|Advocates for transparent government and restricting government
competition with private sector businesses were thrilled with the
results of the recently concluded 2008 General Session of the Utah
Government in the business of business
One of the most significant legislative victories for taxpayers and free
enterprise advocates this
session was a package of three-bills which addressed the issue of
government competition with the private sector. For several years the
Utah Taxpayers Association has toiled to convince the legislature to get
serious about limiting governments’ abilities to get into the business
of business. Finally, the legislature has responded positively.
In 2007 the Association won creation of a Government Competition and
Privatization Subcommittee of the Revenue & Taxation and the Business
and Labor Committees to review processes for setting limits on state and
local government competition with tax-paying private businesses.
The sub-committee also studied ways to encourage out-sourcing and
privatization of government
functions. The subcommittee produced HB 75, (Frank) Inventory of
Competitive Activities, and SB 45 (Stephenson) Inventory for Competitive
Activities of Local Governments, which require state and local entities
to examine their activities which might compete with private businesses.
Both bills were enacted by the legislature.
The legislature added to these sub-committee bills a bonus privatization
bill, HB 426 (Garn)
Government Procurement – Private Proposals, which allows the private
sector to submit proposals to provide a product or service currently
provided by government and to have the proposals to be evaluated by a
committee appointed by the Board of Business and Economic Development.
HB 75 enjoyed the support of such disparate groups as the Reason
Foundation and the Utah Public Employees Association and the Utah
Taxpayers Association, and received bipartisan support in both the House
HB 75 requires 3 things. First, it balances the membership on the
existing Privatization Policy Board (PPB). Second, it requires the PPB
to develop an accounting method that provides an apples-to-apples
comparison of how much it costs to provide a good or service in the
public versus the private sector. Finally, the bill requires the PPB to
conduct a thorough inventory of every activity performed by the state,
and then decide if each activity can only be performed by the state, or
if a private company might be able to provide the service.
While it’s tempting to chalk the bill’s success solely up to the
session’s overall tone, other factors prevented this bill from
succumbing to the bickering that plagued privatization bills in past
sessions. The bill is both modest and revolutionary. It’s revolutionary,
in that Utah will join rather select company. Only the federal
government, Virginia and Florida have conducted such wide-ranging
inventories. Changes coming out of its inventory are saving Virginia
taxpayers $40 million per year.
HB 75 is modest in some respects. First, it brings together parties that
have traditionally been on opposite sides of the privatization issue. It is also a modest approach
because it does not mandate any specific activity to be privatized. After conducting the inventory, the PPB recommends 3 activities to be privatized every 2 years.
The Utah Taxpayers Association was assisted in this effort by the Reason
Foundation, NFIBUtah, and the Utah Restaurant Association. The Reason Foundation considers Utah’s privatization law the best in the nation.
Online access to the state’s check register
For years taxpayers have been frustrated by their inability to know
exactly how their elected officials spend tax dollars.
Some cities, school districts or counties only provide hard copies of
their budgets, and where they provide digital copies, they are almost
never searchable or detailed.
Fearing the accountability that full transparency would provide, they
publish non-searchable digital copies of their budgets. Being
non-searchable, taxpayers have to re-enter all the data in their own
spreadsheets before they can analyze the spending.
Now, Sen. Wayne Niederhauser has won passage of ground breaking
legislation which has changed all that. Partnering with the Taxpayers
Association, he sponsored SB 38, the Transparency in Government Finance
Act. This pioneering bill requires the Division of Finance to publish
and maintain the Utah Public Finance Website. Through this free,
searchable portal, taxpayers will be able to see exactly how specific
departments spend their money; how the Legislature allocates money
between departments; how much money is spent on various services across
departments ; etc.
In effect, SB 38 will create “Google-government,” and arm taxpayers with
the information they need to hold their elected officials accountable at
the polls, and at regularly scheduled meetings throughout the year.