Municipal Enterprises

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= according to Gar Alperovitz in "America Beyond Capitalism, part of the emergence of a model for a Pluralist Commonwealth


Gar Alperovitz:

"An extraordinary range of local municipal efforts embodying Pluralist Commonwealth wealth-related principles also exist. One of the most important areas of activity is land development. As early as 1970 the city of Boston embarked on a joint venture with the Rouse Company to develop the Fanueil Hall Marketplace (a downtown retail complex). Boston kept the property under municipal ownership. One study estimates that in the project's first decade the city took in 40 percent more revenue than it would have collected through conventional property tax (Frieden and Sagalyn 1989: 169). Entrepreneurial "participating lease" arrangements for the use of public property are now common. Alhambra, California, for instance, earns approximately $1 million a year in rent revenues from a six-acre holding it leases to commercial tenants (Williamson, et al. 2002: 158).

A fast growing arena of new activity involves internet and related services. In Glasgow, Kentucky the municipally owned utility offers residents electricity, cable, telephone services, and high speed internet access-all at costs lower than private competitors. The city also has access to an ‘intranet' which links local government, businesses, libraries, schools and neighbors (Glasgow Electric Plant Board 2007). Tacoma, Washington's broadband network "Click!" also offers individuals and private company's internet and cable service; as does Cedar Falls, Iowa (Cedar Falls Utilities 2008; Click! Network 2007). More than 700 public power utilities have equipped their communities with such networks (American Public Power Association 2008).

Municipalities have also been active venture capital investors, retaining publicly owned stock in businesses that hold promise for the city's economy. A survey conducted in 1996 found more than a third of responding city governments reported venture capital efforts of one kind or another (Clarke and Gaile 1998: 72, 79-86). During the 1990s the publicly owned New York Power Authority and two private companies formed a joint investment pool of $60 million which yielded $175 million at the end of the first five years of operation. (Brodoff Communications 2000). Many smaller cities have created local venture funds that make investments in the $500,000 to $2 million range (Bowman 1987: 4; Clarke and Gaile 1998: 84).

Municipally owned sports teams are also widespread. Communities which own (or have owned) minor league baseball teams include Indianapolis, Indiana; Rochester, New York; Franklin County (Columbus), Ohio; Lucus County (Toledo), Ohio; Harrisburg, Pennsylvania; Lackawanna County (Scranton), Pennsylvania; and Visalia, California (Mahtesian 1996: 42-5; Imbroscio 1998: 239-40). At the major league level, the Green Bay Packers are owned by a nonprofit corporation whose stock-holders are mainly city residents.

Other areas of innovation include health services and environmental management. Denver Health is a municipal enterprise which has transformed itself from an insolvent city agency ($39 million in debt in 1992) to a competitive, quasi-public health-care system ($54 million cash reserves in 1997) delivering over $2.1 billion in care for the uninsured over the last ten years (Moore 1997; Denver Health 2008). Denver Health operates a satellite system of 8 primary care centers and 12 school-based clinics and employs some 4,000 Denver area residents (Denver Health 2008; Nuzum, et al. 2007).

Hundreds of municipalities also generate revenues through land-fill gas recovery operations which turn the greenhouse gas methane (a by-product of waste storage) into energy. Riverview, Michigan, one of the largest such recovery operations, illustrates the trend. Riverview's sale of gas for power production helps produce enough electricity to continuously power over 5,000 homes. Royalties covered initial costs of the effort in the first two years of operation and now add to the city's cash flows. (DTE Biomass 2007; EPA 2007)" (