Out of Control Policy Blog

Redding, CA Considering New Privatization Committee

This is purely anecdotal, but as state and local government fiscal conditions have deteriorated over the last year or so, I've noticed a number of newspaper editorials expressing support for exploring the potential privatization of public services. Yesterday, The Record Searchlight in Redding, CA was the latest to weigh in, arguing that privatization should be on the discussion table as city policymakers look for ways to cut costs amid a bleak revenue forecast:

Between falling sales and property taxes and millions of dollars that the state intends to pick from local governments' pockets, the city of Redding will have to cut millions of dollars from an already slimmed-down budget this year.

That will inevitably take a toll on public services, but the city - indeed, every government agency - must also look for faster, cheaper or better ways to do the same work.

Enter, perhaps, the private sector.

The City Council will consider Tuesday whether to name a committee - yes, another committee - to look at specific services that the city could save money by privatizing. This will be painful for anyone who works at City Hall, no doubt, but the city exists to serve residents, not to provide comfortable employment.

Just about every job done at the city, such as cutting grass and offering legal advice, is available through the private sector. Tech support, accounting, fleet maintenance, planning - all could, potentially, be contracted. Indeed, in Georgia, CH2M Hill, the engineering company with roots and a big office in Redding, even manages a handful of city governments.

Do public employees do a bad job? No, but largely because of the generous pay and expensive benefits that their unions have won over the years; at the city of Redding they're often far more expensive than the private sector. [...]

More than ever, local government needs efficiency and flexibility. Outsourcing is one method of getting there that the city can't afford to ignore.

As I wrote recently here and here, commissions like the one proposed in Redding can perform several valuable functions to help advance privatization. Two of the most important would be depoliticizing the issue and providing an across-the-board, enterprise-wide approach, which helps to break down bureaucratic silos.

For other thoughts on what state and local governments should be doing to address the ongoing fiscal challenges, see here, here and here.

» Reason's Privatization Research and Commentary

Leonard Gilroy is Director of Government Reform


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