PHOENIX - The state should pursue more opportunities to turn parks over to private companies, or at least let them operate retail concessions, a panel appointed by Gov. Jan Brewer to study government recommended Tuesday.
The initial report by the Commission on Privatization and Efficiency suggested turning more of government over to the private sector. Members also want to push Congress to repeal laws that now prohibit the state from letting private firms set up shop in rest areas along interstate highways.
But state Gaming Director Mark Brnovich, whom Brewer named to head the panel, said this is only the first step. He said the nine-member commission, all handpicked by the governor, is predisposed to believe that if a government service can be privatized, it probably should be.
"Like the governor, members of the commission are strong believers in the free-enterprise system and the free market," Brnovich said in an interview. "History has shown that the private sector is able to come up with innovative and, very often, cost-effective solutions to problems."
Brnovich acknowledged that private companies, unlike government, must make a profit. But he said commission members don't see this as meaning higher costs for taxpayers.
"The free-market system, capitalism, works because folks are forced to come up with better ideas and create greater efficiencies and come up with new innovations," Brnovich said. He calls it the "Yellow Book test."
If you can find a service provider in the Yellow Book, he said, "you should ask yourself, 'Should government be doing that?' "
Brnovich said this initial list of options includes those things that either already are under way or can be done relatively simply.
For example, the state contracted last year with the city of Yuma to operate the Yuma Quartermaster Depot State Historic Park. And the Arizona Parks Board has since worked out other deals with local groups to help keep parks open.
The commission, however, wants to go further, including giving private companies the opportunity to actually run the parks, collect admission fees and pay the state a percentage, and to bolster profits by allowing them to sell food and other items, and even operate lodging, as concessionaires do at Grand Canyon National Park.
Brnovich said it might also be possible for state agencies to remain viable by bidding to provide services, the same as private groups.
That concept, called "managed competition," has been used in some communities to award contracts for trash collection.
He said that concept will be studied before the final report is issued at the end of this year.
He said the analysis also has to consider whether government should be doing some things, or if the can be done better by, or in conjunction with, private interests.
One issue that already has arisen in the state's efforts to privatize is ensuring there are valid comparisons.
A report prepared by the Department of Corrections said, on the surface, a private firm could house a minimum-security inmate for about $4 a day less than it costs the state. But the study said that is misleading.
For example, it points out that the state is responsible for providing all medical and mental-health services for inmates, regardless of where they are housed.
The Department of Corrections also has fixed costs for functions provided in state prisons that do not exist in private ones, ranging from inmate transportation costs to discharge payments.
When those are included, the report says, the state's costs actually are about $1.50 a day less.
Please Wait…