Commentary

Five No-Brainer Cost Saving Ideas for Government

Over at Governing, Harvard Kennedy School research fellow, Better, Faster, Cheaper blog editor, and former Reasoner John O’Leary highlights five well-established cost saving ideas deserving widespread adoption in government, including asset divestiture and competitive contracting. Here’s a summary (with excerpts, emphasis mine):

  • 311 call systems: “Think New York City, Chicago, Baltimore and Houston. The art and practice of installing a centralized 311 call number to track requests for public services is well established. This not only boosts service quality, it also provides important data for public managers, helping them learn where they need to improve.”
  • Plastic cards for benefit delivery: “When it comes to benefits, plastic beats paper hands down. Roughly 30 states now use plastic benefit cards to disburse unemployment insurance payments, saving on check printing, postage and staff costs. The Kansas Department of Labor, for example, estimates that it will save $300,000 annually in paper and postage costs for a system they say will be “faster, more secure and efficient.” The Texas Workforce Commission estimates it saves $1.4 million a year by using electronic cards rather than paper checks for unemployment benefits.”
  • Economic development clawbacks: “The idea of using tax abatements is questionable to begin with, since other taxpayers will have to pick up the slack. But here’s a no brainer: If you offer a company a tax break, they ought to keep their end of the bargain. A ‘clawback’ provision or other guarantee that the promised jobs will actually appear should be standard practice.”
  • Embracing competitive service delivery: “Contracting out won’t always be the right answer, but it should be a tool in every public official’s toolbox. If there has ever been a time when government cannot afford to ignore competition as a spur to productivity, this is it.”
  • Shedding non-essential assets: “California, the state with a $20 billion budget deficit, owns a lot of stuff, including golf courses, the Los Angeles Coliseum and an $11-million Malibu beach house once used to film an MTV series. It’s time for the Golden State to join the real world. Every state and municipality that owns a golf course, museum or abandoned property should consider these spaces an excellent site for a “for sale” sign.”

O’Leary concludes, “It’s time to redefine low-hanging fruit and take advantage of these proven cost-trimming approaches.” I couldn’t agree more.

See O’Leary’s recent Reason.org article (co-authored with William Eggers), “Five Reasons Why Libertarians Shouldn’t Hate Government,” as well as our recent Reason.tv interview with the two authors on their new book, If We Can Put a Man on The Moon….

Leonard Gilroy is Senior Managing Director of the Pension Integrity Project at Reason Foundation, a nonprofit think tank advancing free minds and free markets. The Pension Integrity Project assists policymakers and other stakeholders in designing, analyzing and implementing public sector pension reforms.

The project aims to promote solvent, sustainable retirement systems that provide retirement security for government workers while reducing taxpayer and pension system exposure to financial risk and reducing long-term costs for employers/taxpayers and employees. The project team provides education, reform policy options, and actuarial analysis for policymakers and stakeholders to help them design reform proposals that are practical and viable.

In 2016 and 2017, Reason's Pension Integrity Project helped design, negotiate and draft pension reforms for the state of Arizona's Public Safety Personnel Retirement System and Corrections Officer Retirement Plan, which both passed with overwhelming bipartisan support in the state legislature and were signed into law by Gov. Doug Ducey.

Gilroy is also the Director of Government Reform at Reason Foundation, researching privatization, public-private partnerships, infrastructure and urban policy issues.

Gilroy has a diversified background in policy research and implementation, with particular emphases on competition, government efficiency, transparency, accountability, and government performance. Gilroy has worked closely with legislators and elected officials in Texas, Arizona, Louisiana, New Jersey, Utah, Virginia, California and several other states and local governments in efforts to design and implement market-based policy approaches, improve government performance, enhance accountability in government programs, and reduce government spending.

In 2010 and 2011, Gilroy served as a gubernatorial appointee to the Arizona Commission on Privatization and Efficiency, and in 2010 he served as an advisor to the New Jersey Privatization Task Force, created by Gov. Chris Christie.

Gilroy is the editor of the widely-read Annual Privatization Report, which examines trends and chronicles the experiences of local, state, and federal governments in bringing competition to public services. Gilroy also edits Reason's Innovators in Action interview series, which profiles public sector innovators in their own words, including former U.S. Transportation Secretary Mary Peters, former Florida Gov. Jeb Bush, former Indiana Gov. Mitch Daniels, former New York City Mayor Rudy Guiliani and more.

Gilroy's articles have been featured in such leading publications as The Wall Street Journal, Los Angeles Times, New York Post, The Weekly Standard, Washington Times, Houston Chronicle, Atlanta Journal-Constitution, Arizona Republic, San Francisco Examiner, San Diego Union-Tribune, Philadelphia Inquirer, Sacramento Bee and The Salt Lake Tribune. He has also appeared on CNN, Fox News Channel, Fox Business, CNBC, National Public Radio and other media outlets.

Prior to joining Reason, Gilroy was a senior planner at a Louisiana-based urban planning consulting firm. He also worked as a research assistant at the Virginia Center for Coal and Energy Research at Virginia Tech. Gilroy earned a B.A. and M.A. in Urban and Regional Planning from Virginia Tech.