Local governments have traditionally existed to serve specific functions, with cities taking care of public safety and roads, school and community-college districts handling education, and transit agencies running buses and trains. However, local-government leaders often face increasing demands, both internally and externally, to address issues beyond their core competences, which can have adverse results for those who rely on those leaders’ primary services.
With the rise of the environmental, social, and governance (ESG) framework and the diversity, equity, and inclusion (DEI) trend, government organizations and corporations are facing additional pressure to address extraneous priorities. However, such initiatives can divert funds from the local government’s core functions and consume time that could be devoted to overseeing those functions.
While most cities were in good financial shape coming out of the pandemic, some are now facing challenges due to out-migration and the collapse of commercial-real-estate valuations, which depresses property-tax revenues. Cities such as San Francisco will increasingly be forced to choose between such basics as police protection and nontraditional services such as looking after the burgeoning homeless population.
Municipal-finance expert Mark Moses recommends that city leaders “take inventory of what they have taken on“ and that they “shed, not double or triple down on, ineffective policies.” But taking this advice is challenging when activist constituents use public-comment opportunities at governing-board meetings to demand action on diversity, equity, and inclusion or on climate change and other allegedly existential threats.
Public colleges are also afflicted by mission creep. One trend is for higher-education institutions to address what they define as “basic student needs.” However, this can displace some of their educational responsibilities.
The most concerning cases of public-agency mission creep today involve transit agencies. These entities lost much of their ridership during the Covid-19 pandemic and now face fiscal cliffs as they use up emergency funding provided by the federal government in 2020 and 2021. Under the circumstances, transit agencies would best be served by focusing narrowly on the task of moving commuters from their place of origin to their place of destination. Instead, they continue to branch out into areas outside this core function.
One preoccupation of these agencies is transit-oriented development (TOD), the idea of building dense housing complexes near train stations and bus stops. This might have been fine if it entailed a transit agency simply selling land to a private developer and letting the buyer take it from there. However, often, the agency remains involved in TOD projects, consuming management time and potentially creating unforeseen liabilities.
In rare cases, mission creep can lead to the elimination of a special-purpose government. One such case is that of the Kent County Land Bank, whose original purpose was to “transform vacant, abandoned and tax-foreclosed property back to productive use” in and around Grand Rapids, Mich. The Land Bank ultimately transformed itself into a developer of modular housing across the state, which led to complaints from private developers who did not appreciate competition from a governmental entity operating outside its territory. After nine years of operation, KCLB was dissolved by the county commission that had created it.
While KCLB’s closure is atypical and not the result of fiscal distress, it may nonetheless serve as a warning to other agencies that exist at the pleasure of an overlying state or county. Should they veer too far from their original missions, they could rightly fall within the local government’s legislative crosshairs — especially if they also require a taxpayer bailout.
