Reform


Print This