Special Districts in the Northeast United States: Do They Enhance or Hinder Local Government Service Delivery?

Gina Scutelnicu, Assistant ProfessorPace University

Special Districts

•Independent, special-purpose units of local government

•Professionalize public services management

•Single vs. multiple functions - 90%/10%

•Enjoy limited general and special powers

•Do not have planning and zoning powers

•Characteristics:•Narrow specialization•Administrative and financial independence•Geographic flexibility•Low political visibility•Status of SDDependent vs. independent

https://www.census.gov//govs/go/sd.html

“The Shadow Governments”

Theoretical and Empirical EvidenceSpecialized vs. General-Purpose Governance

•Metropolitan reform theory vs. public choice theory.

•Consolidation vs. Fragmentation

•Do not differentiate special districts

• Specialized governance less efficient than general-purpose governance (Berry, 2009; Foster, 1997; Mullin, 2009;)

• Economies of scale vs. economies of scope (Hooghe & Marks, 2003)

• Responsiveness, accountability and equity not rigorously investigated

• Efficiency operationalization variation

Contribution:•How does service delivery occur

at the local level?•Develop a typology of SD based

on state level data•Assesses SD performance by

function

Study Objectives

•Develop a typology of multi-purpose special districts based on state data (NE states)

•Special districts classification varies (Eger III, 2006; Foster, 1997; Porter et al., 1992)

•Consistent classification across state boundaries:

Activity

Creation method & oversight

Status

Structure

Multi-Purpose Special Districts

•Focus on economic & community development I. Economic development (BIDs) - 9 states • Manage and fund street improvements; parking; sanitation; security; landscaping; marketing & special events etc.

II. Community development (CDDs) - two states (PA & NY)

“Growth pays for itself” Manage and fund new infrastructure improvements & maintenance; public utilities; recreation facilities and transportation-related services

Multi-Purpose Special Districts Cont’d

• SD centralized agency (NJ, NY & PA)

• Reporting information about SD finances - a formality

• Districts services are intended to supplement GP government services

• BIDs focus on commercial/industrial only

• CDDs focus on residential, commercial & mixed use

Districts Creation and Oversight

Creation process:

Petition method: petition of property/business owners public hearing ordinance or resolution of municipality

Referendum method

Public hearing method Duration:

BIDs are time-limited or revised at certain intervals by municipalities

CDDs as perpetual entitiesAnnexation/incorporation issues

Managerial & FinancialAutonomy Cont’d

Dependent:

Appointed board of supervisors

Generate own revenues with approval of GP govts.; municipalities issue bonds

Under close supervision of municipalities

Limits are placed on taxes/assessments

Managerial & FinancialAutonomy

Independent:

Elected board of supervisors (all CDDs)

Generate own revenues - assessments, taxes, issue bonds

Once established, no clear oversight

Lack of coordination and cooperation between the general and the special-purpose governments

File reports and budgets for information only

Conclusion

• Multi-purpose districts suitable for economic & community development functions

• Great variety - “hidden side of government”

• Few states keep track of their SD & require reporting enforcement

• Varying managerial & financial autonomy

Future Research

• Assess Accountability to Performance

• Assess multi-purpose districts nationally:

Efficiency; Responsiveness; Accountability and Equity