January 16, 2007 |
2007-R-0047 | |
GRANTS FOR CONSOLIDATING MUNICIPAL SERVICES | ||
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By: John Rappa, Principal Analyst | ||
You asked if any states provide grants to two or more towns that share or consolidate municipal services.
As Attachment 1 shows, at least four Northeastern states offer grants to local and county governments that consolidate public services or share the cost of providing them. They encourage local and county governments to consider these steps as a way to save money, deliver services more efficiently, and reduce property taxes. New Jersey and New York provide grants for consolidating or sharing services while Maine and Pennsylvania provide them for only the latter.
The recipient governments can use the grants to plan and implement projects consolidating or sharing public services. Maine offers a general purpose grant for joint service projects while other states' grants offer several grants for specific activities. New Jersey and New York offers grants to counties that jointly deliver services with municipalities. New York also offers grants for (1) consolidating or sharing highway department operations and employee health insurance plans and (2) matching the savings from shared or consolidated services. Pennsylvania offers 50% matching grants to municipalities forming regional councils of governments.
The funding levels vary in each state. New York allocated over $25 million for its grant in FY 07, up from $2.75 million in the FY 06 pilot year. New Jersey allocated $4.2 million per year since FY 05. Pennsylvania allocated $2.4 million in FY 07, up from $1.4 million in FY 06. Maine allocated $500,000 in FY 07. It launched the grant program in FY 05 with a $ 1 million appropriation. It appropriated no funds in FY 06.
Attachment 1: Comparison of Selected State Grant Programs for Sharing or Consolidating Municipal Services
Grant |
Maine: Efficient Delivery of Local and Regional Services (30-A § 6201) |
New Jersey: SHARE Program (N.J. Rev. Stat. 40:8B-14)* |
New York: Shared Municipal Services Incentive Program (2006 N.Y. Laws Chapter 50) |
Pennsylvania: Shared Municipal Services Program (12 P.A. Code §119 ) |
Year Started |
FY 05 |
FY 04 |
FY 06 |
FY 69 |
Total Funding Funding |
FY 05: $1 million FY 06: $0 FY 07: $500,000 |
FY 05: $4.2 million FY 06: $4.2 million FY 07: $4.2 million |
FY 06: $2.75 million FY 07: $25.7 million |
FY 05: $1.5 million FY 06: $1.4 million FY 07: $2.4 million |
Eligible Governments |
Municipalities, counties and regional government agencies |
Municipalities, counties, fire districts, and nonprofit organizations that coordinate regional services |
Counties, municipalities, and school and special taxing districts |
Municipalities and councils of government (COGs) |
Eligible Activities and Grant Amounts |
Max. $200,000 grants for joint projects that reduce costs and spending, deliver services more efficiently, or improve their quality and quantity |
Max. $20,000 grants with 10% local match for service sharing or consolidation feasibility studies Max. $200,000 grants (no local match) to cover start-up, transition, and implementation cost sharing or consolidating services Max. $300,000 annual grants to counties for planning and implementing shared services with towns or regional nonprofit organizations |
Max. $200,000 grants for feasibility studies and plans to share, consolidate merge, or dissolve services Max. $300,000 grants to two or more highway departments for sharing contractual services, making joint purchases or mutually beneficial capital improvements, or consolidating operations Max. $1 million grants for counties developing countywide shared service plans Max. $500,000 grants to two or more towns for reducing health insurance costs. Eligible projects include creating local health care consortiums, joining state health insurance program, and employee cost sharing Maximum $2 million matching grants for consolidation or merger cost savings |
50% matching grants to cover towns' administrative costs of (1) forming a COG or (2) jointly performing a municipal service |
Administering Agency |
Department of Administrative and Financial Services |
Department of Community Affairs |
Department of State |
Department of Community and Economic Development |
*SHARE is a component of the older Regional Efficiency and Development Incentive Program.