On July 7, 2022, the Government Services Administration (GSA) put out an advance notice of proposed rulemaking asking its contractors who make or use single-use plastics to tell the GSA what they think about the Center for Biological Diversity’s proposal that they stop contracting for goods or services that use such materials.

In the notice, GSA poses a long list of questions about the scale and scope of single-use plastics used in goods and services they source through their providers and what it would cost those providers to go along with the plan to ditch the single-use plastics. The class of single-use plastics includes plastic drinking straws, plastic water bottles, plastic packaging materials, plastic grocery bags, plastic cutlery, and many other plastic items often treated as environmental villains of the moment. But it also includes things less commonly considered nuisances, even when found out of place as litter, such as single-use medical containers, products, and devices of many sorts, such as surgical masks.

The GSA appears to be acting on this issue due to the petitioning of the Center for Biological Diversity (CBD). This aggressive group describes itself as a conservation organization “dedicated to the protection of endangered species and wild places.” But in this case, what CBD requests the Government Services Administration to do would not improve global, national, local, or individual environmental health and safety. These proposed actions would, in all probability, most likely compromise those very things.

The Center for Biological Diversity argues that banning single-use plastics aligns with President Joe Biden’s Executive Order 14008, “Tackling the Climate Crisis at Home and Abroad,” which calls for federal agencies to align their activities with the president’s climate change agenda. The crux of CBD’s petition is on page 9:

In furtherance of its stated policy to purchase sustainable products, and in line with its directive to procure environmentally preferable and nonhazardous products, the GSA must issue a rule committing the federal government to reduce and eventually eliminate its procurement and acquisition of single-use disposable plastic products….

Petitioners request that the GSA revise its regulations to reduce and eventually eliminate the acquisition of single-use plastic bags, single-use plastic utensils and straws, beverage bottles, packaging, and other single-use food service items and personal care products.

These revisions should apply to the procurement of single-use plastics for federal government meetings, conferences, and events; food service facilities in leased and custodial buildings; and supplies for federal government operations. In addition, the new regulations should apply to all manners by which civilian executive agencies acquire goods and services, directly or indirectly, including through lease, procurement, contracting, and purchase orders.

We further request that the rulemaking contains exemptions for disability accommodations, disaster recovery, medical use, and personal protective equipment. GSA regulations must clarify that “single-use product” does not include medical products necessary for the protection of public health, or personal protective equipment, including masks, gloves, or face shields.

To give the CBD some credit where it is due, this last paragraph is refreshingly grounded in the reality of real-world tradeoffs—some of them, anyway. More such thinking would improve environmental policy considerably. But there does not appear to be much emphasis on the trade-offs of many problematic elements of CBD’s or GSA’s proposed approach to plastics.

Policy Problem One: First, do no harm (proximal)

Perhaps the first test of sound public policy is the same test used to determine sound medical policy, which is, as the Aesculapians like to say, primum non nocere, or first, do no harm.

It doesn’t take much reviewing of the research literature on the topic of plastic material substitutions to reveal that, in fact, plastic substitutes are usually worse for the environment than plastics, as well as worse for human health and safety. I have written about the downsides of plastics substitutions at some length. My recent piece here examines the Canadian context, where they’re even farther ahead of the United States in pursuing “zero plastic waste.”

So why are alternatives to single-use plastics worse for the environment? One of the biggest reasons for this is that the “reusables,” as I’ll call them, consume more energy over their life cycles than their single-use plastic alternatives. More energy in manufacturing, distribution, utilization, and disposal means greater environmental impacts coming out of the soil (oil production); going into the air (conventional pollutants and greenhouse gases); running off into the water, and going back into the land (landfilling).

The downsides with regard to human health involve something that should be top-of-mind for everyone in the post-Covid-19 pandemic landscape—biological contamination. Single-use products are more likely to be sterile when first used, and they are rarely used again in a context where sterility is essential.

The same is not true for durable plastic alternatives that see regular use involving the same activities where biological contamination is an issue: eating and contact with body fluids.

The research literature on the use of renewable bags is fairly solid on this issue and would extend to renewable alternatives to plastic packaging (for food and medicines, for example). Reusable materials are more likely to be contaminated on secondary and sequential use and are simply less safe.

It should be obvious, but this is one reason why single-use plastics were adopted over reusable materials in the first place, particularly in medical settings, but also with regard to food contamination and preservation.

Policy Problem Two: Also, First, do no harm (proximal-distal)

The second policy problem is the same as the first: The policy is likely to violate the idea of doing no harm—in this case, distally, through its impacts on the economy in which we all live and from whose productive powers we receive all the wonderful goods and services that give us our historically absurdly nurturing quality of life.

From the more proximal economic standpoint of impacts to the American economy specifically, the proposal to get GSA out of the business of participating in the market of single-use plastics can only be a net harm. America’s economy is a high-tech transformation and service economy. America specializes in a certain kind of material and energy transformation, which is the creation and use of advanced technologies, materials, and heaps and gobs of powered gizmos and gewgaws of every sort. That’s our thing. We’re not a nation of farmers anymore. We’re not “hewers of wood and haulers of water,” as some of our Canadian friends have been styled. We’re not a raw natural-resource economy where we just dig up materials found in our environment and trade in them.

We are increasingly a consumer goods and services economy that engages in a vast spectrum of activities requiring a vast spectrum of materials with which to provide those goods and services. And though manufacturing has shrunk as a share of US Gross Domestic Product, America still invents, makes, uses, invents new uses of, and, importantly, sells high-tech goods and services rendered with such goods, in high quantities, at high speed, to as big a market as we can reach.

And plastics have become a significant part of that over a short span of time–only about 60 years since early adoption in the US materials economy.

More distally still (but, to this biologist, no less compelling) is that this entire idea of rationing and restricting access to a useful material such as plastic is unwise from the higher-order perspective of humanity’s evolutionary niche. Unlike other animals, human beings evolved to use technology and energy to transform raw materials into things that let us survive in the places that we otherwise might not, which is most of the surface of the Earth, and compete against animals that would otherwise view us as a light snack, or perhaps a decent lunch. Our transformative capabilities also let us defend ourselves against other humans, some of whom might not have gotten the memo about “cooperation is a better strategy for mutual co-existence.”

This is obligatory stuff woven into human evolution. Humans need to make use of virtually all materials available to them (and need a lot more that are not yet created, like that catalyst that will split water with little energy input) in order to meet their evolutionary imperatives to survive. Banning plastics, arguably one of the singularly most useful materials ever available to homo sapiens (as easily shown through the eagerness with which it has been incorporated into the human materials ecosystem freely, without government compulsion), will needlessly—and obviously—set back humanity’s ability to prosper in a hostile universe.

Summary

The Government Services Administration’s proposal to remove single-use plastics from their supply and acquisition chains at the behest of the Center for Biological Diversity would be detrimental to environmental health and safety from the standpoint of humanity’s evolutionary imperatives, America’s social and economic imperatives, people’s individual imperatives and rights, and the protection of the environment itself, either locally or globally.

The GSA might feel obligated to act on the petition of the Center for Biological Diversity’s anti-plastic demands. However, sound public policy principles would suggest that, at the end of the day, the agency should not give the CBD what it wants. The Government Services Administration should not ban single-use plastics from its supply and acquisition chains. That could only do America more harm than good.

The post The government’s bad idea to stop using single-use plastics appeared first on Reason Foundation.

A recent analysis by Gatehouse Media found that nearly 23,000 spills released 1.6 billion gallons of wastewater into the environment between 2009 and 2019—over 370 million gallons of which were completely untreated. Approximately 980 million gallons of this wastewater, including 220 million gallons of raw sewage, flowed into Florida’s waterways. Reducing sewage spills will require stronger incentives for municipal governments to upgrade sewer systems and public-private partnerships could be used to offset some of the financial burdens. 

Blue-green algae blooms have plagued Florida in recent years. The toxic algae kill wildlife and can have serious health consequences for humans including irritation of the gastrointestinal tract, liver, nervous system, and skin. Prolonged exposure may even be linked to neurological disorders like amyotrophic lateral sclerosis (ALS) and Alzheimer’s disease.

The algae feed on nutrients such as the nitrogen and phosphorus found in wastewater spills and released by failing septic systems.

If these blooms continue to make negative headlines for the state, it could do serious damage to the Sunshine State’s economy, which relies heavily on tourism and inter-state migration. Florida’s reputation as the sportfishing capital of the world draws millions of anglers each year. In the year 2011 alone, over 1.9 million residents and 1.2 million visitors fished in Florida waters, supporting local marinas, boat charters, and bait shops in communities all around the state. The blooms also threaten property values and quality of life for residents living along the state’s lakes, rivers, and coastal estuaries. 

Tackling Florida’s algae crisis will require major upgrades to municipal sewer systems to reduce spills. In fact, the state’s recently-appointed Blue-Green Algae Task Force pointed to failing sewer systems in their first-round recommendations released in October 2019. The task force also concluded that many of the state’s 2.6 million septic systems will need to be converted sewer, further highlighting the need for greater capacity. Unfortunately, despite clear environmental and economic harms, municipal governments often lack sufficient resources and incentives to invest in sewage infrastructure improvements. 

Tougher penalties for spills could create stronger incentives, while public-private partnerships (PPPs) have the potential to alleviate some of the financial burdens local governments would face. The Florida legislature is currently considering legislation that would increase fines for sewage spills to $3,000 every day the spill continues. The frequency of spills over recent years suggests that the existing fines of $2,000 provide insufficient incentives to invest in infrastructure improvements. 

The nature of individual public-private partnerships would vary depending on the context and needs of different municipalities. Broadly, PPPs could be involved in several aspects of infrastructure delivery including project design, construction, financing, operation, and maintenance. PPPs are most commonly used to outsource operation and maintenance (O&M). Under O&M contracts, municipalities maintain ownership of a facility, but a private firm operates, manages, and maintains it. In some cases, systems are sold or leased to private firms. If executed properly, PPPs could reduce costs and ensure that future upgrades are made in a timely manner. 

Sewage spills and related algal blooms threaten Florida’s water and way of life, but municipalities lack sufficient incentives and resources to resolve the problem on their own. Tougher penalties combined with private investment would address these shortcomings to provide a workable solution. 

The post Greater Accountability and Public-Private Partnerships Could Reduce Sewage Spills in Florida appeared first on Reason Foundation.

Annual Privatization Report 2015 details the latest on privatization and government reform initiatives at all levels of government. The individual sections include:

• State Government Privatization
• Federal Government Privatization
• Education
• Air Transportation
• Surface Transportation
• Transportation Finance
• Criminal Justice and Corrections
• Local Government Privatization (COMING SOON)

Additionally, in May 2015 Reason Foundation announced that Purdue University President and former two-term Indiana Governor Mitch Daniels is the recipient of the inaugural Savas Award for Public-Private Partnerships, a new award recognizing an individual or organization whose actions improved the cost-effective provision of public services through partnerships with private organizations. More information about the 2015 Savas Award for Public-Private Partnerships is available here.

Your comments on Annual Privatization Report 2015 are important to us. Please feel free to contact us with questions, suggestions or for more information. For the most up-to-date information on the rapidly changing privatization world, please visit Reason’s privatization research archive, and sign up for our monthly Privatization & Government Reform Newsletter.

Leonard C. Gilroy, Editor
Director of Government Reform, Reason Foundation
leonard.gilroy@reason.org

The post Annual Privatization Report 2015 appeared first on Reason Foundation.

Even if you don’t use the common, convenient, lightweight plastic grocery bag, you should be concerned about the state ban.

Proponents of the ban claim it will benefit the environment. But a comprehensive analysis recently undertaken by Reason Foundation, which looked at the impact of plastic bag bans on the environment, found these claims don’t stand up to scrutiny. Indeed, the ban is likely to do more harm than good both to the environment and to people’s pocketbooks.

Lightweight plastic bags constitute less than 1 percent of all visible litter, represent only 0.4 percent of all municipal solid waste and are not a major cause of blocked storm drains. Banning them has practically no impact on the amount of litter generated, the amount Californians pay for waste disposal, or the risk of flooding. In fact, when plastic bags were banned in San Francisco, the county’s own studies showed that litter actually increased.

Lightweight plastic bags have not caused a giant “garbage patch” in the North Pacific, nor are they a significant threat to marine animals or birds. Rather, the real culprit of untimely marine animal death is cast-off fishing gear. A bag ban might catch a school of red herrings but it won’t save any real marine life.

For our study, we calculated that an average consumer using only lightweight plastic bags would be responsible for consuming less energy and water and generate fewer greenhouse gas emissions than someone using alternative bags. The main proposed alternative is five times heavier than the current bag and is responsible for the consumption of far more resources, energy and water. Paper bags also consume more resources, including five times more water over their lifecycle than lightweight plastic bags.

Further, the Department of Public Health has warned, “During the warmer months, the increased temperatures can promote the growth of bacteria that may be present on [reusable] bags.”

They encourage users to wash their reusable bags “frequently.” This of course consumes water – and if the advice were followed rigorously, “reusable” bags would consume as much as 40 times more water than lightweight plastic bags.

Some dismiss this advice, bragging that they never wash their bags. In those cases, they are putting themselves and other consumers at risk as bacteria spreads easily in shopping carts and at checkout counters.

Additionally, our research demonstrated enormous direct and indirect costs on California’s consumers. If California’s 12.4 million households spend five minutes each week cleaning their shopping bags to get rid of germs and bacteria, the annual opportunity cost would be more than $1.5 billion.

The bag ban is likely to disproportionately burden the working poor and those households on a tight budget. A dollar spent on 10 paper bags is a dollar not available for other purchases. And while it’s easy to place all the blame on the Legislature, grocery chains sponsored the plastic bag bill and may reap hundreds of millions of dollars charging the consumer more for a paper bag than it cost them to procure them wholesale.

Opponents of the bag ban say they’ll try to gather enough signatures to give voters the chance to repeal the plastic bag law.

In the meantime, it’s clear leaders in Sacramento passed another feel-good measure that hurts working people and the state economy.

Lance Christensen is director of the pension reform project at Reason Foundation. This column originally appeared in the Orange County Register.

The post Plastic Bag Ban Hurts California’s Economy appeared first on Reason Foundation.

Unfortunately, for those who see banning plastic grocery bags as a panacea, a recent report for the Reason Foundation shows that all these claims are false.

Authoritative studies show that plastic bags constitute less than 1 percent of visible litter in U.S. cities. The presence of plastic bags in trees and on the ground signifies that a community has a litter problem. The appropriate response is to reduce and ameliorate that problem through education and other initiatives – not to ban plastic bags.

Members of some pressure groups claim that plastic bags kill large numbers of marine animals. Even for bags distributed in coastal cities, that claim is simply false.

As David Santillo, a senior biologist with Greenpeace, told The Times of London: “It’s very unlikely that many animals are killed by plastic bags. The evidence shows just the opposite … . On a global basis, plastic bags aren’t an issue.”

Because they are so strong and light, plastic shopping bags can actually reduce the amount of waste that ends up in landfills.

About 80 percent of all grocery bags in the U.S. are made from lightweight plastic but constitute only 0.4 percent by weight of all waste sent to landfills.

Paper bags, which account for most of the remaining 20 percent of grocery bags used, generate the same amount of waste (0.4 percent of the total) because each bag is far heavier.

New Mexico’s plastic bag bans have likely increased the amount of waste produced as people switch to paper, which would actually increase the costs of municipal solid waste disposal.

Some alternative bags appear to be superior to lightweight plastic on some environmental measures, such as use of energy and emissions of greenhouse gases. But that is true only if those bags are reused a sufficient number of times (ranging from six to 30 or more, depending on the type of bag). In practice, households do not typically reuse their bags enough to achieve those gains.

At actual reuse rates, lightweight plastic bags result in about half the energy consumption and greenhouse gas emissions of alternative bags, whether those alternatives are paper or reusable.

Likewise, at actual reuse rates, all alternative bags are associated with greater water use.

Reusable bags are the worst, resulting in the use of at least 10 times as much water as lightweight plastic bags – if households wash their bags regularly. And such washing is strongly advised: Studies show that about half of unwashed bags contain potentially dangerous germs; meanwhile, failure to clean reusable bags regularly has resulted in several instances of serious illness.

So, banning lightweight plastic bags likely increases energy use, water use and emissions of greenhouse gases, but does not substantially reduce waste or litter, or the cost of associated municipal waste and litter collection.

If communities are concerned about litter, the best solution is likely a campaign directly addressing that problem.

Advocates of banning plastic grocery bags, while perhaps well-intentioned, are actually harming the environment, raising consumer costs and reducing personal freedom.

That sounds like a bad deal to me.

Julian Morris is vice president of research at Reason Foundation. This article originally appeared in the Albuquerque Journal.

The post Plastic Bag Bans Are a Not a Panacea for Environmental Ills appeared first on Reason Foundation.

• LOCAL GOV: What’s New in Local Government Privatization
• FEDERAL GOV: Reviewing the Past Year in Federal Privatization
• PRISONS: The Latest in Criminal Justice, Private Corrections
• PENSIONS: Rebutting Pension Reform Critics
• REGULATION: Grocery Bag Bans-Are They Green?
• PRIVATIZATION: Is Privatization a “Race to the Bottom?”
• News & Notes
• Quotable Quotes

The full newsletter is available here, and previous editions of the newsletter are available here.

The post Privatization & Government Reform Newsletter #8 (June 2014 edition) appeared first on Reason Foundation.

• LOCAL GOV: What’s New in Local Government Privatization
• FEDERAL GOV: Reviewing the Past Year in Federal Privatization
• PRISONS: The Latest in Criminal Justice, Private Corrections
• PENSIONS: Rebutting Pension Reform Critics
• REGULATION: Grocery Bag Bans-Are They Green?
• PRIVATIZATION: Is Privatization a “Race to the Bottom?”
• News & Notes
• Quotable Quotes

LOCAL GOV: What’s New in Local Government Privatization

Privatization and public-private partnerships remain a hot area of local government activity and innovation, according to the newly released Local Government Privatization section of Reason Foundation’s Annual Privatization Report 2014. The report reviews developments in privatization and public-private partnerships at the local level over the past year, including the latest on the privatization of municipal parking assets, water/wastewater public-private partnerships, solid waste privatization, fiscal distress in Michigan cities, and much more.
» FULL REPORT: Local Government Privatization 2014
» Annual Privatization Report 2014 homepage

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FEDERAL GOV: Reviewing the Last Year in Federal Privatization

A newly released section of Reason Foundation’s Annual Privatization Report 2014 provides an overview of the latest on privatization and public-private partnerships in the federal government. Topics include proposed legislation to address government agency competition with private enterprise; proposals to privatize the Tennessee Valley Authority, Fannie Mae and Freddie Mac; and the congressional passage of legislation encouraging public-private partnerships in water, wastewater and navigation projects.
» FULL REPORT: Federal Government Privatization 2014
» Annual Privatization Report 2014 homepage

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PRISONS: Recent Developments in Criminal Justice and Private Corrections

Criminal justice reform remains a potent national issue, and the private sector is rapidly evolving in its role in corrections and rehabilitation, according to Reason Foundation’s Annual Privatization Report 2014. The report’s section on criminal justice and corrections reviews developments in criminal justice reform, public-private partnerships in corrections, correctional healthcare privatization and more.
» FULL REPORT: Criminal Justice and Corrections 2014
» Annual Privatization Report 2014 homepage

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PENSIONS: Addressing Common Objections to Shifting from Defined-Benefit Pensions to Defined-Contribution Retirement Plans

State and local government pension systems’ costs are skyrocketing and unsustainable, endangering other budgetary priorities. The most effective long-term reform for dramatically reducing-if not eliminating-unfunded pension liabilities is converting defined benefit plans (DB) to defined contribution plans (DC) to minimize taxpayer risk and offer government workers the same type of retirement benefits that most private sector workers receive. However, converting from DB to DC plans faces steady resistance from those who benefit from the status quo, and opponents often make unfounded claims regarding the costs and shortcomings of reform. In this brief, Reason Foundation rebuts some of the most common arguments against reform.
» FULL POLICY BRIEF
» ARTICLE: The Public Employee Pension Crisis Explained

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REGULATION: How Green Is that Grocery Bag Ban?

In the past 15 years, approximately 190 municipalities in the U.S. have banned plastic shopping bags and more than half have also imposed fees on paper bags. Proposed legislation in California would ban plastic shopping bags and impose fees on paper bags statewide. Contrary to claims made by proponents of these policies, a new Reason Foundation study finds that they have a minuscule impact on litter, do not significantly reduce environmental impacts (and in some cases, increase them), may lead to adverse health effects, and impose costs that fall disproportionately on the poor.
» POLICY STUDY: How Green Is that Grocery Bag Ban?
» POLICY BRIEF: Evaluating the Effects of California’s Proposed Plastic Bag Ban

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PRIVATIZATION: Is Privatization a “Race to the Bottom?”

Privatization is a tool long used successfully by governments, yet it remains a ripe target for rhetorical attacks by ideological opponents. The latest example comes from a recent In the Public Interest (ITPI) report suggesting that contracting out government services creates a “race to the bottom” and “sets off a downward spiral in which reduced worker wages and benefits can hurt the local economy and overall stability of middle and working class communities.” Unfortunately, the report paints an overly simplistic scenario regarding the practice of privatization and ignores the financial unsustainability of government worker benefits.
» FULL ARTICLE

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NEWS & NOTES

New Report Estimates State and Local Pension Funding Status: The Center for Retirement Research at Boston College recently released its annual report on the funding of state and local government pension plans, which found that the funded status-the ratio of assets to liabilities-of government pension plans in 2013 held steady at 72 percent, leveling off after several consecutive years of declines from a 2007 level of 87 percent. Despite strong stock market gains, the report suggests that the overall funded status remained unchanged due to five-year actuarial smoothing (covering the years 2009-2013) and a significant reduction in the funded ratio reported by CalPERS. Overall, governments paid 83 percent of their annual required contributions, a slight increase over the 81 percent paid the previous two years. The report also estimated funding ratios using a risk-free five percent discount rate-not the 7.7 percent expected rate of return assumed in the earlier calculation-and found an overall funding ratio of 50 percent. The full report is available here.

Congressmen Introduce Federal Social Impact Bond Legislation: Last week, Congressmen Todd Young (R-IN) and John Delaney (D-MD) introduced the bipartisan Social Impact Bond Act (H.R. 4885), which would allocate $300 million to a new program in which state and local governments would compete for funds to repay investors that partner with those jurisdictions to implement privately financed, evidence-based social service interventions aimed at addressing unemployment, welfare dependency, child abuse prevention and other social challenges. “This bipartisan legislation harnesses the power of the private sector to improve government services while saving taxpayer dollars,” Rep. Delaney said in a press release. “Best of all, it moves our government to be more evidence-focused, so we can pay for achieving desired outcomes rather than paying for services regardless of the outcome.” The legislation and supporting information is available here.

Oregon Liquor Privatization Ballot Measure Withdrawn: Liquor privatization proponents in Oregon that had filed two separate ballot initiatives to privatize the sale of distilled spirits ran into legal challenges that ultimately prompted them to withdraw both measures in recent weeks, according to The Oregonian. In late May, the state Supreme Court rejected the ballot title for the proponents’ preferred initiative, and rather than proceed with signature gathering for the second, less desirable measure, they opted to drop the initiative drive for 2014 and seek privatization legislation in 2015 (and a 2016 ballot measure if that fails).

Texas A&M Outsources Airport Management: In the latest edition of his Airport Policy News newsletter, Reason Foundation colleague Robert Poole noted that Texas A&M University in College Station, TX has outsourced the operations and management of the university-owned Easterwood Airport in a 10-year contract with Astin Limited that began this month. The contract will see the firm invest $7 million in capital improvements that may include modernizing the McKenzie and general aviation terminals, adding a new multi-purpose hangar, and upgrading existing airport hangars, according to The Eagle. University officials anticipate that most airport employees will transition to the private operator.

Arizona DOT Launches ‘Safe Phone Zones’ Sponsorship Program Via Rest Area PPP: Earlier this month, the Arizona Department of Transportation announced a new “Safe Phone Zones” driver safety program in which insurance company GEICO is sponsoring a series of signs pointing drivers to state highway rest areas to use their cell phones for calls, texts and mobile app use. This is the first sponsorship program developed under the state’s five-year public-private partnership with Infrastructure Corporation of America for the operations and maintenance of 14 state rest areas. “These Safe Phone Zones provide travelers with the opportunity to pull into a rest area where they can use their phones safely and responsibly,” according to ADOT Director John Halikowski. “We are able to move this project forward because of the legislation enacted to generate public-private partnerships in Arizona-partnerships that have proven to be an innovative approach to funding transportation projects with non-traditional funding sources.”

San Diego Seeks to Streamline Managed Competition Process: San Diego Mayor Kevin Faulconer announced this month he would be implementing a consultant’s recommendation on ways to streamline the city’s managed competition (public-private competition) process, which has been criticized for being cumbersome and discouraging of private sector interest. Since being approved by voters in 2006, the city has only implemented four competitions-each of which was won by city workers-estimated to save $9 million annually overall, according to the San Diego Union-Tribune. The city hired a consulting team that included former Indianapolis Mayor and managed competition pioneer Stephen Goldsmith to review the program, and their analysis recommended that the city adopt San Diego County’s streamlined managed competition model, a 10-step process, compared to the city’s current 22-step process.

Upland, CA Contracts Out Library Operation: In late May, the Upland, CA City Council voted unanimously to enter into a public-private partnership with the Maryland-based Library Systems & Services Inc. to operate the Upland Public Library. The city expects to save $1 million over the five-year contract, according to the Inland Valley Daily Bulletin, while increasing the hours of operation by 24 percent, allowing the library to open seven days per week, and more than doubling the book and materials budget. “After a lengthy dialogue with our community and input from a citizens’ task force, the City Council was confident moving forward with a solution which provides more opportunities for library patrons, staff and volunteers while conserving taxpayer dollars,” Upland city manager Stephen Dunn noted in a press release.

San Bernadino Solicits Bids for Privatized Animal Shelter Operation: San Bernadino, CA officials are reviewing bids from a request for proposals seeking the potential privatization of the city’s animal shelter amid growing concerns over high euthanasia rates. The city is considering turning over the police-run shelter’s operation to a nonprofit in order to help improve the adoption rate and reduce severe overcrowding in the facility, which now holds 16,000 animals per year, far more than its design capacity, according to the Riverside Press-Enterprise.

Altoona, PA Officials Considering Water System Lease: City officials in Altoona, PA are considering a potential long-term lease of the city’s water and wastewater system, after a consultant report suggested that the city could generate between $180 million to $240 million and allow the city to pay off debt, fully fund all city pension systems, reduce its property tax, and return to fiscal health. A presentation summarizing the recommendations of the Griffin Financial Group is available here.

Survey Shows Most, Least Friendly States for Small Businesses: Earlier this month, Thumbtack.com (in partnership with the Ewing Marion Kauffman Foundation) released the results from its third annual Small Business Friendliness Survey, covering over 12,000 small business owners. The survey finds that Utah, Idaho, Texas, Virginia and Louisiana are the friendliest states for small businesses; the least friendly states for small businesses are California, Rhode Island, Illinois, Connecticut and New Jersey. The survey also found that taxation rates were less important than professional licensing requirements and ease of filing taxes in terms of a jurisdiction’s overall small business friendliness.

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QUOTABLE QUOTES

“[Ignoring some expenses is] exactly what some governors are doing to claim balanced budgets. Gov. Andrew Cuomo of New York moved some expenses off the books by paying them with promissory notes. Gov. Jerry Brown of California proposed a budget ignoring billions in expenses. Gov. Chris Christie of New Jersey skipped a payment to that state’s underfunded pension plans.

Under accrual methods, all those expenses would be recorded this year whether or not paid with cash. But under cash-based budgeting, those governors get to ignore them and to report balanced budgets to boot. In doing so, they are making involuntary debtors of unsuspecting young people to pay for current services. But because of cash-based budgeting, no one is the wiser. Needless to say, those three governors are by no means the only state executives gaming accounting rules.”
-David Crane, “Governors shouldn’t hide costs even when they can,” Contra Costa Times, June 6, 2014

“State/local employment contracts should not be negotiated in secret. Taxpayers are ultimately responsible for funding these agreements. They should be allowed to monitor the negotiation process and to hold government officials accountable for their actions. Open meetings will also quickly identify if one side is being unreasonable in negotiations to help the public determine who is acting in good or bad faith.”
-Jason Mercier, “Do you know how the current state contract negotiations are going?” Washington Policy Center, June 9, 2014

“RCW 43.88.090 now requires each major activity in the agency’s Activity Inventory to have at least one performance measure. If the agency and OFM agree that it is not possible to identify an appropriate quantitative performance measure for an activity, the agency must at least provide a narrative description of the intended outcome for the activity in the “expected results” text box provided in the system. The agency will not be able to submit its budget to OFM unless each activity is linked to at least one performance measure or has an expected results statement. The performance measure and expected results information will be printed on the Activity Inventory report that the agency must include in its budget submittal.”
-Washington State Office of Financial Management, 2015-17 Biennium Operating Budget Instructions, June 2014, (see Chapter 10: Performance Measures)

“‘Rhode Island is in the midst of an especially grim economic meltdown,’ a 2009 New York Times story began, ‘and no one can pinpoint exactly why.’ Five years later, the state continues to suffer from most of the same problems the Times story described: high unemployment, a crippling tax structure, dangerously underfunded state pension systems. But contrary to the Times’s claims, Rhode Island’s predicament is easy to explain. With no special economic advantages, the state has maintained an entitlement mentality inherited from an age of colonial and industrial grandeur. Rhode Island was once one of America’s most prosperous states, and its rate of higher-education attainment remains better than the national average. But the state’s key industries collapsed long ago, and its political leadership has refused to make adjustments to its high-cost, high-regulation governance system.”
-Aaron Renn, “The Bluest State,” City Journal, Spring 2014 edition

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Additional Resources:

• More privatization news
• More government reform news
• Annual Privatization Report 2014 homepage
• Innovators in Action 2014 homepage
• Privatization & Government Reform Newsletter archive

The post Privatization & Government Reform Newsletter #8 appeared first on Reason Foundation.

This study investigates all these claims using the best data available and finds:

1. The bans, fees and taxes on shopping bags have a minuscule impact on litter.
2. There is no evidence of a reduction in municipal litter or waste collection costs as a result of the introduction of bans, fees and taxes on shopping bags.
3. Other environmental impacts are not significantly reduced and some, including greenhouse gas emissions, may increase as a result especially of restrictions on the use of plastic (HDPE) shopping bags.
4. There is likely an adverse health effect from people failing to wash bacteria-ridden reusable bags, the use of which may increase as a result of restrictions on the distribution of other bag types.
5. Reusable bags are less convenient and, when taking into account the time and resources required to remove bacteria from bags, are very costly for consumers.
6. The costs of plastic bag bans fall disproportionately on the poor.

In sum, over the past 30 years, decisions by consumers and retailers have dramatically shifted consumption toward bags with superior environmental and cost characteristics, namely those made from high-density polyethylene (HDPE) plastic. By banning HDPE plastic bags, legislators have been reversing this trend, to the detriment of the environment and consumers.

Those people who are genuinely concerned about reducing litter and other environmental problems should focus their efforts on solutions that have been proven to work. In the case of litter, this means communicating the benefits of litter reduction and undertaking amelioration. In the case of protecting marine animals (a concern especially in coastal states), banning plastic bags won’t make a difference but shifting toward more rational fisheries policies would.

Attachments

• Appendix: Plastic Bag Bans in the United States and Other Countries
• Policy Study: How Green Is that Grocery Bag Ban?

The post How Green Is that Grocery Bag Ban? appeared first on Reason Foundation.

Topics discussed in this year’s edition include:

• A municipal fiscal review and outlook that finds that despite some slight economic improvement over the past year, local governments continue to struggle with ongoing fiscal challenges and continued budget pressures in the near and long term that are likely to drive policymakers toward greater fiscal restraint and the pursuit of new ways to control costs and increase government efficiency.
• An analysis of Detroit’s bankruptcy plan of adjustment, which offers a mixed bag on outsourcing and asset privatization.
• A review of Pontiac, Michigan’s transformation into a contract city under emergency manager control.
• An update on public-private partnerships for government-owned parking assets, including the steadily increasing revenues to the city in Indianapolis after privatization, a look back at the first year of privatized parking at Ohio State University, and the latest on Chicago’s controversial parking meter concession.
• An update on public-private partnerships in solid waste and recycling, including Detroit’s privatization of residential solid waste and recycling services.
• A review of the latest developments in water and wastewater public-private partnerships, including groundbreaking federal legislation that will encourage greater private investment in municipal water/wastewater infrastructure and the latest on privatization initiatives in Detroit, Los Angeles, Miami-Dade County, St. Louis and more.
• A review of the latest news in the privatization of municipal golf operations, including new contracts in Phoenix, Tucson, St. Paul and more.
• An update on efforts to privatize the operation of municipal zoos and animal shelters.
• A state-by-state review of numerous other local privatization initiatives.

The full Local Government Privatization section is available here, and the full Annual Privatization Report 2014 is available here.

The post What’s New in Local Government Privatization? appeared first on Reason Foundation.

A. Municipal Fiscal Review and Outlook

B. ANALYSIS: Detroit Bankruptcy Plan of Adjustment Offers Mixed Bag on Outsourcing, Asset Privatization

C. Pontiac, Michigan Emerges From Emergency Manager Control as Contract City

D. Parking Asset Public-Private Partnerships Update

E. Solid Waste Public-Private Partnerships Update

F. Water and Wastewater Public-Private Partnerships Update

G. Golf Course Privatization Update

H. Zoo and Animal Shelter Public-Private Partnerships Update

I. Local Government Privatization News and Notes

» Annual Privatization Report 2014: Local Government Privatization [pdf, 5.1 MB]

» Complete Annual Privatization Report 2014

The post Privatization and Public-Private Partnership Trends in Local Government appeared first on Reason Foundation.

Annual Privatization Report 2014 details the latest on privatization and government reform initiatives at all levels of government. The individual sections include:

• Air Transportation
• Surface Transportation
• Transportation Finance
• Education (COMING SOON)
• Federal Government Privatization (COMING SOON)
• State Government Privatization (COMING SOON)
• Local Government Privatization (COMING SOON)
• Criminal Justice and Corrections (COMING SOON)

Your comments on Annual Privatization Report 2014 are important to us. Please feel free to contact us with questions, suggestions or for more information. For the most up-to-date information on the rapidly changing privatization world, please visit Reason’s privatization research archive, and sign up for our monthly Privatization & Government Reform Newsletter.

Leonard C. Gilroy, Editor
Director of Government Reform, Reason Foundation
leonard.gilroy@reason.org

The post Annual Privatization Report 2014 appeared first on Reason Foundation.

• MUNICIPAL BANKRUPTCY: Analyzing Detroit’s Plan of Adjustment
• TRANSPORTATION: Replacing Fuel Taxes With Per-Mile Tolling
• PENSIONS: Why the “California Rule” is Counterproductive
• INNOVATORS IN ACTION: Pioneering Pension Reform in Michigan
• SOCIAL FINANCE: Massachusetts Announces Social Impact Bond Program
• PRIVATIZATION: Missouri Think Tank Examines State, Local Privatization Opportunities
• News & Notes
• Quotable Quote

MUNICIPAL BANKRUPTCY: Analyzing Detroit’s Plan of Adjustment

Detroit’s ongoing bankruptcy saga has now taken another turn with the long-awaited release of Emergency Receiver Kevyn Orr’s plan of adjustment last week. While considerable attention is understandably being paid to the treatment of creditors and pensioners in the overall plan, it’s also important to review how the plan addresses future city government operations-specifically with regard to the privatization of services and assets-as well as proposed reforms to the city’s pension system. In two new articles, Reason Foundation analysts explore these issues.

In my latest article, I write that the more services and assets privatized, the more manageable the emergence from bankruptcy and the smoother the path to long-term fiscal and financial sustainability-which translate into improved quality of life for Detroit’s citizens and businesses. However, on both fronts-outsourcing and asset privatization-the proposed plan of adjustment is a mixed bag.

In a separate article, my Reason Foundation colleague Anthony Randazzo writes that the history of Detroit’s bad actuarial assumptions and its poor operating practices more than make the case for pension reform. The city’s plan to “adjust” its $18 billion in debt by slashing as much as half of it before exiting bankruptcy includes cuts to already accrued pension benefits, as well as changes to how future public pension benefits are earned. The proposal also has less innovative, but important elements of good pension reform including forcing the city to use “market values” in accounting for its liabilities, using slightly more realistic investment return assumptions, and adjusting its defined-benefit system. However, while the Detroit plan of adjustment makes some steps towards the needed reform, there is more to do.
» FULL ARTICLE: Detroit Plan of Adjustment Leaves Much to be Desired on Privatization (Gilroy)
» FULL ARTICLE: Detroit Bankruptcy Pension Reform Not Good Enough (Randazzo)
» RANDAZZO & GILROY OP-ED IN THE DETROIT NEWS: How Detroit Can Build From Bankruptcy

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TRANSPORTATION: Replacing Fuel Taxes With Per-Mile Tolling

A new Reason Foundation policy brief focuses on the challenge of developing a viable, user-friendly, per-mile charging system to replace fuel taxes for the nation’s major highways and outlines 10 reasons why per-mile tolling is a better highway user fee than fuel taxes. As the brief explains, fuel taxes should be replaced with a direct charge for highway services that is sustainable, fair, efficient and-for major highways and bridges-tailored to the capital and operating cost of individual facilities. Further, the system should not create privacy concerns by enabling governments to track where and when people travel, and it should give motorists choices in how to pay for their miles traveled. » FULL POLICY BRIEF

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PENSIONS: Why the “California Rule” is Counterproductive

The so-called “California rule” on pensions basically holds that California government employees acquire a right to their promised pension benefits on day one of employment, and those benefits are assumed to be protected for their entire career in government. In other words, they are seen as permanent contractual rights that cannot be changed-unless the terms are modified to bestow enhanced benefits. Policymakers are thus precluded from later deciding to enact reforms to rein in those benefits in the interest of the financial sustainability of the pension system-such as reducing cost of living adjustments or increasing contribution rates-even if on a purely prospective basis, where previously accrued benefits would be left untouched. In a recent Reason.org article, Emory Law School associate professor of law Alexander Volokh explains why the “California rule” is counterproductive and explores several potential workarounds, including shifting to defined contribution plans, providing benefits via short-term contracts, amending the state constitution, and privatization. » FULL ARTICLE

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INNOVATORS IN ACTION: Pioneering State-Level Pension Reform in Michigan

The latest installment of Reason Foundation’s Innovators in Action monthly interview series-which profiles innovative policymakers in their own words, highlighting good government efforts delivering real results and value for taxpayers-examines Michigan’s groundbreaking reforms to its state employee pension system in 1996, which closed the defined-benefit system to new hires and created a parallel defined-contribution system. Michigan’s pioneering reforms have served as a model for similar actions taken later in Alaska, Utah and other states. I recently interviewed former state treasurer Douglas B. Roberts, Ph.D., on the factors that prompted Michigan’s historic pension reforms, how proponents made the case for reform, lessons learned, and much more. » FULL INTERVIEW

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SOCIAL FINANCE: Massachusetts Announces $27 Million Social Impact Bond Program

A month after New York launched the nation’s first social impact bond initiative-where the private sector finances and implements new social service delivery models on behalf of governments under a pay-for-success contract model-Massachusetts Gov. Deval Patrick announced the launch of the Massachusetts Juvenile Justice Pay for Success Initiative, a seven-year, $27 million program that represents the largest social finance investment in the U.S. thus far. » FULL ARTICLE

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PRIVATIZATION: Missouri Think Tank Examines State, Local Privatization Opportunities

In February, the Missouri-based Show-Me Institute released a report examining ways that Missouri’s state and local governments can and do partner with the private sector to provide an array of public services, as well as challenges that some jurisdictions have faced in contracting out services and best practices in implementation. I recently interviewed Show-Me Institute Director of Local Government Policy David Stokes, the report’s author, on its findings. » FULL INTERVIEW

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NEWS & NOTES

New Reason Foundation Pension Reform Case Study on San Jose: Starting in 2010, San Jose embarked on a series of pension reforms that are profiled in a new Reason Foundation case study. These reforms culminated with the passage of Measure B, under which retirement benefits were reduced for new employees, while current employees had to choose between switching to a plan with reduced benefits or contributing more of their salaries in order to maintain their existing benefits. In addition, the measure eliminated the “13th checks” that had been issued in the past when the pension investment fund had earned a return higher than a certain threshold, reduced the automatic annual cost-of-living adjustment from 3 percent to 1.5 percent, and required voters to approve any future benefit increases. With many other cities and states facing large unfunded liabilities for post-employment benefits, San Jose offers one possible model for reform.

Detroit Council Gives Final Approval to Solid Waste Outsourcing: Last week, Detroit’s city council gave final approval to two contracts with private waste haulers for residential trash and recycling pickup services that are expected to save taxpayers $6 million annually, according to the Detroit News. The firms will offer positions to current city solid waste workers at a higher pay rate, and the city will avoid an estimated $35 million in costs for new vehicles to replace its aging fleet. “We let the facts drive our decision and […] concluded that the residents of Detroit are better served by turning over trash collection to private contractors better equipped to provide improved and expanded service,” according to the city’s Chief Operating Officer Gary Brown.

Dallas Exploring Privatized Road Maintenance: Dallas, Texas city manager A.C. Gonzalez is reportedly exploring privatizing the city’s street maintenance, according to the Dallas Morning News. Gonzalez recently informed the city council that it was in preliminary discussions with a private infrastructure firm on privatization concepts-including a fixed-cost contract covering all street maintenance services-to stem the city’s annually rising costs in maintenance expenditures. “If they could just keep it the same as what we’re spending, it’s a big win,” according to Gonzalez.

Washington State Opens Bulk Printing to Competition: After a lengthy, year-long review, Washington State Gov. Jay Inslee’s administration recently announced plans to open up bulk state printing services to private sector competition. State agencies seeking products like business cards, letterhead, brochures, maps, and voter guides will now be able to solicit bids directly from the state’s print shop as well as over 350 private printing firms, according to The News-Tribune. The administration also announced plans to review four more state activities for potential outsourcing, including remaining print and imaging functions, website functions, real estate leasing services and vehicle liability claims.

Texas Approves Bundled Maintenance Contract for Houston-Area Highways: Earlier this month, the Texas Transportation Commission approved a two-year, $23 million contract with a private vendor to perform all routine highway maintenance on 350 miles of state-controlled highways-including Interstates, U.S. highways, state highways and farm-to-market roads-within the Beltway 8 loop around Houston. Under the contract, Texas Tree and Landscape, Ltd. will take over a full-scope of routine maintenance functions-encompassing pavements, guardrails, signage, mowing, striping, litter removal and more-at a cost nearly 15 percent lower than the state’s, according to Engineering News-Record. The state expects to roll out a number of similar bundled highway maintenance contracts across the state, with anticipated aggregate savings of approximately $96 million over the next five years.

Goldwater Institute Challenges Tucson’s Bid Preference Program: Earlier this month, the Arizona-based Goldwater Institute filed a lawsuit challenging a 2012 City of Tucson ordinance that enacted a discriminatory preference for local and state vendors in city contracts for goods and services. Filed on behalf of two Tucson taxpayers and a local business owner, Goldwater is seeking a court order to invalidate the bid preference ordinance as being illegal under state statute and unconstitutional under both the federal and state constitutions. More details on the case and the legal rationale are available here.

University of Kentucky to Pursue Privatized Dining Services: Earlier this month, officials at the University of Kentucky directed its purchasing division to begin negotiations with potential vendors to take over campus dining services in an effort to expand the capacity of dining facilities, as well as lower the cost and improve the quality of dining services offered. Conditions sought by the university include the retention of current dining employees and student workers, the continuation of a current local food purchasing program, and the addition of healthier food choices. The university is also asking bidders to make a capital investment of between $25 million to $50 million to improve and expand dining facilities on the campus in order to avoid taking on new debt, according to the Lexington Herald-Leader. The university received several private proposals in November 2013 after issuing a request for proposals in September.

Maine Announces New Liquor Wholesale Lease: Though categorized as a “control state,” Maine has leased the operation of its state-owned liquor wholesale enterprise since 2004. In the summer of 2013, Maine launched a procurement to rebid its wholesale liquor warehousing and delivery operation, and early last month announced that it had selected Pine State Trading Company for a 10-year lease designed to significantly increase revenues to the state relative to the previous 10-year lease agreement. Under the previous wholesale system lease with Maine Beverage Company, the state received an estimated $190 million in revenues over the 10-year contract period, which included a $125 million upfront payment and a share of annual revenues; the new lease agreement is expected to generate up to $450 million in revenue over the next decade, primarily due to shifting from a percentage-based revenue share model to one that pays the contractor a set fee, according to the Bangor Daily News. The administration of Gov. Paul LePage sought the increased revenues to help cover nearly a half million dollars in past Medicaid debts owed to the state’s hospitals.

Early Results from the Justice Reinvestment Initiative: A new Urban Institute report developed on behalf of the U.S. Department of Justice’s Bureau of Justice Assistance (BJA) offers some early insights into the implementation of the BJA’s Justice Reinvestment Initiative (JRI) across 17 states since 2010. The initiative relies on using evidence-based strategies to identify the drivers of prison populations and correctional costs and develop corresponding policies to better manage them while enhancing public safety. Part of the initiative involves reinvesting the cost savings from successful evidence-based programs into more effective public safety measures. According to the report, eight states have already experienced reductions in their prison populations since launching JRI, and it projects cost savings-both from reduced prison populations and avoided capital costs of new prisons-of up to $4.6 billion. The full report-Justice Reinvestment Initiative State Assessment Report-is available here.

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QUOTABLE QUOTE

“Even under the most conservative measures, public pension liabilities are currently over $1 trillion larger than plan assets. Using discount rates that actually reflect the promise reveals shortfalls of $2.5 trillion for accumulated benefits only and over $3 trillion for broader measures. This shortfall has to be borne by some party: taxpayers or public employees, be they past, current, or future.”
-Robert Novy-Marx and Joshua D. Rauh, “Policy options for state pension systems and their impact on plan liabilities,” Journal of Pension Economics and Finance, April 2011.

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Additional Resources:

• More privatization news
• More government reform news
• Annual Privatization Report 2013 homepage
• Innovators in Action 2014 homepage
• Innovators in Action 2013 homepage
• Privatization & Government Reform Newsletter archive

The post Privatization & Government Reform Newsletter #4 appeared first on Reason Foundation.

• STATES: Sampling the State of the State Speeches
• EDUCATION: Houston Reducing Achievement Gaps Under Student-Based Budgeting
• PUBLIC HEALTH: Rush to Regulate E-Cigarettes May Harm Public Health
• PENSIONS: Rhode Island Pension Reform Case Study
• SOCIAL FINANCE: New York Launches Social Impact Bond Program
• LOTTERIES: Pennsylvania Ends Procurement for Private Lottery Management
• PRISONS: The Challenge of Public/Private Cost Comparisons
• INNOVATORS IN ACTION: Pioneering Road User Charges in Oregon
• News & Notes
• Quotable Quotes

STATES: Sampling the State of the State Speeches

With President Obama’s State of the Union address getting major attention this week, it’s easy to forget that over a dozen state governors have also been busy in recent weeks giving their annual State of the State speeches. Looking across a representative sample of six recent State of the State speeches-three from “blue” states (California, New York and Colorado) and three from “red” states (Wisconsin, Indiana and Georgia)-some common policy themes emerge, including tax reform, government reform, increasing rainy day fund balances, education and infrastructure. » FULL ARTICLE

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EDUCATION: Report Ranks Houston Tops In Reducing Achievement Gaps Under Student-Based Budgeting

In the United States, state and local education funding systems are increasingly adopting a “school funding portability” framework, where funding is attached to the students and “follows the child” to the school he or she attends. While this goes by several names-including weighted student formula, results-based budgeting, student-based budgeting, “backpacking” or fair-student funding-in every case the meaning is the same: dollars rather than staffing positions follow students into schools. A new Reason Foundation report examines 14 school districts currently using portable student funding, ranking each district in 10 categories, including test scores, achievement gaps, graduation rates, and transparency. It also recommends a series of “best practices” for districts, including publishing school report cards for parents, using performance-based pay for teachers and principals, allowing students to enroll in any school in the district, and giving principals control over their hiring and budgets. » FULL REPORT

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PUBLIC HEALTH: Rush to Regulate E-Cigarettes May Harm Public Health, Anti-Smoking Efforts

Despite a recent Reason/Rupe poll that found that 62 of Americans support governments allowing the use of e-cigarettes in public places, cities like New York City and Chicago have recently enacted ordinances to include e-cigarette “vaping” in existing public smoking bans. Further, over the last year there has been a wave of local regulations enacted or proposed across the country to restrict the sale or use of e-cigarettes. In a recent Orange County Register commentary, I discuss how the misguided rush to limit the sale or use of e-cigarettes is more likely to harm public health instead of benefit it, primarily by making it more difficult for smokers to transition to safer nicotine delivery alternatives, thus keeping them smoking longer.
» FULL ARTICLE
» REASON/RUPE POLL RESULTS

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PENSIONS: Rhode Island Pension Reform Case Study

In 2011, Rhode Island enacted major pension reform legislation spearheaded by State Treasurer and current gubernatorial candidate Gina Raimondo to address an unfunded pension liability of $6.8 billion and a system less than 50 percent funded relative to its obligations. Among the changes, the reforms introduced a hybrid defined-benefit/defined-contribution funding system, suspended cost-of-living-adjustments for retirees, and increased the retirement age. A new Reason Foundation report offers a detailed case study of Rhode Island’s pension reform efforts, reviewing the challenges that prompted the reforms, the specific policies enacted, and the lessons learned for other states and municipalities facing significant unfunded pension liabilities. » FULL REPORT

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SOCIAL FINANCE: New York Launches First State-Level Social Impact Bond Program

The concept of social impact bonds-in which the private sector finances and implements new social service delivery models on behalf of governments under a pay-for-success contract model-has been advancing rapidly in the U.S. in recent months. New York State recently announced the first state-level social impact bond program, which is aimed at reducing recidivism among recently released inmates. Additionally, legislators in New Jersey and Washington State are seeking to launch social impact bond pilots. » FULL ARTICLE

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LOTTERIES: Pennsylvania Ends Procurement for Private Lottery Management

All of the 44 states that operate lotteries currently outsource certain components of their internal lottery operations, but three states-Illinois, Indiana and New Jersey-have taken privatization further in recent years by entering into private management agreements (PMAs) with private service providers designed to increase net lottery revenues to the state as a means of augmenting traditional tax revenues. Privatized lottery management took a different course in Pennsylvania, however, where last month Gov. Tom Corbett’s administration announced that it was abandoning a PMA negotiated the previous year that got stalled amid union and legislative opposition and a rejection of the contract by the state’s attorney general in early 2013. » FULL ARTICLE

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PRISONS: The Challenge of Public/Private Cost Comparisons

There is an ongoing debate over the relative cost of public and private prison operations, with some research suggesting that governments can save money through public-private partnerships and other research finding that the cost difference is negligible or that public sector delivery is cheaper. One of the primary reasons for this disparity is different budgeting and accounting practices in the public and private sectors, which make “apples-to-apples” comparisons difficult and often distort cost comparisons in favor of the public sector. A new Reason Foundation policy brief examines this issue, using a 2011 Arizona Department of Corrections report as a case study. Though the report was interpreted as showing that privately-operated prisons are costlier than public ones in Arizona, it suffers from a variety of methodological shortcomings, including deficient treatment of capital assets and liabilities, retiree healthcare and pension costs for public employees, inmate healthcare costs, transferred legal risks, and taxes paid to state and local government. The Reason brief finds that rigorous cost comparisons must be undertaken carefully, lest they muddy the debate at the expense of sound policymaking. » FULL POLICY BRIEF

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INNOVATORS IN ACTION: Pioneering Road User Charges in Oregon

The latest installment of Reason Foundation’s Innovators in Action monthly interview series-which profiles innovative policymakers in their own words, highlighting good government efforts delivering real results and value for taxpayers-examines Oregon’s work in recent years to advance the concept that may ultimately replace the beleaguered gas tax: mileage-based road user charges. I recently interviewed James Whitty, manager of the Oregon DOT’s Office of Innovative Partnerships and Alternative Funding, on what prompted Oregon policymakers to explore road user charges, the evolution of the state’s pilot programs, how Oregon has addressed the public’s concerns over protecting privacy, and much more. » FULL INTERVIEW

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NEWS & NOTES

The Economist on Divesting Government Assets: I was honored to be cited in an article in the January 11th print edition of The Economist on the topic of divesting government-owned assets. The article cited a surge in the privatization of state-owned assets in emerging economies in recent years and suggested that advanced OECD economies take another look at their asset portfolios, as “[s]elling some of these holdings could work wonders: reduce debt, finance infrastructure, boost economic efficiency.” The full article is available here.

New Reason Foundation Study Recommends Organizational Reform of Air Traffic Control System: Despite dramatic advances in technology, the basic features and procedures of the 1960s-era air traffic control (ATC) system have remained largely unchanged in the U.S. and have fallen well behind the capacity of new technologies to provide safer, faster, more reliable and more fuel-efficient air travel and to keep pace with the increasing volume of air traffic. A new report by Reason Foundation founder and transportation policy director Robert Poole published by the Hudson Institute finds that fundamental reform of the U.S. air traffic system’s funding and governance is the key to a full embrace of cutting-edge air traffic management in this country. It’s worth noting that ATC providers in many other countries have embraced the new technologies and procedures recommended by Poole much more readily than we have in the U.S.-including providers in Australia, New Zealand, Canada, Germany and the UK-and are seeing superior performance.

New Reason/Buckeye Institute Study Recommends Public-Private Partnerships to Operate State Parks: Reason Foundation and the Ohio-based Buckeye Institute released a study in December making the case that one way to keep cash-strapped state parks open without imposing additional burdens on the taxpayer is to utilize public-private partnerships. Many states already use private concessionaires to provide piecemeal services within parks (e.g., food, retail, lodging, marinas, etc.) so a shift to more extensive involvement can build on that. Whole park operation PPPs would transfer the responsibility of maintaining the park to a private operator while allowing them to collect entrance and other fees, paying the state an annual rent payment in return. The U.S. Forest Service has used this PPP model for over 25 years to operate hundreds of its developed recreation areas nationwide, and in 2012 California became the first state to turn over the operation of state parks to private recreation management companies to avoid closure. The full report is available here.

Pennsylvania Seeking Innovative Public-Private Partnership for Bridges: The Pennsylvania Department of Transportation (PennDOT) issued a request for qualifications in December 2013 seeking qualified private contractors for its Rapid Bridge Replacement Project, a public-private partnership to reconstruct at least 500 structurally deficient bridges of similar design. The selected team will manage the bridges’ design, construction and maintenance under one comprehensive contract to streamline project delivery, and it will finance the project in an availability-payment concession. The department anticipates significant cost savings since the same basic design and construction standards can be used for multiple bridges. The project will launch in 2015, and the selected team will also maintain the bridges for as much as 35 years. A Pennsylvania Department of Transportation spokesperson told the Pittsburgh Post-Gazette last week that the initiative “gives us the ability to accelerate the delivery of 550 to 650 bridge replacements that otherwise wouldn’t happen for 15 to 20 years if we were to use a traditional contracting model.”

Privatization of School Support Services on the Rise in Michigan: The Mackinac Center for Public Policy’s Michigan School Privatization Survey 2013, released last week, finds that 357 of Michigan’s 545 local school districts (65.5%) contracted out for at least one of the three main non-instructional services-custodial, food, and transportation-in 2013, a figure that has more than doubled since the Center began publishing its annual study in 2001. The survey found that 45.5% of districts contracted with private companies for facilities maintenance and other custodial work, followed by food services at 36.5% and transportation at 21%. “Every dollar saved through privatization is a dollar that can be redirected toward the classroom where it belongs,” according to the Mackinac Center’s James Hohman. The full report is available here.

Oregon Liquor Privatization Push Begins: In 2011, Washington State became the first of the 18 so-called liquor “control states”-those with state-run monopolies over the distribution and/or sale of distilled spirits-since the end of Prohibition to fully privatize its wholesale and retail monopolies, as discussed in the October edition of this newsletter. But it may not be the last. In mid-December, a Northwest Grocery Association-backed group called Oregonians for Competition filed five different initiative petitions that would end the state-run liquor monopoly and expand the sale of distilled spirits to retail outlets over 10,000 square feet. Liquor sales are currently only allowed in state-sanctioned liquor stores, which would continue to operate under the various proposed ballot measures. The five measures are variations of a proposed Oregon Liquor Control Modernization Act, and Oregonians for Competition plans to choose one version to potentially take forward to the November 2014 ballot, according to The Oregonian. The state’s Liquor Control Commission is currently pushing the legislature to consider a modernization effort that could potentially forestall privatization, but early skepticism among legislators prompted The Oregonian’s editorial board to recently suggest that they should not “be surprised in November when voters come to the sensible conclusion that government really shouldn’t be in the booze-selling business.”

Rockefeller Institute Report on Defined-Benefit Pensions: Regardless of where one stands on the issue of reforming public employee pension systems, I would commend to readers’ attention a new Rockefeller Institute of Government report by Donald Boyd and Peter Kiernan entitled, Strengthening the Security of Public Sector Defined Benefit Plans. Starting with the premise that defined-benefit pension systems “can and should be structured to fund benefits securely,” Boyd and Kiernan present a blistering critique of the “bad incentives, inadequate rules, and little transparency” that have contributed to the massive underfunding of public sector defined-benefit pensions, and they offer a series of recommendations designed to address these systemic flaws. Defenders of defined-benefit pensions and pension reform advocates alike will benefit from Boyd and Kiernan’s analysis. The full report is available here.

Privatizing Utah’s State-Owned Golf Courses: Provo’s Daily Herald recently reported that Utah State Rep. Kay Christofferson is planning to introduce a bill in the 2014 legislative session that would require the Department of Natural Resources to contract out the operations and maintenance of the four gold courses owned and operated by the state. A 2012 Utah State Parks report found that the four courses required taxpayer subsidies to cover operating and debt expenses. “Why are we competing against people that provide that service? Let’s put it out for a [proposal] and see if we can get somebody to operate this privately,” Christofferson told the Herald.

Indianapolis Seeking Private Partners for Parks: In November, Indianapolis issued a request for proposals seeking potential private for-profit or nonprofit partners to take over operations of parks, take over existing park facilities or programs, and/or propose new facilities or programs. The city is seeking opportunities to lower operating costs and potentially increase revenue through the solicitation. According to the Indianapolis Star, the city’s $3.4 million annual park capital budget is unable to cover a $46 million backlog of facility improvements, much less the $51 million in new park facilities sought by the city. Proposals are due on January 31st.

Solid Waste Privatization to Help Eliminate Deficits in Lawrence, IN: A new contract with Republic Services for residential trash and recycling collection will save Lawrence, Indiana an estimated $5 million over the 10-year contract, helping the city eliminate its budget deficit, according to an article last month in the Indianapolis Star. The company offered positions to all nine city sanitation employees and paid the city $300,000 for its trucks and waste containers, according to the article.

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QUOTABLE QUOTES

“Governments of OECD countries still oversee vast piles of assets, from banks and utilities to buildings, land and the riches beneath (see table). Selling some of these holdings could work wonders: reduce debt, finance infrastructure, boost economic efficiency. But governments often barely grasp the value locked up in them.”
-“Setting out the store,” The Economist, January 11, 2014.

“The problem [with defined benefit pensions] begins with mismeasurement of liabilities and the cost of funding them securely, for financial reporting purposes. The proper way to value future cash flows such as pension benefit payments is with discount rates that reflect the risk of the payments. This is separate from the question of the rate pension funds will earn on their investments. […] This bears repeating: The proper rate for valuing pension liabilities on financial statements is separate from the question of what pension funds will earn on their investments. Different rates may be appropriate for valuing liabilities than for assumed investment returns – and we recommend, later, that different rates be used. The major significance of valuing liabilities incorrectly is that it leads to inadequate funding policies, and encourages the mistaken belief that benefits can be greater, services can be greater, or taxes lower while still funding benefits securely.”
-Donald J. Boyd and Peter J. Kiernan, Strengthening the Security of Public Sector Defined Benefit Plans, The Nelson A. Rockefeller Institute of Government, State University of New York, January 2014, pp.vii-viii.

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Additional Resources:

• More privatization news
• More government reform news
• Annual Privatization Report 2013 homepage
• Innovators in Action 2014 homepage
• Innovators in Action 2013 homepage
• Privatization & Government Reform Newsletter archive

The post Privatization & Government Reform Newsletter #3 appeared first on Reason Foundation.

• STATE/LOCAL BUDGETS: New Reports Highlight Fiscal Shape of States, Cities
• CONTRACTING: Are Local Vendor Preferences a Good Thing?
• CRIMINAL JUSTICE: Reforming Mandatory Minimum Laws in Louisiana
• CORRECTIONS: Responding to Critiques of Correctional Privatization
• TRANSPORTATION: Reviewing the First Year of the I-495 Express Lanes
• FEDERAL: Divesting the Tennessee Valley Authority
• INNOVATORS IN ACTION: Pursuing Fiscal Self-Reliance in Utah
• News & Notes

STATE/LOCAL BUDGETS: New Reports Highlight Fiscal Shape of States, Cities

Earlier this year, three separate reports by major national organizations suggested that states and local governments are going to face continued fiscal headwinds into the future. Two new reports by the National Association of State Budget Officers (NASBO) and the Pew Charitable Trusts, respectively, shed additional light on the fiscal shape of state and local governments in the wake of the Great Recession and similarly suggest persistent fiscal pressures. » FULL ARTICLE

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CONTRACTING: Are Local Vendor Preferences a Good Thing?

Across the nation, a number of municipal governments have adopted ordinances that give preferential treatment to local businesses in procurements, often via requirements that non-local bidders come in 3-10% lower on their pricing relative to their locally-based competitors. Elected officials often argue that such local preferences benefit cities by boosting local businesses and economic activity and increase municipal tax revenues. But is preferential treatment for local businesses a good thing in municipal contracting? » FULL ARTICLE

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CRIMINAL JUSTICE: Reforming Mandatory Minimum Laws in Louisiana

Louisiana today has the highest incarceration rate among the states, with 868 of every 100,000 of its citizens in prison. A major cause is the expansion of determinate sentencing laws in recent decades, which have been disproportionately applied to nonviolent crimes. Further, the trend has been costly for taxpayers-the state prison population has nearly doubled over the past two decades, with a commensurate increase in correctional spending of over $300 million. Yet, these laws have failed to reduce Louisiana’s violent crime rate. While Louisiana policymakers have enacted some modest sentencing reforms, a recently released study by Reason colleagues Lauren Galik and Julian Morris recommends that they take additional steps to reform the state’s sentencing laws to right-size the prison population and get better results from its criminal justice system. » FULL ARTICLE

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CORRECTIONS: Responding to Critiques of Correctional Privatization

One of the more contentious areas of privatization policy debate involves competitive contracting in corrections, including the operations and management of prisons themselves, as well as specific support services like correctional healthcare. Four recent Reason Foundation articles examine different aspects of the debate and find that the related issues are often much more nuanced than they may first appear. » FULL ARTICLE

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TRANSPORTATION: Reviewing the First Year of the I-495 Express Lanes

In recent years, managed lane projects-projects involving the tolling of highway lanes where prices vary throughout the day depending on the amount of traffic in the lanes (e.g., the higher the traffic, the higher the toll) to maintain free-flow conditions-have been proliferating in various metro areas, as has the private financing of public highway infrastructure projects through public-private partnerships. One project that combines both in a 75-year long-term concession is the 495 Express Lanes project on the Northern Virginia portion of Interstate 495 (the Capital Beltway), which recently celebrated its first anniversary. A recent report provides an interesting snapshot of the first year in operation. » FULL ARTICLE

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FEDERAL: Divesting the Tennessee Valley Authority

A recent Reason Foundation article by William B. Newman, Jr.-a former Conrail executive who worked on its successful sale by the federal government via IPO-explores the Obama administration’s interest in a potential divestiture of the Tennessee Valley Authority (TVA) and reviews some options on how that could proceed in practice. Newman explores three potential divestiture options-a public offering, an asset sale and divestiture to the states-and makes the case that a TVA divestiture would: (1) avoid the potential pressure for a future taxpayer bailout, given the TVA’s massive debt load and investment needs, and (2) shed the federal government of an unnecessary function, given the ubiquity of private sector power provision in this country. » FULL ARTICLE

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INNOVATORS IN ACTION: Pursuing Fiscal Self-Reliance in Utah

The latest installment of Reason Foundation’s Innovators in Action monthly interview series-which profiles innovative policymakers in their own words, highlighting good government efforts delivering real results and value for taxpayers-examines Utah’s recent moves towards fiscal self-sufficiency, relative to federal fund transfers and land ownership.

Utah State Rep. Ken Ivory has emerged as a leader on both issues. Ivory was a primary sponsor of the recently enacted “Financial Ready Utah” bills-aimed at quantifying the amount of federal funding used by state agencies and making contingency plans in the event of a major cutback in the flow of federal funds-as well as the 2012 Transfer of Public Lands Act, which established a framework for the transfer of certain federal lands to the state of Utah. Ivory also serves as president of the American Lands Council, a nonprofit advancing the cause of local control of land access, land use, and land ownership in the West. I recently interviewed Rep. Ivory on the rationale behind the Financial Ready Utah bills and the Transfer of Public Lands Act, the history of federal control of Western lands, and much more.
» Read full interview with Utah State Rep. Ken Ivory
» Innovators in Action 2013 homepage

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NEWS & NOTES

Toledo Officials Tout Public-Private Partnership in Solid Waste Collection: Since 2011, Republic Services has provided solid waste management services for Toledo, Ohio (via an agreement with Lucas County), the result of an attempt by city officials to seek cost savings amid a $48 million budget deficit. In a recent blog post, I discuss a promotional video produced by Republic that features first-hand testimonials from Toledo Mayor Mike Bell, City Councilman Tom Waniewski, and several other local officials and city department heads on the benefits of their solid waste contract-which include $6 million in annual savings-and more.

Colorado State University Examining Potential Parking Lease: The Coloradoan reports that officials at Colorado State University (CSU) in Fort Collins are evaluating the potential lease of its parking assets to a private investor/operator as one way to help address growing parking demand. The move follows on the heels of Ohio State University’s 50-year lease of its parking assets to a private consortium last year, in exchange for a $483 million upfront payment that was invested in the university’s academic endowment to help support its long-term academic mission. According to CSU officials, any revenues from a parking asset lease would be used to fund new parking facilities and transit operations.

Louisiana Piloting Privatized Driver’s License Renewals: The Advocate recently reported that Louisiana Gov. Bobby Jindal’s administration has launched a pilot program to privatize driver’s license renewals in two locations (in East Baton Rouge and Jefferson Parishes, respectively), with the possibility of expanding the program statewide. According to Office of Motor Vehicles (OMV) Commissioner Stephen Campbell, customers at the private facilities may pay a transaction fee of up to $18, on top of the regular renewal fees charged in state OMV facilities, but in return they are expected to see shorter wait times and greater convenience. As Louisiana State Police Superintendent Michael Edmonson explained, “Some people just want the ease, and they pay more,” according to the Associated Press.

Indianapolis Seeking Public-Private Partnerships for Parks: Late last month, the Indianapolis Star reported that the city parks department is seeking potential private partners for a range of potential activities, including launching new programs, taking over existing facilities or programs, or even taking over operations of “swaths of the park system.” The initiative is aimed at lowering costs, expanding programs (and revenue generation opportunities), and addressing a nearly $46 million backlog of needed facility improvements. “If a proposal comes back in a way that would improve the quality of a space, and that would improve utilization of a space, then we are open to having some of these facilities (privately) operated,” city parks deputy director Jen Pittman told the Star. The city issued a request for proposals in late November, with a submission deadline of January 31, 2014.

NJ Turnpike Authority Seeks to Privatize Cash and Electronic Toll Collection: In the last issue, I reported that the South Jersey Transportation Authority is seeing significant savings through privatizing toll collection on the Atlantic City Expressway, with an estimated savings of nearly $7.5 million by the end of 2014 (or 43 percent savings over three years). A similar initiative may now be on deck for New Jersey Turnpike Authority (NJTA) as well. Last month, the Asbury Park Press reported that NJTA officials were issuing requests for proposals to potentially privatize electronic and cash toll collection on the New Jersey Turnpike and Garden State Parkway in 2016. According to NJTA executive director Veronique Hakim, the authority intends to shed its manual toll collection and administration functions and expects that cost savings could total in the millions of dollars.

West Virginia Workers’ Compensation Program Privatization Continues to Pay Dividends: The 2005 privatization of West Virginia’s Workers Compensation Commission-at the time, the state-run monopoly insurer-continues to benefit the state and its taxpayers and businesses. A 2005 law began the process of converting the Commission into a private insurance carrier-BrickStreet Mutual Insurance Co.-that was given a temporary monopoly as it transformed into a private sector enterprise, and since 2008 Brickstreet has faced competition from over 200 other private insurers. Last month, The State Journal reviewed the results thus far of opening the market to competition, finding:

Since the process completion in 2008, workers’ compensation rates declined an average of 30 percent statewide, saving employers annual costs of $150 million in 2010. The number of protested claims is now hovering at about 4,000 a year – a dramatic difference from 2004 when it was about 24,000. In just the first two years, the number of outstanding, unfunded liabilities from the old state-run system dropped from $3.2 billion to $1.9 billion.

Separately, a July article in Insurance Journal noted that the state has seen nine consecutive decreases in loss costs (the costs associated with worker’s compensation claims) since privatization, representing a 48.1 percent decline. Former state insurance commissioner Jane Cline told The State Journal, “It has really been a success all the way around.”

Washington State Municipal Contracting Guide Released: Having recently returned from speaking on state and local government privatization and public-private partnerships at the inaugural Solutions Summit events held by the Washington Policy Center, I was pleased to see the release of a new guidebook on local government contracting, Contracting for Services, by the Municipal Research and Services Center of Washington. It contains an overview and handy guidance for municipal governments on contracting for architectural/engineering professional services, personal services, and purchased services, along with some useful questions and answers, solicitation checklists and other useful resources. While tailored for local governments in Washington, a large amount on the content is general in nature and could serve as a useful contracting primer for local officials elsewhere.

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Additional Resources:

• More privatization news
• More government reform news
• Innovators in Action 2013 homepage
• Annual Privatization Report 2013 homepage
• Privatization & Government Reform Newsletter archive

The post Privatization & Government Reform Newsletter #2 appeared first on Reason Foundation.

• STATE/LOCAL BUDGETS: Reports Suggest Serious Fiscal Challenges Ahead
• SOCIAL FINANCE: Social Impact Bond Initiatives Gaining Traction in U.S.
• LOTTERIES: States Turning to Private Lottery Management
• TRASH COLLECTION: Detroit Seeking to Privatize Trash Collection
• CONTRACTING: Austin Report Finds a High Cost to Insourcing City Services
• INNOVATORS IN ACTION: Pension Reform in Utah & San José
• News & Notes

STATE/LOCAL BUDGETS: Reports Suggest Serious Fiscal Challenges Ahead

Though we’re starting to hear more about an economic recovery in the wake of the 2008 recession (albeit a sluggish one), three recent reports suggest that states and local governments are going to face continued fiscal headwinds into the future-primarily driven by rising healthcare costs-that will put perpetual pressures on budgets and drive ongoing efforts to control spending and find new ways to drive innovation and efficiency in government. » FULL ARTICLE

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SOCIAL FINANCE: Social Impact Bond Initiatives Gaining Traction in U.S.

Over the last two years, a new public-private partnership concept known as “social impact bonds” (also known variously as “pay for success” or “social finance” initiatives) has been spreading rapidly in the U.S., capturing the attention of policymakers at all levels of government. In a nutshell, a social impact bond is a PPP that uses private sector funding to advance new social service delivery models on a performance basis. Experiments in social impact bonds can be expected to start spreading even further and faster this year, after the Rockefeller Foundation and Harvard University’s Kennedy School of Government announced six winners of a national competition in June to provide technical assistance to state and local governments to develop social impact bond projects. » FULL ARTICLE

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LOTTERIES: States Turning to Private Lottery Management

Since 2011, three states-Illinois, Indiana and New Jersey-have turned over major parts of their lottery operations to private managers to deliver better returns to state coffers. Unlike some forms of public-private partnerships, the goal behind these initiatives was not to increase efficiency or lower costs, as many state lotteries are already fairly lean. Instead, the private sector is being tapped to help well-performing lotteries increase net revenues through expanding sales and marketing staff, introducing new product lines, improving marketing to attract new types of lottery players, and finding new outlets for lottery ticket purchases. In a recent Orange County Register article, I discuss these state initiatives and suggest that California policymakers consider exploring a similar initiative in that state. » FULL ARTICLE

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TRASH COLLECTION: Detroit Seeking to Privatize Trash Collection

In the wake of Detroit’s bankruptcy filing, it’s become well known that Detroit’s emergency manager Kevin Orr is proposing an aggressive package of reforms to help get the beleaguered city back on its fiscal feet. However, one concept being explored to cut operating costs in the short-term-privatizing residential solid waste and recycling collection-has been implemented by so many other cities that it’s almost surprising it hasn’t already been done in Detroit. » FULL ARTICLE

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CONTRACTING: Austin Report Finds a High Cost to Insourcing City Services

Opponents of the privatization of municipal services often try to frighten policymakers away from using competitive contracting by claiming that costs will rise because the private sector seeks a profit. Under this line of thinking, the use of in-house public employees would presumably have to be cheaper, since governments don’t need to make a profit themselves. While it is certainly true that an efficiently operating government unit can be cost competitive with the private sector, it would certainly be a mistake to assume that this is always-or even often-the case. A report prepared by the City of Austin, Texas last fall demonstrates this point well. » FULL ARTICLE

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INNOVATORS IN ACTION: Pension Reform in Utah & San José

The latest installments of Reason Foundation’s Innovators in Action monthly interview series-which profiles innovative policymakers in their own words, highlighting good government efforts delivering real results and value for taxpayers-focus on reforming public sector pension systems in Utah and San José, California. Utah became an early leader in the pension reform movement when it passed legislation in 2010 closing the state’s existing defined-benefit pension plan to new entrants, creating a defined-contribution style retirement plan for new state employees, and ending the practice of retiree “double-dipping,” among other reforms. And in June 2012, 70 percent of San José voters passed a ballot measure containing a comprehensive package of reforms to the city’s beleaguered pension system aimed at putting it back on a path toward financial sustainability. I recently interviewed the architects of these initiatives- former Utah State Senator Dan Liljenquist and San José City Councilman Pete Constant, respectively-on what prompted them to take on the issue of pension reform, how they made the case to policymakers and stakeholders, the specifics of the reforms enacted, and more.
» Read full interview with former Utah State Senator Dan Liljenquist
» Read full interview with San José City Councilman Pete Constant
» Innovators in Action 2013 homepage

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NEWS & NOTES

Reason Foundation’s Annual Privatization Report 2013: This spring, Reason Foundation released its Annual Privatization Report 2013, which details the latest on privatization and public-private partnerships at all levels of government. The individual sections of the report cover an array of topics, including developments in air and surface transportation; federal, state and local government privatization; education; and criminal justice and corrections. The full Annual Privatization Report 2013 is available here.

Looking Back at the First Year in Washington State’s Liquor Privatization: Washington State made history in June 2012 by becoming the first of the 18 so-called “control states”-those who set up a state-owned liquor retail and/or wholesale systems after the end of Prohibition-to fully privatize its liquor retail and wholesale enterprises. And the sky did not fall, as some opponents feared. In May, Melissa Allison of the Seattle Times wrote an excellent wrap-up of developments at the end of the one-year mark. Among her findings were that liquor sales have increased slightly; liquor-related tax revenues increased by over 33 percent compared to 2011 (largely due to the imposition of additional spirits taxes, some of which will expire in the coming years); prices of some products have risen, while others have dropped; liquor jobs gained have exceeded those lost; underage sales have been flat; drunk driving fatalities are down; and incidents of shoplifting appear to have increased. Further, Jason Mercier at the Washington Policy Center has published data from the Washington State Police showing that DUI-related accidents and arrests between June 2012 and June 2013 were down from the previous year (and in fact, were at their lowest levels in five-years). On balance, despite the inevitable hiccups associated with such a massive privatization initiative, it appears that the new private market is settling out fairly well and that many fears-including widespread social costs-have not materialized.

LSU Health System Exec Cites Smooth Transition to Private Hospital Management: Louisiana’s state-run charity hospital system is in the midst of a major transition to privatization, with nine of the ten hospitals operated by Louisiana State University shifting to private management. The privatization initiative-developed by Gov. Bobby Jindal’s administration as a way to shed costs in response to a decline in federal Medicaid funding for the state-is still early in implementation but has been proceeding smoothly and is already yielding improved patient outcomes, including reduced prescription waits and increased cancer screening and disease prevention, according to Frank Opelka, LSU’s Vice President for Health Affairs and Medical Education Redesign. “What the partners have done in the transition is just beyond my imagination,” Opelka told the Associated Press in September. The Jindal administration has recently cited additional benefits of the privatization, including shortened emergency room waits, improved access to specialty services for the uninsured, expanded care offerings, reduced delays for needed surgeries, and increased numbers of graduate medical education residents, according to the AP.

Atlantic City Expressway Sees Estimated 43% Savings Through Privatized Toll Collection: In August, The Press of Atlantic City reported that South Jersey Transportation Authority (SJTA) officials are seeing significant savings in toll collection on the Atlantic City Expressway since contracting out that function to Faneuil, Inc, in early 2012. SJTA estimates the privatization initiative will yield nearly $7.5 million in savings by the end of 2014, translating to a 43 percent savings over three years. SJTA’s Acting Executive Director Sam Donelson told The Press, “It’s been doing exactly what we intended it to do […] The savings have been substantial.”

Temple University Study Finds Significant Savings through Competitive Contracting in Corrections: Recent research from Temple University’s Center for Competitive Government makes a valuable contribution to the academic literature and long-running debates over the comparative costs of public and private sector prison operation. Temple economics professors Simon Hakim and Erwin Blackstone analyzed government data from nine states with higher numbers of inmates in privately operated prisons (Arizona, California, Florida, Kentucky, Mississippi, Ohio, Oklahoma, Tennessee and Texas) and Maine (which does not contract out prison operations), and their research estimates that the use of contracted prison operations brings long-run cost savings of 12 percent to 58 percent, with equal or better levels of performance than publicly-operated prisons. Notably, the research accounts for depreciation, pension obligations and retiree healthcare costs, which are factors often overlooked in comparative cost studies. The full report is available here.

Reason Report on Private Management of the Indiana Toll Road: In recent years, some state and local governments have taken steps to turn over the operation of public sector toll roads to private sector investor-operator teams in order to improve their financial and operational performance and stretch traditional transportation dollars further. A recent Reason Foundation policy brief (available here) examines the results from the Indiana Toll Road lease after its first six years of private operation. The report finds that the lease has been a major boon for Indiana, allowing it to make enviable investments in transportation infrastructure statewide and leaving the state in a far stronger position than it otherwise would have been.

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Additional Resources:

• More privatization news
• More government reform news
• Innovators in Action 2013 homepage
• Annual Privatization Report 2013 homepage

The post Privatization & Government Reform Newsletter #1 appeared first on Reason Foundation.

In July, Detroit issued a request for proposals seeking potential bidders for a five-year contract (or set of contracts) for the collection and disposal of residential trash, recycling, bulk waste and yard waste. The RFP divided the city into four collection zones, and bidders were allowed to submit proposals on one or more zones. If a vendor’s performance is satisfactory, the city has the option to extend any contract by one year, up to a total of five additional years beyond the initial five-year term. Bidders are “strongly encouraged”-but not required-to give hiring preference to current city public works staff, and the city is also offering up its current portfolio of collection vehicles for potential purchase, which could create a significant one-time revenue influx. Vendors would take over responsibility for customer service (e.g., tracking and addressing complaints and the like), but the city would retain responsibility for handling customer billing. Any eventual contract would also include penalties for failing to meet specified performance standards, such as a minimum of $1,000 in financial penalties per incident if the vendor fails to collect a household’s waste, for instance.

Last month, the Detroit Free Press reported that the city ultimately received proposals from 10 different bidders, a blend of national and local solid waste firms that includes Waste Management Inc., Republic Services, Midwestern Sanitation, Emterra Group, Kurtz Brothers, Resource Recovery Systems, Advanced Disposal, Unity Midwest Waste & Recycling, and J Fons and Rizzo Services.

The procurement process has been in the works for some time, and the reason is fairly obvious-the city is seeking to dramatically reduce the costs of its current in-house waste collection as it struggles to maintain its mix of public services. On June 13th, Waste & Recycling News reported that city officials had met with two large, national solid waste management companies-Waste Management Inc. and Republic Services-to discuss the potential privatization of residential solid waste, and the firms reportedly told officials that they believed that they could cut costs by approximately 30 percent ($15 million in savings on the $50 million annual cost of collection currently). Though these are preliminary numbers, and the true cost savings potential will be discovered through the current competitive bidding process, savings of that potential magnitude would be nothing to sneeze at given Detroit’s precarious fiscal position.

In June, the Detroit Free Press‘s editorial board offered some perspective on why this type of cost-cutting move hasn’t happened already:

“This is simple stuff. You might call it the low-hanging fruit of improving city services. So why couldn’t the mayor or the Detroit City Council get it done? Well, there’s the city’s anti-privatization ordinance, which requires an arcane set of proofs that work can be performed more efficiently by a private-sector company. Then there’s the procurement process that favors Detroit-based businesses: Companies based in Detroit are awarded so many points during contract evaluation that a low bidder from outside the city often can’t compete with a higher-priced, Detroit-based firm. And let’s not forget the city’s unions, virulently opposed to any form of privatization – whether or not it’s in the best interest of residents.”

On the latter point, union opposition to trash privatization is not just a phenomenon in Detroit. A union-led campaign against trash privatization in Fresno, California successfully (though narrowly) defeated a pro-privatization ballot measure in early June by about 800 votes. In fact, the unions drove the privatization decision to the ballot in the first place, after the city council voted to approve a contract last December with Mid Valley Disposal that would have brought Fresno a $1.5 million upfront payment and a $2.5 million payment from the company each year over the life of the contract. The contract would have also lowered residents’ trash bills by 15 percent, and the company would have hired on nearly all of the city’s current solid waste workers.

Nonetheless, unions were able to sow doubt in enough voters’ minds to squelch the deal, despite the benefits to residents. Worse, Mayor Ashley Swearengin has warned that the rejection of trash privatization would result in a $2.8 million revenue hit in next year’s budget, which may require layoffs of either 25 police officers or elimination of up to 49 other city workers to close the gap. Ironically, unions based their campaign on sympathy for the current solid waste workers, who would have kept their jobs, but at a lower pay rate.

The Fresno result was puzzling, as the privatization of solid waste services is something that in this day and age should not be controversial, given that so many jurisdictions have done it for so long. In fact, a 2007 International City-County Management Association survey of local governments found that residential trash collection was outsourced in over 57 percent of suburban governments, 39 percent of rural towns and 29 percent of large cities. Given the fiscal pressures on many local governments in the wake of the recession, it’s likely that these numbers may be even higher today.

It’s unlikely that the Fresno experience will have much bearing on solid waste privatization in Detroit, however. First, Detroit’s privatization moves are coming in the context of a much larger fiscal crisis and a historic municipal bankruptcy. Second, Detroit’s government unions are likely to be less engaged on the very specific issue of outsourcing solid waste services when their energies and attention are so directly focused on the potential bankruptcy-related threats to employee pensions and post-employment retirement benefits. Last, Fresno’s defeat of privatization came at the ballot box and thus was the result of a political campaign, and it’s unlikely that opposition to outsourcing solid waste services will rise to that level of political action in Detroit given the many other issues at play there.

Still, Fresno offers an interesting lesson for other cities exploring privatization. Privatization proponents tend to emphasize the fiscal merits of such deals, which are certainly important, but they should also anticipate and be ready to respond to the emotional side, which is inevitable if there are any job transitions at play. Hence, they should be clear in explaining what will happen to affected current public employees, what accomodations have been made in contracts for preferential hiring for current public workers and the like, what the tradeoffs are with regard to pay and benefits, and what retraining or job reassignment opportunities are being made for those current public workers that may not ultimately transfer over to the private side. These are actually routine and common practices most jurisdictions undertake during outsourcing initiatives across the U.S., but they also tend to get less emphasis in the public discourse, which can allow fears of rampant layoffs and economic hardship to fester.

With the bleak fiscal outlook at the local government level for at least the next generation, we should expect to see more and more attempts to contract out “low-hanging fruit” operations like solid waste collection, as these are hardly inherently governmental functions. And, at least outside of Fresno, most citizens are less concerned with who picks up their trash, so long as it gets picked up at an affordable cost.

As Detroit struggles to provide city services amid its bankruptcy and ongoing fiscal woes, let’s hope we see more common-sense approaches to cost-cutting and government downsizing like the current push to outsource trash collection.

Leonard Gilroy is director of government reform at Reason Foundation. An earlier version of this article was published on Reason.org on July 31, 2013.

The post Detroit Seeking to Privatize Trash Collection appeared first on Reason Foundation.

The bill, SB 405, along with companion bill AB 158 in the Assembly, would have prohibited grocery stores and convenience stores with at least $2 million in gross annual sales and 10,000 square feet of retail space from providing single-use plastic or paper bags, although stores would have been allowed to sell recycled paper bags for an unspecified amount. The bill fell just three votes short of passage in the Senate – with four Democratic senators not voting – and Sen. Alex Padilla, D-Los Angeles, who sponsored the measure, has indicated that he would like to bring it up again, so expect this fight to be recycled rather than trashed.

While public debate over plastic bag bans often devolves into emotional pleas to save the planet or preserve marine life (and, believe me, I love sea turtles as much as the next guy), a little reason and perspective is in order.

According to the U.S. Environmental Protection Agency, plastic bags, sacks, and wraps of all kinds (not just grocery bags) make up only about 1.6 percent of all municipal solid waste materials. High-density polyethylene (HDPE) bags, which are the most common kind of plastic grocery bags, make up just 0.3 percent of this total.

The claims that plastic bags are worse for the environment than paper bags or cotton reusable bags are dubious at best. In fact, compared to paper bags, plastic grocery bags produce fewer greenhouse gas emissions, require 70 percent less energy to make, generate 80 percent less waste, and utilize less than 4 percent of the amount of water needed to manufacture them. This makes sense because plastic bags are lighter and take up less space than paper bags.

Reusable bags come with their own set of problems. They, too, have a larger carbon footprint than plastic bags. Even more disconcerting are the findings of several studies that plastic bag bans lead to increased health problems due to food contamination from bacteria that remain in the reusable bags. A November 2012 statistical analysis by University of Pennsylvania law professor Jonathan Klick and George Mason University law professor and economist Joshua D. Wright found that San Francisco’s plastic bag ban in 2007 resulted in a subsequent spike in hospital emergency room visits due to E. coli, salmonella, and campylobacter-related intestinal infectious diseases. The authors conclude that the ban even accounts for several additional deaths in the city each year from such infections.

The description of plastic grocery bags as “single-use” bags is another misnomer. The vast majority of people use them more than once, whether for lining trash bins or picking up after their dogs. (And still other bags are recycled.) Since banning plastic bags also means preventing their additional uses as trash bags and pooper scoopers, one unintended consequence of the plastic bag ban would likely be an increase in plastic bag purchases for these other purposes. This is just what happened in Ireland in 2002 when a 15 Euro cent ($0.20) tax imposed on plastic shopping bags led to a 77 percent increase in the sale of plastic trash can liner bags.

And then there are the economic costs. The plastic bag ban would threaten the roughly 2,000 California jobs in the plastic bag manufacturing and recycling industry, although, as noted in the Irish example above, they might be able to weather the storm if they can successfully switch to producing other types of plastic bags. In addition, taxpayers will have to pony up for the added bureaucracy, and the higher regulatory costs foisted upon bag manufacturers and retailers will ultimately be borne by consumers in the form of price increases.

Notwithstanding the aforementioned reasons why plastic bags are not, in fact, evil incarnate, environmentalists have every right to try to convince people to adopt certain beliefs or lifestyles, but they do not have the right to use government force to compel people to live the way they think best. In a free society, we are able to live our lives as we please, so long as we do not infringe upon the rights of others. That includes the right to make such fundamental decisions as “Paper or plastic?”

Adam B. Summers is a senior policy analyst at Reason Foundation. This article originally appeared in the U-T San Diego.

The post Bag Ban Bad for Freedom and Environment appeared first on Reason Foundation.

In California, cities like Riverside, Oakland and Torrance already use private trash collectors. It’s a service that is regularly privatized across the country. In fact, a 2007 survey of municipal governments by the International City-County Management Association found that residential trash collection was outsourced to in over 57 percent of suburban governments, 39 percent of rural towns and 29 percent of large cities.

Mayors across the country, Democrats and Republicans, are looking to improve government’s efficiency and cut costs by partnering with the private sector.

Shortly after he was elected mayor of Chicago, Rahm Emanuel, who served as President Barack Obama’s chief of staff, turned to outsourcing to create a head-to-head competition with the city’s recycling city workers. Chicago saved $2.2 million during just the first six months and the competition from the private companies also prompted the city’s own recycling crews to lower their costs by 35 percent. Emanuel is now working to expand public private partnerships to other city services.

Similarly, former President Bill Clinton advisor Alvin Brown, now mayor of Jacksonville, Florida, is pursuing an array of public-private partnerships to maintain buildings and the city’s vehicle fleet. The mayor is aiming to save the city $1 million up front and about $1.5 million per year.

Fresno’s financial situation is bleak. The city budget tenuously closes a $15 million deficit, the city’s bonds are rated as a junk and it cannot count on another massive housing market boom or bubble to bring back the tax revenues of a decade ago.

The proposed trash contract with Mid Valley Disposal would bring Fresno $1.5 million up front and $2.5 million a year over the life of the contract. The contract also guarantees residents a 15 percent reduction in trash bills and better service. If Mid Valley fails to deliver on either of those things, it loses the contract.

While $2.5 million a year from a public-private partnership for trash collection won’t solve all of Fresno’s budget woes, it would turn an expense into revenue and certainly help close the budget deficit.

Fresno’s leaders are attempting to use the private sector to reduce costs, improve services and ensure that city resources are available for the highest-priority tasks. And the city’s trash collectors are right as well: they aren’t the only cause of Fresno’s dismal fiscal outlook. But there’s a better, much cheaper alternative for the city’s trash collection out there. And the Mid Valley will hire all the current workers.

When a city is facing the major challenges that Fresno is, it cannot afford to choose protecting government workers over making efficiency improvements and realizing large costs savings for the city and its residents.

Leonard Gilroy is director of government reform and Adrian Moore, who lives in Tehachapi, is vice president of policy at the Los Angeles-based Reason Foundation, a free market think tank. The column was originally published in The Business Journal on May 31, 2013.

The post From Oakland to Chicago to Jacksonville, Mayors Are Using Privatization appeared first on Reason Foundation.

Solid Waste Collection Update

Over the last three decades, there have been dramatic changes in solid waste collection in the U.S. The Waste Business Journal reports that while more than 75 percent of the collection and disposal of trash was once done by municipalities, the number has now flipped, with 75 percent of collection and disposal being handled by the private sector in what has become a $50 billion industry.1 One reason this reversal continues is that private firms leverage the ability to pool resources and use high-cost capital expenses, such as heavy vehicles, more productively.

In 2012, the solid waste industry pursued the remaining 25 percent of the market, which reportedly represents approximately $8 billion in new revenue.

The changing dynamics of solid waste in the wake of the Great Recession has forced some major players to re-evaluate their position in the marketplace. For example, Paris-based Veolia Environment sold its U.S. solid waste business (which had revenue of $818 million, operating cash flow of $212 million and operating income of $110 million in 2011) to Star Atlantic Waste Holdings LP for $1.91 billion. This move is a part of a larger divestiture strategy by the firm as it looks to move into new markets.2

Below are some highlights from this year’s efforts to privatize solid waste service delivery.

Chicago, Illinois: Mayor Rahm Emanuel pledged in April that he would bring recycling to every home in Chicago by the end of 2013-something that policymakers have been discussing since the late 1980s. The city of Chicago partners with Waste Management and Metal Management Midwest, allowing the firms to compete alongside public employees to process recycling for Chicagoans. This led to dramatic savings ($2.2 million in the first six months) even while expanding service to new households. These savings are fueled by increased productivity by city workers who have lowered their costs by 35 percent from $4.77 per cart down to $3.28 per cart.3 The city currently hauls recycling for 261,000 households, while 340,000 don’t have recycling service at all.4

Fresno, California: Mayor Ashley Swearengin fought for months to outsource the city’s residential trash removal service. The debate over privatization was contentious, both in city hall and in the editorial pages of local newspapers. In December 2012 the city council finally approved Swearengin’s proposal. The city previously provided trash collection for 105,000 Fresno residents. The contract with Mid Valley Disposal pays the company $2.5 million annually with a $1.5 million signing bonus. For residents, it would reduce rates by 17 percent for nearly two years. For employees, it would guarantee jobs for at least one year.5 Officials are reporting that customer complaints are only a quarter of 1 percent, far below the maximum of 3 percent stipulated in the contract.6 In response, public employee labor unions recently submitted a ballot proposal to overturn the contract.7

This outsourcing contract is one of several initiatives to address Fresno’s $5 million budget deficit. Like many cities, Fresno spends a substantial amount of money on public safety-80 percent to be exact-most of which goes toward police. And the city’s contract with the Fresno Police Officers Association includes a no-layoff clause that requires vacancies from attrition and retirement to be filled.8 Therefore, when facing tight budgets, policymakers have little choice but to consider commercial services like trash removal.

Norwalk, Connecticut: The Common Council voted 9-6 on July 24, 2012 to privatize trash pickup in Norwalk. The 10-year contract was signed with Stamford-based City Carting & Recycling Inc., a local firm that already operates Norwalk’s transfer station on Crescent Street.9 The move is considered high profile-despite the ubiquity of comparable contracts across the U.S.-because of the exhaustive campaign run by the American Federation of State County and Municipal Employees (AFSCMCE) Local 2405 against privatization. A July 19, 2012 letter by the union argued the council should abandon or defer privatization to avoid “making a grave mistake Norwalk will suffer from for a long time.”10

In practice, the contract appears to be a significant win for the community and the 33,000 properties that will be affected. The city is expected to save over $600,000 in the first year alone. Then, in July 2013, the city will revamp its entire recycling program by converting to single stream recycling, which has been found to increase the proportion of waste products that are recycled by allowing recyclable materials to go into one container. Combining the switch to single stream with other cost-cutting moves, the contract is eventually expected to save at least $1.2 million per year.11

San Bernardino, California: The San Bernardino City Council voted in 2012 to declare bankruptcy after it became clear the city’s fiscal path was unsustainable. The council also voted in favor of partnering with the private sector to handle trash collection. However, after months of wrangling they decided to table contracting in October.

It began when city officials sent out a request for proposals (RFP) in August to partially privatize trash collection that only received two bids. The council approved proceeding twice, but the mayor vetoed twice. Then, the city hired Sloan Vazquez LLC to consult on procurement and found the contract value could range anywhere from $300-600 million.12

Surprisingly, San Bernardino is subsidizing trash collection through the general fund because rates have not gone up since 2008, while gas prices and landfill fees have, meaning that privatization would likely come with a rate increase. Ultimately, the city council voted to halt procurement and it is unclear whether or not it will revisit the issue in 2013.13

Lockport, New York: In fall 2011 the city privatized its garbage and recycling program. Halfway through 2012 City Clerk Richelle J. Pasceri told the Common Council that partnering with Modern Disposal had yielded $380,000 in savings. Privatization also came with the institution of a user fee and standardization of garbage and recycling containers. There have been several non-fiscal benefits to the transition. First, waste has been reduced by approximately 43 percent from 9,000 tons of trash down to 5,100 tons. Part of this drop is because some commercial businesses opted to partner with another provider, but regardless taxpayers are saving the $30.73 per ton that it cost to dump in Modern’s Lewiston Landfill. The city also has 80 percent participation in its recycling program, and 22 percent of waste produced is being recycled according to the mid-year report.14

Westwood, New Jersey: The Westwood Council voted to contract out recycling beginning on July 1, 2012, signing a single-stream contract with Advanced Waste for weekly pickup (versus twice a month pickup currently provided by the borough). The four-and-a-half-year, $310,000 contract is expected to save the borough on fuel costs and generate more revenue from recycling.15

Brunswick, Florida: The City Commission voted in August 2012 to partner with Waste Management, Inc. to privatize solid waste collection and disposal, signing a $715,000 per year contract. The move is expected to save taxpayers approximately $500,000 each year according to City Manager Bill Weeks, while maintaining weekly garbage pickup, every other week recycling pickup and notably expanding yard trash collection from every six weeks to weekly. The contract also includes a new program called Recycling Rewards, which gives participants an average of $165 a year in discount coupons for local and national businesses.16

Cincinnati, Ohio: The Ohio Auditor of State, Dave Yost, published a performance audit of Cincinnati’s Public Service Department finding the city could save millions of dollars each year by streamlining its operations. Yost found $1.7 million could be saved through civil service reform (overtime, sick leave, staffing levels). He also found that outsourcing solid waste and street sweeping could save $1 million and $930,000 respectively, and that improved salt and fuel purchasing could save more than $1.3 million. The full performance audit highlighted a number of issues that may lead the city to rethink its current service delivery.17

» Return to Annual Privatization Report 2013: Local Government Privatization
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Endnotes

1 Sagarika Jaisinghani and Kartick Jagtap, “Tough times force garbage firms to dig around for growth,” Reuters, October 16, 2012. http://www.reuters.com/article/2012/10/16/us-refuse-growth-idUSBRE89F17A20121016

2 Ibid.

3 “Mayor Rahm Emanuel Announces Citywide Recycling in 2013,” City of Chicago, April 5, 2012. http://www.cityofchicago.org/city/en/depts/mayor/press_room/press_releases/2012/april_2012/mayor_rahm_emanuelannouncescitywiderecyclingin2013.html

4 Ibid.

5 George Hostetter, “Fresno City Council OKs trash outsourcing,” The Fresno Bee, December 21, 2012. http://www.fresnobee.com/2012/12/21/3109313/fresno-oks-trash-outsourcing.html#storylink=mirelated

6 Rachel Azevedo, “Trash privatization progress report,” CBS 47, January 14, 2013. http://www.cbs47.tv/news/local/story/Trash-privatization-progress-report/jPVcjJCickSBjqE5uSWs1w.cspx

7 Dan Walters, “Fresno joins the ranks of troubled California cities,” The Sacramento Bee, February 11, 2013. http://www.sacbee.com/2013/02/11/5180134/dan-walters-fresno-joins-the-ranks.html

8 George Hostetter, “Swearengin leads pitch to outsource Fresno trash,” The Fresno Bee, November 20, 2012. http://www.fresnobee.com/2012/11/20/3073754/fresno-mayor-city-manager-raise.html

9 Nicole Rivard, “Common Council oks outsourcing of city’s trash collection,” Norwalk Citizen, August 1, 2012. http://www.norwalkcitizenonline.com/news/article/Common-Council-oks-outsourcing-of-city-s-trash-3741287.php

10 Ibid.

11 Ibid.

12 Cassie MacDuff, “SB council hits roadblock on refuse division outsourcing,” Riverside Press-Enterprise, October 18, 2012. http://blog.pe.com/cassie-macduff/2012/10/18/sb-council-hits-roadblock-on-refuse-division-outsourcing/

13 Ibid.

14 Thomas J. Prohaska, “Garbage, recycling program starts by saving $380,000 in 8 months,” Buffalo News, July 5, 2012. http://www.buffalonews.com/incoming/article935114.ece

15 Jason Braff, “Westwood to contract out for recycling,” NorthJersey.com, March 20, 2012. http://www.northjersey.com/news/143496706_Westwood_to_contract_out_for_recycling.html?page=all

16 Mike Morrison, “Brunswick to park its garbage trucks to privatize service,” Jacksonville Times-Union, August 16, 2012. http://jacksonville.com/news/georgia/2012-08-16/story/brunswick-park-its-garbage-trucks-privatize-service

17 “Performance Audit Finds $3.7 Million in Potential Savings for Cincinnati Service Department,” Ohio State Auditor, July 24, 2012. http://www.auditor.state.oh.us/newscenter/press/release/1354

The post Solid Waste Collection Update appeared first on Reason Foundation.

• Privatization of municipal parking assets,
• Georgia’s evolving contract cities,
• Zoo privatization in Dallas and Tulsa,
• Privatization of public libraries in California,
• Market-based land development in Houston,
• Updates on privatization in public safety, solid waste/recycling and animal shelter operation,
• Privatization updates from Chicago, San Diego, Milwaukee County and more.

» Annual Privatization Report 2010: Local Government Privatization [pdf, 700 kB]

» Complete Annual Privatization Report 2010

The post Privatization and Public-Private Partnership Trends in Local Government appeared first on Reason Foundation.