U.S. town dissolutions up in down economy

Amid a tough economy, a growing number of

Amid a tough economy, a growing number of small municipalities have had to consider measures such as dissolution to cut costs for local residents. (Credit: iStock)

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Carmen Wilkerson ran for mayor of St. George with one clear goal in mind for the tiny Missouri town: Get rid of it.

Like many of St. George's 1,200 residents, the paralegal had dreaded the thought of having to pay more taxes for a backlog of road fixes. So she campaigned for mayor in the spring of 2011 with a slogan -- "Save Us From Our City" -- touting disincorporation. She won, and the following November residents voted by nearly 3-to-1 to dissolve the town.

In its budget woes, St. George is far from alone.

Amid a tough economy, a growing number of small municipalities have had to consider that most extreme of measures -- dissolution -- to cut costs for local residents. Ten states had fewer townships because of mergers and consolidations, which include dissolutions, between 2007 and 2012, the Census Bureau found in its preliminary 2012 Census of Governments, a count undertaken every five years.

"What is driving a decision is different in every community, but in almost all the cases at this time, it's the economy," said Vicki Brown, one of the researchers at Rochester, N.Y.-based Center for Governmental Research, a consulting firm working with several communities in the country's northeast corner considering dissolution.

"They're all facing fiscal pressures," Brown said.

A study by an assistant professor at the University of California, Berkeley law school found the past 15 years saw more than half of the dissolutions ever recorded and since 2000, nearly as many municipal governments dissolved as were formed.

"Fiscal strain on local governments has definitely been amplified by the foreclosure crisis . . . but the local fiscal crisis has longer, deeper roots in falling local aid from federal and state governments since the 1980s, anti-tax measures passed in most states since the late 1970s," said Michelle Wilde Anderson, who published a study on towns dissolving in March.

Lack of growth in small communities with the rising cost of services and a shrinking tax base are some of the common issues found among municipalities considering dissolution. Many other towns in trouble also appeared when a certain industry was booming and if that goes away, so does the town's revenues, experts added.

"Voters or local politicians have decided that they can no longer sustain the costs of a separate local government for their territory," Anderson said.

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