City of Boulder should consider outsourcing, privatizing services

Background from the Daily Camera:

Boulder City Manager Jane Brautigam has been working this year to move to a “priority-based” budget, in which the things most important to the community are first in line for funding.

My response, published in the Camera:

The Boulder City Council should consider saving money the way private organizations often do: by outsourcing some of its operations to private firms. For-profit and non-profit firms that compete for government contracts have incentive to provide low-cost quality services. A firm won’t get a contract if its bid is too high, and its contract won’t be renewed if it does a lousy job. Typical savings from privatization are between five and twenty percent, reports the Reason Foundation.

The towns of Roswell and Sandy Springs, Georgia each have around 90,000 residents. But Sandy Springs’ annual budget is around $300 less per person. Why? Sandy Springs has outsourced many of its services to private-sector firms. Unlike surrounding cities with budget deficits, Sandy Springs has a surplus.

Outsourcing some Public Works services could be worthwhile. Consider Centennial, CO. In 2008 Centennial signed a five-year agreement with a private firm to “manage all public works functions for the city.” This includes “traffic engineering and operations, permit processing, inspections, administrative services, and street and roadside maintenance, including snow removal.”

Also examine Parks and Recreation. Consider outsourcing their operation to private firms.  Such privatization efforts have yielded 20% cost-savings. Or better yet, could the City raise money by leasing its facilities – rec centers, fields, pools, and golf course – to private organizations to manage them?

Or how about increasing user fees for Parks and Recreation programs? Don’t some programs compete with private firms, and make taxpayers subsidize other people’s leisure activities? This is both costly and unfair.

This was originally printed in the Daily Camera on July 31.

A couple of Daily Camera articles about this:

And the Priority Based Budget Memo dated July 27 by the City Manager and others. This includes one method by which they would prioritize city services.


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