CONSTITUENCY PREFERENCE AND POLICE CONSOLIDATION: THE CASE OF WEST HOLLYWOOD

I. INTRODUCTION Constituency preferences play a significant role in determining the allocation of local government goods and services (Gramlich and Rubinfeld, 1982; Borcherding and Deacon, 1972). These preferences are revealed through voting mechanisms that directly or indirectly determine the provision of public goods. Research on the determinants of voting choices in referenda has tended to support the hypothesis that voters behave "rationally," basing their decisions on the calculation of private benefits relative to costs (Schroeder and Sjoquist, 1978; Craig and Hsieh, 1994; Deacon and Shapiro, 1975). In 1992, residents in the city of West Hollywood in Los Angeles County voted on a referendum to create a city police force and eliminate its contract with the county sheriff's department. A number of recent studies have found that police output is produced under returns to scale that are continuously decreasing (Gyimah-Brempong, 1986, 1987, 1989; Finney, 1997). Finney (1997) estimates decreasing returns specifically for Los Angeles municipalities. These returns to scale findings suggest that, holding output constant, the cost of police production accruing to West Hollywood residents would fall if a smaller city police force replaced the contractual county department. (By California law, the county is not allowed to subsidize the contracting cities through the agreements.) The residents in West Hollywood voted to maintain the contractual agreement with the larger county department. In rejecting the proposed independent police force, West Hollywood voters exercised, by referendum, the policy option taken by a majority of municipalities in Los Angeles County. In contrast, only 6% of U.S. cities produce police output through such agreements (Renner, 1989). This study estimates the determinants of voter behavior in West Hollywood, first, to test the rational voter model within the context of a referendum whose outcome is, putatively, irrational and, second, to seek an explanation for the prevalence of intergovernmental sharing among Los Angeles municipalities for police services. A number of hypotheses that bear upon both central issues of this study could explain the referendum outcome. The referendum result in West Hollywood may reflect the fact that constituents treated the two police outputs as heterogeneous and were willing to pay for the preferred county-provided services. An alternative hypothesis involving voter preference is that constituents were simply biased toward the status quo. The literature on decision theory provides much evidence that the choices made by economic agents depend on their initial reference point (see, e.g., Tversky and Kahneman, 1991; Samuelson and Zeckhauser, 1988). Constituency support for a new police department would involve the potential loss of the present consumption of police services - a loss that would not arise if voters chose the status quo. The West Hollywood voter wishing to avert this perceived loss may have been biased toward supporting the existing police arrangement regardless of the objective costs/benefits of the alternative choices. The institutional context of the referendum, however, gives support to the hypothesis that West Hollywood voters chose to maintain the contractual police arrangement because they simply perceived the alternative as too costly. The language within the referendum itself made no reference to the costs or financing of the proposed municipal department. Information on the anticipated costs of the police proposals came largely from the experiences of neighboring cities in Los Angeles County. Contracting cities in Los Angeles County typically spend far less on police services than do municipalities with an independent force. Consequently, the intergovernmental agreement was generally presented in West Hollywood as less costly than maintaining a municipal department.(1) Mehay (1974), however, finds that the intergovernmental arrangements allocate on average far fewer police inputs in comparison to the autonomous municipal departments in Los Angeles County. …