Cities across America look for management strategies useful for accomplishing their responsibilities and programs. While some cities include privatization strategies in their management portfolios, others do not, and the underlying reasons are not readily apparent. This study seeks to gain some insight into this disparity through several questions: Why do some cities use more privatization than others! Are privatization levels higher in fiscally healthy or fiscally stressed cities? Where are the cities that use privatization located? This study attributes municipal privatization levels in medium-sized cities, in part, to degree of wealth, fiscal stress, and location. The findings suggest that privatization levels are higher in wealthy, fiscally healthy, suburban cities.
NotesPrivatization scores were based on data included in the Intemational City Management Association's 1988 survey on altemative service deliveiy anangements. Tlie data ate available from Woody Talcove, Intemational City Management Association, 777 North Capitol Street, NE, Suite 500, Washington, DC 20002-4201, (202) 962-3S98. The study also used daU from the 1988 Counly and City Data Book, available from the United Sutes Depaitment of Commerce, Bureau of the Census, Washington, DC 20233, (301) 763^100.
Symposium on Privatization and the Public Interest: GreenêFor a more detailed comparison of La Mirada and La Habra, see Htzgeiald (1988). This system is called Metropolitan Status. It indicates a city's sutus vis-a-vis standard metropolitan areas (SMSAs). "Central" cities are the core cities in SMSAs; "suburban" cities are other cities in SMSAs; and "independent" cities are incoiporated cities not located in SMSAs.The response rate of independent cities to the ICMA survey was veiy low; thus, they are excluded fmn the study.It is recognized that other explanations exist for privatization. The limited nature of this study does not intend to ignore the impoitance of other factors. The purpose here was to focus on privatization and the three facton within a narrow segment of cities (medium-sized cities).The ICMA colleaed data on incidents of privatization. The 1,311 ICMA-survey cities served as a pool because of the rich source of privatization data. Although more cities within the population range responded to the survey, only 199 of these cities completed the entire survey. Rather than use privatization levels based on incomplete dau for all cities, it was detenmined that using only those cities with complete dau would produce more accurate findings.The five broad functional areas were: public works, public safety, utilities, parks and recreation, and support functions.' The types of service arrangements included were: contracting with private profit-oriented fimis, contracting with private nonprofit organizations, contracting with other govemments, volunteers, self-help, franchising, and voucher systems.This indicator is intended to measure the "breadth" of privatization among services. The indicator indudes only the specific services from the five...