Government Efficiency
The Case for Local Control
A Report Submitted by
Wendell Cox of Demographia, Inc.
May 2008
This report was commissioned by:
150 State Street
Albany, New York 12207
FOREWORD
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n 2007, then Governor Eliot Spitzer created, by executive order, the Local Government Commission on
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G. Jeffrey Haber
Executive Director
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TABLE OF CONTENTS
Chapter
iii
Page
Foreword
i
Table of Contents
iii
Executive Summary
iv
1
Introduction
1
2
Size, Consolidation & Efficiency in Local Government
2
3
Government Efficiency: New York and the Nation
7
4
Government Efficiency Within New York
15
5
Smart Growth and the Quality of Life
24
6
Competitiveness Factors and New York
30
7
Towns, Villages and a Competitive New York
37
Executive Order No. 11
39
Glossary of Terms
41
About the Author
42
iv
EXECUTIVE SUMMARY
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ew York State has a Competitiveness Problem.
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laims that local government consolidation would
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improve New York’s competitiveness are not supported
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oward a More Competitive New York: New York’s
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Conclusions in Brief
Conclusion #1:
Government consolidation does not improve
government efficiency.
Conclusion #2:
Nationally, states with larger governments
are not more efficient.
Conclusion #3:
There is a strong association between smaller
units of local government and greater government efficiency in New York.
Conclusion #4:
There is a strong association between regional
planning, smart growth and the loss of housing
affordability. Imposition of regional planning
and smart growth would be likely to raise the
cost of living, making New York less competitive.
Conclusion #5:
Claims that local government consolidation
would improve New York’s competitiveness are
not supported by the experience.
Conclusion #6:
New York’s system of smaller local governments
are principal competitive assets.
CHAPTER 1
T
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INTRODUCTION
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6
SIZE, CONSOLIDATION & EFFICIENCY IN LOCAL GOVERNMENT
consolidation is implemented, it is nearly impossible to restore
WKH SUHYLRXV RUJDQL]DWLRQDO VWUXFWXUH HYHQ LI WKHUH LV VWURQJ
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WKH RYHUZKHOPLQJ PDMRULW\ RI IRUPHU PXQLFLSDOLWLHV YRWHG WR
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CHAPTER 2
Bigger is Not Better
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Conclusion #1
Government consolidation does not improve government efficiency.
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GOVERNMENT EFFICIENCY: NEW YORK AND THE NATION
I
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◆ From state to state, local government’s share of combined state and
local taxation ranges from 13 percent (Vermont) to 55 percent
(New York), with an average of 37 percent. Local taxes, as a share
of state and local taxation, are higher in New York than in any
other state, at 55 percent. This is one-third higher than the state
average (Figure 2).
Local Share of State & Local Taxes
STATES
60%
50%
7
Local Share of State & Local Spending
STATES
70%
60%
50%
40%
30%
20%
10%
0%
NV
CA
CO
NY
FL
MI
AZ
GA
TX
IL
NJ
WI
OH
IN
VA
MN
KS
WY
OR
MO
IA
PA
NE
WA
NC
NH
MD
ID
TN
LA
AL
MS
OK
SC
CT
SD
UT
MA
MT
NM
ND
AR
KY
RI
ME
VT
WV
DE
AK
HI
CHAPTER 3
Figure 3
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state DQGORFDOJRYHUQPHQW¶VWD[DWLRQDQGVSHQGLQJ
Government Finance
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40%
◆ New York’s state and local government taxation per capita is 63
percent higher than the average of the other 49 states (Figure 4).
30%
20%
0%
NY
NH
TX
CO
SD
IL
NJ
MO
MD
FL
GA
OH
VA
NE
RI
OR
ME
PA
IA
KS
AZ
IN
LA
CT
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SC
TN
MA
NV
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W
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ND
MI
AL
CA
OK
NC
MT
ID
MS
NM
KY
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DE
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10%
◆ New York collects more state and local taxes per capita than any
of its neighboring states. New York’s state and local taxation per
capita is 27 percent higher than the average of its neighboring
states. New York’s neighboring states generally have higher
taxation per capita than the rest of the nation.
Figure 2
◆ Local government spending as a share of combined state and local
expenditures also varies from state to state. The lowest share is 20
percent (Hawaii), and the highest is 68 percent (Nevada). New
York State has the 4th highest share of local government spending,
at 63 percent. This is one-fifth higher than the state average
(Figure 3).
◆ New York collects the most state and local taxes per capita among
the 10 largest states.32 New York’s state and local taxation per
capita is 66 percent higher than the average of the nine other
largest states (Figure 5). New York’s taxation is well above any
of the other largest states and 42 percent higher than secondranking California.
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GOVERNMENT EFFICIENCY: NEW YORK AND THE NATION
8
CHAPTER 3
Federal Revenue per Capita
STATES
STATES
$6,000
$5,000
$5,000
$4,000
$4,000
$3,000
$3,000
$2,000
$2,000
$1,000
$1,000
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$0
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CT
WY
NJ
MA
AK
HI
MD
RI
VT
MN
CA
ME
DE
WI
IL
NV
NE
PA
VA
WA
OH
MI
KS
IN
FL
CO
ND
NH
IA
LA
NM
NC
AZ
WV
OR
TX
GA
MO
KY
UT
ID
MT
AR
OK
SC
SD
TN
MS
AL
$6,000
WY
AK
NY
NM
MT
VT
ND
MS
ME
RI
WV
SD
LA
SC
AL
AR
PA
HI
TN
NE
CA
NC
OH
MO
IA
KY
OK
OR
MA
MN
DE
MI
AZ
MD
WA
ID
UT
WI
CT
TX
NH
KS
NJ
IL
FL
GA
IN
CO
NV
VA
State & Local Taxes per Capita
Figure 6
Figure 4
Federal Revenue per Capita
State & Local Taxes per Capita
10 LARGEST STATES
10 LARGEST STATES
$6,000
$2,500
$5,000
$2,000
$4,000
$1,500
$3,000
$1,000
$2,000
$500
$1,000
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FL
GA
IL
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Figure 5
Federal Revenue:'HVSLWHLWVKLJKVWDWHDQGORFDOUHYHQXHV1HZ<RUN
UHFHLYHVPRUHIHGHUDOUHYHQXHSHUFDSLWDWKDQPRVWRWKHUVWDWHV
◆ New York has the third highest federal revenue per capita of
any state (Figure 6). New York’s federal revenue per capita is 46
percent higher than the average of the other 49 states, though it
is well below the levels of Alaska and Wyoming.
◆ New York receives the most federal revenue per capita compared
to its neighboring states. New York’s federal revenue per capita
is 56 percent higher than the average of its neighboring states.
New York’s federal revenue is well above any of the other states,
except for Vermont. New York’s federal revenue per capita is 12
percent higher than second ranking Vermont and 52 percent
higher than third ranking Pennsylvania.
◆ New York receives the most federal revenue per capita among
the 10 largest states. New York’s federal revenue per capita is 74
percent higher than the average of the nine other largest states
(Figure 7).
CA
FL
GA
IL
MI
NJ
NY
OH
PA
TX
Figure 7
◆ New York’s federal revenue is well above any of the other states.
Federal revenue per capita is 53 percent higher than Pennsylvania,
which ranks second to New York.
General Government Debt: 1HZ<RUNJHQHUDOO\KDVKLJKHUJHQHUDO
JRYHUQPHQWGHEWSHUFDSLWDWKDQRWKHUVWDWHV
◆ New York has the third highest per capita general government debt of
any state (Figure 8). New York’s general government debt per capita
is 92 percent higher than the average of the other 49 states.
◆ New York has the second highest general government debt per
capita compared to its neighboring states, ranking slightly (less
than one percent) below Massachusetts. New York’s general
government debt per capita is 39 percent higher than the average
of its neighboring states. New York’s general government debt is
36 percent higher than third-ranking Connecticut. New York’s
neighboring states generally have higher debt per capita than
the rest of the nation.
CHAPTER 3
GOVERNMENT EFFICIENCY: NEW YORK AND THE NATION
State & Local Govt. Debt per Capita
Property Tax per Capita
STATES
STATES
9
$2,500
$14,000
$12,000
$2,000
$10,000
$8,000
$1,500
$6,000
$1,000
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AK
MA
NY
CT
WA
CO
NJ
IL
PA
RI
CA
NV
DE
HI
KY
NH
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MN
SC
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TX
KS
FL
UT
VA
VT
AZ
LA
MT
NM
MO
OH
ME
ND
MD
SD
AL
IN
NE
NC
WV
TN
GA
OK
AR
IA
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MS
ID
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CT
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MI
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W
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GA
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ID
NC
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MS
TN
HI
DE
W
LA
KY
OK
NM
AR
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$500
$2,000
Figure 8
Figure 10
◆ New York has the highest general government debt per capita
among the 10 largest states. New York’s general government debt
per capita is 88 percent higher than the average of the nine other
largest states (Figure 9). New York’s debt is well above any of the
other states. General government debt per capita is 21 percent
higher than Illinois, which ranks second to New York among
the largest 10 states. The nine other largest states have slightly
higher debt per capita than the rest of the nation.
◆ In comparison to its neighboring states, New York’s amount of
property taxes per capita trails only New Jersey and Connecticut.
New York’s property taxes per capita are 2 percent higher than
the average of its neighboring states, which generally have higher
property taxes per capita than the rest of the nation.
State & Local Govt. Debt per Capita
10 LARGEST STATES
◆ New York has the highest property taxes per capita among the 10
largest states. New York’s property taxes per capita are 60 percent
higher than the average of the nine other largest states (Figure
11), 21 percent above those of second ranking Illinois, and well
above any of the other states.
Property Tax per Capita
$14,000
10 LARGEST STATES
$12,000
$2,500
$10,000
$8,000
$2,000
$6,000
$1,500
$4,000
$1,000
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FL
GA
IL
MI
NC
NY
OH
PA
TX
$500
Figure 9
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◆ New York has the fourth highest property taxes per capita of any
state (Figure 10). New York’s property taxes per capita are 64
percent higher than the average of the other 49 states.
CA
FL
GA
IL
MI
NC
NY
OH
PA
TX
Figure 11
New York’s Spending Problem
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GOVERNMENT EFFICIENCY: NEW YORK AND THE NATION
State & Local Spending per Capita
CHAPTER 3
State & Local Spending per Capita
10 LARGEST STATES
STATES
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Figure 12
Figure 13
◆ New York ranks third among the states in direct general
expenditures per capita, at 84 percent above the national average
(Figure 12).
Personnel Expense
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◆ New York has higher expenditures per capita than all of its
neighboring states, 32 percent above the average.
◆ New York also has the highest spending per capita among the 10
largest states. New York’s per capita spending is 50 percent above
the average for the other nine largest states (Figure 13).
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◆ New York has the second highest government wages and salaries
per capita of any state (Figure 14), trailing Alaska by 14 percent.
New York’s wages and salaries per capita are 44 percent higher
than the average of the other 49 states.
◆ New York has higher government wages and salaries per capita
than any of its neighboring states. New York’s wages and
salaries per capita are 26 percent higher than the average of its
neighboring states. New York’s neighboring states generally have
higher wages and salaries per capita than the rest of the nation.
◆ New York has the highest wages and salaries per capita among
the 10 largest states. New York’s wages and salaries per capita
are 48 percent higher than the average of the nine other largest
states (Figure 15). New York’s wages and salaries per capita are
16 percent higher than second ranking California and 45 percent
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PRUHWKDQSHUFHQWRIWKHGLIIHUHQFHZDVDWWULEXWDEOHWRWKHKLJKHUZDJHVDQGVDODULHVRQ/RQJ,VODQGI In fact, all of the difference may
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CHAPTER 3
GOVERNMENT EFFICIENCY: NEW YORK AND THE NATION
11
Education Expenditures per Pupil
STATES
STATES
$16,000
$3,500
$14,000
$3,000
$12,000
$2,500
$10,000
$2,000
$8,000
$1,500
$6,000
$1,000
$4,000
$500
$2,000
$0
$0
AK
NY
WY
NJ
CT
CA
WA
DE
MD
VT
MA
NE
ND
CO
IA
MN
KS
RI
HI
WI
NM
IL
OH
MI
VA
OR
NC
LA
MS
AL
ME
TX
PA
MT
SC
NH
GA
IN
NV
KY
AZ
SD
TN
MO
UT
FL
ID
AR
OK
WV
$4,000
NJ
NY
CT
MA
WY
VT
HI
RI
PA
DE
MD
NH
IN
ME
WI
OH
AK
MN
MI
VA
IL
NE
GA
W
IA
MO
CO
KS
CA
W
OR
SC
FL
ND
NM
AR
TX
NV
MT
KY
NC
LA
AL
SD
OK
TN
MS
ID
AZ
UT
Government Wages & Salaries per Capita
Figure 16
Figure 14
State & Local Spending per Capita
Education Expenditures per Pupil
STATES
10 LARGEST STATES
$16,000
$15,000
$14,000
$12,500
$12,000
$10,000
$10,000
$7,500
$8,000
$6,000
$5,000
$4,000
$2,000
$0
$0
AK
WY
NY
DE
MA
CA
VT
NJ
RI
CT
MN
HI
NM
ME
WA
PA
ND
WI
OH
MI
SC
IA
MD
OR
IL
AL
FL
LA
NE
CO
NV
VA
MT
MS
WV
KS
IN
NC
NH
UT
SD
TX
TN
ID
MO
KY
AR
GA
AZ
OK
$2,500
Figure 15
CA
FL
GA
IL
MI
NY
NC
OH
PA
TX
Figure 17
higher than third ranking Illinois. The nine other largest states
have slightly lower wages and salaries per capita than the rest of
the nation.
Primary and Secondary Education
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◆ New York has the second highest primary and secondary
education expenditures per pupil of any state (Figure 16), trailing
New Jersey by 6 percent. New York’s education expenditures
per capita are 61 percent higher than the average of the other
49 states.
◆ New York’s education expense per pupil is 13 percent higher
than the average of its neighboring states. New York’s education
expense per pupil is higher than all neighboring states except New
Jersey. New York’s neighboring states generally have education
expenses per capita that are higher than the rest of the nation.
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12
GOVERNMENT EFFICIENCY: NEW YORK AND THE NATION
◆ New York has the highest education expense per pupil among
the 10 largest states. New York’s education expense per pupil is
64 percent higher than the average of the nine other largest states
(Figure 17). In addition, New York’s education expense per capita
is substantially higher than that of the nine other largest states.
New York’s education expense per capita is 31 percent higher than
second ranking Pennsylvania. The nine other largest states have
slightly lower education expenses than the rest of the nation.
CHAPTER 3
Public Welfare Spending per Capita
10 LARGEST STATES
$2,500
$2,000
$1,500
Public Welfare Spending per Capita
STATES
$2,500
$1,000
$500
$2,000
$0
CA
FL
GA
IL
MI
NC
NY
OH
PA
$1,500
TX
Figure 19
$1,000
NY
AK
RI
MN
ME
VT
MA
PA
NM
TN
MS
OH
DE
KY
WV
WI
CT
NH
SC
CA
AR
IA
NE
HI
ND
NC
AL
MO
WY
WA
MD
OK
MI
NJ
OR
IL
KS
IN
LA
AZ
ID
FL
GA
SD
UT
VA
MT
TX
CO
NV
Calculating the Differences
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interest on debt — account for nearly all of the difference in per
$500
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$0
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Public Welfare
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◆ New York has the highest public welfare expenditures per capita of
any state (Figure 18). New York’s public welfare expenditures per
Table 1
capita are 83 percent higher than the average of the other 49 states.
Expenditure Differences: New York and U.S. State Average
◆ New York has a higher public welfare expense per capita than any
of its neighboring states. New York’s public welfare expense per
capita is 49 percent higher than the average of its neighboring
states. New York’s margin in public welfare expense is substantial;
its public welfare expense is 25 percent higher than second
ranking Vermont. New York’s neighboring states have generally
higher public welfare expenses than the rest of the nation.
◆ New York has the highest public welfare expense per capita
among the 10 largest states. New York’s public welfare expense
per capita is 95 percent higher than the average of the nine other
largest states (Figure 19), and is substantially higher than that
of the other largest states; its public welfare expense per capita
is 34 percent higher than second ranking Pennsylvania.
Interest on Debt
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JRYHUQPHQWGHEWRIDQ\VWDWHIROORZLQJ$ODVND0DVVDFKXVHWWVDQG
&RQQHFWLFXW1HZ<RUN¶VLQWHUHVWRQGHEWSHUFDSLWDLVZKLFK
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New York
Average of
Other States
Function
Personnel
Wages (Excl. Education & Public
Welfare)
Fringe Benefits (Excl. Education &
Public Welfare)
Difference
Between NY and
Avg of Other
States
% of Total
Difference
$ 2,000
$ 1,487
$
513
18.1%
$
$
$
480
17.0%
944
463
Education
$ 2,102
$ 1,455
$
647
22.8%
Public Welfare
$ 2,031
$ 1,066
$
965
34.1%
Interest on Debt
$
$
$
171
6.0%
Subtotal
$ 7,508
$ 4,733
$ 2,775
98.0%
Net (all other Direct General
Expenditures)
$ 2,024
$ 1,969
$
Total (Direct General Expenditures)
$ 9,532
$ 6,702
$ 2,830
Total if New York at National Average
in Personnel, Education, Public
Welfare & Debt
$ 6,757
$ 6,702
$
432
261
55
55
2.0%
◆ Higher public welfare expenditures account for $965 per capita,
which is 34 percent of the difference between New York and
average state expenditures.38
CHAPTER 3
GOVERNMENT EFFICIENCY: NEW YORK AND THE NATION
◆ Higher primary and secondary education expenses account for
$647 per capita, which is 23 percent of the difference between
New York and average state expenditures.39
◆ Higher personnel expense in functions other than public welfare
and primary and secondary education accounts for $993 per
capita, which is 35 percent of the difference between New York
and average state expenditures. This expense is nearly evenly
distributed between wages ($513) and fringe benefits ($480). It is
estimated that total personnel expense, including public welfare
and primary and secondary education, is more than $1,750 per
capita and more than 60 percent of the difference compared to
the national average.
◆ Higher interest on debt accounts for $171 per capita, which is
6 percent of the difference between New York and average state
expenditures.
13
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Per Capita Taxation & Jurisdiction Size
STATES
$7,000
$6,000
$5,000
$4,000
$3,000
$2,000
$1,000
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50,000
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Average Jurisdiction Population
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Figure 21
14
GOVERNMENT EFFICIENCY: NEW YORK AND THE NATION
CHAPTER 3
Conclusion #2
Nationally, states with larger governments are not more efficient.
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CHAPTER 4
A
GOVERNMENT EFFICIENCY WITHIN NEW YORK
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Cities: ([FOXGLQJ1HZ<RUN&LW\WKHUHDUHFLWLHVLQWKHVWDWH
ZLWKDFRPELQHGSRSXODWLRQRIXQGHUPLOOLRQ7KHVHFLWLHV
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LQ1HZ<RUN&LW\RUWKHRWKHUFLWLHV7KHWRZQVKDYHPLOOLRQ
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WKHWRZQSRSXODWLRQDERYH
New York City:7KH&LW\RI1HZ<RUNFRPELQHVDOOPXQLFLSDO
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◆ Combined County-Local Government Spending Comparison:
County and local (or municipal) governments in New York are
separate except in New York City, which has a combined city-
15
county (5 county or borough) government. As a result, it is only
at the combined county-local level that New York City can be
included. Analyses of New York government often exclude New
York City. However, New York City represents a large consolidated
government. Any examination of government size or the potential
impacts of government consolidation would be incomplete if it
excluded New York City.
◆ Combined City, Town and Village Spending Comparison: All
of the geography of New York is divided into cities and towns.
Villages are within towns and are, in some cases, in more
than one town. The combined city, town and village spending
analysis combines all spending on the core of services by cities,
towns, villages and fire districts at the city or town level, which
is referred to as the “local government area” level (Box 3).
◆ Combined City, Town and Village Spending Comparison in
Metropolitan Areas: A separate metropolitan area analysis
was conducted to identify the differences in spending between
jurisdictions in the principal areas of urbanization in the state.
There is also a parallel analysis by each of the state’s metropolitan
areas, as designated by the United States Bureau of the Census.
◆ Combined City, Town and Village Debt Comparison: All of
the geography of New York is divided into cities and towns.
Villages are within towns and are, in some cases, in more than
one town.
◆ Fire Service Spending by Local Government Area: Fire service
spending is examined because of substantial differences in service
delivery that could be materially impacted by local government
consolidations. In many smaller towns and villages, fire services
are provided by volunteer arrangements, which is significantly
less costly than fire services that employ full-time fire fighters.
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GOVERNMENT EFFICIENCY WITHIN NEW YORK
16
Local Expenditures per Capita
CHAPTER 4
Average Jurisdiction Population from 10,000 to 25,000:
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COUNTIES & NYC BY AVERAGE JURISDICTION SIZE
$3,000
$2,500
Average Jurisdiction Population from 5,000 to 10,000:
([SHQGLWXUHVSHUFDSLWDZHUHLQFRXQWLHVZLWKDYHUDJH
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$2,000
$1,500
Average Jurisdiction Population from 2,500 to 5,000:
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$1,000
$500
$0
Over
25,000
10,000 20,000
5,000 10,000
2,500 5,000
1,000 2,500
Average Jurisdiction Population
Under
1,000
Figure 22
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Average Jurisdiction Population from 1,000 to 2,500:
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Average Jurisdiction Population under 1,000: Expenditures
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Average Jurisdiction Population Over 25,000:
:LWK D SRSXODWLRQ RI PRUH WKDQ DQG
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FRXQW\ RU FLW\FRXQW\ DUHD RI WKH VWDWH ZLWK DQ
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expenditures on the core functions are estimated
DWSHUFDSLWD7KLVLVSHUFHQWKLJKHUWKDQ
WKHVWDWHZLGHDYHUDJHRI
County
Albany
Allegany
Broome
Cattaraugus
Cayuga
Chautauqua
Chemung
Chenango
Clinton
Columbia
Cortland
Delaware
Dutchess
Erie
Essex
Franklin
Fulton
Genesee
Greene
Hamilton
Herkimer
Jefferson
Lewis
Livingston
Madison
Monroe
Montgomery
Nassau
Niagara
Table 2
Average Jurisdiction Population by County
Average
Population
Population
Jurisdictions jurisdiction
County
Jurisdictions
Surveyed
Surveyed
population
294,565
49,927
200,536
83,955
81,963
139,750
91,070
51,401
79,894
63,094
48,599
48,055
280,150
950,265
38,851
51,134
55,073
60,370
48,195
5,379
64,427
111,738
26,944
64,328
69,441
735,343
49,708
1,334,544
219,846
40
48
33
73
47
63
28
41
36
40
30
55
57
76
38
28
18
26
32
16
37
60
30
34
36
55
24
109
23
7,364
1,040
6,077
1,150
1,744
2,218
3,253
1,254
2,219
1,577
1,620
874
4,915
12,503
1,022
1,826
3,060
2,322
1,506
336
1,741
1,862
898
1,892
1,929
13,370
2,071
12,244
9,559
Oneida
Onondaga
Ontario
Orange
Orleans
Oswego
Otsego
Putnam
Rensselaer
Rockland
Saratoga
Schenectady
Schoharie
Schuyler
Seneca
St Lawrence
Steuben
Suffolk
Sullivan
Tioga
Tompkins
Ulster
Warren
Washington
Wayne
Westchester
Wyoming
Yates
235,469
458,336
100,224
341,367
44,171
122,377
61,676
95,745
152,538
286,753
200,635
146,555
31,582
19,224
33,342
111,931
98,726
1,419,369
73,966
51,784
96,501
177,749
63,303
61,042
93,765
923,459
43,424
24,621
67
56
34
79
18
41
52
14
49
46
51
26
32
13
19
62
62
135
56
25
22
66
20
28
39
77
30
16
New York City
8,008,278
1
Jurisdictions included: counties, cities, towns, villages and fire districts.
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Average
Jurisdiction
Size
3,514
8,185
2,948
4,321
2,454
2,985
1,186
6,839
3,113
6,234
3,934
5,637
987
1,479
1,755
1,805
1,592
10,514
1,321
2,071
4,386
2,693
3,165
2,180
2,404
11,993
1,447
1,539
8,008,278
CHAPTER 4
GOVERNMENT EFFICIENCY WITHIN NEW YORK
Municipal Expenditures per Capita
BY AVERAGE JURISDICTION SIZE
$1,500
$1,250
Average Jurisdiction Population from 25,000 to 50,000:
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Average Jurisdiction Population from 10,000 to 25,000:
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$1,000
$750
$500
$250
$0
Over
50,000 - 25,000 100,000 100,000 50,000
10,000 25,000
5,000 10,000
2,500 5,000
Average Jurisdiction Population
1,000 2,500
Under
1,000
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Average Jurisdiction Population over 100,000: Expenditures
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Average Jurisdiction Population from 50,000 to 100,000:
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Average Jurisdiction Population from 5,000 to 10,000:
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Average Jurisdiction Population from 2,500 to 5,000:
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Average Jurisdiction Population from 1,000 to 2,500:
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Average Jurisdiction Population under 1,000: Expenditures
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GOVERNMENT EFFICIENCY WITHIN NEW YORK
Municipal Expenditures per Capita
METROPOLITAN AREA BY AVERAGE JURISDICTION SIZE
CHAPTER 4
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$1,500
$1,250
$1,000
Average Metropolitan Jurisdiction Population under 1,000:
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10,000
5,000
2,500
1,000
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Average Jurisdiction Population
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Average Metropolitan Jurisdiction Population over 100,000: RIWKH&HQVXV7DEOH2QDYHUDJHFLWLHVZLWKODUJHUDYHUDJH
([SHQGLWXUHVSHUFDSLWDZHUHLQORFDOJRYHUQPHQWDUHDV jurisdiction populations in each of the metropolitan areas spent more
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Average Metropolitan Jurisdiction Population from 50,000
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Average Metropolitan Jurisdiction Population from 25,000 to LQWKHORFDOJRYHUQPHQWDUHDVZLWKWKHVPDOOHVWDYHUDJHMXULVGLFWLRQ
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Average Metropolitan Jurisdiction Population from 10,000 to
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$2,000
Average Metropolitan Jurisdiction Population from 5,000 to $1,750
10,000: ([SHQGLWXUHVSHUFDSLWDZHUHLQORFDOJRYHUQPHQW $1,500
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$1,000
$750
Average Metropolitan Jurisdiction Population from 2,500 to
$500
5,000: ([SHQGLWXUHVSHUFDSLWDOZHUHLQORFDOJRYHUQPHQW
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$250
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$0
Average Metropolitan Jurisdiction Population from 1,000 to
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Total Debt per Capita
BY AVERAGE JURISDICTION SIZE
Over
50,000 - 25,000 100,000 100,000 50,000
10,000 25,000
5,000 10,000
2,500 5,000
Average Jurisdiction Population
1,000 2,500
Under
1,000
Figure 25
GOVERNMENT EFFICIENCY WITHIN NEW YORK
CHAPTER 4
Table 3
City and Town/Village Spending per Capita: 2005
Cities
Metropolitan Metro Area # of
Area
Population Cities
New York City *
Buffalo
Rochester
Albany
Syracuse
Poughkeepsie
Utica
Binghamton
Kingston
Glens Falls
Ithaca
Elmira
4,025,000
1,167,000
1,026,000
810,000
644,000
602,000
290,000
252,000
168,000
124,000
97,000
90,000
8
6
3
8
4
5
4
1
1
1
1
1
Avg
Juris.
Pop.
61,151
73,164
81,551
33,918
47,026
21,237
25,984
47,380
23,456
14,354
29,287
30,940
Towns
City Per
# of
Capita
Towns
Spending
$1,371
$1,050
$1,362
$1,095
$1,301
$1,130
$ 922
$ 973
$1,180
$1,330
$1,518
$1,032
373
96
174
176
126
128
99
55
63
46
20
25
Avg
Juris
Population
9,480
7,583
4,488
3,060
3,617
3,877
1,877
3,726
2,289
2,391
3,361
2,371
Cities
Town Per
Compared
Capita
to Towns:
Spending
Spending
$866
$591
$517
$647
$466
$697
$534
$524
$595
$589
$494
$446
Average City to Town Spending
58%
78%
163%
69%
179%
62%
73%
86%
98%
126%
207%
131%
111%
*
New York City excluded. It seems likely that inclusion of New York City would make this gap larger, given its
higher expenditure levels. However it county level expenditures in New York City cannot be readily separated out to
make a valid comparison (above).
19
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Average Jurisdiction Population over 100,000: Total debt
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Figure 26
Average Jurisdiction Population over 100,000: Fire
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20
GOVERNMENT EFFICIENCY WITHIN NEW YORK
CHAPTER 4
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CHAPTER 4
GOVERNMENT EFFICIENCY WITHIN NEW YORK
1HZ<RUN¶VKLJKSURSHUW\WD[HVDUHWREHH[SHFWHGLQOLJKWRIVWDWH
SROLFLHV)RUH[DPSOH
◆ As noted above, New York local governments collect a larger
share of state and local taxes than in any other state. Local
governments tend to rely to a large degree on property taxes.
New York local governments are responsible for spending the
fourth highest share of state and local expenditures among the
states. This greater reliance on local government is the result of
various factors. Perhaps the most important are state mandates
and state policies, all of which are under the direct control of the
Governor and the State Legislature.
◆ The state requires an unusually large share of public welfare
spending at the local (principally county) level. New York has
the highest local spending in the nation on public welfare, at
$513 per capita. This is nearly eight times the national average
for the states. It is thus to be expected that county property taxes
are high (Figure 27).
◆ New York has the second highest primary and secondary expenses
per pupil in the nation. Property taxes are a principal financing
mechanism for schools. Thus, again, it is to be expected that
school property taxes will be high.
of expensive provision required under the Taylor Law.50 Indeed,
the increase in average state and local government employee
wages and salaries has been 36 percent higher in New York than
the national average since before the Taylor Law was enacted.51
This report does not provide the extent of analysis necessary to
attribute New York’s higher personnel cost increase to the Taylor
Law. However, it is clear that personnel expense in New York has
been growing at an inordinate rate compared to other states since
the Taylor Law was enacted (Figure 28).
Government Employee Compensation
NEW YORK & OTHER STATES: CHANGE 1965-2005
30%
New York
25%
20%
15%
Other States
10%
5%
0%
◆ Government employee expense is high in New York, representing
the second highest per capita level in the nation. Personnel
expense represents more than 70 percent of local government
current expenditures in New York. There is some analysis that
suggests New York’s high government employee cost is the result
Local Public Welfare Spending
PER CAPITA BY STATE
$600
1965
Compensation per Employee: Inflation Adjusted
2005
Figure 28
◆ The State of New York mandates various activities on the part
of local governments. These increase taxes and can reduce the
tax base. A 1999 report published by the Public Policy Institute
of New York State, Inc. estimated that a $5 billion reduction in
state mandates can create 225,000 jobs in the state.52
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21
Figure 27
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'HFHPEHUKWWSZZZFEFQ\RUJ&%&/RFDO7D[HVLQ1<),1$/SGI
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KDGJURZQDWWKHVDPHSHUFHQWDJHUDWHDVLQWKHUHVWRIWKHQDWLRQLWLVHVWLPDWHGWKDWPLOOLRQOHVVZRXOGKDYHEHHQVSHQWLQ7KLVLVDSSUR[LPDWHO\WKH
VDPHDPRXQWWKHWRWDOUHYHQXHFROOHFWHGE\DOORIWKHVWDWH¶VFLWLHVWRZQVDQGYLOODJHVRXWVLGH1HZ<RUN&LW\&DOFXODWHGIURP86%XUHDXRIWKH&HQVXVJRYHUQPHQW
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22
GOVERNMENT EFFICIENCY WITHIN NEW YORK
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$PRQJWKHFRUHVHUYLFHVWRZQVDQGYLOODJHVVSHQGOHVVWKDQFLWLHV
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7DEOHDQG7DEOH
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◆ Statewide, towns and villages spend 40 percent less per capita
than cities on the core services.
Table 5
Additional Spending at City Per Capita Rates Compared to Towns & Villages (By County)
County
◆ Towns and villages spend 83 percent less per capita on fire
services than cities.
Cities
Expenditures per Capita
Expenditures per Capita: Metropolitan Areas
Debt per Capita
Fire Expenditures per Capita
Average Jurisdiction Population-All
Average Jurisdiction Population-Metropolitan
$1,075
$1,104
$1,196
$ 207
$37,146
$46,229
Towns
Difference
& Villages
$640
$633
$511
$35
3,639
5,291
-40%
-43%
-57%
-83%
-90%
-89%
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Per Capita
Town/Village
Spending
Relative to
Cities
$75,500,000
$436
$1,009
-35%
Allegany
$30,100,000
$645
$1,631
-54%
Broome
$61,400,000
$401
$951
-41%
Cattaraugus
$24,400,000
$407
$1,026
-45%
Cayuga
$30,400,000
$569
$1,439
-55%
Chautauqua
$58,300,000
$615
$1,504
-53%
Chemung
$34,700,000
$585
$1,430
-57%
Chenango
$20,100,000
$521
$1,309
-53%
Clinton
$56,400,000
$923
$2,284
-65%
Columbia
$24,800,000
$446
$1,086
-45%
Cortland
$7,200,000
$328
$823
-42%
Delaware
$4,700,000
$117
$281
-10%
Dutchess
$152,400,000
$644
$1,696
-51%
Erie
$281,800,000
$454
$1,096
-42%
$5,700,000
$157
$379
-13%
Franklin
$26,400,000
$624
$1,541
-53%
Fulton
$14,400,000
$490
$1,188
-57%
Genesee
$52,000,000
$1,193
$3,088
-71%
Greene
$19,400,000
$494
$1,195
-42%
Hamilton
($3,100,000)
($684)
($1,555)
59%
Herkimer
$17,700,000
$299
$734
-31%
Jefferson
$52,000,000
$798
$2,060
-58%
Lewis
$16,800,000
$664
$1,768
-56%
Essex
Livingston
$44,300,000
$689
$1,788
-58%
Madison
$21,000,000
$377
$962
-47%
Monroe
$454,700,000
$882
$2,182
-63%
$6,200,000
$206
$497
-31%
Nassau
$330,800,000
$260
$763
-25%
Niagara
$58,400,000
$543
$1,332
-55%
Oneida
$56,300,000
$445
$1,081
-48%
$263,000,000
$850
$2,086
-63%
Ontario
$25,800,000
$342
$866
-36%
Orange
$69,000,000
$266
$759
-26%
Orleans
$25,600,000
$803
$2,125
-68%
Oswego
$78,800,000
$871
$2,264
-69%
Otsego
$28,800,000
$608
$1,476
-53%
Putnam
$41,600,000
$509
$1,456
-43%
Rensselaer
$34,500,000
$389
$957
-41%
Rockland
$28,200,000
$98
$296
-8%
St Lawrence
$19,800,000
$231
$576
-30%
Montgomery
Saratoga
Table 4
Per Capita Expenditures: 2005
Difference
Per
Household
Albany
Onondaga
◆ In metropolitan areas, towns and villages spend 43 percent less
than cities per capita.
◆ Towns and villages have 57 percent less debt per capita than cities.
CHAPTER 4
$109,100,000
$664
$1,668
-53%
Schenectady
$25,300,000
$299
$710
-34%
Schoharie
$17,600,000
$635
$1,584
-54%
Schuyler
$11,700,000
$609
$1,532
-51%
Seneca
$18,700,000
$779
$1,959
-66%
Steuben
$34,400,000
$444
$1,105
-47%
Suffolk
$658,200,000
$471
$1,394
-40%
Sullivan
$20,400,000
$276
$690
-23%
Tioga
$41,700,000
$805
$2,096
-68%
Tompkins
$68,800,000
$1,024
$2,377
-67%
Ulster
$84,300,000
$585
$1,442
-50%
Warren
$27,400,000
$560
$1,349
-42%
Washington
$45,500,000
$745
$1,900
-63%
Wayne
$69,100,000
$737
$1,942
-62%
Westchester
$15,100,000
$30
$81
-2%
Wyoming
$31,600,000
$728
$1,905
-61%
Yates
$12,900,000
$524
$1,356
-44%
Total
$3,941,900,000
$464
$1,230
-41%
Notes
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
Based Upon Statewide City
Average
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Consolidation Proposals
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CHAPTER 4
GOVERNMENT EFFICIENCY WITHIN NEW YORK
◆ Buffalo: At city spending levels, a consolidated Erie County
government would spend $282,000,000 more annually than at
the town and village spending levels. This is nearly $1,100 per
household.
◆ Syracuse: At city spending levels, a consolidated Onondaga
County government would spend $263,000,000 more annually
than at the town and village spending levels. This is nearly $2,100
per household.
◆ Binghamton: At city spending levels, a consolidated Broome
County government would spend $61,000,000 more annually
than at the town and village spending levels. This is nearly $950
per household.
23
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Table 6
Expenditures per Capita: Core Public Services
Factor
Over
100,000
50,000 100,000
Average Jurisdiction Population
25,000 - 10,000 - 5,000 - 2,500 50,000
25,000 10,000
5,000
1,000 2,500
Under
1,000
Expenditures per
Capita
$1,323
$1,213
$944
$806
$709
$602
$545
$773
Expenditures per
Capita:
Metropolitan Areas
$1,323
$1,213
$1,044
$794
$677
$562
$514
$697
Debt per Capita
$2,001
$1,054
$1,060
$815
$736
$652
$483
$416
$295
$263
$167
$120
$52
$35
$31
$37
Fire Expenditures
per Capita
Shaded areas indicate maximum and minimum expenditure levels.
Conclusion #3
There is a strong association between smaller units of local government
and greater government efficiency in New York.
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◆ There is a strong association in New York between greater government efficiency and smaller units of local government.
◆ The association between greater government efficiency and smaller units of local government is evident both in metropolitan and
non-metropolitan areas.
◆ Any move to consolidate fire and emergency services would likely lead to the elimination of the volunteer services, necessitating
large property tax increases.
◆ As a result, local government consolidation is likely to lead to less government efficiency and a less competitive New York.
24
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SMART GROWTH AND THE QUALITY OF LIFE
Table 7
Prescriptive Planning (Smart Growth) Policies:
Including Potential for Increasing Housing Prices
Potential to
Increase
Housing
Strategy
Prices
Regional Urban Growth Boundaries
YES
Local Urban Growth Boundaries
YES
Regional Urban Service Districts
YES
Local Urban Service Districts
YES
Large-Lot Zoning in Rural Areas
YES
High Development Fees & Exactions
YES
Restrictions on Physically Developable Land
YES
State Aid Contingent on Local Growth Zones
Transferable Development Rights
Adequacy of Facilities Requirements
From Table 15.4, “Costs of Sprawl---2000”
Potential to Increase Housing Prices from “Costs of Sprawl---2000”
CHAPTER 5
Smart Growth Prices: Predicted & Actual
PRESCRIPTIVE V. RESPONSIVE MARKETS
$180,000
Change in House Prices: 2000$
26
$160,000
Actual
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
Predicted by Costs of
Sprawl-2000
$0
-$20,000
2000
2005
2010
2015
2020
2025
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$700,000
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$500,000
$400,000
$300,000
$200,000
$100,000
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been available in all of the markets. If the credit-induced demand
were the cause of higher housing prices, then all markets, rather
than just some, would have experienced the price escalation.
◆ The second problem is that demand, in and of itself, does not
raise prices. Demand raises prices only where there are material
supply constraints. Generally, responsive markets have only
modest supply constraints, while prescriptive markets are typified
by substantial supply constraints.
Mortgage/Income Ratio
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Mortgage Costs
60%
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2000
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2006
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SMART GROWTH AND THE QUALITY OF LIFE
28
CHAPTER 5
Median Multiple
House Cost & Financing Trend
MAJOR NEW YORK MARKETS: 2000-2006
MAJOR NEW YORK MARKETS: 2000-2006
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Buffalo
Rochester
Albany
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Figure 38
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72
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70
CHAPTER 5
SMART GROWTH AND THE QUALITY OF LIFE
29
Conclusion #4
There is a strong association between regional planning, smart growth and the loss of housing affordability.
Imposition of regional planning and smart growth would be likely to raise the cost of living,
making New York less competitive.
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◆ The resulting higher housing costs translate into a higher cost of living and make an area less competitive. This is illustrated by dramatic
shifts in domestic migration patterns that have occurred as housing prices have escalated in some markets around the nation.
◆ There is an emerging consensus that regional planning and smart growth seriously retard housing affordability. Donald Brash,
former Governor of the Reserve Bank of New Zealand has urged that many of smart growth’s policies, including urban growth
boundaries be outlawed because of the damage they do to households and economies.
COMPETITIVENESS FACTORS AND NEW YORK
D
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and its suburbs have remained more competitive
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CHAPTER 6
Population Growth
STATES: 2000-2007
30%
25%
20%
15%
10%
5%
0%
LA
ND
WV
RI
OH
MI
PA
MA
NY
VT
IA
MS
CT
NJ
KS
ME
IL
NE
AL
IN
WI
OK
KY
MO
MN
SD
MD
WY
AR
HI
MT
NH
CA
TN
NM
VA
AK
OR
WA
SC
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NC
CO
FL
TX
ID
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UT
AZ
NV
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Population Trends
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Figure 39
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Population Growth: Annual Rate
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NEW YORK & NEIGHBORING STATES: 2000-2007
◆ New York’s share of national population growth fell from 11
percent between 1900 and 1935 to 7 percent between 1935 and
1970 and finally to 1 percent between 1970 and 2005. New York
accounted for 9.5 percent of the nation’s population in 1900 and
10.2 percent in 1935. In 1970, New York still accounted for 9.0
percent of the population. By 2005, New York’s population share
had dropped to 6.5 percent of the national total.
◆ New York’s slow population growth has continued into the 2000s.
From 2000 to 2007, New York grew 1.6 percent, which is less than onequarter of the national average (7.1 percent). New York ranked 42nd in
growth out of the 50 states (Figure 39).
0.9%
0.8%
0.7%
0.6%
0.5%
0.4%
NJ
MA
CT
NY
VT
0.3%
0.2%
0.1%
0.0%
-0.1%
PA
2001
2002
2003
2004
2005
2006
2007
-0.2%
◆ New York’s population growth of 1.6 percent from 2000 to 2007
is below the 2.0 percent average of neighboring states. Three
neighboring states grew faster than New York (New Jersey,
Vermont and Connecticut), while two states grew more slowly
(Massachusetts and Pennsylvania). However, New York’s growth
rate dropped substantially during this period. Between 2005 and
2007, New York grew more slowly than all of its neighbors, while
Pennsylvania emerged as the fastest growing neighbor over the
same period (Figure 40).
Domestic Migration
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indicates the attractiveness to people of a state or area relative to
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◆ Among the ten largest states, New York ranked 7th in population
growth between 2000 and 2007, at approximately one-fifth the
average growth rate of 7.8 percent for these states (Figure 41).
New York experienced a substantial drop in its growth rate
during this period. In 2000-2001, New York grew 0.4 percent. By
2006-2007, the growth rate had fallen to under 0.1 percent (over
the same period, California’s growth rate was cut nearly in half).
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Figure 40
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COMPETITIVENESS FACTORS AND NEW YORK
CHAPTER 6
Population Growth
31
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and Pennsylvania lost more than one percent of their residents to
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TOP TEN STATES: 2000-2007
20.0%
17.5%
15.0%
12.5%
10.0%
7.5%
5.0%
2.5%
0.0%
CA
FL
GA
IL
MI
NC
NY
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PA
TX
Figure 41
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ODUJHVWQHWGRPHVWLFPLJUDWLRQORVVDWPLOOLRQ76
Net Domestic Migration
STATES: 2000-2007
20%
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15%
10%
0%
NY
LA
MA
NJ
IL
MI
CA
RI
ND
OH
KS
CT
NE
IA
HI
MS
MD
MN
AK
PA
IN
WI
VT
SD
OK
W
MO
AL
UT
NM
KY
WY
VA
AR
ME
W
NH
TX
CO
MT
TN
OR
DE
SC
GA
NC
ID
FL
AZ
NV
5%
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Figure 42
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76
Domestic Migration within New York
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◆ New York City had a net domestic migration loss of 946,000, or 11.8
percent of the 2000 population. The New York City suburbs had a
net domestic migration loss of 170,800 or 4.2 percent of the 2000
population. Overall, that portion of the New York City metropolitan
area within New York State had a net domestic migration loss of
1,116,000, or 9.2 percent of the 2000 population.78
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COMPETITIVENESS FACTORS AND NEW YORK
32
Net Domestic Migration
◆ The other metropolitan areas exceeding 500,000 populations
(Buffalo, Rochester, Albany and Syracuse) had a net domestic
migration loss of 81,000, or 2.2 percent of the 2000 population.
This is one-fifth the domestic migration loss rate of New York
City and less than one-half the domestic migration loss rate of the
New York City suburbs. Even the suburbs of New York City are
losing domestic migrants at a greater rate than Buffalo, Rochester
and Syracuse. Albany is gaining domestic migration.
TOP TEN STATES: 2000-2007
1,500,000
1,000,000
500,000
◆ Areas outside these major metropolitan areas had a net domestic
migration loss of 9,000, or 0.3 percent of the 2000 population,
well below the metropolitan rates.
0
CA
FL
GA
IL
MI
NC
NY
OH
PA
TX
-500,000
-1,000,000
-1,500,000
Figure 44
Net Domestic Migration: New York
BY AREA
0%
NY City
NY Suburbs
-2%
Other Metros
>500,000
CHAPTER 6
Rest of State
-4%
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is a part, has experienced virtually the same competitive decline
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-8%
◆ Between 1900 and 1935, the Frost Belt accounted for 53 percent of
the nation’s growth, while the Sun Belt accounted for 47 percent.
-10%
-12%
◆ Between 1935 and 1970, the Frost Belt accounted for 41 percent of
the nation’s growth, while the Sun Belt accounted for 59 percent.
-14%
Figure 45
◆ Frost Belt growth dropped substantially between 1970 and 2005.
The Frost Belt accounted for only 16 percent of national growth,
compared to 84 percent in the Sun Belt. Virtually the same
distribution of growth occurred between 2000 and 2006.
Net Domestic Migration: New York
MAJOR METROPOLITAN AREAS
2%
0%
New York
Buffalo
Rochester
Albany
Syracuse
-2%
-4%
-6%
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CHAPTER 6
COMPETITIVENESS FACTORS AND NEW YORK
33
◆ Metropolitan areas with average local jurisdiction populations
under 10,000 experienced a 38 percent growth in employment.82
◆ Metropolitan areas with average local jurisdiction populations
between 10,000 and 20,000 experienced a 20 percent growth in
employment.
Frost Belt
Sun Belt
◆ Metropolitan areas with average local jurisdiction populations
over 20,000 experienced a 17 percent growth in employment.
This is not to suggest that smaller local jurisdictions are the cause
of greater employment growth. It is rather to note the fallacy
of contending that government consolidation and less local
democracy (larger jurisdictions) cause greater employment
growth. The data indicates no relationship between the size of
local governments and economic growth.
Frost Belt
Sun Belt
Figure 47
Table 8
Share of Population Growth: United States
1900-1935 1935-1970 1970-2005
27.3%
18.1%
5.7%
Northeast
25.6%
23.0%
10.4%
Midwest
29.6%
30.5%
48.0%
South
17.6%
28.4%
35.9%
West
100.0%
100.0%
100.0%
Total
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Employment Growth
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10%
0%
0
5,000
10,000
15,000
20,000
25,000
30,000
Average General Government Population
35,000
Figure 48
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COMPETITIVENESS FACTORS AND NEW YORK
Consolidated statistical areas with more than 1,000,000 population.
Employment Growth & Suburbanization
FROST BELT METROPOLITAN AREAS
70%
60%
50%
N
Y
40%
YO
R
K
N
EW
C
H
ES
30%
TE
R
AL
BA
AL
O
20%
BU
FF
Table 9
Employment Growth & Average jurisdiction population
Major Frost Belt Metropolitan Areas
Average General
Employment
Government
Rank Metropolitan Area
Growth:
Jurisdiction
1980-2005
Population
1 Grand Rapids
62.7%
7,800
2 Minneapolis-St. Paul
57.6%
7,977
3 Columbus
57.6%
8,372
4 Indianapolis
53.2%
8,104
5 Cincinnati
46.6%
8,129
6 Kansas City
44.1%
7,043
7 Albany
31.0%
7,723
8 St. Louis
29.6%
7,073
9 Philadelphia
25.8%
14,806
10 Boston
24.9%
19,847
11 Chicago
24.3%
15,014
12 Milwaukee
24.1%
15,103
13 Detroit
20.3%
18,051
14 Providence
19.7%
27,053
15 Rochester
19.1%
9,165
16 New York
18.5%
29,178
17 Hartford
13.3%
22,251
18 Dayton
13.3%
8,868
19 Cleveland
12.5%
12,857
20 Pittsburgh
8.0%
5,396
21 Buffalo
7.2%
19,120
CHAPTER 6
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Employment Growth
34
10%
0%
0
1,000
2,000
3,000
4,000
Core Urban Area Population Density
5,000
6,000
Figure 49
Table 10
Employment Growth and Suburbanization in Large Frost
Belt Metropolitan Areas
Population
Employment per Square
Growth:
Mile: Core
Rank
Metropolitan Area
1980-2005 Urban Area
1
Grand Rapids
62.7%
2,095
2
Minneapolis-St. Paul
57.6%
2,671
3
Columbus
57.6%
2,849
4
Indianapolis
53.2%
2,205
5
Cincinnati
46.6%
2,237
6
Kansas City
44.1%
2,330
7
Albany
31.0%
1,966
8
St. Louis
29.6%
2,506
9
Philadelphia
25.8%
2,861
10
Boston
24.9%
2,322
11
Chicago
24.3%
3,914
12
Milwaukee
24.1%
2,688
13
Detroit
20.3%
3,094
14
Providence
19.7%
2,332
15
Rochester
19.1%
2,353
16
New York
18.5%
5,309
17
Hartford
13.3%
1,814
18
Dayton
13.3%
2,174
19
Cleveland
12.5%
2,761
20
Pittsburgh
8.0%
2,057
21
Buffalo
7.2%
2,664
Smart Growth and Domestic Migration
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ZKHUHKRXVLQJDIIRUGDELOLW\KDVEHHQPDLQWDLQHGWKHUHKDVEHHQD Consolidated statistical areas with more than 1,000,000 population.
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CHAPTER 6
COMPETITIVENESS FACTORS AND NEW YORK
Table 11
Relocation Bonus: Moving from Prescriptive to Responsive Markets
RESPONSIVE MARKETS
Move to-->
Dallas-Fort
Average
Worth
Houston
Atlanta
Detroit
Bonus
PRESCRIPTIVE
MARKETS
New York
$697,000
$698,000
$648,000
$695,000
$684,000
Los Angeles
$921,000
$922,000
$872,000
$919,000
$908,000
Miami
$455,000
$456,000
$406,000
$453,000
$443,000
Washington
$598,000
$599,000
$549,000
$597,000
$586,000
Average Bonus $668,000
$669,000
$619,000
$666,000
$655,000
Includes purchase and financing.
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Other Competitiveness Factors
The previously cited Paytas econometric analysis principally focused on
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included in the econometric analysis, such as measures of taxation,
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factors are important drivers of economic
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Table 12
Competitiveness Factors
Employment Growth Quintile
1
2
3
4
5
Average
(Lowest)
(Middle)
(Highest)
10
11
11
11
Metro Areas in Frost Belt
9
6
4
2
0
Metro Areas in Sun Belt
1
5
7
9
10
32%
48%
73%
142%
62%
$1,106
$974
$855
$928
$849
$942
47
23
16
18
7
22
6.9%
6.1%
4.3%
2.6%
5.6%
1.00
0.95
0.95
0.94
0.89
0.95
1880
1890
1900
1918
1942
1906
Total Metro Areas
Job Growth 1980-2005
1980 Taxes per Capita
Annual Snowfall (Inches)
Manufacturing Union
Members/Private Employment
1980 Average Pay Compared to
Highest Quintile
Census Year Core City Reached
100,000 Population
13%
8.2%
10
Consolidated Statistical Areas over 1,000,000 population.
Sources: Derived from data from the U.S. Department of Commerce, www.unionstats.com, Statistical Abstract of the
United States.
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35
36
COMPETITIVENESS FACTORS AND NEW YORK
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Manufacturing Unionization – The extent of unionization is an
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experienced an unprecedented loss of comparatively unionized
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CHAPTER 6
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Conclusion #5
Claims that local government consolidation would improve New York’s competitiveness
are not supported by the experience.
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◆ In the Frost Belt, higher employment growth has been associated with smaller units of local government.
◆ Metropolitan areas with employment growth rates since 1980 of more than 40 percent have average jurisdiction populations less
than one-half that of metropolitan areas with employment growth rates less than 20 percent.
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CHAPTER 7
TOWNS & VILLAGES AND A COMPETITIVE NEW YORK
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previously competitive metropolitan areas uncompetitive because of
KLJKKRXVLQJSULFHV. At the same time, less expensive metropolitan
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37
◆ In 2000, the cost, including financing, of the median priced house
was $348,000 higher in New York than in Buffalo. By 2006, New
York housing costs rose to $798,000 more than Buffalo.
◆ In 2000, the cost, including financing, of the median priced
house was $317,000 higher in New York than in Rochester.
By 2006, New York housing costs rose to $764,000 more than
Rochester.
◆ In 2000, the cost, including financing, of the median priced house
was $277,000 higher in New York than in Albany. By 2006, New
York housing costs rose to $602,000 more than Albany.
◆ In 2000, the cost, including financing, of the median priced house
was $351,000 higher in New York than in Syracuse. By 2006, New
York housing costs rose to $759,000 more than Syracuse.
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38
TOWNS & VILLAGES AND A COMPETITIVE NEW YORK CHAPTER 7
$0RUH&RPSHWLWLYH1HZ<RUN
7KXVDQ\SURJUDPWKDWZRXOGLPSURYH1HZ<RUN¶VFRPSHWLWLYHQHVV
*RYHUQPHQWFRQVROLGDWLRQDQGVPDUWJURZWKDUHQRWLQKHUHQWO\JRRG ZLOOQHHGWR
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◆ Make New York competitive in state and local taxation. This is
to an HYHQOHVVFRPSHWLWLYH1HZ<RUN$PRUHHI¿FLHQW1HZ<RUN
not likely to be accomplished without dealing with the principal
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issues that have driven New York’s taxes so high relative to other
LQUHDOLW\QRWWKHRUHWLFDOO\$PRUHFRPSHWLWLYH1HZ<RUNUHTXLUHV
states. Forcing government consolidations would only make
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things worse.
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◆ Make New York competitive by restoring the competitive cost
DWWUDFWQHZUHVLGHQWVIURPRWKHUVWDWHV7KLVPHDQVWKDW
of living that has been lost in recent years in the New York City
metropolitan area as a result of the unprecedented increases in
◆ Any mergers or consolidations between local governments
housing prices relative to incomes. Moreover, upstate New York’s
should be the result of voluntary actions in which representatives
cost of living competitiveness needs to be retained. Smart growth
improve the overall good of the community based upon careful
would work against both objectives.
research, not a predisposed, top-down predilection for larger
units of government.
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◆ State incentives to encourage consolidation or smart growth are REMHFWLYHVUDWKHUWKDQPHDQV
likely to UHWDUG New York’s competitiveness, because consolidation
raises costs and smart growth destroys housing affordability.
Conclusion #6
New York’s upstate housing affordability and its system of smaller local governments
are principal competitive assets.
0DQGDWHGORFDOJRYHUQPHQWFRQVROLGDWLRQLVOLNHO\WROHDGWROHVVJRYHUQPHQWHI¿FLHQF\DQGDKLJKHUFRVWRIOLYLQJ7KLVZRXOGPHDQ
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◆ Upstate New York, which has experienced little growth in recent decades, is now experiencing net domestic migration losses far
below those of downstate. This appears to be attributable to its much improved housing affordability relative to downstate and
other unaffordable areas.
◆ New York local government areas with smaller average jurisdiction populations are generally more efficient than those with larger
average jurisdiction populations. New York’s towns and villages are competitive in efficiency with the rest of the nation, despite
serious challenges and expensive state mandates.
CHAPTER 1
EXECUTIVE ORDER NO. 11 PAGE TITLE
39
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Eliot Spitzer, Governor
Richard Baum, Secretary to the Governor
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