Scope of Report

The purpose of this report is to identify the cost savings relating to the privatization efforts of the City of Ecorse, Michigan, with special focus on that city's Department of Public Works (DPW). The period of study is from 1986 to 1991 – encompassing all of the time the city was in receivership as well as a full year beyond.

While the Receiver, Louis H. Schimmel, had considered the DPW to be an area of substantial potential cost savings, no formal analysis of the actual costs to be saved was developed prior to privatizing this service. No analysis was undertaken at the time because the overall fiscal situation of the City was extremely serious and required swift and decisive action.

The DPW was responsible for maintenance of buildings and grounds, water and sewer infrastructure, and roads. In addition to the City's DPW operations, this report briefly addresses the privatization efforts of services similar to the DPW operations, including rubbish disposal, engineering, and parks and recreation maintenance.

This report is broken into the following two sections:

  1. Discussion of the fiscal background of the City, the City's privatization and related efforts, and observations arising from the compilation of financial information of the DPW operations for the fiscal years 1986 through 1991. A summary of the costs incurred and saved is contained at the conclusion of this section of the report.

  2. An important Appendix, which is a schedule of expenditures of the DPW for each of the fiscal years ended June 30,1986 through 1991, including explanatory footnotes.

The financial information obtained for this analysis was compiled from the City's audited financial statements, related City account analysis and records, discussions with the Receiver and City personnel, and other sources. The historical financial information contained on the Schedule of Department of Public Works Costs (Appendix) for the years ended June 30,1986 through 1991 should be read in connection with this section of the report.