Sandy Springs: The City Based on Private Services

Can you start a full-service city of 100,000 citizens with only two employees? The answer is ‘yes’. We did it in Sandy Springs, Georgia, USA. How was it done? By enlisting private industry.

Should other, especially new communities, adopt the Sandy Springs model? There is compelling evidence to suggest that the private contracting model can be highly effective for both newly established and existing local governments. Why should the model be adopted? The primary rationale is its enhanced efficiency and responsiveness to citizens’ needs. Private contracting leverages the experience and resources of the industry to more expeditiously implement and manage a new city, as we have shown in Sandy Springs. The employment of private sector as the service provider should be a basic element for establishing a Free Global City.

The long road to self-governance

The community of Sandy Springs, Georgia, in the United States, existed as an unincorporated area for a century. The area encompassed approximately 38 square miles on the northern border of the large city of Atlanta. Atlanta had, for a number of years, indicated a desire to annex the Sandy Springs area. The majority of Sandy Springs residents opposed annexation, so a committee was formed to resist the annexation before the Georgia state legislature. After several years, it was decided that the best way to permanently defeat annexation was to incorporate the community. Thus began a quarter-century battle before the legislature to obtain a bill for incorporation. The city of Atlanta used its political influence with the party in power to thwart the incorporation. Finally, in 2004, the opposition party gained control of both the legislature and governorship. With this change of political leadership in Georgia, the founding of the city of Sandy Springs was seeming possible.

While Sandy Springs was an existing community, it had no government. Local government services were being provided by Fulton County in which Sandy Springs resided. To create a new city government that was instantaneously capable of providing all those services and to complete the task in a matter of months seemed, at first, to be an insurmountable task. Indeed, the legislature approved, and the Governor signed, a bill in May, 2005, that allowed a referendum by the citizens of Sandy Springs to vote on Incorporation. The vote was set to occur in June 2005. Good news, except the problem was that the incorporation date, if supported by the majority, was to be 1 December, only six months away!

An intense campaign was waged over the next month and the citizens approved the incorporation by an overwhelming 93 per cent!

With that successful referendum, the new city of Sandy Springs, Georgia, in the United States, was finally set to be incorporated on 1 December 2005. It was the first new city to be created in Georgia in 50 years, and therefore, there was no template for launching the new entity. The launch was of some significance in that Sandy Springs would be the fifth largest city in the state at birth.

In addition to the major problem of establishing a new city in such a short period, there was a second significant hurdle. The legislation did not provide for anyone to have the authority to carry out all the major functions that would be required to set up the city. No authority to act on behalf of the City was granted until the day that the new City Council was seated.

About five years earlier, I had established and chaired a Charter Commission to describe the duties and responsibilities of the proposed city. That Charter was the basis for the Bill before the legislature.

Two years before passage of the bill, on my own initiative, I had drawn up a rough outline of the steps needed to create the city. With the sudden passage of the bill, the Committee for Sandy Springs asked me to accept the responsibility for starting Sandy Springs. The title Interim City Manager was conferred upon me, and I immediately began to deal with the combined major problems of severely limited time and the lack of authority to act, until the Council was elected and convened.

Choosing the private sector to launch a city

The decision to investigate involving private sector to provide the city’s services was driven by my certainty that the typical bureaucracy could not succeed as a start-up method and that it was neither efficient nor responsive in the long-run. On the other hand, consideration of a private contract for such a complex undertaking was so unique, and possibly risky, that it was almost overwhelming.

After some research, my initial step in seeking private providers was to draft a short letter addressed to CEOs or Presidents of 25 companies that I deemed capable of meeting our needs. The letter listed the needed services and then asked two questions. The first was ‘Where has your company provided any of the listed services to a local government or any other governmental entity?’ The second was ‘Would your company be willing to set up and operate these services without a contract?’

Of the 25 letters, 12 companies actually responded with locations where their firms had provided one or more of the required services. Between all the companies there was an indication that we could receive all the listed services. Not surprisingly, no one responded that they would initiate the services without a contract. However, several offered such statements as: ‘we can discuss that later’ or ‘open to negotiation’. I took that as a ‘Yes’, and I retreated to my basement office and began to write massive Requests for Proposals (RFPs) to obtain bids from the companies.

There was substantial interest in the RFPs especially considering that this was an entirely new concept. . After an extensive review of the bids and a series of oral presentations by the finalists, the Selection Committee arrived at a winner and made the recommendation to the GC. The GC approved the winning bidder and established a second Negotiating Committee to finalise the contract. Once that work was completed the GC recommended the approval of the final contract to the, soon to be elected, City Council.

The Council was elected on 8 November 2005, still with no authority. With the help of the selected company, we provided training to the Council that enabled them to understand their duties, responsibilities and resources prior to assuming office.

At midnight on the morning of 1 December 2005, the new council was sworn in and they had a fully operational city to manage.

It is worth noting that the chosen company still did not have a contract, and did not receive one until three weeks later. All of the work and approximately $5 million had been expended by the company to implement the city, without a contract. There was a tremendous amount of trust exhibited by both the city and the company during the entire process.

Was this innovative effort successful? By any measure the answer is ‘Yes’. The start-up, going from zero to full speed in the blink of an eye was rather amazing.

In the longer view, after ten years of operations under this concept, we had experienced the following results:

• There had been no increases in tax rates.
• Service levels had improved in all areas (as measured by internal and external citizen surveys, as well as citizen feedback to the city).
• The city had amassed a $40 million surplus.
• There were no long-term liabilities (neither debt nor unfunded liabilities for pensions; which presents a major problem in many U.S. governments from the local to national level).

Further proof of the success of the Sandy Springs model is that in the 18 years since its introduction 12 additional new cities have been formed in Georgia. The total population of 13 new cities is in excess of a half million citizens. More than the population of Atlanta, Georgia’s largest city. All have been based on the Sandy Springs model, or a version thereof.

Free Global Cities

While the location and scope of the first Free Global City has not yet been decided, it would seem obvious that the founders of such cities should strongly consider the use of the Sandy Springs Model as the basis for implementation.

The need and the opportunity for creating Free Global Cities around the world should serve to create a market opportunity for the services of large firms.

The concept of creating permanent cities that will allow refugees to grow and prosper through long-term residency and the development of a commercial, retail and industrial base is a leap forward in solving an extremely difficult problem. The inclusion of privately provided services as a fundamental element will facilitate and expedite the introduction of the projects.