The Quest for Cost-Efficient Local Government in New England : What Role for Regional Consolidation?

In the aftermath of the Great Recession, many local governments have experienced significant financial strain. Local governments' financial challenges are likely to continue in the foreseeable future, as federal deficit-reducing measures trigger cuts in state and local aid and as all levels of government struggle to fund their medical and retirement obligations. In an effort to maintain service provision without significant tax increases, many cities and towns will be forced to consider a variety of cost-cutting measures, including joint service provision with other localities. This research examines the potential long term savings that could be realized through greater regional consolidation of select local government services, specifically emergency call handling and dispatch, public health, and high-level government administrative services. It focuses especially on the expected long term savings in the New England states, with specific estimates for Massachusetts and Connecticut. The report finds that regional service-sharing can be an effective means to achieve savings, particularly for services that rely on high levels of technology, capital, or specialized expertise. The author recommends that the state consider playing a stronger role in encouraging local regionalization through measures such as instituting quality standards and using funding to promote and facilitate consolidation