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Shaw: Not all government consolidations work

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Updated: November 24, 2013 6:36AM



Most reform groups and editorial page writers are strong proponents of government consolidation, and for obvious reasons — when it’s done right it saves money and improves efficiency.

And the sheer magnitude of government in Illinois — we have more than 7,000 taxing districts, the most in the country by far — cries out for consolidation.

But merging public services can have unintended negative consequences when new sources of money and power end up in the wrong hands, creating new opportunities for abuse.

Case in point: Lyons Township has a school treasurer’s office responsible for managing and investing more than $200 million in tax money for 13 school districts in the west suburbs. The purpose of the office is commendable — centralize financial services so the school districts don’t have to hire their own people.

But a Better Government Association investigation found that the former school treasurer, Robert Healy, had deep political connections but no discernible financial expertise.

And with little oversight by the township school board or the school districts, Healy improperly cashed in unused sick, vacation and personal days; hired friends as consultants; operated with no budget and allowed investments that may have violated state law.

He was recently charged with two felonies for allegedly embezzling more than $1.5 million from the treasurer’s office over the past two decades.

This is one consolidation that clearly ran amok.

Another merger in the western suburbs also gave the BGA cause for concern, though not in a criminal context.

As of Oct. 1, Willow Springs eliminated its part-time fire department and contracted out fire and emergency medical services to the Tri-State Fire Protection District in what was sold to Willow Springs’ residents as a cost-savings move.

In theory, that appeared to be a good move, but a review of Tri-State’s track record makes us wonder whether, in practice, it’s good for taxpayers.

A three-person board governs the fire district, which has its own property tax levy and provides fire and EMS services to parts of Burr Ridge, Darien, Willowbrook, unincorporated DuPage County and now Willow Springs.

One of those elected board members, Jill Strenzel, is the longtime domestic partner of Tri-State’s fire chief, Michelle Gibson. The two live together and formed a civil union last year.

As a Tri-State trustee, Strenzel has voted for generous pay raises and other perks since Gibson became chief in 2008, which looks like an obvious conflict of interest.

And under Gibson’s watch, the district has been burning through taxpayer money with many questionable purchases, including steak and lobster dinners; excessive bonuses and overtime; new Ford Expeditions and legal bills that from 2007 to 2012 jumped from about $13,000 annually to more than $100,000, according to documents obtained under Illinois’ freedom of information law.

With help from the financial advisory firm Duff & Phelps, the BGA found that Tri-State’s expenditures from its main operating fund rose by 24 percent from 2008 to 2012 compared with 2003 to 2007, when expenses actually went down 2 percent. Overall, Tri-State’s spending exceeded its revenue by more than $2.7 million from 2008 to 2012.

So the question is obvious: Should the fire district be expanding and taking on more responsibilities when its financial house isn’t in order?

Bottom-line — government consolidations are usually important reforms that reduce costs and avoid duplication of services when they’re executed properly.

But public officials have to approach them cautiously and thoughtfully. Efficiency talk is cheap, but merging taxing districts poorly can be expensive for us, the taxpayers.

Andy Shaw is president and chief executive of the Better Government Association.



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