Municipal Boundaries – One Driver of Inefficient Local Government

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It stands to reason, say some, that eliminating some of the overlapping layers of local government—villages, in particular—will save lots of money. The facts are more complicated.

In CGR’s experience after studying more than three dozen communities in the last five years or so, the operational savings from a simple merger are typically modest.  Yet this misses one of the important reasons for communities to review their local government structures—the capital budgets of local governments.  Decisions about capital investments are often made through the lens of a single local government—the individual town, village or school district. Even though these individual governments may be running their governments efficiently, many studies show that taxpayers are paying for more buildings, more equipment, and more people to manage them than would be needed if local government services were managed by thinking regionally. Four examples illustrate this point.

1)      In the town of Whitestown, NY, four separate police departments, one in each of three villages plus the town, are located within a 2 mile radius of each other.  As one police chief noted, “I could hit a golf ball into the next police department with a 9-iron.”

2)      Anyone looking at a map of the location of fire stations and the amount of equipment in each location in our major metropolitan areas, quickly understands how much unnecessary duplication of facilities and equipment exists. With the costs for one piece of new equipment ranging from $500,000 to $1 million, having excess equipment rapidly increases costs to taxpayers.

3)      School facilities and associated administrative costs plus services like bus transportation can be shared regionally without compromising the education of our children.

4)      Water and sewer infrastructure investment is a particularly challenging issue. In areas where villages run water and sewer operations and control delivery of water and sewer to the surrounding towns, this is a leading cause of conflict between towns and villages.  We have seen examples where inability to resolve inter-municipal conflicts over control of local development has resulted in duplication or overbuilding of infrastructure and/or annexation battles.  Not only is this an inefficient use of tax dollars, it divides communities.

All of these examples illustrate how current local government boundaries cost taxpayers money.

There are six types of services where efficient delivery of those services is affected by the location from which those services are delivered: fire, police, public works, school facilities, and water and sewer infrastructure investments. For example, one rule of thumb is that in high density areas fire equipment should be located within a 1.5 mile radius of the structures to be covered. In dense urban areas where many fire districts exist, the number of fire stations often far exceeds the number required to meet the 1.5 mile standard. Every extra station and piece of equipment represents inefficiencies and unneeded costs.

Village and town governments want to protect their own interests in providing service to their own constituents, even if sharing across boundaries would save money. Overcoming “boundary thinking”—whether the boundaries stay or go– could save money for New York taxpayers without compromising service. NYS towns and villages alone spend nearly $10 billion each year, so saving even 1% in aggregate would lower costs by $100 million across the state.