With pension bombs and bond defaults, the cities of America are looking at a bleak future, burdened by huge long-term liabilities and declining revenue to fund them. In some cities, the crisis means choosing between cuts to public services or massive tax hikes that will drive off businesses and families. In Sandy Springs, Georgia, they’re trying to decide where to invest their surpluses instead. Reason TV takes a look at how necessity and a desire for independence put Sandy Springs on the map, and then in the black, all while offering a higher level of municipal services at a much lower cost:

While cities across the country are cutting services, raising taxes and contemplating bankruptcy, something extraordinary is happening in a suburban community just north of Atlanta, Georgia.

Since incorporating in 2005, Sandy Springs has improved its services, invested tens of millions of dollars in infrastructure and kept taxes flat. And get this: Sandy Springs has no long-term liabilities.

This is the story of Sandy Springs, Georgia—the city that outsourced everything.

Sandy Springs started off with a few advantages, not the least of which was its tax base and their fresh start, of course.  It’s easier to solve problems before they occur, especially with money in the bank.  The choice to outsource wasn’t much of a choice at all, at least not at first.  But their experience shows why private-sector services work better than public sector services, at least in those jobs where the private sector is an option: competition forces providers to be efficient and effective.  That allows Sandy Springs to have firms competing for their business and avoids the issue of labor management for the city.

And a funny thing happens when a community keeps its own money and manages it well.  They tend to invest in themselves.  While dependent on Fulton County and the public sector, roads fell into disrepair as their taxes went to other communities instead of their own.  Their roads have improved, they have expanded public spaces, and their services are now targeted at their own citizens.

Can existing cities follow this example?  Reason asks the question at the end, but one obstacle is obvious.  Be sure to watch it all.

Tags: Georgia