Management & Labor

The Search for Interstate Cooperation

In desperate budget times, more and more local governments are turning to their neighbors, hoping to save money by sharing services and equipment. This kind...
by | October 31, 2009
 

In desperate budget times, more and more local governments are turning to their neighbors, hoping to save money by sharing services and equipment. This kind of collaboration is trickier to pull off at the state level, but Minnesota and Wisconsin are trying.

States rarely share anything, except occasional bulk purchasing. But after talking over their budget woes earlier this year, Minnesota Governor Tim Pawlenty, a Republican, and Wisconsin Governor Jim Doyle, a Democrat, decided that there must be savings to be found in joint efforts across their borders. They ordered an agency-by-agency review to find overlapping or duplicative efforts.

They've run into some roadblocks. Different regulations and types of inspection doomed many initial ideas, ranging from air-quality monitoring to amusement park ride inspections. The governors' talk of $10 million savings per state seemed overly optimistic when, after several months of trying, the two states were lucky to have saved $100,000 between them.

The whole effort came under more criticism in September, when Pawlenty decided to end a 40-year-old reciprocal income tax agreement, meaning that more than 50,000 border residents who live in Wisconsin but work in Minnesota will have to file returns in both states. "It's definitely not a step in the right direction," says Wisconsin state Representative Kitty Rhoades.

But Pawlenty's tax decision had nothing directly to do with the ongoing effort at functional collaboration. And implementing the projects that should lead to bigger savings will take time, says Aaron Olver, deputy secretary of Wisconsin's Department of Commerce. His own department, for instance, has recently been able to cut back on inspections of petroleum terminals because of overlap they found with Minnesota. Eliminating the cost of duplicative inspections is trimming $100,000 from his budget.

Olver also highlights soon-to-be shared projects in tourism and corrections that should lead to significant savings for both states. And a shared effort to clean and maintain the St. Croix River could save the states $1 million over the next eight years.

Like a lot of nascent collaborators, however, Olver says that simply getting people together to swap ideas is turning out to be as important as the dollar savings. "By comparing programs, sometimes you're more motivated or able to see what you can do differently," he says. "It doesn't necessarily save money, but it makes services more powerful."

The biggest question facing the whole effort, though, is whether the type of dialogue across state lines that Pawlenty and Doyle have started will become institutionalized, or whether it will be forgotten after both men leave office at the end of next year.

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