For many years local governments have entered into formal and informal agreements for the provision of services on a regular or standby basis to their citizens by other local governments and private firms, and by the joint provision of services with other governmental units. Since they facilitate the solution of problems, including ones transcending local political boundaries, without structurally reorganizing the governmental system of the area, we may view service agreements as an adaptive procedural response to problems, particularly those associated with urbanization.

Although it is impossible to trace the origin of the first informal agreement under which one local governmental unit provided a service to another unit, it is reasonable to assume that such agreement existed in the colonial period. Statutory authorization for interlocal service agreements is at least 121 years old. In a study of interlocal cooperation in five States Alabama, Indiana, Nebraska, Pennsylvania, and Wisconsin - Professor John E. Stoner of Indiana University found an 1852 Indiana statute authorizing "any jail to be used to house a fugitive from justice, and entitled the jailor to collect reasonable compensation from the officer having the prisoner in custody." The oldest written intergovernmental service agreement turned up by our survey dates from 1889 (Ludlow, Massachusetts). Older unwritten agreements were reported by Ogden, Utah (1855), Manitou Springs, Colorado (1876), and Modesto, California (1884).

Intergovernmental service agreements are popular for several reasons. The agreements in some cases allow a local government to obtain a service, such as sewage disposal, or a product, water for example, which the locality cannot produce itself or could produce only at a prohibitively high cost. In other cases, a municipality is able to lower the cost and improve the quality of a service or a product by obtaining it from another unit or private firm. Service agreements also can allow a local government providing a specific service to lower the cost of providing that service to its citizens by taking advantage of economies of scale.

Political feasibility is another reason for the popularity of service agreements. A problem affecting several local governments can be solved by interlocal agreements without changing the basic structure of the local government system. Agreements do not significantly restrict the freedom of action, or autonomy, of the recipient governments, and do not require voter approval in most cases. They usually can be terminated on relatively short notice, and the municipality can either provide the service itself, contract with another governmental unit or private firm for the service, or join a service district. Consequently, service agreements can be a flexible

method of obtaining services as needed, and the supplier can provide the services in an area with flexible boundaries.

Of course, not all local governments have the option of producing a service or obtaining it from another producer. In certain areas one municipality may have a monopoly on a basic resource such as water, and the isolated location of some communities (particularly in Alaska) makes it impossible for them to obtain services from another unit. Furthermore, the extensive use of annexation by the central city in certain areas has resulted in a situation where there are few units of local government in an area other than the central city and the county. Lincoln, Nebraska, for example, has annexed five other municipalities, and increased its area from 20 square miles in 1950 to 51 square miles in 1972.

An earlier Advisory Commission on Intergovernmental Relations (ACIR) study identified two patterns of contracts and agreements.2 A "vertical" system involves agreements between upper- and lower-tier governments such as the States and cities. A "horizontal" system involves agreements between units of the same tier, i.e., agreements entered into by cities, towns, and villages, or agreements entered into by counties.

While most service agreements are voluntary, some local governments have been ordered by the State to provide a service to a neighboring municipality. Milford, Connecticut, for example, has “been ordered by the State to provide waste water treatment for an adjoining community that presently has no sewer facilities." In a few States, Texas as an example, counties are required by statute to provide certain services as requested to do so by a city. And the county in several States is required by statute to provide certain services - assessing, tax collection, election administration - which are the responsibilities of cities, towns, and villages in other States.

Intergovernmental service agreements are sometimes confused with the transfer of functions, such as from the city to the county levels. In theory, however, there are two major differences between these approaches: (1) the transfer arrangement is usually permanent, while an intergovernmental contract or agreement is normally in effect for only a limited. period of time; and (2) unlike the contract or agreement, a functional transfer involves shift of policy control and fiscal responsibility as well as operational authority.3 A better understanding of the differences between these two approaches may be obtained by examining the pertinent State legislation.

ments in 1957 drafted a model interlocal contracting act, and the Advisory Commission on Intergovernmental Relations endorsed the act in 1961.4 Fortytwo States currently have enacted all or part of this act or their own general statute (see Table III-1). Thirty States authorize local governments to cooperate with local governments in other States, and Michigan permits its local governments to cooperate with Canadian governments.

One of the broadest grants of power to local governments to cooperate with other governments is found in the New York State constitution.

Local governments shall have the power to
agree, as authorized by act of the legis-
lature, with the Federal government, a
State or one or more other governments
within or without the State, to provide
cooperatively, jointly, or by contract any
facilities, services, activity, or undertaking
which each participating local government
has the power to provide separately.5

Most States have granted blanket authorization to their local units to provide services to other units or jointly provide services. However, a number of States still have specific statutory provisions authorizing such agreements. Minnesota currently has approximately 110.6

Although the State of Rhode Island lacks a joint. exercise of powers act, the General Assembly on April 28, 1972, followed the lead of a few other States by enacting a general law specifically authorizing cities and towns to establish regional councils of governments. The law contains an unusual provision: A "council may, by appropriate action of the governing bodies of the member governments, exercise such other powers as are exercised by the member governments and necessary or desirable for dealing with problems of mutual concern."7 Statutory Impediments and Incentives

General interlocal cooperation acts often contain two provisions impeding the ability of local governments to cooperate with each other. First, in 31 States a power can be exercised jointly by two local governments only if each possesses the power. In other words, a city and a town may be interested in jointly exercising a power, but they would not be allowed to do so if only the city was legally authorized to exercise the power. While a State may feel it desirable to prevent a municipality from exercising a power it does not possess, this stipulation is often. overly restrictive. For example,

... in Missouri, first class cities are em-
powered to acquire land outside the city
limits for the establishment of a city park
and to operate and maintain such a park.
Second class cities do not have such a

power, but may operate parks within the
city limits. The first and second class cities
could jointly exercise only a power that was
exactly equally possessed by both, they
could not jointly acquire the land, build
and operate a park outside the city limits
of the second class city. . . .8

A second type of impediment, found in the general interlocal cooperation statute in 13 States, stipulates that it does not supersede individual statutes authorizing interlocal cooperation in a specific functional area. Several States have a large number of specific statutes still on the books, and in many instances these statutes contain detailed procedural requirements which limit the opportunity to employ the more flexible general interlocal cooperation statute. The New Jersey County and Municipal Government Study Commission in 1970, for example, reported the existence of 200 such statutes. 9

Not to be overlooked when considering State legislation in this area is whether there is an active State policy of encouraging the use of a general cooperation statute rather than a specific one. In response to a question put by the ACIR to the attorneys general of the 42 States having a general law authorizing such cooperation, four stated that they had no policy of encouraging local governments to use either general or specific cooperation statutes. One (Tennessee) indicated it encouraged cooperation under the general law and one (Wisconsin) replied that from a review of past formal opinions, it would seem that its general law "has been consistently interpreted in a way that could be considered restrictive. The opinions have expressed doubt as to whether the language of sec. 66.30 is sufficient to be a general grant of power for all purposes."

These findings, coupled with the fact that the general laws of several States have clauses attached making the general law supplemental or subordinate to the specific laws, indicates that the mere existence of a broadly phrased law is no guarantee of legal ease in setting up a joint operation. Transfer of Functions

In contrast with interlocal contracting, as of 1971 only ten States had general constitutional or legislative authorizations for the transfer of functions.10 Four had solely constitutional authority, one had only statutory authority, and five had a combination (see Table III-2).

Constitutional and statutory provisions dealing with the transfer of functions fall into two main groups, those requiring voter approval - Florida, New York, Ohio, Pennsylvania, and Vermont - and those that do not- Alaska, California, Illinois, Michigan, and Virginia. Alaska, California, Michi