University of Wisconsin - Extension

As Wisconsin communities consider the Governor's budget proposal to eliminate state shared revenues, local government structure and options have become priority issues. Three UW-Extension studies are available to help local leaders address these issues, according to Steven C. Deller, UW-Madison/Extension community development economist and co-author of the publications. The publications are:

-- ¿Local Public Services in Wisconsin: Alternatives for Municipalities with a Focus on Privatization,¿ by Steven Deller, David Hinds and Donald Hinman.

Local governments are wrestling with how to provide services to meet citizen demand while keeping tax rates from growing too rapidly. Increasing efficiency in the delivery of public services is likely to be a significant part of the solution, and local officials recognize that they can retain provisionary control over services while examining various alternatives for the production of those services. This report provides a broad overview of which types of services are being privatized (contracted by private firms) in Wisconsin¿s cities and villages, and which services tend to retain municipal employees as the main method. This paper (Staff Paper No. 441, June 2001 is available at http://www.aae.wisc.edu/www/pub/sps/stpap441.pdf.

-- ¿Local Public Sector Performance: Are Wisconsin City and Village Taxes Too High?¿ by Steven Deller and Victor Lledo.

This project examines the economic efficiency of municipal government spending and taxation levels in Wisconsin. Using economic notions of local government effectiveness and efficiency, a theoretical and empirical model is presented and estimated using data from Wisconsin cities and villages. Results for Wisconsin cities and villages suggest that service and taxation levels are positively related to property values, and that spending and taxing in Wisconsin's cities and villages may be too low. This applied research study focuses on city and village taxation and spending, so attention is not paid to public schools, counties, towns or other special districts that have taxing authority. This paper (Staff Paper No. 440, May 2001) is available at http://www.aae.wisc.edu/www/pub/sps/stpap440.pdf"> http://www.aae.wisc.edu/www/pub/sps/stpap440.pdf.

-- ¿Local Government Structure, Devolution, and Privatization¿ by Steven Deller.

The rules of the game have changed for rural local governments. The explicit policy of devolution has placed greater responsibility on local governments at a time when the intensity for tax reductions has increased. The trade-off between greater local responsibility and the risk of higher costs has renewed the debate over local options. One policy option receiving significant attention is privatization, or the contract with private companies to produce or supply a government service. This article provides a critical review of privatization, including alternative local government structures, the experiences governments have had, and the unique problems rural governments face when considering privatization. In the end, privatization may not be a viable option for smaller rural governments where cooperative arrangements to jointly supply services present opportunities. For a copy of this paper (published in the Journal of Agricultural Economics, 20(1) 2000), contact Steve Deller at 608-263-6251 or email to deller@aae.wisc.edu"> deller@aae.wisc.edu.