One of the long-standing criticisms of the Center for Local Innovation’s annual By The Numbers report is that it does little to tell folks how cities and counties handle their spending. For years, cities or counties with higher tax burdens pointed to their use of additional services or benefits as a reason for their higher taxes. In order to address many of those criticisms, CLI now produces a new companion piece called the City and County Guide.
At the heart of the argument over the role of government is funding. Clearly, taxpayers are served by having robust police and fire departments, health departments, social services, and a host of departments that are clearly governmental in nature. But beyond that, should taxpayers be funding golf courses? Should their income be used for business incentives? What about the new Tax Increment Financing schemes?
The City and County Guide provides both elected officials and taxpayers the opportunity to pose questions about the ways government spends your money. All of these extra-governmental activities have costs associated with them. When county commissioners say they need additional money for schools, they’re also saying they need to preserve the programs they have in place, which might include an equestrian center or a water system that could be privatized.
And the guide is rather extensive. It addresses issues such as planning and zoning, offering tangible ideas about ways to simplify complex planning regulations that may save money and promote freedom. It points out the erosion of property rights that is occurring almost daily at the local level. Councilmen and commissioners may well be unaware of the costs and consequences of their actions on these fronts.
In the zoning section, the guide points to the example of Anaheim, Calif., which dramatically simplified its land-use regulations and streamlined its permitting processes, resulting in significant economic development without government handouts.
On the incentives front, the guide charts incentives on a per capita grid, showing the costs to citizens. Forsyth County spends about $140 per capita on incentives, Bladen about $46, and Guilford only about $13. Do incentives determine the success of a county? They are costly, and the companies who receive them don’t end up paying the lion’s share of the costs for law enforcement or school construction, as do the rest of the companies in a county.
The guide also stresses cost-saving ideas like competitive sourcing and performance management. Both ideas promote a higher level of service at a lower cost. As an added benefit, they encourage transparency. Sadly, it is rare to see North Carolina localities implement such plans. Examples abound of success in places such as Philadelphia, Phoenix, Baltimore, and Chicago.
Also featured in the guide are issues like air transportation, education, smart growth, and a myriad of other costly initiatives. One particularly interesting chart shows that Charlotte spends more than 57 percent of its transportation dollars on transit for only 2.6 percent of its public commutes. When highways are congested and highway dollars are spent elsewhere, the results can be costly. Even cities like Wilmington have transit woes, spending 13 percent of transportation dollars on less than 1 percent of the public that uses transit.
All of these aspects of local government have costs or cost savings attached to them. When looking at the cost of local government, folks should be aware of how the money is being spent, and if that money is being wasted. There are always alternative ways to get things done. The true winners over time are the localities that are challenging themselves with new ideas and new ways to solve problems. In doing so, they can also generate taxpayer savings which, in turn, creates more economic freedom for the people who pay the bills.
Chad Adams is director of the Center for Local Innovation.