Report praises county’s “fragmented” cities, calls for “carrots, sticks” to encourage inter-city partnerships

A state-commissioned report by a coalition of universities praises St. Louis County’s system of multiple municipalities as efficient, responsive, and resistant to the corrupting influence of special interests.

Instead of municipal mergers, the report suggests Missouri attempt to enhance the efficiency of local governmental by encouraging “inter-city partnerships” for purchasing or infrastructure development.

The report – “Best Practices: An Overview of Current Policies and Strategies for Improving Municipal Efficiencies,” by Mark Tranel, director of the University of Missouri–St. Louis (UMSL) Public Policy Research Center (PPRC), and research assistant Bradley DiMariano – appears to mark a major victory for opponents of a much publicized effort to merge the City of St. Louis and St. Louis County municipalities.

It even warns that inter-city partnerships should not be considered for the providing of municipal services – as service cost reduction or quality improvements can generally not be achieved through “economies of scale” – but for functions such as text book purchasing by local school districts.

That admonishment from university researchers comes just as Pelopidas, LLC, – the Richmond Heights-based lobbying firm retained by one of the City of St. Louis’ largest creditors to promote municipal consolidation – is expected to propose consolidation of law enforcement across the region.

In addition, critics may find a list of roughly two dozen “carrots and sticks,” suggested in the report to encourage inter-city partnerships, to be coercive.  Inter-city partnership study grants, proposed in the  report, could effectively force municipalities to enter into a partnership once grant money was accepted by a city.

Critics may also be concerned the proposed partnerships could provide a means of funding controversial public works projects such as a new football station in downtown St. Louis, expansion of the city’s largely empty convention center, or the rapidly expanding (though already underfunded) CityArchRiver project.

The report is one of four developed recently at the request of the Missouri Legislature’s Joint Interim Committee on St. Louis Metropolitan Statistical Area Governance and Taxation, by a newly-formed Applied Research Collaborative, a joint venture of the UMSL PPRC, St. Louis University and Southern Illinois University-Edwardsville. The four reports, posted on the UMSL PPRC web site (http://pprc.umsl.edu/), explore “how county and city governments and other political subdivisions work,” according to the site. “The series is specifically interested in options for increasing efficiency and decreasing costs, as well as improving the quality of services provided to the public,” the PPRC website states.

As the Joint Interim Committee was established specifically to propose legislation on governmental operations in the St. Louis area, all four of the reports are likely to become the basis of legislation in the coming months.

Critics are likely to note that the inter-city partnerships outlined in the Bests Practices reports bear some resemblance to the regional governance structures now being advocated around the nation by teams from the Brookings Institution. The Missouri Legislature’s Joint Interim Committee heard a Brookings Institution proposal for regional governance structures in the St. Louis area last year at the behest of the influential business group, Civic Progress.

However, overall, the new report by the university collaborative concludes small municipalities function well – even in challenging financial times – and consolidation has seldom proven necessary to improve them.

“Although often criticized for fragmentation and duplication, the American system of local government has also been responsive and resilient,” notes “Leveraging Local Change: The State’s Role,” a May 2014 International City/County Management Association (ICMA) white paper, on which the new university collaborative report is in part based. “Local governments have demonstrated a remarkable ability to bounce back in the wake of crises without fundamentally altering their jurisdictional boundaries, core services or personnel.”

The ICMA report notes that consolidation does not ensure either cost reduction or service improvements. “Merging different municipalities will inevitably bring together citizens that are accustomed to different levels of a service,” the ICMA notes. The “harmonizing” of services generally involves either service cuts or tax increases, the organization observes.

“The literature points out several drawbacks to consolidating fragmented municipalities into one. The first is that residents and voters lose connection to local representatives.  Some have speculated that consolidating local offices leads to higher spending in the long run given that elected officials are now less accessible and accountable to the electorate. The needs of the citizens may also be diluted or (re-)worked as the new governing entity is less responsive to individual concerns. This environment may also help special interests gain influence with fewer obstacles and official to overcome,” the ICMA report continues.

At least one study has found the ideal population for achieving economies of scale in a municipality is around 20,000 residents, the new new university collaborative report notes.  However, “…conventional wisdom (has) dictated that municipal consolidations should be evaluated on a case by case basis…,” the report adds.

“On the other side of the (municipal merger) arguments are those who advocate for multiple centers of local government. These policymakers contend a fragmented patchwork of municipalities much like what is seen in St. Louis is ideal to enhance efficiencies and while keeping local tax burdens at a minimum. The idea behind this fragmented or public choice ideology is that efficiency is realized through competing municipalities and options for residents,” Tranel and DiMariano note.

They coin the term “choice-based” to describe the municipal structure of St. Louis County.

“In a system of fragmented governments, a citizen or business is able to select which municipality best suits their needs and locate accordingly. Municipalities which fail to attract or retain residents and business will have to consider new policies and strategies to enhance their appeal and compete with other municipalities. In some cases, the process may include reevaluating local government service to pinpoint inefficient operations and make changes.” Tranel and DiMariano note.

And they find other benefits.

“An additional benefit to this system is that many governments do exist in an areas like St. Louis County, which offers the civic benefit lost with consolidated entities. The residents of smaller communities enjoy greater access to their local officials and can expect higher levels of political accountability. This system addresses most of the previously listed shortcomings of consolidation and mergers in this respects.  Citizens are able to retain their relative political influence and better influence, and better influence local public policy, which makes it harder for special interest groups,” they continue.

The complete report can be accessed at http://pprc.umsl.edu/pprc.umsl.edu/data/bestpractices-final-app.pdf