Big Idea: Privatizing City Services

Sandy Springs, GA, is one of the most efficient cities in the country, as reported in the Tribune Review. Incorporated in 2005, it was the first fully privatized city in the world.

A city officially splitting from the greater Fulton County and Atlanta area, its privatization had been in the works for over 30 years. The affluent residents, whose taxes continue to pay twice as much to the lower Atlanta area as they do to Sandy Springs itself, wanted to experiment with a downsized local government. They outsourced jobs by contracting CH2M Hill, a Colorado-based private company that tackles engineering and construction projects all over the world. For about $26 million a year, CH2M takes care of “public works, community development, code enforcement, recreation and parks, court services, administrative services, information technology and communications.” Under CH2M, there is worker accountability and health care payment responsibilities are put on the company, not taxpayers. Sandy Springs itself provides ambulance, emergency, and police services.

Using the private sector to accomplish previously governmental tasks promotes efficiency, direct control, and price reduction. Pennsylvania’s House Republican Caucus recently examined the potential for public-private partnerships in the Keystone State. “Not only can P3s be applied to road and bridge infrastructure, but they can be used for water and wastewater projects, parks systems, prisons and public transit. Our hearing focused on these applications and how such teamwork can benefit the public,” says Representative Dick Stevenson.

Pennsylvania could benefit from a P3 system that “merge[s] the bottom-line efficiency of private enterprise with the accountability of public officeholders.” No Pennsylvania cities have been fully privatized, though cities in Georgia, Florida, and Colorado show that its efficiency saves taxpayers’ money.

The Commonwealth Foundation’s research on privatization is available here.