Sandy Springs, Georgia: The City That Privatized Nearly Everything (VIDEO)
This post has been corrected.
In 2005, decades after Sandy Springs first attempted annexation, the Republican-dominated Georgia state legislature allowed the affluent city, located adjacent to Atlanta, to break off and become a largely autonomous, self-governing entity.
Scrambling to ready themselves for the division, Sandy Springs effectively privatized the large majority of the municipal services by entering into a public-private partnership with CH2M HILL, a full-service operations company that now controls nearly all of the once-public sector, from road maintenance to cleaning up trash in the park.
"Nobody likes change," Sandy Springs Mayor and former economist Eva Galambos told Reason, a libertarian magazine. "But, if your city is fiscally bankrupt, there may have to be some change."
The city, sixth-largest in the state with a 2010 population of 93,853, wanted to separate itself from what it saw as wasteful government spending in surrounding communities. The city benefits greatly, though, from the number of Fortune 500 companies headquartered there, boasting an extremely high per capita income, with the median family household income, according to a 2008 census estimate, approximated at $129,810, and the average family income $169,815.
Comparatively, the surrounding Fulton County has a median family income of only $58,573. The median national income is $49,777.
Adding to that, only 3.1 percent of families -- 7.9 percent of the entire population -- live below the poverty line in Sandy Springs. The percentage of Fulton County families living in poverty, in comparison, is nearly four times higher at 11.5 percent. Without needing to provide to as many poverty-stricken families, who typically use more public services, Sandy Springs can more easily keep taxes at a lower, sustainable level.
Not all of Sandy Spring's public services have been privatized, however. Public safety continues to be handled by government police officers and firefighters, and the Fulton County School System still operates public schools within the city, something not noted in the below video by Reason magazine. Mayor Galambos also notes the city "made a clear decision" to not hand out "defined benefits" of any sort to police officers and firefighters, in order to keep taxes low and avoid future obligations.
In light of municipal budget crises wreaking havoc across the country, the fiscally-conservative Sandy Springs government is proud of their radical decision, which they say has left them with no long-term liabilities. The $25 million they paid to CH2M HILL for one year's work, Reason argues, is less than half what they would pay in a typical, government-run scenario.
Since 2005, four surrounding Georgia cities have adopted the model.
CORRECTION: A previous version of this post said Sandy Springs, GA was located 100 miles outside Atlanta. The two cities are adjacent.
Watch Reason Magazine's video on Sandy Springs' privatization: