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CT Business Lobby Pushes Regionalism Reforms

By Greg Bordonaro

March 12, 2012

Regionalism has been the buzzword at the State Capitol for years.

But efforts to create a more efficient and coordinated system for local delivery of municipal and education services have largely gone nowhere as political interests have fought to protect a system in which 169 municipalities maintain independent governance.

Now, business leaders are stepping up pressure on lawmakers to change that system, which they say is proving too costly in light of the budget shortfalls facing many of the state's 169 cities and towns and the state.

According to a new report from the Connecticut Institute for the 21st Century, a group of mostly business and some public interests advocating government reform, the state's municipalities collectively spend $12 billion annually to fund public services, up 11.6 percent since 2004.

In the same span, the trajectory of local spending has grown 57 percent faster than gross state product and 3 ½ times faster than median personal income.

As the largest property taxpayers in towns and cities, businesses have felt the brunt of those cost hikes, a trend that must reverse itself if the state is to be economically competitive, said Jim Torgerson, chair of the Connecticut Institute and president and CEO of UIL Holdings Corp.

Mandating more cooperation among cities and towns to achieve economies of scale in the delivery of public services is the answer, Torgerson and other business leaders say.

"When businesses make decisions about where to invest they look for value based on price and performance," Torgerson said. "They are looking for a business environment that is stable and for public leaders who are reliable and consistent."

Connecticut Institute proposes several measures to encourage more regionalism efforts between state and local governments and school systems, starting with procurement reform and shared-services programs, said Brian Renstrom, a partner at the accounting firm Blum Shapiro.

Renstrom said the state must consolidate its purchasing practices by using statewide contracts and cooperative purchasing agreements that would allow the state to capitalize on economies of scale to achieve administrative savings and other benefits.

In addition by consolidating municipalities' back-office services such as payroll and accounting, significant cost savings can be achieved, he said.

Renstrom said a few states have consolidated their buying of commodity products. Procurement programs in Virginia and Minnesota, for example, have saved those states $280 million and $210 million respectively.

The institute also advocates a new record-tracking system, called a Uniform Chart of Accounts, that benchmarks local government spending so cities and towns can be compared to their peers, creating more accountability.

The idea is that if two cities with similar demographics are found to be spending vastly different amounts on the same services, they can identify the gaps and drive cost savings or shared services agreements between the two.

The institute also supports education reforms, including improving teacher preparation and certification programs and new guidelines for teacher and principal evaluation.

Although regionalism efforts have never gotten very far in the state legislature there is some support across party lines.

Regionalism supporter State Sen. John McKinney, R-Fairfield, says one of his priorities has been trying to get the state out of the social services delivery business and outsourcing it to nonprofits which can provide the same services at a fraction of the cost.

Such efforts have faced fierce resistance in the past. State Sen. Steve Cassano, D-Manchester, has been a long-time advocate for regionalism, only to see those efforts fall short. For regionalism to work, town aid grants must be tied to shared services and regional procurement agreements, forcing cities and towns to work together in order to get their share of state funding, Cassano said.

"We've been studying regionalism for years but the studies keep getting set aside," said Cassano, former mayor of Manchester. "Shared services work. We must do more to get people to work together."