Can local governments save money by consolidating?

Dec 7, 2012

New York state has a variety of programs intended to save taxpayer dollars by helping governments share services or eliminate certain government entities altogether. A New York state Assembly hearing in Syracuse this week tried to find out whether these programs work.

New York state earmarks about $75 million a year to help local governments save money by sharing or consolidating services.  But is it worth it? Assemblyman William Magnarelli, of Syracuse, is chairman of the Local Governments Committee, and held the hearing on this controversial topic.

"I think I'm getting two different messages -- from our urban areas one thing, from our villages, towns and counties, another," he said.

Magnarelli says the bottom line for bigger cities like Syracuse is that shared services and consolidations don't put a dent in the massive budget gaps caused by escalating pension and health care costs. But Magnarelli says the story is different in counties, towns and villages.

"I think there is more fertile ground for these kind of grants, where there are so many different local governments and districts, that consolidations and efficiencies can lead to saving of money for taxpayers," Magnarelli said.

Many central and northern New York villages have voted on dissolving their village governments in recent years. Some other local governments have attempted to or successfully combined services like police and fire departments.

Magnarelli also says even if there are no direct taxpayer savings to consolidations or dissolution, if they result in more efficient government, it makes the state investment worth it. He expects any changes in the program could come in the Governor Andrew Cuomo's State of the State speech or budget proposal early next year.