https://www.americancityandcounty.com/wp-content/themes/acc_child/assets/images/logo/footer-logo.png
  • Home
  • Co-op Solutions
  • Hybrid Work
  • Commentaries
  • News
  • In-Depth
  • Multimedia
    • Back
    • Podcast
  • Resources & Events
    • Back
    • Resources
    • Webinars
    • White Papers
    • IWCE 2022
    • How to Contribute
    • Municipal Cost Index – Archive
    • Equipment Watch Page
    • American City & County Awards
  • About Us
    • Back
    • About Us
    • Contact Us
    • Advertise
    • Privacy Statement
    • Terms of Service
American City and County
  • NEWSLETTER
  • Home
  • Co-op Solutions
  • Hybrid Work
  • Commentaries
  • News
  • In-Depth
  • Multimedia
    • Back
    • Podcasts
    • Latest videos
  • Resources/Events
    • Back
    • Webinars
    • White Papers/eBooks
    • IWCE 2022
    • How to Contribute
    • American City & County Awards
    • Municipal Cost Index
    • Equipment Watch Page
  • About Us
    • Back
    • About Us
    • Contact Us
    • Advertise
    • Cookie Policy
    • Privacy Stament
    • Terms of Service
  • newsletter
  • Administration
  • Economy & Finance
  • Procurement
  • Public Safety
  • Public Works & Utilities
  • Smart Cities & Technology
  • Magazine
acc.com

Smart Cities & Technology


Commentary

Commentary: Privatization of government tasks

Commentary: Privatization of government tasks

Leonard Gilroy, director of government reform at the Reason Foundation, discusses privatization as a budget-balancing tool for local government administrators
  • Written by Leonard Gilroy
  • 2nd July 2014

Despite decades of proven successes, privatization (along with its cousins, public-private partnerships and outsourcing) is often a contentious subject, as evidenced by a recent article on a report from In the Public Interest (ITPI). The report suggests privatization prompts a race to the bottom in terms of service quality and employee impacts. Yet, while there are certainly cases where privatization fails to meet expectations, there are also many success stories that do not generate headlines.

Government isn’t perfect; see the recent Veterans Affairs waiting times scandal as just one tragic example. Yet privatization’s opponents demand perfection from privatization.

For example, they say Chicago’s controversial parking meter privatization should scare others away from similar transactions. The Chicago privatization effort saw policymakers agree to significantly raise rates in order to generate a $1.1 billion upfront payment. The private partner in the project, however, invested in a massive technological upgrade of the entire downtown parking meter system. The Chicago parking contract requires that similar system upgrades be performed periodically over the remaining seven decades of the contract.

However, both Indianapolis and Ohio State University learned key lessons from Chicago’s experience. The institutions improved the process and contracts, and implemented successful parking privatization deals.

Privatization is not some monolithic cookie cutter; rather, it is a tool, and like any tool it can be designed and used well or poorly. The keys to success involve defining specific goals for the private sector, and designing the procurement and performance-based contracts with proper due diligence in order to achieve those goals. As part of the process, contract administrators need to rigorously monitor and enforce the terms of the contract. This will ensure that taxpayers’ interests are protected in the deal.

Policymakers should be wary of the ITPI report. It attempts to tie administrators’ hands through mandating pay and benefit requirements. The report calls for requiring onerous review processes that will likely scare away potential private bidders, which means officials won’t maximize value for taxpayers, or improve the quality of service. After all, the purpose of government is to serve citizens. With continuing fiscal challenges looming in the coming decades, municipal leaders will need every tool at their disposal to balance budgets and ensure the continued delivery of vital public services. Privatization can play an important role in that process.

Leonard Gilroy is director of government reform at the Reason Foundation and publishes the monthly Privatization & Government Reform Newsletter.
 

_____________

To get connected and stay up-to-date with similar content from American City & County:
Like us on Facebook

Follow us on Twitter
Watch us on Youtube

Tags: Administration Economy Smart Cities & Technology Commentary

Most Recent


  • Amid digitization of public infrastructure, cybersecurity is increasingly a challenge
    The digitization of public infrastructure is a double-edged sword: While technology can streamline workflows and make systems run more efficiently, it’s also vulnerable to digital threats.  “The integration of new technologies into the public transit industry has resulted in improved service offerings to customers. But while these new services provide important information and conveniences to […]
  • security
    Note to cities: Watch out for security gaps and hidden expenses as you acquire new IT systems
    Government purchasers need to be aware of the security concerns new technology can introduce into a network or system, says Jeffrey Jones, a national security and global trade attorney with the firm of Lowenstein Sandler LLP. “State and local governments are soft targets for ransomware actors and cyberattacks because smaller government entities often lack the […]
  • When spending federal stimulus dollars, local governments are considering long-term, community impact
    From staffing constraints to budget shortfalls and an unprecedented pivot into the digital realm (driven by the pandemic), local governments have confronted myriad challenges over the last few years. But in this, there’s a bright spot: The federal government is investing an unprecedented amount of money into local governments. “The covid pandemic shuffled the deck […]
  • $52B semiconductor investment intended to rejuvenate American manufacturing
    Three decades ago, American manufacturing dominated the semiconductor industry, producing about 40 percent of the global supply annually. But over time, companies shipped business overseas looking to cut costs, and today, the nation produces only 10 percent of all semiconductors. It’s something the Biden Administration is trying to change through CHIPS and Science Act. “There […]

Leave a comment Cancel reply

-or-

Log in with your American City and County account

Alternatively, post a comment by completing the form below:

Your email address will not be published. Required fields are marked *

Related Content

  • North Texas alliance partners with Marketplace.city on smart government solutions
  • Harris County deploys next-generation security in 150 public buildings
  • Prioritizing rapid restore leads to stronger ransomware attack recovery
  • Today’s infrastructure needs greater than roads and bridges - It’s time to face our digital connectiveness

White papers


Modern American Perspectives on Law Enforcement

14th July 2022

Reimagine the Employee Experience

12th July 2022

How to Assemble a Rockstar Website Redesign Steering Committee

7th June 2022
view all

Events


PODCAST


Young Leaders Episode 4 – Cyril Jefferson – City Councilman, High Point, North Carolina

13th October 2020

Young Leaders Episode 3 – Shannon Hardin – City Council President, Columbus, Ohio

27th July 2020

Young Leaders Episode 2 – Christian Williams – Development Services Planner, Goodyear, Ariz.

1st July 2020
view all

Twitter


AmerCityCounty

Amid digitization of public infrastructure, cybersecurity is increasingly a challenge dlvr.it/SWh6Ww

15th August 2022
AmerCityCounty

Note to cities: Watch out for security gaps and hidden expenses as you acquire new IT systems dlvr.it/SWgth1

15th August 2022
AmerCityCounty

When spending federal stimulus dollars, local governments should consider long-term, community impact dlvr.it/SWXJWZ

12th August 2022
AmerCityCounty

In Nevada county, data underpins efforts to address climate change dlvr.it/SWTGHy

11th August 2022
AmerCityCounty

$52B semiconductor investment intended to rejuvenate American manufacturing dlvr.it/SWPqHQ

10th August 2022
AmerCityCounty

How capital improvement project prioritization helps secure infrastructure funding dlvr.it/SWLQB7

9th August 2022
AmerCityCounty

Climate bill lauded; predicted to reduce nation’s carbon foot print by 40% within decade dlvr.it/SWHGQL

8th August 2022
AmerCityCounty

Partnership launches no-cost wastewater monitoring service for local governments dlvr.it/SW7N74

5th August 2022

Newsletters

Sign up for American City & County’s newsletters to receive regular news and information updates about local governments.

Resale Insights Dashboard

The Resale Insights Dashboard provides model-level data for the entire used equipment market to help you save time and money.

Municipal Cost Index

Updated monthly since 1978, our exclusive Municipal Cost Index shows the effects of inflation on the cost of providing municipal services

Media Kit and Advertising

Want to reach our digital audience? Learn more here.

DISCOVER MORE FROM INFORMA TECH

  • IWCE’s Urgent Communications
  • IWCE Expo

WORKING WITH US

  • About Us
  • Contact Us

FOLLOW American City and County ON SOCIAL

  • Privacy
  • CCPA: “Do Not Sell My Data”
  • Cookies Policy
  • Terms
Copyright © 2022 Informa PLC. Informa PLC is registered in England and Wales with company number 8860726 whose registered and Head office is 5 Howick Place, London, SW1P 1WG.
This website uses cookies, including third party ones, to allow for analysis of how people use our website in order to improve your experience and our services. By continuing to use our website, you agree to the use of such cookies. Click here for more information on our Cookie Policy and Privacy Policy.
X