Small towns with small budgets in Alabama have become golden opportunities for companies offering to take over government services. But critics worry whether the price they pay to outsource traditional government services includes diminished civil rights and due process.

Prichard, an impoverished suburb of Mobile with 23,000 residents, doesn’t have much of a tax base. But what it does have are lots of commuters zipping through its jurisdiction. To take advantage of this situation, Mayor Ron Davis agreed to contract with iTraffic Safety.

The company provided the necessary equipment for setting up speed traps, and it reimbursed the city for the cost of the six police officers needed to man them. It even will help track down violators who don’t pay their fines.

In exchange, iTraffic gets $35 of every fine, plus expenses. Davis expected to collect more revenues through the deal, enough to bolster Prichard’s annual budget of $10.5 million by 15%. The problem with the arrangement is iTraffic’s revenue projections assume the half dozen officers will write at least 3,000 tickets per month, which comes out to 500 per person, or more than 20 a day.

City officials also realized the first contract gave Prichard only $72.50 from each ticket, when they were expecting $156.

Another small Alabama town, Semmes, turned to contracting out for tax collections. Newly incorporated, Semmes in western Mobile has only 3,000 residents. Facing costs to hire its own police force, local leaders decided to contract with Revenue Discovery Systems (RDS) in Virginia to collect taxes.

RDS has more than 250 client cities and counties in Alabama, and more than 750 nationally.

Private contractors can bring a level of experience and an economy of scale to reduce costs for cash-strapped communities, but they might be harder for the citizenry to control down the road. As Jay Stanley, a senior policy analyst with the American Civil Liberties Union, told the Birmingham News, “If you get a Sheriff of Nottingham who his carrying out the law in an abusive way, you can vote him out of office. The public can't vote out a CEO of a company.” 

–Noel Brinkerhoff

To Learn More:

Justice Inc.: Privately Funded, For-Profit Traffic Enforcement? Itraffic Looking for Toehold in Alabama (by Robert McClendon, Birmingham News)

Justice Inc.: Should Private Companies Help Alabama Cities Enforce the Law? (by Kyle Whitmire, Birmingham News)