Managing Tight Resources: Alternative Service Delivery in Local Government

This month's "facts and stats" focuses on a recent summary report of the 2017 Alternative Service Delivery survey.

BLOG POST | Jun 24, 2019
By Rebecca DeSantis, content and engagement coordinator, ICMA
constuction workers painting road, facts and stats sticker above

Local governments face a number of challenges when determining how to best deliver services to their communities. With fiscal stress, environmental concerns, and state policies affecting local government resource allocation, many leaders face decisions about the tools they use to address service delivery.

"Pragmatic local government managers seek to maintain services and continue to serve residents," explains Mildren Warner, Yunji Kim, and Austin Aldag in a recent article on service delivery in ICMA's Local Government Review. "To do so, they must balance resident demands with fiscal constraints and internal (union and department head pressure), along with external pressures to explore alternatives. If fiscal stress deepens, their ability to continue to provide quality services is at risk."

ICMA has been assessing local government practices, experiences, and policies in alternative service delivery for more than three decades. In June 2017, ICMA partnered with Cornell University to launch an update to the Alternative Service Delivery (ASD) Survey.

This survey provides insights into alternative service delivery among U.S. local governments. The results of the survey explore topics such as feasibility work done by local governments on private service delivery; obstacles faced in adopting private service delivery; techniques to evaluate private service delivery, as well as shared services with other jurisdictions; and how certain services are provided within communities. The term private service delivery includes for-profit firms, nonprofit organizations, and private industries.

Below are some findings from the survey focused on delivery of services in local government.

77.3% of local governments use intergovernmental contracting to deliver services, with cost savings being the most common reason.

Transit systems and health/social services, such as child welfare programs and inspection of food facilities, are frequently provided through another government or authority. In comparison, the top three services provided directly by local government employees are payroll, public relations, and personnel services.

80% of local governments use the private sector in delivering services.

Services provided mostly (50% or more) by the private sector are vehicle towing and storage, legal services, commercial and residential solid waste collection, operation of daycare facilities, recycling, and electric/gas utility operation and management. Services often provided by nonprofits are social services, including operation of homeless shelters, museums, and cultural and arts programs.

33% of local governments reported studying the feasibility of adopting private service delivery in the past five years.

Local governments that studied the feasibility cited internal attempts to decrease the cost and external fiscal pressures as the main factors impacting their decision. Interestingly, 20.1% of local governments said they encountered an obstacle in adopting private service delivery, with some stating opposition from local government line employees and elected officials to be common issues they have faced.

As the issue of service delivery continues to be at the forefront for local managers, balancing demand with revenue becomes increasingly important. "In a global world of mobile capital, local government is fixed in place and focused on community well-being," says Warner, et al. "As professional managers explore responses to fiscal stress, they recognize efficiency is not the only goal. Meeting community needs with innovative revenue and service delivery approaches requires a balance that pragmatic managers understand."

Download the newly released Alternative Service Delivery Summary Report today to gain deeper insight into the results of this ICMA survey. Look out for the data set, which will be available for purchase!

Download Report

Looking to do a deep dive into the results? The data set is available for purchase!

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