Maintaining the levels of service delivery expected by residents continues to be a challenge for fiscally strapped local governments.  Although typically residents are unwilling to increase local taxes for services, the demand has not decreased.  In fact, some might argue that it has increased. Service delivery is complex and costly. In order to provide services, local governments need knowledgeable staff and specific types of equipment.

Contracts with private firms to deliver some services have been used for many years—especially in solid waste collection and disposal and recycling. We don’t hear as much about intergovernmental contracting, but it does occur and can be a cost-effective and efficient approach to service delivery. Preliminary results from ICMA’s survey “Profile of Local Government Service Delivery Choices 2012” offer a window into the motivators and obstacles of intergovernmental contracting.

Motivators for Intergovernmental Contracts for Service Delivery

More than 1,600 local governments with existing intergovernmental contracts for service delivery reported on the factors motivating them to enter into the service agreements:

• Save money: 81%
• Achieve economies of scale: 70%
• Lack of private providers: 63%
• Strengthen collaborative intergovernmental relations: 63%
• Promote higher quality/more effective service delivery: 60%
• Promote regional service integration: 54%
• Access technical expertise: 35%
• Avoid shedding services: 14%

Obstacles to Intergovernmental Contracts for Service Delivery

Respondents identified a number of obstacles to intergovernmental contracting. The top three are shown below:

• Concern about community control (69% reporting)
• Lack of common vision/shared mission (46% reporting)
• Lack of trust (43% reporting)

A “need to create new accounting structures” was reported by the smallest percentage of respondents (11%), followed by “no neighboring government willing to enter into an agreement,” with 12% reporting that obstacle. Opposition from citizens was reported by 22%, and internal opposition from employees was reported by 29%. Perhaps reflecting both citizen opposition and employee opposition, 38% of local governments reported opposition from elected officials as an obstacle. Of those who reported strengthening intergovernmental relations as a motivator for intergovernmental contracting, 132 also reported concern about difficulty monitoring intergovernmental agreements as an obstacle.

On the Horizon

A rigorous analysis of the comprehensive survey results will be accomplished over the next several months. As we learn more about intergovernmental contracts, we will share trends in upcoming newsletter articles. The survey collected data service delivery methods for 76 local government functions, and it will be interesting to see if there has been an increase in intergovernmental contracting in these service areas.