WHITE PAPER: Better Together and Indianapolis: Comparing Fruit Salads

By on April 8, 2019
Regionalism Drill Down White Paper #5

by David Rusk
Special to ConstructForSTL

“Better Together research shows —that these governments [St. Louis City, St. Louis County and its 90 municipalities] cost the taxpayers approximately $1,600 per capita.   When contrasted with the per capita cost of just over $1,200 for the same services in Indianapolis-Marion County, IN and an even lower $1,100 per capita in Louisville-Jefferson County, KY, it is clear there is a significant overspend on local government in the St. Louis region. In fact, that overspend adds up to over $750 million annually in local government services.”

Better Together Task Force Report: Appendix A: The Will To Change,” page 2

I remember well a luncheon I attended in the mid-1980s several years after my term as mayor of Albuquerque. Sponsored by the Good Government Group (of which I was a charter member), our guest speaker was the Honorable William Hudnut, the second mayor of consolidated Indianapolis-Marion County, or “Unigov.” The Good Government Group was interested in exploring the possible consolidation of Albuquerque and Bernalillo County.

As I listened to Mayor Hudnut discuss the successes of Unigov, I found myself thinking, “Heck, as mayor of Albuquerque, I had been responsible for more local public services than the mayor of the famed ‘Unigov’.”

Our library system, our regional bus system, our convention center and sports facilities, our international airport, our regional water and wastewater system – all were simply departments of Albuquerque city government whose heads reported directly to the mayor.   

In Indianapolis, IndyPL (libraries), IndyGo (buses), the Capital Improvements Board (convention center and sports facilities), the Indianapolis Airport Authority – all were independent “municipal corporations” governed by their own boards and financed by fees and independent taxing authority separate and apart from Unigov and its annual budget. (Unigov’s mayor and council sometimes appointed board members and some “municipal corporation” budgets were reviewed and approved by the City-County Council.)

And then city-owned water and wastewater system would shortly be transferred to the Citizens Energy Group, a non-profit charitable trust that also provided cooled water, steam and natural gas services to Indianapolis.

On that basis alone, if we compared the Unigov budget with the combined Albuquerque and Bernalillo County budgets, Albuquerque’s local government costs per capita would probably have been greater than Unigov’s simply because our combined budgets covered a broader range of public services.

The “Unigov” That Wasn’t

And “Unigov” wasn’t really Unigov. Disregard the fact that legally the Consolidated City of Indianapolis and Marion County were still two separate governments, though sharing a City Mayor/County Executive and a single City-County Council and combining several administrative departments.   

In addition to Marion County and the Consolidated City there were 31 other independent taxing authorities that had not merged into “Unigov” – four cities, eight towns, nine townships, two conservancy districts, and  the eight “municipal corporations” (the four cited above plus the Capital Improvement Board (administering the convention center and sports facilities), the Health and Hospital Corporation (including a major public hospital), the Building Authority (owning and managing the City-County building and 18 other public buildings,), and the Bond Bank, which has issued $13 billion in bonds and notes between 1985 and 2016.    

(In Albuquerque-Bernalillo County, by contrast, there were only eight independent taxing authorities.)

Apples to Apples — or Comparing Fruit Salads

When Better Together states that “for the same services” local government in St. Louis City and County cost approximately $1,600 per capita compared to just over $1,200 per capita in Indianapolis-Marion County, just how rigorous is that definition of “same services?”

What is counted on the St. Louis side of the equation? What on the Indianapolis-Marion County side?    

  • Do the St. Louis calculations include budgets of all 90 independent municipalities as well as the St. Louis City and St. Louis County budgets?
  • Are the budgets of all unmerged four cities, eight towns, and nine townships included on the Indianapolis side?
  • What about the public water and sewer utilities, such as Citizens Energy Group and the Metropolitan St. Louis Sewer District (MSD)?
  • What about the international airports?   Lambert is part (and probably a big part) of the St. Louis City budget; is the budget of the Indianapolis Airport Authority – an entity separate and apart from the city and county – included in the calculations?
  • And so on and so on and so forth.

My point is that local governments are highly complex and variable creatures. Nashville-Davidson County and Louisville-Jefferson County (two other favorite examples cited by Better Together) are barely less complex than Indianapolis-Marion County – and over the last quarter century I’ve done studies of all three.

The danger is not to end up making apples-to-oranges comparisons.   The reality is that most often one is challenged to compare fruit salads. How does a pear-peach-maraschino cherry fruit salad compare to a cantaloupe-honeydew melon-pineapple fruit salad?   And what happens when you throw chunks of watermelon into the melon salad (which at $4.49 a pound is outrageously expensive … equivalent to a county hospital)?

Toasted Ravs vs. Gooey Butter

Lest you think that the above analyses are simply the musings of one inside-the-Beltway pundit, I share with you a quote from an October 2015  study authored by Mark Tranel,  director of the Public Policy Research Center at the University of Missouri — St. Louis.  In keeping with the food theme of this white paper, let’s call it “Gooey Butter vs. Toasted Ravs” — both delicious, but decidedly not similar. The study, Case Study Comparing St. Louis and Indianapolis Local Government Structures (click here to download complete study) states:

“Given the challenges of comparing and contrasting the fiscal performance of differing local government structures, the University of Missouri-St. Louis Public Policy Research Center (PPRC) collected and analyzed data for a case study examining in more detail the titular Unigov of Indianapolis and governments and subgovernments of the City of St. Louis and St. Louis County. The PPRC case study was conducted using data primarily from a standardized source, the Comprehensive Annual Financial Report (CAFR), a financial reporting format that meets the requirements of the Governmental Accounting Standards Board. For purposes of transparency Volume II of the PPRC case study contains all of the source data.

“In the course of collecting and analyzing data for the PPRC case study it became apparent there were both discrepancies in the total cost of local government when the data were taken from a standardized source and gaps in the service areas accounted for in the regional comparison report. As shown in Table 1 when the unaccounted for tax-supported local government activity of Unigov is added to the $1,132,778,622 used in the regional comparison report, the resulting total is $1,721,691,833; when this is divided by the 2013 Census estimated population for Marion County Indiana of 928,281, the result is a per capita calculation of $1,854.70 or $44.99 more than the per capita calculation for St. Louis reported in the regional comparison report.”

“Show Me the Money”

So when reading Better Tomorrow’s glowing claims about cost savings from city-county consolidation, follow your state motto: “Show Me” – and in the most rigorous, detailed manner.   Don’t just accept the author’s possibly biased characterization. Demand the underlying documentation.  

Previous David Rusk Regionalism Drill Down White Papers in This Series

#1 St Louis City and St Louis County – The Fake Region

#2  The Incredible, Shrinking “Metropolitan City of  St. Louis”

#3 Scenic Overlook: Beware the O’Hara Rule

#4 Better Together’s New Math

David Rusk is a former mayor of Albuquerque, New Mexico legislator, and federal official who has consulted on regional issues in over 130 metropolitan areas in the USA as well as in Canada, Germany, England, South Africa and The Netherlands

He is author of Cities without Suburbs (4th edition 2012), called “the bible of the regionalism movement,” and three other books.

Mr. Rusk began analyzing the Better Together report for ConstructForSTL as soon as it was issued. In this series of white papers he is drilling down into items ranging from savings from consolidation, to size and ranking of the “statistical city”, economic development, planning and zoning, bond ratings, taxation, political representation, and Metropolitan Council composition.

About Tom Finan