Nevada Exploring Privatization of State Mail Services

From today’s Las Vegas Review-Journal:

Nevada’s longtime state mail delivery service could by next year become a private operation, eliminating 21 government jobs and saving up to $400,000 a year. State Budget Director Andrew Clinger said an analysis is under way to firm up the potential savings of privatizing the state mail system. If the numbers pencil out with the vendor selected by the state for detailed negotiations on a contract, it will become part of Gov. Jim Gibbons’ budget for consideration by the 2009 Legislature. Clinger, who declined to identify the Reno-based vendor by name, said the plan would be to phase in the privatization effort beginning in July 2009. Every effort would be made to find other positions for the state employees, he said. The employees are aware that privatization is being considered. “The preliminary numbers that I was given showed potentially it could save us $400,000 a year,” Clinger said. “It won’t balance the budget but over 10 years, it would save some money.”

This is exactly the sort of thinking that state and local officials nationwide should be engaging in as they face the challenges of declining tax revenues and growing budget shortfalls. And no need to think small—officials should be scouring departments and divisions for all services and activities like this that are widely performed in the private sector, typically at a lower cost and higher quality of service than public operations. Utah is moving in that direction now with its revamped Privatization Policy Board, a variation on similar entities in Florida (Council on Efficient Government) and Virginia (Commonwealth Competition Council). These entities conduct regular commercial activity inventories (the “scouring,” if you will), develop recommendations for competition opportunities and serve as an institutional mechanism to facilitate the ongoing “right-sizing” of government. A similar sort of entity would be perfect for Nevada. Nevada’s SAGE Commission should explore such a commission as part of its wide-ranging review of cost-cutting and efficiency-enhancing opportunities. More here. Reason’s Annual Privatization Report 2008 Reason’s Privatization Research and Commentary