Intergovernmental Cooperation Conference

A policy conference on Intergovernmental Cooperation was held May 17-18, 2007, at the Kellogg Hotel and Conference Center on the campus of MSU, sponsored by the Land Policy Institute (LPI) and many partner organizations.

LPI would like to thank all who participated to make the conference a success. The Intergovernmental Cooperation in Michigan: A Policy Conference Final Report of the conference is now available. Please take a chance to review the information that has come out of this event.

Conference Background
Statistics show that Michigan is facing its most challenging economic environment of the last 30 years. The state lost nearly one third of its manufacturing jobs between 2000 and 2005. The unemployment rate is a full percentage point higher than the national average according the Michigan Senate Fiscal Agency (2006).

Economists in the Michigan Department of Treasury, Michigan Senate and House of Representatives estimate that 2006 and 2007 will see no economic relief. The state's fiscal stress has already translated into local government's revenue reductions and will likely translate into continued minimal increases or even cuts to local government revenue sharing and other programs.

Local governments, providers of critical and essential public services, now face their most serious fiscal challenge to date.

Quality of life factors are partially determined by local government service provision in such items as transportation systems, health care and food safety, parks and recreational opportunities, and public safety. Businesses' and residents' bottom lines are affected by the delivery of public services as well as by tax rates.

A review of the relevant economic research published by Ronald Fisher, Professor of Economics at MSU, demonstrates a link between the provision of public services, such as public safety transportation, and economic development. Research also shows that this link exists even after factoring in tax rates. Therefore, communities and local governments must strike a balance between providing a reasonable portfolio of services while maintaining reasonable tax levels. An imbalance in either direction will be potentially damaging.

To address this crisis, local governments have already implemented significant workforce and expenditure reductions. Many local governments have used up fund balance and rainy day funds in order to maintain a balanced budget and continue to provide critical services.

Finally, local governments are beginning to or have engaged in cooperative ventures with neighboring jurisdictions. Although intergovernmental cooperation and consolidation is not a new tool to Michigan, the framework and legal structure in which it occurs has not been thoroughly scrutinized for some time. The Governor's Task Force on Local Government Services and Fiscal Stability in 2005 and 2006 began a preliminary investigation of these issues.

The Intergovernmental Cooperation Conference sought to explore those issues more deeply and thoroughly and focused on the issue of intergovernmental cooperation and consolidation.

For some, these words invoke the fear of a loss of control and autonomy. For others, they invoke government efficiency and a rethinking of boundaries. The truth undoubtedly lies somewhere in the middle.

There is evidence that, in some cases, intergovernmental cooperation can lead to significant cost savings, better quality service, and a higher standard of living. There are other cases where the loss of local control has led to negative outcomes, such as higher costs and poorer services.

Intergovernmental cooperation and consolidation is neither a silver bullet nor a panacea. However, it remains an important tool that local governments must use in addressing the economic and fiscal crisis facing the state of Michigan. Used judiciously, it may be part of the solution to get Michigan on the right track in the 21st century.

The goal of the conference was to examine, deliberate, debate, and formulate policy options in the arena of intergovernmental cooperation and consolidation. Michigan currently has over 70 statutes and constitutional provisions that directly address the issue of cooperation/consolidation. These laws set the stage for the "rules of the game."

But just as in sports, sometimes the rules of the game need to be altered to accelerate the pace of change and adaptation. Therefore, the conference was not about "how we do" intergovernmental cooperation, but rather if we should change the rules of the game, and if so, what would be the impact on the "how" of cooperating.

White Papers Presented at the Conference:

• White Paper A - Consolidation and State Boundary Commission.
  Author: Kenneth Verburg, Professor Emeritus, MSU
• White Paper B - Legal Barriers to Intergovernmental Cooperation, "Legal Issues" (Urban Cooperation Act).
  Authors: Christopher M. Trebilcock and Michael P. McGee, Miller, Canfield, Paddock and Stone, PLC
• White Paper C - Tax Base Sharing.
  Authors: Scott Buhrer, Assistant City Manager of City of Grand Rapids, Eric Scorsone, Ph.D. and Joseph Martin, M.S. MSU
• White Paper D - Special Districts: A Growing Trend. Does the State Want to Encourage or Discourage this Activity?
  Authors: Joseph Martin, M.S. and Nicole Bradshaw, MSU
• White Paper E - Past, Present and Future Role of Regional Planning Bodies.
  Authors: Naheed Huq and Clarinda Barnett-Harrison, Southeast Michigan Council of Governments
• White Paper F - Regional Economic Development.
  Author: Steven Miller, Ph.D. MSU
• White Paper G - The County's Role in Government Collaboration and Service Delivery (minimum service level standards).
  Author: Art Holdsworth, Oakland County
• White Paper H - Intergovernmental Cooperation and Revenue Sharing.
  Author: Eric Lupher, Citizens Research Council of Michigan

Supplemental Material

• School District and Municipal Reorganization
• Tools for Intergovernmental Cooperation
  Series: Financing and Cost Allocation Handbook
• Selected Constitutional and Legislative Provisions Promoting Local
  Government Cooperation

Special thanks to our partner organizations through the grant/conference:

• Citizens Research Council of Michigan
• Grand Valley Metropolitan Council
• Land Information Access Association
• Michigan Association of Counties
• Michigan Association of County Administrators Organization
• Michigan Government Finance Officers Association
• Michigan Land Use Institute
• Michigan Local Government Management Association
• Michigan Municipal League
• Michigan Suburbs Alliance
• Michigan Townships Association
• Southeast Michigan Council of Governments
• University of Michigan
• Wayne State University

For more information, contact:
Eric Scorsone, Ph.D.
State and Local Government Program
Department of Agricultural Economics & Extension Service
Michigan State University
Room 202 Agriculture Hall
East Lansing, MI 48824-1039

517.353.9460
517.432.1800 Fax
http://web1.msue.msu.edu/slg/

or

Melissa A. Gibson
Hannah Research Coordinator
Land Policy Institute
3rd Floor Manly Miles Bldg
1405 South Harrison Rd
East Lansing, MI 48823

gibson@landpolicy.msu.edu
517.432.8800 ext 110
fax: 517.432.8769