Local Government Innovation ― Issues and Trends in Privatization and Managed Competition

Nationally recognized scholars and practitioners examine opportunities in which services traditionally provided by local governments are offered by the private sector though a contract or are transferred to a private business completely. Many large U.S. cities have contracted services for many years. With the movement to rightsize governments in recent years there has been renewed interest by local governments in similar ventures. Privatization, in its many forms, is now seen as a viable alternative to traditional ways of providing public services and can bring substantial benefits to residents. With greater accountability being demanded and pressures on local officials to hold the line on or reduce taxes, efforts to find innovative service delivery methods will probably increase. Cities, such as Atlanta, Indianapolis, and Charlotte, are examples showing that contracts with private businesses can work to benefit all parties. Local officials must move ahead cautiously, and not all attempts at privatization or contracting have succeeded. Some cities, after an evaluation, have decided to provide services with municipal employees.

ROBIN A. JOHNSON directs the Illinois Center for Competitive Government located at Western Illinois University./e

NORMAN WALZER is Professor of Economics and director of the Illinois Institute for Rural Affairs at Western Illinois University./e He is the editor of numerous books.