This story was reported for San Diego News Network on August 3, 2009.
One-thousand days have passed since voters approved a proposition allowing San Diego to contract city services – but the penny-pinching-process has yet to begin.
That’s what Councilmember Carl DeMaio said Monday morning when he released a report showing the city has spent more than $124,000 when it could be saving roughly $15 to $20 million.
“The voters have spoke 1,000 days ago and insisted that the city use this proven reform tool to eliminate inefficiencies and achieve taxpayer savings,” DeMaio said. “Not one city program, not even one single city position, has been reviewed using this cost-saving tool.”
Proposition C was approved by 60 percent of voters in November 2006. The city charter amendment allows officials to contract any services into the private sector – rather than have city employees do the job – if the city manager’s office determines it is more economically effective to do so and if the city council approves.
For example, if the city wanted a particular beach to be cleaned up after July 4, officials would ask private businesses for rates. If their rates are cheaper than having city employees clean up the beaches, city officials would offer the job to a private business.
The proposition, which received bipartisan support, also allows the city manager’s office to establish a Managed Competition Independent Review Board.
But, all of the meetings are costing more to the city than any managed competition programs and that’s because the programs have yet to be implemented.
DeMaio’s report show that nearly 1,100 hours of meetings from September 2008 to last Tuesday cost the city $124,000. That’s the amount it cost to pay union members involved and doesn’t include the number of hours from November 2006 to August 2008.
DeMaio – who was joined by San Diego County Taxpayers Association Chair Mike McDowell and former Republican candidate for city council April Boiling – said the delay of the managed competition process “derails the will of the people.” He asked Mayor Jerry Sanders and his colleagues on the city council to examine at least 10 percent of the city budget within the next 12 months and decide which services could be done more inexpensively through private businesses.
“The city maintains a print shop that has a complete monopoly over all printing done by city departments,” said DeMaio as he held the Yellow Pages in his hand. “They set a rate and city departments have to pay it. No second opinion, no competitive bid.”
He said the result of this, is the printing shop has had a deficit for each of the last five years.
But, the managed competition process is definitely still in the city’s game-plan, say two councilmembers. In recent interviews with Councilmembers Anthony Young and KevinFaulconer – who also serve as the chair and vice chair of the budget and finance committee – managed competition is on their “to-do list.” Young said the city will “objectively look at the departments” to see what services could be done by private businesses.
DeMaio’s findings come at a time when city leaders recently closed a $60 million deficit last fiscal year. The city’s fiscal issues have been compounded by the state’s decision to borrow about $35 million from San Diego, as part of the state’s $2 billion cash-grab from city governments. In addition, the state will borrow $44 million from San Diego’s redevelopment agencies.
According to a 2007 study by the Reason Foundation and the former San Diego Institute for Policy Research (now National University System Institute for Policy Research), managed competition could save the city $80 to $200 million. Services that the city could offer to the private sector include environmental, fleet, maintenance, parks, recreation and libraries, according to the study.
If San Diegans want city leaders to bring public services to the private, DeMaio said the only way to do so is through “good old-fashioned public pressure.”
Hoa Quach is the political editor for the San Diego News Network.