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City Attorney Says No Need For Competition In Outsourcing Plan

Audio

Aired 10/23/09

San Diego's debate over a program to outsource city services took an interesting turn last week. City Attorney Jan Goldsmith issued a legal opinion where he essentially said the city can outsource services without giving current city departments an opportunity to compete for those jobs. What impact will Goldsmith's recent opinion have on the program that was commonly referred to as "managed competition"?

GLORIA: PENNER (Host): I’m Gloria Penner. I’m joined by the editors at the roundtable These Days in San Diego. Today, a look at outsourcing San Diego City services without allowing city workers to compete, concerns surface over the financial toll on San Diego’s fishing industry from the Marine Life Protection Act, and a local journalist will again report from Afghanistan about Camp Pendleton Marines there. The editors with me are Andrew Donohue, editor of voiceofsandiego.org. Welcome back, Andrew.

ANDREW DONOHUE (Editor, voiceofsandiego.org): Always good to see you, Gloria.

PENNER: Thank you. Barbara Bry, co-publisher and opinion editor of SDNN.com. Barbara, I’m pleased to see you again.

BARBARA BRY (Associate Publisher and Opinion Editor, SDNN.com): Thanks, Gloria.

PENNER: And we also have Tony Perry, San Diego bureau chief for the Los Angeles Times. Good to see you, Tony.

TONY PERRY (San Diego Bureau Chief, Los Angeles Times): Salam alaikum.

PENNER: Okay, Tony.

DONOHUE: Alaikum Salam.

PENNER: And that was from Andrew. All right, let’s move on now. San Diego City Attorney Jan Goldsmith shook things up last week when he offered the opinion that the long awaited outsourcing of city service could happen without allowing city employees to bid on the projects. So, Andrew, this sort of flies in the face of the mayor’s emphasis on managed competition or having private industry compete with city services. So step back a bit and remind us when we voted on this issue, what did we vote on?

DONOHUE: Well, that is the primary question because, you know, we have a new city attorney so you can forgive him, perhaps, for having a different legal analysis of the ballot proposition but the big question is, is what was the mayor’s office going to say about this fact that the city attorney says you don’t need to compete – the city employees don’t need to compete. Well, it’s very fascinating. Jay Goldstone right away said, well, listen, the whole goal was privatization, it wasn’t necessarily managed composition (sic). But if you look at the ballot argument from Prop C that was signed actually by the mayor, it says city employees will be given an opportunity to develop plans for improving the efficiency and effectiveness of a targeted service while qualified outside providers will be invited to submit proposals for providing the service. So I think very clearly you have the mayor going back on not only what he was promising to voters but actually what he was signing on a ballot initiative.

PENNER: Okay, so let’s kind of figure out what this means. Barbara, I’m going to turn to you with your business background. Theoretically, could all city departments staffed by city workers be eliminated and private companies take over?

BRY: Gloria, in theory only. In reality, this is never going to happen. I mean, the bottom line is even if you think Jan Goldsmith’s legal opinion is correct, the city council has to approve everything in the end. And do you think the San Diego City Council is going to, you know, approve extreme privatization of city functions? Doubtful. I think actually the managed competition issue is going to go away; it’s never going to happen.

PENNER: It’s never going to happen.

BRY: It’s never going to happen.

PENNER: So that means that we are not going to do outsourcing.

BRY: I would highly doubt that we’re going to outsource any city function because of the political reality of needing to get the votes.

PENNER: Well, I’m wondering whether all of the city council members would agree with Barbara Bry. Voice of San Diego did a – I guess you questioned the city council, you’re right, the other day.

DONOHUE: Yeah, we did a straw poll.

PENNER: Right. Okay. So I’m going to turn this to Tony. Let me tell you what the results were. Okay. Carl DeMaio favored privatization. Todd Gloria and Ben Hueso opposed it. Tony Young, Marti Emerald and Sherri Lightner didn’t answer. What does this tell you, Tony Perry?

PERRY: Tells you that a couple of the members of the council know the political power of labor unions in this city and a couple of other council members are aware of it but don’t want to commit themselves. I agree with Barbara. I don’t think it’s going to happen in large measure. I think possibly some smallish functions, janitorial is a good one, will be outsourced but I wouldn’t look for Park & Rec, the whole department, to be outsourced. This change of city attorney opinion, I realize we have a new city attorney, this is why labor unions exist because it – based on the idea that you can’t trust management. The employees were at least given the indication that they could at least bid for their jobs to keep their jobs and now, whoops, we have a new city attorney opinion that says, no, that’s not even necessary although politically it probably is. This is why labor unions exist, because management cannot always be trusted to be consistent or when it turns over to be in line with what the previous promises were.

PENNER: Do you agree with that, Andrew? Do you think this is, you know, all to do with labor unions?

DONOHUE: Oh, it has everything to do with labor unions but it also, I think, has everything to do with the mayor’s office. I think what you see right now is a desperation on their part. Here we are three years down the road. One of his key promises to voters both in 2005 and 2006 is that he was going to go in and make city hall more efficient and he was going to do that through either managed competition or the threat of privatization. Like I said, three years down the road, we have little or nothing to show for it and so they’re starting to get desperate. And when you get desperate, you change your tune a little bit and maybe you go back on promises.

PENNER: But wait a minute, that was the city attorney who gave his legal opinion.

DONOHUE: Well, and…

PENNER: So who’ll – I mean, who’ll make the decision?

DONOHUE: Well, I think like Barbara said, ultimately it’s the city council. So a lot of this – a lot of the debate over sort of actually what gets put into place may be moot but I think it’s telling us a lot about the actual players in the whole saga. It was just a city attorney opinion, so then we all looked, okay, well, the city attorney’s giving the mayor this power but will the mayor actually go back on his promises and use that power. They’re signaling that they’re, at the very least, considering it, which I think speaks a lot to what they’re going through right now.

PENNER: So do you agree with Andrew, Barbara? Do you think this is what the mayor wants?

BRY: I think the mayor was probably surprised by the Goldsmith opinion and I think, though, with the response that he’s seeing from, you know, the labor unions and the city council members who’ve been polled that they’re only going to be able to outsource if they really go to a process where the city employees can compete. That’s the only way I believe that you can get enough votes on the city council.

PENNER: Well, Tony, Labor – I mean, you talked about Labor, Labor critics call it political, these critics from Labor call it political, so what’s political about it? What could, let’s say, City Attorney Goldsmith gain politically from this opinion?

PERRY: I have no indication that Jan Goldsmith is a political being to the extent that he tailors his political needs and his legal opinions. We went through that with his predecessor. I don’t think that’s where Jan Goldsmith is. I think he gave an opinion. I don’t think he’s got a political agenda here. Now, he could certainly catch hell at election time from labor unions, and that’s the way this game is played. But, again, I think if you step back, this is once again San Diego trying to get out of paying its bills in one way or another: firing people, getting cheaper people, doing everything it can to keep from actually paying its bills.

PENNER: Okay. We’re going to take a short break now. If you’d like to join the conversation, our number here is 1-888-895-5727. This is the Editors Roundtable. I’m Gloria Penner.

PENNER: I’m Gloria Penner and this is the Editors Roundtable. I’m at the roundtable today with Barbara Bry from SDNN.com and Tony Perry from the LA Times, and from voiceofsandiego.org, we have Andrew Donohue. And we have you. And we’re talking about the City of San Diego seems to have gone back on this whole concept of outsourcing city services. I guess the labor unions must be happy about that but there’s some embarrassment here from the mayor because he sold it to the voters as sort of a managed competition and now it looks as though the city attorney has said, well, not really managed competition, actually city workers can’t bid for these kinds of services. It’s all going to be privatized or at least maybe. Well, the panel here says it ain’t gonna happen. If it isn’t going to happen, Barbara Bry, then it seems to me it’s a big waste of time.

BRY: Yeah, it’s a waste of time and money to keep going down this managed competition route given that there aren’t the votes, I believe, the votes on the city council to privatize any major city function even if you let the employees compete. And I think politically, no matter what the Jan Goldsmith decision was, you’re going to have to let city employees compete, to get the votes on the city council. So I think the city’s got to look at other ways of saving money or raising revenue. You know, they’ve just got to stop with the managed competition issue.

PERRY: And I think it’s, you know, based on a libertarian pipe dream and that is that somehow private industry is more efficient and better and could sweep these lazy, no good city employees out and do much better. I don’t think there’s much proof of that. Look at your nursing home scandals of the last 40 years, look at private jails. There’s all sorts of indication it just doesn’t work that way.

PENNER: Okay, Andrew, your colleagues are saying it isn’t going to happen.

DONOHUE: It isn’t, and I – Well, I don’t know. It’s going to – If it happens, it’s going to happen in, I think, a very small form. But, I mean, this is indicative of a larger problem of what the mayor has promised us from the start, which was no real structural overhaul of a completely broken system but rather just a nickel and diming of trying to save a few bucks here, trying to save a few bucks there. Meanwhile, a lot of those – even a lot of those sort of small, short term fixes were reliant on a city council, were reliant on other people, labor unions cooperating, and when the mayor was first asked what would you do if the city council doesn’t help you out on this, what would you do if the city council doesn’t help you on that, he always said leadership.

PENNER: That’s…

DONOHUE: Right? That was his answer. I will lead them to the right answer. And so far we’re not only seeing – not seeing those financial answers but we’re not seeing that sort of leadership that’s leading us to any sort of real clear path on how we’re actually going to fix a really serious problem that’s been around for a long time.

PENNER: Okay, well, let’s take a call from one of our listeners who would like to get in on the conversation. It’s Ian in Mission Hills. Ian, welcome to the Editors Roundtable.

IAN (Caller, Mission Hills): Yes, my comment is essentially the city hasn’t even defined the parameters that define efficient delivery of services. If it’s just simply cost, then the people of San Diego are going to regret that. Second, bringing those services back into the city, should the contractor not perform, is much more difficult than outsourcing in the first place.

PENNER: All right, Tony, do you agree with Ian?

PERRY: I do agree with Ian. There is a reason, if you look long term, why civil service grew up in this country as it did, to perform certain services efficiently and at a decent cost that the private sector couldn’t or wouldn’t. Is civil service always the way to go? Is it without fault? No, it is not. But this idea that somehow private industry is going to swoop in, run our parks, run our streets, our police department, fire department, lifeguards, whatever, I think is a pipe dream, and I think we’re delaying the hard news of actually going out and making San Diegans pay, say, for their trash pickup and actually paying our bills with real money.

PENNER: So take it there, libertarians, according to Tony. And with that, we have to wrap up this subject. Ian, thank you very much for your phone call and let’s move on.

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