The third paper in the Thrive Washington series is now available.  The Case for Contracting Out: A Vital Tool to Help Balance Washington’s Budget and Improve Public Services shows how the state could save money by contracting out a variety of services it currently provides.

Other states have had success with opening services to competitive bidding, and research shows that Washington could save anywhere from $80 million to $700 million per biennium, depending on the number of services contracted out and the level of savings realized–and without compromising quality.

Not only would such savings be a great help as we face budget shortfalls, but Washington voters (56 percent) think that the private sector would do a better job at providing services than the public sector.

Unfortunately, although the state has the ability to contract out, it has failed to do so.  The paper includes a set of recommendations for the state:

• Reform how the state negotiates labor contracts so contracting out authority is not subject to collective bargaining.
• Direct the state auditor to survey all state agencies that provide government services and identify those that could save money through contracting out.
• By the end of 2012, set a goal of identifying savings of 15 percent from the selected agencies.
• Implement a prototype contracting out process for at least five agencies by 2013.
• Create a commission focused on maintaining Washington’s commitment to contracting out.