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Louisville becomes lean, less mean after city/county merger

Officials leave squabbles behind to create one place with one vision

Sunday, September 07, 2003

By Bill Toland, Pittsburgh Post-Gazette

LOUISVILLE, Ky. -- Of all the bitter medicines that could rescue Pittsburgh and restore its fiscal health, the idea of a total city-county merger ranks on a feasibility scale somewhere between selling the city on e-Bay and putting the mayor on a bus bound for Las Vegas and telling him to return only after he's won $60 million at the craps tables.

Geographically, it's a quagmire. Politically, it seems like suicide. Getting 130 municipalities on board for such a move? Not a chance.

But nearly three years ago, voters in Louisville, Ky., gave it a chance. And on Jan. 6, the separate Louisville and Jefferson County governments dissolved, giving way to one 26-member council, one budget, one police chief and one mayor.

And one vision, said Jerry Abramson, new mayor of the "new" city.

"We were always pulling back and forth, between the city and county," Abramson said. "Now, we have one agenda, one clear vision, rather than two people who feel like they are both in charge of the same community."

If that sounds familiar, it's because Pittsburgh and Allegheny County leaders have historically maintained a competitive relationship. Abramson, who served three terms as mayor of Louisville in its previous manifestation, said the spats between Pittsburgh and Allegheny County mirror the old relationship between Louisville and Jefferson County.

Business leaders interested in investing in Louisville would often complain that it was impossible to get city and county politicians to agree on anything.

"I'd meet someone at the airport, shake his hand, and say, 'I hope you put your business in the city of Louisville. The [county executive]would shake the guy's hand and say, 'I hope you put your business outside the city of Louisville,'" Abramson said.

"The CEO would get back on the plane and say, 'This city doesn't have its act together.' All of the effort that was expended on that gamesmanship did not move Louisville forward."

Achieving savings

Of particular interest to Pittsburgh, the Louisville merger allows the metro city to be more efficient, Abramson claims. Instead of two information-technology departments, there is one. Instead of two human resources offices, there's one.

By eliminating redundant offices, the city will eventually save money not only on personnel, but also on rent, once leases on county office buildings expire.

The merger also has allowed Abramson, a Democrat, and his staff to craft a budget largely from scratch. That process has resulted in the elimination of 700 city jobs. About 150 people were fired, and the other 550 positions were eliminated outright because of the merger.

The first-year maneuvering also helped the metro city avoid what was shaping up to be a combined $44 million shortfall for the former city and county governments.

For Pittsburgh, a city facing a $60 million budget shortfall that will almost certainly resurface next year if the state Legislature doesn't intervene, the kind of economies Louisville has achieved might mean that even remedies that once seemed politically improbable will get a look.

And the Metro Louisville experiment -- the first notable city-county merger since Indianapolis pulled off a similar merger three decades ago -- is one that will be closely watched by civic leaders in Pittsburgh; Milwaukee; Buffalo, N.Y.; Fresno, Calif.; and any other city suffering through perpetual budget crunches or annual population losses.

The merger also may be of interest to Pittsburghers because attitudes regarding consolidation appear to be changing. In a poll published last month in the Post-Gazette, majorities in the city and countywide said they would support a merger of city and county government.

"Strategies like what's going on in Louisville ... need to be looked at by Pittsburgh," said David Miller, associate dean at the University of Pittsburgh's Graduate School of Public and International Affairs and an expert on regional government.

"We're not going to get structural changes in the Louisville sense of the word," he said. "But at some point, we ought to have a zero-tolerance of service duplication as a state of mind. Right now, we have a very high tolerance, unfortunately."

How we'd look

If Pittsburgh did join with the county today, its population would become 1.27 million, making it the seventh largest American city, between Phoenix and San Diego.

Now the 54th largest city, with a population of 327,898, it would leapfrog over Boston, Dallas, San Francisco, Las Vegas, New Orleans and dozens more along the way.

But it couldn't happen here, could it? Where Louisville had to contend with 84 municipalities in its merger, Allegheny County is home to 130 separate governing councils and boards. Many have their own police departments, fire departments and water authorities.

Western Pennsylvania's parochial structure would no doubt be an impediment to any broad merger attempt, said Mark Muro, a policy analyst with the Brookings Institution Center on Urban and Metropolitan Policy.

"You are certainly looking at a degree of governmental fragmentation that is off the charts," he said. "People like those little units. From what I understand of Pittsburgh, they'd be even harder to dissolve than they were in Louisville."

But technically, Metro Louisville didn't dissolve anything, and that was a key to the merger's success.

Jefferson County's incorporated towns and cities were allowed to maintain their municipal identities -- they may continue to collect taxes, employ their own police departments, even elect their own councils.

The new Louisville government was, essentially, layered on top of old municipal ones. And even then, the referendum was approved by only a 12-point margin, 56 percent to 44 percent.

Not everyone is smitten with the city's new image.

Louisville by any other name -- Loo-ee-ville, Loo-uh-ville, Lewiz-ville -- is still Louisville, said Cary Stemle, editor of the city's weekly paper, the Louisville Eccentric Observer.

That's why a lot of people living and working in the new Metro Louisville, including Stemle, kind of roll their eyes when they hear that Louisville, once the 65th largest American city with a population of 256,000, is suddenly the 16th largest, with nearly 700,000 residents.

"We all kind of laugh at it," he said. "I think most people see through that. It's just a semantics thing."

It is and it isn't, the mayor explained. "We feel that we're now on all of the lists," he said. "Decision-makers have to see you on a radar screen to consider you." And if the U.S. Census Bureau says you're the 16th-largest city, that's exactly what you are.

Promoting its image

Greater Louisville Inc., the metro-wide chamber of commerce that itself resulted from unifying city and county chamber offices, has spent $250,000 to spread that message nationwide, through a new public relations campaign.

The new city, alternately called Greater Louisville and Metro Louisville, won't become an overnight economic engine, like Seattle or Atlanta did in the 1990s. But the merger isn't about big promises, said Steve Higdon, executive director of Greater Louisville Inc.

It's about doing the little things that will allow Louisville and other midsized cities, which collectively are marching toward fiscal obsolescence, to remain solvent and streamlined.

"We needed to create an efficient government system," Higdon said. "Obviously, there's nothing efficient about two government systems competing against each other."

Mostly, Abramson said, the city's chief concern is to maintain, or improve, city services without increasing cost. It's a modest goal, but it's one most cities -- including Pittsburgh -- are having difficulty accomplishing these days.

Some Louisville merger opponents, such as former Jefferson county commissioner Darryl Owens, wonder if it's really happening at all.

"Understanding that government is labor-intensive, how are you going to lay off 700 people and not reduce services?" Owens said. "I think that there's an effort in the community, by media and others, to not reveal the warts of this process."

The merger has meant a certain amount of upfront expense, which so far has not been added up. The city discovered that a complete consolidation of the former city and county police departments would require a $50 million overhaul of the new department's radio system (one department communicated on UHF frequencies, the other, via VHF). Squad cars, which still bear the logos of both the city and county departments, will all have to be repainted.

Whether the merger eventually results in tangible savings for taxpayers remains to be seen. But an examination of the 1992 merger of Athens, Ga., and surrounding Clarke County offers some encouraging signs. Once upfront costs were out of the way, general government spending in Athens dropped by nearly 10 percent, while finance costs on old loans declined by 16 percent.

Boosting development

The merger has caught the eye of several developers who otherwise might not have considered investing in the city, officials here said.

Now under construction: a new Marriott hotel and convention center, a pyramid-shaped office building on the downtown's east side, a 22-story waterfront condominium tower, and a West Fourth Street entertainment complex that could be open by 2004.

Certainly, a great deal of what curses Pittsburgh also afflicts Louisville -- the city's Main Street has an impressive share of vacant buildings, many with plywood covering the windows, others recently renovated but still searching for tenants. The city's 20-year-old Galleria mall, the ill-fated counterpart to Pittsburgh's Allegheny Center, was razed a few weeks ago.

Much also has been made of Louisville's "brain drain." Since 1970, the city has lost 35,000 young professionals, according to the census, while Nashville, Tenn., Louisville's competitor to the south and itself the product of a 1962 merger, has gained more than 20,000.

The merger will not be a panacea for these problems. But leaders here are convinced that the city has taken a giant step toward solving them.

It also makes a difference psychologically

"From a semantics perspective, there's the perception that we are big, moving and growing," Higdon said. "Companies don't want to go somewhere that's slow, stagnant and sleepy.

"Perception is reality in life."

Louisville, like Pittsburgh, also suffers from a chronic inferiority complex, and some of those feelings have now been scuttled, he said.

"This was the first time in a really, really long time that we've challenged ourselves, and we've won. We now feel good about ourselves."

On the other hand, there is concern that the new megalopolis will reduce the government's "urban voice," Stemle and Owens said.

"The urban area probably has lost power" to the suburbs, Stemle said, and Owens, who is black, noted that the city's racial pie chart was altered pretty much overnight -- black residents who on Jan. 5 made up 34 percent of Louisville's population accounted for less than 20 percent of it on Jan. 6.

"That reduced their significance," he said. Six of the city's 26 council members are black.

The Pittsburgh region may face one impediment that Louisville didn't.

It's dubious whether a Louisville-style merger could happen in Pennsylvania without amending the state Constitution.

"I really am unsure of whether or not there exists a mechanism that would allow Allegheny County's voters to agree to take on the indebtedness of Pittsburgh proper, let alone that of its various public authorities," said Robert Strauss, professor of economics and public policy at Carnegie Mellon University.

But even if a merger were possible in a legal sense, it's probably impossible right now politically, said Allegheny County Chief Executive Jim Roddey.

"I think it would be very difficult to do anything more than merging city and county departments," Roddey said. If the city and county were to attempt a merger on the scale of Louisville or Indianapolis, "I think you'd have a revolution if you tried something like that."

But for decades they said it couldn't happen in Louisville, either, yet it did. And from a financial standpoint the city seems to be swimming along.

Pittsburgh, meanwhile, is still gasping for breath.

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