Los Angeles City Council Pursuing Zoo Privatization

In March 2009 Los Angeles Mayor Antonio Villaraigosa proposed a bundle of privatization initiatives as the city faced a nearly $1 billion budget deficit. The Los Angeles Times reports that over two years later, one of Mayor Villaraigosa’s proposals—privatizing the Los Angeles Zoo—is a step closer to reality after the City Council voted to begin soliciting proposals from prospective operators. City officials are also charged with exploring alternatives to privatization to see whether or not the zoo could remain open under public operation.

The city is currently struggling to close a $200 million budget deficit, and the LA Daily News reports that the zoo’s operating budget is projected to increase from $26 million to $33.7 million over the next five years. Mayoral aide Jim Bickhart testified before the city Arts, Parks, Health and Aging Committee last month saying, “The zoo was identified (by Mayor Villaraigosa’s office) as something that is important for the city but is not something we would do in a pinch.”

A recent report by City Administrative Officer Miguel Santana found that “Without an alternative (operating) model, the city’s fund subsidy is very likely to be reduced further or eliminated, resulting in the continual increase of admission fees and the possible eventual closure of the (zoo).” (A PowerPoint presentation of Santana’s report is available online here.)

City analysts estimate privatization would save nearly $20 million over the next five years, and implementation is feasible considering the recent proliferation of privately operated zoos. The majority of accredited urban zoos across the U.S. (over 70% according to some estimates) now rely on private operators — this includes major cities like Atlanta, Chicago, Dallas, Denver, Fresno, Houston and Seattle. In fact, eight publicly owned zoos and aquariums have been transferred to private operators in the last ten years alone.

Reason Foundation highlighted Dallas Zoo’s recent privatization in Annual Privatization Report 2010: Local Government:

In August 2009, the Dallas, Texas City Council voted unanimously to privatize the Dallas Zoo, turning over operations to the nonprofit Dallas Zoological Society through a partnership expected to save the city $1.5 million in 2010 and $16 million over the next five years. Privatization discussions began earlier that year when Mayor Tom Leppert began exploring ways to close a $190 million city budget deficit. According to the Dallas Morning News, Leppert enthusiastically supported the move, stating that the privately operated zoo “can and will be regarded as one of the best in the nation.”

Under the privatization, the Dallas Zoological Society is responsible for all zoo management, operations and animals, while the city retains ownership of all related land and the zoo’s nearly 200 physical exhibits. In the short term, the city plans to continue contributing operating funds to the zoo, though the level of subsidy is expected to fluctuate over time as the operator implements strategies to increase visitation and self-generated revenues. The agreement also requires the Zoological Society to meet or exceed current operating standards, lest it risk having to return operations back to city control.

Another benefit of the privatization is found in the potential for greater private sector support through donations, according to supporters. Michael Meadows, president and chief executive of the Zoological Society, told the Dallas Morning News in 2009 that, “There is a perception when something is run by a public entity, that they don’t have a need for private donations. [The City] found that donors prefer to give to privately funded institutions.” Meadows’ point was later validated after four private donors pledged $2.25 million to the zoo within the first four months after privatization.

Read the full report online here, which also features coverage of the recent Tulsa Zoo privatization. For more on privatization, see Reason Foundation’s privatization research archive.