Dear Mayor:

Yesterday, the Joint Legislative Committee on Government Consolidation and Shared Services met and took testimony from three academics who each are experts in the areas of public productivity and consolidations at the local level. What each of them told the Committee is, in a nutshell, that while the consolidation of services can indeed yield greater administrative efficiencies and modest savings, the savings may not be as much as one might anticipate.

The first speaker was Professor Marc Holzer, the Dean of the Rutgers-Newark School of Public Policy and Administration and Director of the National Center for Public Productivity (NCPP.) Professor Holzer provided an overview of his collaborative efforts with the Department of Community Affairs (DCA), including the introduction of a measurement collection system for benchmarking of service delivery. Additionally, Dr. Holzer discussed the identification of best practices, promoting professional education and training and promoting regionalization of certain services, such as a statewide 3-1-1 system.

From the League's view, the most important part of Dr. Holzer's testimony came when questioned regarding consolidation. The Professor laid out a number of option for the Legislature, and specifically stated that he advocates pressuring local government by equipping them, "empower them" to solve problems themselves. This view is most-welcomed when others are attacking home rule and calling for mandatory consolidation of services and governments.

Up next was Professor John Yinger, Director of the Education Finance and Accountability Program in the Center for Policy Research at the Maxwell School at Syracuse. Professor Yinger recounted his research on school consolidations in New York State. The New York model demonstrates savings in administrative costs, but often these savings are offset by increases elsewhere. Professor Yinger also stated that his findings indicate opportunities for some savings for the merger of smaller districts, but less savings for large districts.

The last speaker was Professor Ernest Reock, Professor Emeritus at Rutgers and former director of the Center for Government Services. Professor Reock provided an overview of his research on school district consolidation, which was most recently updated in December 2003. Professor Reock proposed a plan in which all districts would offer a K-12 program and the number of districts would drop from 574 to 264 (using 2003 numbers.) Professor Reock estimated savings of $365 million (in 2002-2003 dollars.) He cautioned, however, that this was a "highly speculative" estimate and that there may be unexpected costs of consolidation. Professor Reock's summarized his findings this way: It appears that there are some potential costs savings that could be made through consolidation of school districts, especially in administrative costs. Whether they are large enough to justify the turmoil and disruption involved is open to serious question.

Judging from the questions from the legislative panel, one could conclude that they are seriously considering the concept of school district consolidation, particularly employing the county model. Other questions did probe municipal consolidation, but most of the questions seemed directed as to what municipal services could be delivered at the county level without infringing on home rule.

The Joint Legislative Committee on Government Consolidation and Shared Services is schedule to meet again next Wednesday, September 6.

Today, (Thursday, August 31) the Joint Legislative Committee on Public Employee Benefits Reform will meet.

For more on yesterday's proceedings, please contact Mike Cerra at mcerra@njslom.com or 609-695-3481 x20.