The U.S. Government is currently spending over $530 billion on federal, state and local contracts (Amey, 2012).  While cost savings are often the primary motive of the privatization reforms, another important motive is to create “community-owned governments” that rely heavily on private organizations – organizations that understand the local problems and deliver cheap, flexible and creative solutions (Osborne & Gaebler, 1992; Savas, 2005).  Thus, privatization, in its many forms, may help government agencies “share power” with their communities and make public programs more responsive to the citizens’ needs (Kettl, 1993).  The purpose of this study is to investigate one aspect of private contractors’ stewardship role – their establishment of forums for citizen participation and the influence that these forums have on the implementation of state and local contracts in the field of health and human services.   Citizen participation may help ensure that public policies – “double-delegated” from the legislature to the administrative agencies and then on to private organizations – are implemented cost-effectively, as well as with constitutional due process and citizens’ preferences in mind (Dickinson, 2007-2008).

The first objective of this research is to understand the nature and the scope of citizen participation in the context of contracting. Previous studies suggest that private contractors use a variety of public participation tools such as client surveys, advisory boards, work groups, client meetings and public forums (Dickinson, 2007-2008; Hodge & Greve, 2007; LeRoux, 2009).  However, it is unclear which community groups are more likely to engage in contract governance. Private contractors may be more heavily influenced by the entities with the most political clout, while the general population may not have a voice in contract governance (Dickinson, 2007-2008; Smith & Smyth, 1996). Understanding the “reach” of citizen engagement efforts is, therefore, important. The second objective of this study is to investigate the determinants and the motives for having citizen participate in contracts.  While government agencies may encourage public participation for constitutional and managerial reasons, private contractors may be driven by private-sector values and interests. Specifically, public participation may allow contractors to gain the “legitimacy” needed to: (a) enhance organizational reputation; (b) lower costs; or (c) eliminate unrealistic performance standards and increase the odds of contract renewal. Understanding these motives and other factors influencing the use of citizen engagement will help government agencies manage this process more effectively.  The final objective of this study is to examine how citizen participation affects the way contract outcomes are defined and monitored.

This paper is the first phase of a multi-stage mixed-methods project. This study is based on over 50 in-depth interviews with public and private contract managers in numerous state and local jurisdictions. It uses rigorous qualitative data analysis to identify trends in citizen participation, its scope, its causes and its consequences.  By contributing to our understanding of these issues, this study enhances government agencies’ ability to manage citizen participation and use citizen feedback to improve contract outcomes. (Bibliography is available upon request).