Municipal Residency Requirements and the Local Economy 1

In a previous post, Proposed Sturbridge Department Head Residency Requirements, I stated my negative opinions of a rumored attempt to institute residency requirements for department heads of municipal departments.  From a management relations and from a humane perspective, I thought the idea was terrible.

I decided to do a little research to see if any of the purported reasons for the proposal had ever been verified by actual economic or social science research.

The research shows there are pros and cons to the idea depending on economic circumstances, size of municipality, and perceptions of fair play.  In my opinion, the cons outweigh the pros pretty substantially for the Town of Sturbridge.

I did find a number of reviews of legal opinions that indicated that the courts find that the municipalities are within their legal rights to institute these requirements.

I found a paper, Institute for Research on Poverty – Discussion Papers – Municipal Residency Requirements and the Local Economy, that had some interesting background on this issue.

One of the little-noticed developments in American municipal administration in the 1970s was the explosive revival of an old machine-era device, the city residency law for public employees. In this paper, using information based on a survey of 85 cities, residency laws are explained not so much as a tool of public personnel management as an attempt to combat local unemployment and encourage the spending of city salaries in the local economy. The adoption of residency laws is in fact associated with unemployment, fiscal hardship, population loss, and black political influence. Local residency laws may be viewed as efforts by municipal governments to combat some of the causes of municipal fiscal distress.
One of the little-remarked developments in American municipal administration during the 1970s was the explosive revival of an old machine-era device, 1 the residency requirement for public employees; In an age of increasing rationalization of personnel systems, students of public administration will find this a puzzling countertrend. I shall suggest, however, that the resurrection of residency laws may best be understood not as an aspect of personnel management, but rather as one of the various local government efforts to combat municipal fiscal distress. An examination of residency laws in this light not only helps to explain why modern administrators have been willing to revive a device associated with the spoils system but also the growing popularity of these laws in the face of almost universal and bitter opposition by the public employees they constrain.  In a period in which tensions between urban managers and their employees run high over issues such as cost of living adjustments and affirmative action, the injection of an issue such as the residency requirement, which establishes no management advantage over employees or their unions, is only explicable if we understand such laws as directed mainly to purposes which lie outside the domain of personnel administration.

To show how the particular situation can change the merit or demerit of these requirements, I contrast the statement from the subject report:

Arguments in favor of residency laws have not only stressed their potential contribution to the general municipal economy but also, more particularly, their anticipated economic impact on central city minority groups. Indeed, the implications of residency requirements seem especially important for urban blacks, who generally suffer an unemployment rate twice that of whites. In addition, the greater poverty level among blacks means that they are on the whole more dependent than whites on a healthy public treasury to finance critical services
that upper income groups may purchase from the private sector.

With what I found in Challenging Residency as Job RequirementThe New York Times August 25, 1991

The civil rights advocates contend that residency requirements can lead to racial discrimination, particularly in towns that have few minority residents but are near cities with large minority populations.

“We found that blacks and Hispanics from urban areas were categorically being denied employment in suburban towns because of residency requirements,” said Keith M. Jones, president of the New Jersey chapter of the National Association for the Advancement of Colored People.

He said, for example, that a person who lived in Newark would essentially be barred from municipal employment in nearby Harrison because Harrison residents were given preference for jobs there.

The support for residency requirements is not universal as noted by the following quote from the first paper above:

And a number of California cities, including Los Angeles, San Francisco, Oakland, and San Jose, passed such laws in the early 1970s, only to have to erase them from the statute books when California voters barred local residency requirements in a state constitutional initiative in 1974.

This shows that if enough fair minded voters get together, they can overturn an idea that is premissible to enact, but is not wise to enact.

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One thought on “Municipal Residency Requirements and the Local Economy

  • SteveG Post author

    I found from my research that Tom Menino got elected as mayor of Boston on the promise of enforcing residency requirements. Now I remember why I have a dimmer view of Tom Menino than the idol worship that is currently going on at the news of his retirement.