The Quasi Government: Hybrid Organizations with Both Government and Private Sector Legal Characteristics

Kevin R. Kosar
Analyst in American National Government

To assist Congress in its oversight, this report provides an overview of federally related entities that possess legal characteristics of both the governmental and private sectors. These hybrid organizations (e.g., Fannie Mae, National Park Foundation, In-Q-Tel), collectively referred to in this report as the “quasi government,” have grown in number, size, and importance in recent decades.

A brief review of executive branch organizational history is followed by a description of entities with ties to the executive branch, although they are not “agencies” of the United States as defined in Title 5 of the U.S. Code. Several categories of quasi governmental entities are defined and discussed: (1) quasi official agencies; (2) government-sponsored enterprises (GSE); (3) federally funded research and development corporations; (4) agency-related nonprofit organizations; (5) venture capital funds; (6) congressionally chartered nonprofit organizations; and (7) instrumentalities of indeterminate character.

The quasi government, not surprisingly, is a controversial subject. To supporters of this trend toward greater reliance upon hybrid organizations, the proper objective of governmental management is to maximize performance and results, however defined. In their view, the private and governmental sectors are alike in their essentials, and thus subject to the same economically derived behavioral norms. They tend to welcome this trend toward greater use of quasi governmental entities.

Critics of the quasi government, on the other hand, tend to view hybrid organizations as contributing to a weakened capacity of government to perform its fundamental constitutional duties, and to an erosion in political accountability, a crucial element in democratic governance. They tend to consider the governmental and private sectors as being legally distinct, with relatively little overlap in behavioral norms.

There is nothing modest about the size, scope, and impact of the quasi government. Quasi governmental entities run the gamut, from not-for-profit organizations that raise funds for the upkeep of parks to venture capital entities that fund the development of new technologies of use by federal agencies.


Date of Report: June 22, 2011
Number of Pages: 36
Order Number: RL30533
Price: $29.95

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