Magazine article Government Finance Review

Collaborate or Collapse - Tough New England Message

Magazine article Government Finance Review

Collaborate or Collapse - Tough New England Message

Article excerpt

Call it, if you will, the American way: thousands of tiny little governments, each with its own council, each in command of its own tax collector, police and fire chiefs, emergency call center, road crews, park and library staffs - and more.

In a simpler age, amateur local government worked well enough. Neighbors helped neighbors, services were personal and often volunteer-manned, and the costs weren't high.

Even today, many people leave urban areas in search of small towns where they expect the old, informal culture - and low costs.

But the system has veered off the tracks, with escalating costs and rising frustrations. And what's the top culprit? Sprawl, says Angus King, Maine's immediate past governor. King's planning director, Evan Richert, found that when a small town in the path of suburbanization passes the 3,500-person mark, citizens start demanding a town manager, more police and professionalized services - and budgets start to soar.

Though they've added jobs since 1980, Maine's cities and regional centers have simultaneously lost residents to outlying towns within commuting reach. Smaller town populations - and duplicated government services - have risen fast. King's economic development director drew a 20mile circle around Augusta and found 91 fire trucks serving 95,000 people. Not one of the monster trucks - priced from $100,000 to $500,000 and up - was jointly owned.

Hit by rising costs, the towns end up competing furiously for property taxes and development. And with suburban spread, Maine has spent close to $750 million on new schools since 1980, even though the state's total student enrollment has actually declined.

"We pay due respect to local control but it comes at a high cost," says King. "We have 205,000 school kids in 186 school districts, each with its own superintendent, curriculum, purchasing office - and about one superintendent for each 1,200 kids."

Result: the competing values of fiercely guarded home rule and Yankee love of frugal government are rubbing together like tectonic plates - in "full collision," says John Baldacci, Maine's present governor. A spirited tax revolt is under way and the state has started to impose caps on local spending - which it subsidizes through a major share of the state sales tax.

But Maine is now going a step further with a "regionalization" program of cash incentives for localities that agree to curb local tax rates through systems of shared services between towns or school districts.

Maine's current high government costs just can't be sustained, says Charles Colgan, an economist at the University of Southern Maine: "It's going to be collaborate or collapse."

Indeed, the test may be whether the small 18th-century town government form so popular in New England and other parts of the Northeast and Midwest, indeed reflected in smaller town and county governments nationwide, can survive at all without dramatic increases in joint service districts and shared tax bases. …

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