Government Consolidation a Priority in Michigan, just a Nice Idea in Ohio

Michigan, like Ohio, has many levels of government and many local government entities, but Governor Rick Snyder is trying to change that as part of his effort to revive the state.  Michigan, having lost over 700,000 jobs since 2000, has the worst economy in the United States.  (Ohio is number two.)

Governor Snyder, positing that consolidating and sharing services will save money through reducing redundancy and bureaucracy, is providing incentives for villages, townships, and cities to work together.  From trash pickup and snow removal to fire departments and administrative offices, each local government is encouraged to work with neighbors to fully realize cost savings for taxpayers. Governor Snyder has set aside $5 million in his budget to help facilitate the process.  To show his seriousness about consolidation, he is also withholding $200 million in local government funding that will only be distributed once municipalities show progress.

In Onekama, Michigan, a village and a township are talking of merging.  A few years ago, they came together to solve a problem with a lake.  Since then, they have talked about dissolving the village government.  Village residents would benefit from reduced taxes while township residents would experience no change in taxes.  Voter will get the final say later this year.

Ohio would benefit from greatly from consolidation.  According the Government Density chart in The Wall Street Journal, Ohio has fewer than 5,000 people per unit of local government.  If you look at the map, states in the South and in the West have significantly more people per local government.  Ironically enough, these states generally have more economic growth than states in the Midwest and Northeast that have many local governments.  A high presence of local governments not only leads to inefficiencies, but also to higher taxes.  Ohio has over 3,700 local government entities which have the ability to tax.

As part of the original House Budget, Ohio was going to implement incentives similar to Michigan’s to encourage consolidation.  However, when the budget was sent to the Senate, this provision was removed.  Money allocated to covering consolidations was returned to the local government fund.  There is a possibility that the provision could be inserted in the final budget although it is doubtful.

While our many local jurisdictions might have made sense when they were created (some dating back to the Northwest Ordinance of 1787), they don’t make sense now.  Ohio’s government is stuck in yesterday:  just like Michigan, we need to restructure to meet the demands of the 21st Century.

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