| Chapter 2: | Government Consolidation |
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municipalities are excluded from the consolidation and continue to have separate government functions.
Local government consolidation (amalgamation) continues to gain traction in industrialized countries. In 2007 the government of Denmark implemented a plan to reduce the number of municipalities in the country from 271 to 98, abolishing the country's 15 counties and replacing them with 5 regions.4 Norway offers incentives to encourage municipalities to consolidate (Sorenson, 2006). In Canada over the past two decades, there have been a variety of efforts to consolidate municipalities (Reese, 2004). In contrast, many less-developed countries have been going through a process of fiscal decentralization in which the number and the authority of local governments are increasing (Bahl & Linn, 1992).
Determinants of Consolidation
The corpus of academic research on local government consolidation lacks the broad empirical studies that are common on many other fiscal matters.5 This absence is even more apparent when it comes to the consolidation of intracounty government units, such as townships; the more recent trend that has garnered much media attention has been towards consolidating city-county governments around larger cities. Yet several states, particularly in the Midwest, continue to have the township layer of government.
Much of the academic literature on consolidation has focused on the process of city-county consolidation rather than on its outcomes. Most prior analyses consist of case studies of specific communities or comparative case studies.6 Leland and Thurmaier (2006) found that consolidation referenda that are approved by voters usually focus on the economic development aspects of consolidation rather than on increased equity or efficiency. They also suggested that in many cases, successful consolidation referenda follow a three-step process:
- 1. A crisis climate develops. It may result from demographic shifts, changes in the quality of government services, or other factors. Citizens demand a government response.