Troy to Explore Extensive Privatization
Theoretically, when John Szerlag is done with his overhaul of the city of Troy, the only official municipal employees left standing could be his city manager position and the police.
Szerlag is believed to be the first city manager in Michigan to seek to privatize every function of city government except for the police and the volunteer fire department.
There are bids from private contractors to replace the functions of the buiding department as well as a golf course. He said he hopes to have all city functions reviewed for privatization within a year.
"We are looking at everything and anything in terms of what can be done," said Dick Carlisle, a community planner consultant from Ann Arbor, who was hired to help in the transformation.
Szerlag's plan to farm out city duties comes as the city has put a 1.9 millage increase for five years on the ballot that will be voted on Tuesday. The millage would generate $37.7 million over five years, according to the city. If it is defeated, the average Troy tax bill will be $196 less a year.
But Szerlag said that even if the millage passes, he could layoff up to 90 of his 430 employees, because privatization is the more cost-efficient route.
On Tuesday, the Troy city manager will give an update to his employees.
The process involves having a panel of experts — both internal and external — come up with the specifications of the private bid. Once bids are returned, a panel determines the lowest qualified bid.
Then the city departments have the opportunity to match or beat the private bid to save their jobs.
Szerlag said privatization had to be considered because the normal cost-cutting measures weren't enough.
"If we kept on running the way we had, we were economically unsustainable," he said.
One Troy resident against the millage increase wonders why it took so long to consider such cost-cutting measures.
"Why haven't you been doing that before this point if we are in such bad shape?" asked Glenn Clark of Troy. "Why haven't you attempted to reform before now, but only after a massive tax hike?"
Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.