Helping Mayor Berry Solve $24 million deficit

According to the Albuquerque Journal this morning, the City of Albuquerque faces a $24 million deficit this year. First and foremost, thank you Mayor Marty for leaving the incoming Mayor and the taxpayers of Albuquerque such a nice lump of coal in our (early) Christmas stockings.

Unfortunately, there are no easy ways to solve a major deficit like this in the current fiscal year. There is going to be pain and tough decisions have to be made.

Of course, even after completing this fiscal year, the picture is unlikely to improve dramatically. Deficits are likely to continue, but the good news is that the decisions are somewhat easier. For starters, Berry should do is to strongly consider halting some of the sweetheart union contracts signed during the Martin Chávez administration such as the one for firefighters that calls for a 6 percent pay raise in the coming fiscal year.

There are more systematic reforms available as well. One big one is “managed competition,” a concept that has been adopted in cities nationwide. Our friends at Reason Foundation found that San Diego taxpayers could save $80 to $200 million per year by allowing the private sector to compete with government agencies to do things like clean city buildings, perform maintenance on government vehicles, and run golf courses. There is no doubt that Albuquerque could save a great deal of money — with similar or even improved service resulting — if it adopted these practices.

The full reason study is available here, but the basic method is to take something like garbage collection and open it up to competitive bidding. This can include bids by private companies as well as the government employees who are currently doing the job. Significant cost savings can result. Sure, government employees may not like having to compete for their jobs, but taxpayers can experience significant savings which can come in handy when cities are facing massive deficits.

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