Are Ohio's Cities Competitive?

[Night Owl]

Are Ohio's Cities Competitive?

Ohio’s three major cities are failing to effectively compete with the nation’s largest cities or their suburbs. Out of 44 American cities, The Reason Public Policy Institute ranked Columbus 20th, Cleveland 29th, and Cincinnati 30th in terms of efficiency.[1] The study cited poor fiscal policy as a competitive disadvantage for the cities.

One of the downsides to poor fiscal policy decisions during economic expansions is that cuts have to be larger during recessions. For example, Columbus Mayor Michael Coleman has recently proposed $5.9 million in budget cuts and fund shifts. Councilman Richard W. Sensenbrenner, chairman of the finance committee, said: “We’re definitely tightening our belts again, and it’s not any fun." [2]

Cincinnati is also experiencing some “belt-tightening” of its own. The Cincinnati City Hall has cut 52.5 positions from the payroll of 6,500 people. “The reductions, approved by City Council, are designed to stave off a $35 million deficit due to stagnant tax revenues and rising expenses."[3]

Cities throughout Ohio are experiencing similar problems in financing municipal services and in turn are losing citizens to suburban areas. According to the 2000 Census, Columbus was the only major Ohio city that experienced population growth during the 1990s.

Cleveland’s experience is more typical, with population declining by 5.4 percent during the decade. Cincinnati’s population declined 9 percent over the same period while three surrounding counties - Warren, Clermont and Butler - grew by 39 percent, 19 percent and 14 percent respectively.[4]

“Today, the American dream for many is to escape the city for the comforts of the suburbs,” states Stephen Goldsmith, former mayor of Indianapolis. “Cities are losing population, and businesses increasingly locate outside city limits. Badly deteriorated inner-city neighborhoods are places of widespread unemployment and intolerably high rates of crime."[5]

The response of city policymakers is often to ignore the high taxes, poor schools, and high crime levels that cause people to leave the city. Instead of focusing on improving the core functions that people entrust to government, they often expand the number of activities undertaken by city government. Cities create program after program designed to “increase retail diversity” or “expand housing options” all of which take more and more taxpayer dollars.

Mayor Goldsmith found this emerging pattern as governments desperately try to solve problems through a top-down approach. “The flight of wealth left a smaller, poorer tax base and caused chronic revenue shortfalls. Predictably, government’s solution was to raise taxes further and pour more money into programs, and a vicious cycle began."[6]

While mayor of Indianapolis, Goldsmith took a different approach to running municipal government. Today, Indianapolis provides a great example of metropolitan efficiency.

According to his book, The Twenty-first Century City, Mayor Goldsmith “eliminated city deficits, cut the city payroll, enhanced services, rebuilt infrastructure, revitalized neighborhoods, and reduced crime” all while cutting taxes.[7] By introducing competition among public and private contractors into the municipal services, Mayor Goldsmith saved Indianapolis more than $10.6 million in sewer billing alone. Competition resulted in lower costs with better service.

Indianapolis is not the only city turning to competition and privatization. The city of Portage, Michigan has saved $785,000 in the first year of their contract with the private firm Earth Tech Operation Services, which began operation of the city’s water and sewer treatment. That savings allowed the city to reduce expenses by more than 11 percent.[8]

Ohio’s cities are losing the competition against the suburbs. Instead of expanding the activities of city government in an attempt to retain residents, Ohio’s cities should take a page from Mayor Goldsmith’s book and use privatization to focus city government on its core functions.

Notes

[1] Adrian T. Moore, et al., “Competitive Cities: A Report Card on Efficiency in Service Delivery in America’s Largest Cities,” (Los Angeles, CA: The Reason Public Policy Institute, April 2001).

[2] Suzanne Hoholik, “Revised Budget Cuts $5 Million,” Columbus Dispatch, 17 May 2003

[3] Kevin Osborne, “Budget Cuts Affect 52.5 City Workers; Most in Water Dept.,” Cincinnati Post, 1 March 2003

[4] Jessie Halladay, “A growth spurt, but state still lags,” USA Today, 27 March 2001.

[5] Stephen Goldsmith, The Twenty-first Century City, (Washington, DC: Regnery Publishing, Inc., 1997), 7.

[7] Goldsmith, The Twenty-first Century City, 8.

[8] Goldsmith, The Twenty-first Century City, front jacket.

[9] “Private Water Trends: Portage Goes with the Flow,” (Midland, MI: Mackinac Center for Public Policy, 16 November 1998).

http://www.buckeyeinstitute.org/article.php?id=393

[Night Owl]

oops. my bad, I created a thread instead of replying to a different one.

[Linda_D]

Which one were you replying to? Not one of Mr. Sunshine's, I hope. I ignore the cretin.

[MrSunshine]

According to NightOwl.....Buffalo is better than Columbus???

Thank god he doesn't work for the US Census or other data collection agencies or he would create numbers to go along with his crap.