Private vs. public is debated

December 23, 1992|By Suzanne Wooton | Suzanne Wooton,Staff Writer

The business of turning government over to business is fashionable stuff in these financially troubled times.

But a task force that has analyzed how far Maryland should head in that direction advised caution yesterday, saying privatization isn't always the answer.

"We don't believe privatization is a cure-all for all of government's problems," said William K. Hellman, chairman of the Maryland Task Force on Privatization. "But it has the potential to be part of the solution for the '90s."

The task force, which has been working for three months, examined eight major state departments and found that $3.8 billion -- or 53 percent of their operating and capital expenses -- were already contracted to the private sector.

In a 60-page report released in Annapolis, the group offered recommendations that for the most part seemed to parallel what state officials were already planning.

For instance, it recommended that the state Department of Health and Mental Hygiene follow through on plans to privatize the Deer's Head and Western Maryland chronic-care hospitals. It also suggested that the Department of Public Safety consider turning five functions over to private hands, including transportation of inmates and criminal record checking.

The task force said the state should adopt a policy requiring departments to always consider whether specific services would best be provided by the state or private sector. It called for creation of a seven-member Advisory Council on Privatization, which would be appointed by the governor.

The panel earlier heard testimony from private-sector employees, as well as state workers, who feared that a move to contract out more government work could mean a loss of jobs.

"The recommendation could have been far worse," said William H. Bollander, executive director of Council 92 of the American Federation of State, County and Municipal Employees, which represents 10,000 state workers.

"The state has already had a recent bad example of privatization," Mr. Bollander said, referring to the troubled Charles H. Hickey School for young offenders. The reformatory was turned over to a private firm last year but continued to be plagued by escapes. The state is now seeking a new contractor.

In one of its most controversial recommendations, the task force said the state should not allow a private firm to lease or manage Baltimore-Washington International Airport at this time.

A joint venture, consisting of Westinghouse Electronic Systems Group of Linthicum and Lockheed Air Terminal, had proposed that it lease the airport from the state and run it under a profit-sharing arrangement. The proposal included a possible advance lease payment reportedly between $40 million and $50 million.

Of the firms' proposal, Gov. William Donald Schaefer said this yesterday: "There are ways to make improvements at the airport without turning a money-maker over to private enterprise. I'm not going to be stampeded into privatization."

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