MAUREEN CAVANAUGH (Host): I'm Maureen Cavanaugh, and you're listening to These Days on KPBS. Just when you thought political battles might cool down a bit after the primary election, a brand new battle is heating up in the City of San Diego. Earlier this week, San Diego City Councilman Carl DeMaio delivered thousands of signatures to the city clerk in support of a ballot initiative called "Competition and Transparency in City Contracting." Supporters say the initiative will promote outsourcing of city services and save the city money. Opponents of the idea are against everything from the substance of the proposal to its name. They say the initiative is anything but transparent and will eliminate the city's hard won Living Wage Ordinance. My two guests are on opposite sides of this issue. I’d like to welcome San Diego City Council member Carl DeMaio, who represents District 5. And, Carl, welcome back to These Days.
CARL DEMAIO (District 5, San Diego City Council): Good morning, Maureen. Thank you for having us back.
CAVANAUGH: And San Diego City Council member Marti Emerald is here. She represents District 7. It’s good to see you, Marti.
MARTI EMERALD (District 7, San Diego City Council): Good to see you, too.
CAVANAUGH: Now, Carl, what is the motivation behind the Competition and Transparency In City Contracting Initiative that you’re proposed (sic) for the November ballot?
DEMAIO: Well, the motivation is simple. The city is broke financially, we’ve seen our services cut back to unacceptable levels in our neighborhoods and we need to change how the city government does business. Right now, city labor unions have a monopoly on the provision of city services. We want to open up those monopolies to competition with outside bidders. I don’t care about outsourcing. I do care very much about competition because competition will get us the best price at the best quality. And, unfortunately, the labor unions have blocked an implementation of a ballot measure that was passed in 2006, Proposition C, managed competition, where voters overwhelmingly asked the city to start using managed competition to save money and improve services, and that is why we had to go back to the voters to get a stronger ballot measure to require city politicians to actually implement that which the voters have already asked them to do and to get around some of the obstacles that the labor unions have created. The ballot measure also brings in a level playing field into the competitions so that no one is getting a sweetheart deal or favoritism and, finally, as we mentioned, the transparency. It requires that all city contracts be posted online in a searchable format, not just a list of the contracts but in a searchable format so the public knows what are the terms, the conditions and the prices on the contracts. It also requires that the city leaders disclose how many bids they received so we can figure out which are the no-bid contracts, and if there was any contract awarded under a sole source process. In other words, you just give it to one person, you don’t do competition. There now has to be a written justification under this ballot measure, a written justification as to why they didn’t do competition for that contract. So the transparency, the level playing field to eliminate sweetheart deals, and the requirement that we use regular competition to save money in city services and to improve the quality of our services, those are all the reforms brought to bear by the ballot measure and it’s quite important because the voters have already asked that this be implemented but the politicians and their friends in the labor union community have blocked it. That’s unacceptable.
CAVANAUGH: Just some background, if we could, so we all know what we’re talking about. What city services and contracts are we talking about? Obviously, we’re not talking about things like public safety.
DEMAIO: Exactly. You know, police, fire, uniformed public safety needs to continue to be done without competition by city forces. But, for example, we have a print shop in the basement of city hall and it’s never been competed out. We have 250 employees in the City of San Diego doing auto maintenance. That’s out of 10,000 city workers. Auto maintenance, rotating tires, changing oil, fixing these police cruisers and it’s quite costly, and so we want to open that up for competition. We have a lot of landscaping being done by city employees at city parks, facilities maintenance, so a lot of these things are commercial activities that you can find in the Yellow Pages. And so what we want to do is ask the city employees, what’s your best price that you’re going to charge the city’s budget? And then go out to bid and ask the private sector whether they can beat that price. What that will do, Maureen, is it will put pressure on city labor unions to come to the table to reduce the waste, to reform pensions because with the bloated pensions, they can’t really win these competitions because no one else in the rest of San Diego gets the sort of sweetheart deals they get on pensions. So all of these issues that we’ve been struggling with at city hall to balance our budget, to fix the structural budget deficit, I believe are part and parcel with the strategy of opening city services up for open competition.
CAVANAUGH: Well, let me get the opposing viewpoint because, Marti Emerald, I do believe you come out in opposition to the Competition and Transparency In City Contracting Initiative. Why are you opposed?
EMERALD: Because it’s anything but transparent and it’s anything but creating a level playing field. What – The biggest element that those of us who oppose this ballot measure are taking a stand on has to do with the concern about it eliminating the Living Wage Ordinance. In it, if you – if people take the time to read it, they’ll see that the City won’t be required to pay, city contractors, won’t be required to pay anything above minimum wage and, of course, no health benefits. So what we would be doing is replacing jobs that now offer not even a living wage but San Diego’s definition of a living wage. We would create a whole poverty class in the city at a time when we need to be creating middle class jobs with health benefits that help to sustain our economy. Also, it’s just not true that this City and this city council are not engaging in a competitive bidding process with our partners in private industry. It just isn’t true. I brought in a list for you to peruse, Maureen, if Carl would hand it over to you. This is a list of just $216 million worth of contracts for goods and services with private businesses, bid competitively, by and large, through a transparent process and supported by this city council. In addition to that, during the course of this year, the city council has been entertaining open bidding for street work, $103 million worth of repairs and repaving of streets, sidewalks. We’re retooling our water treatment plants with private partners. We are replacing hundreds of miles of sewer lines and water systems with private industry partners, working with our employee groups and city management to find the best people to do the job at the best price. And that’s – that is business as usual at the City. We contract out hundreds of millions of dollars to our partners in private industry and we do so because we want to get the best people on the job and we want to get the best prices.
CAVANAUGH: Now, as you’ve pointed out, if I may, Marti, one of the major objections you have to this new city contracting initiative is the fact that it – you claim that it’s really not up front about what it will do with this Living Wage Ordinance, and I think that there’s been some idea that the people who signed these petitions didn’t realize that the Living Wage Ordinance would be abolished with this – with the new…
EMERALD: Well, remember, Mr. DeMaio and his friends, who’ve put this on the ballot, hired people to collect signatures and these people received money for each signature they received. And we have several confirmed reports of these signature gatherers saying basically anything they think they need to say in order to get somebody to sign a petition. Mr. DeMaio’s own staff has gone door-to-door in my district, just up the street here in Del Cerro and Allied Gardens over the course of the last several months during the business day, knocking on doors in the 7th District, asking people to sign these petitions. And those people are calling us, in my office, asking what gives? Why is Carl DeMaio’s staff knocking on our door in the middle of the week? Aren’t they supposed to be at work? Well, maybe this is the work they’re supposed to be doing. But – And so when you have a situation where you’ve got paid signature gatherers who are not invested in this issue, who are not educated up about the history of this issue, yes, it is a – the field is ripe for misinformation and for deception. And we believe that that’s something that has happened, and we’ve received it from – so many reports from so many different people that we have to assume that where there is smoke there is fire.
CAVANAUGH: I’d like to get…
EMERALD: But on the face of it…
CAVANAUGH: Yes.
EMERALD: On the face of it, this proposition really is not about creating a more open, transparent and competitive marketplace. If anything, it’s going to make it easier for the mayor’s office to contract out…
CAVANAUGH: I want to talk about that in a moment, that managed outsourcing…
EMERALD: …and it’s going to cut the pay to people who get those jobs.
CAVANAUGH: Let me get Carl DeMaio’s response to the whole – the whole argument that this new ordinance would basically abolish the living wage and also the way that you went about collecting signatures.
DEMAIO: Absolutely, because what you heard from Miss Emerald is the excuses and the accusations of a city politician who has not produced results. Miss Emerald was elected. She knew that she had to implement our city charter. Our city charter requires, as part of Proposition C from 2006 that city politicians implement the will of the people to do competitive bidding. Not one function, not one job, not one service has been subjected to Proposition C’s competitive bidding in the past four years since it was passed.
EMERALD: Instead, the city – the city…
DEMAIO: I let you speak, Miss Emerald. I would like to respond.
EMERALD: The city jumped in with both feet to implement Proposition C after the voters approved it. Unfortunately, city management violated the law in the process, the Brown Act.
CAVANAUGH: Let’s give Carl his…
EMERALD: So…
CAVANAUGH: …time to respond.
EMERALD: …we’ll come back and get the history of the situation.
CAVANAUGH: We will. We will.
DEMAIO: Thank you, Maureen. What Miss Emerald says is both feet is barely a toe. There’s been no function that has been competed out under Proposition C. That’s a fact. She’d like to misinform the public and I’m not going to allow that to happen. That’s a fact, and it’s very easily verifiable. Second of all, when you have accusations that 138,000 San Diegans were duped or somehow were fooled into signing a petition, I find that offensive and I think they’re offended. These are San Diegans who are sick and tired of your excuses, the labor union excuses, for not having a balanced budget, for having browned out fire stations, for having service cuts and you not implement competitive bidding which is what they’ve asked. Now, that’s why…
CAVANAUGH: Okay, this is really isn’t a Marti-Carl…
DEMAIO: But – but…
CAVANAUGH: …argument here. We’re trying to keep it to…
DEMAIO: No, it’s an argument of 138,000 San Diegans, Maureen, who knew what they were signing. And let me also point out, Miss Emerald, for the last six weeks, has been out there with her union friends saying don’t sign this petition. They’ve been – they’ve had an opportunity to ask people to take signatures off this petition. They’ve been out presenting their case, and guess what? No one has stepped forward except for one person who’s with the labor unions, no one has taken the name off their – the petition, and so those 138,000 signatures, I find it quite offensive for the labor unions and Miss Emerald to somehow say that these are ignorant San Diegans. No, Miss Emerald, I believe San Diegans know what’s happening in city government, they’re sick of it, and this is just one expression of their frustration with a city government that has not worked for them and this is their way of intervening and getting city government back on track.
CAVANAUGH: Okay, time out. San Diego City Councilman Carl DeMaio and San Diego City Councilmember Marti Emerald are my guests. And I want to ask you, Carl DeMaio, if I may, are you philosophically opposed to the Living Wage Ordinance?
DEMAIO: Absolutely not. In fact, I want to get San Diegans working again. My two goals in office and basically every touchpoint that I have revolve around balancing our city’s budget to get our services back on track and getting San Diegans back to work with quality jobs. And this initiative is the embodiment of those two goals. We need a city government that respects our working families, that can live within its means rather than constantly going after tax increases and fee increases. We need a city government that respects our working families by providing the sorts of services that they need to make ends meet such as library hours after school for their kids so they have a safe zone to go to, so that is part of helping our working families. At the same time, we need a city government that allows small businesses to compete for city contracts, that opens up opportunities for our minority and women-owned businesses, our veteran businesses. By having a monopoly controlled by labor unions at city hall on all the services, you don’t give our small businesses a chance to succeed. And, finally, all these public works projects we’re talking about, maybe expanding a convention center or repaving roads, there are a lot of union-only mandates called project labor agreements that city politicians and labor unions want to put on those projects, and that means, Maureen, that 87% of San Diegans are not even eligible to apply for the jobs on those projects. We have almost a 10% unemployment rate in our city. I want all San Diegans to be able to apply for jobs on city funded, taxpayer funded, projects. That’s what this ballot measure provides, a guarantee of achieving that. If we do all this…
CAVANAUGH: Well, we need a response now…
DEMAIO: …I think we’ll have prosperity.
CAVANAUGH: …from Marti Emerald. Marti.
EMERALD: And an excellent segue, actually. I would like to create jobs, too, but I want to create jobs that pay a living wage and offer basic benefits like health benefits. Otherwise, we create a permanent poverty – a group of poverty class people who are going to wind up coming back to government seeking services. And he said – he didn’t tell you what his view was on living wage, he just said, well, he wants to create jobs. Sure, we all want to create jobs but not to create minimum wage jobs with no benefits so that we can line the pockets of Mr. DeMaio’s friends in big business. This is about maximizing profits to big contractors who are lining up at the government trough right now with the belief that they can buy a proposition and pocket taxpayer money without giving something back. There are a lot of good citizens, big businesses in town, good, good people who are developing and building things of lasting value, and who also don’t agree with this premise of eliminating the living wage. So, yeah, we all want to create jobs but we want to create jobs that offer something more than minimum wage with no benefits…
CAVANAUGH: Now, how is…
EMERALD: …and that’s exactly what this…
CAVANAUGH: Right.
EMERALD: …proposition would do.
CAVANAUGH: Opponents of this proposition also have focused on the idea that it – even though it calls itself a transparency proposition, that there is a problem with transparency and that’s in the clause called direct outsourcing. What is your opposition to that?
EMERALD: My opposition to the direct outsourcing is it doesn’t follow the process of coming through the city council, having the public hearings, to determine who the best qualified contractor would be. It would allow the mayor’s office more discretion in directly issuing those contracts, letting the contracts, and so there’s nothing transparent about that. Let me get back, though, to the managed competition. Mr. DeMaio likes to get, you know, attention by saying that we’re all fighting this managed competition. When the City first addressed it after the voter – after the vote, they violated the Brown Act state law and were ordered back to the table to develop a system that complies with the law. So this new council inherited that situation at the end of ’08, and we began the process of sitting down and complying with state law. Now, we can’t – I can’t get into a lot of the details of the discussions because it’s happened in closed session…
CAVANAUGH: Right.
EMERALD: …but we’re in the process of developing a manual, a book that we all have to follow, making sure everybody’s on the same page. And we’re very, very close to agreeing on the terms and conditions for managed competition going forward so that when we do implement it we’re not going to be back in court being sued because we were too enthusiastic or we skipped the steps we need to—we need to—follow to make sure that all of this is legal and above board.
CAVANAUGH: Right.
EMERALD: I have no problems with the concept of managed competition when it’s done transparently…
DEMAIO: Then why did you vote against the mayor’s managed competition guide in October? Maureen, the reason why…
EMERALD: No, I – we didn’t do that.
DEMAIO: The reason why we proceeded forward with this ballot measure is that in October, Miss Emerald and six oth – she joined six council members to vote against the mayor’s last, best and final proposal on managed competition. That is a fact.
EMERALD: Because we wanted to make sure…
DEMAIO: That is a fact, Miss Emerald. You stopped…
CAVANAUGH: Okay, let her – let her respond.
EMERALD: …the healthcare is par – is in the mix.
DEMAIO: I would like – I would like to address your issues, Miss Emerald.
EMERALD: And we – Again, we do not want to create a system where we are producing jobs that pay minimum wage and that do not offer healthcare.
DEMAIO: No, you don’t want competition on a fair and level playing field…
EMERALD: Well…
DEMAIO: …and that’s exactly why we need the ballot measure. Miss Emerald and her union friends don’t want to give up the union monopolies at city hall. That is a fact. She voted against the managed competition guide, which is why we filed this ballot measure. This ballot measure provides a level…
EMERALD: You know, Maureen, I’m sorry.
DEMAIO: …playing field on – on…
EMERALD: I’m sorry. He has said this several times.
DEMAIO: …all city contracts and competitions because this is a city council that has continually put poison pills in contract solicitations and in the managed competition guide to favor the labor unions. That’s why we need the ballot measure.
CAVANAUGH: Let me ask you a question, Carl. Let me ask you then…
EMERALD: No, we just find it – we find it…
CAVANAUGH: Okay.
EMERALD: …morally unconscionable – I’ll speak for myself.
DEMAIO: Well, you speak a lot.
EMERALD: I find it morally unconscionable…
DEMAIO: I would like to speak a lot.
EMERALD: …to eliminate middle class jobs that have health insurance…
DEMAIO: There’s no mention of middle class jobs and health insurance on this proposal.
CAVANAUGH: I understand.
EMERALD: …and replace them with jobs that pay none of that. Okay.
CAVANAUGH: I think our listeners have gotten
EMERALD: All right.
CAVANAUGH: …those points. Let me ask you a question, Carl. The campaign for this initiative has reportedly raised $200,000 in support. Where is the bulk of that money coming from?
DEMAIO: Well, we’ve raised money from a variety of sources and we are expecting to have to raise about $1.5 million. The labor unions are going to put about $2 million into this campaign like they did down in Chula Vista. They spent $700,000 in Chula Vista to prevent a similar measure which would require all contracts in the City of Chula Vista to allow employment opportunities for all the taxpayers rather than just union only. And so you want to talk about special interest money, take a look at the hundreds of thousands of dollars that the labor unions have already spent to try to stop competition.
CAVANAUGH: But my – Answer my question. Would you…
DEMAIO: Our finance reports are all online at the City Clerk’s office. We have people who’ve given $5.00 up to $50,000 and we are very proud of the coalition that we’ve built.
EMERALD: Most of them are the big builders…
DEMAIO: Now we’ve talked – we’ve talked about…
EMERALD: …associate general contractors…
DEMAIO: …the opposition to the ballot measure, which are labor unions, labor funded think tanks, and our city council, which, of course, the city council is the problem. That’s why we filed the ballot measure. Let’s talk about who supports this: the Howard Jarvis Taxpayers Association, 138,000 San Diegans who are Democrats, independents and Republicans from every walk of life, from every socio-economic background, from every part of this city who signed the ballot measure to get it qualified. Let’s talk about the 60% of San Diegans, Maureen, in 2006 that voted overwhelmingly for managed competition. So you want to know who supports this ballot measure, Marti Emerald? It’s San Diego that supports this ballot measure. Who opposes it? Let’s take a look at the – let’s review the bidding. It’s the city council members who’ve blocked the managed competition initiative, it’s their union friends who helped put them into office and it’s the rank and file labor union members who are getting all the jobs while the rest of San Diego is shut out of public sector funded projects.
CAVANAUGH: Marti, you and the other members of the council have opposed this initiative. What are you – what is going to be your response collectively? Are – Is there another initiative that’s going to be approved to compete with this one?
EMERALD: We understand that some initiatives are coming forward from other organizations and that they’ll be up for review before the city council rules committee in the weeks ahead. I haven’t had a chance to thoroughly review these measures but – so I really can’t comment on them. However, I will still continue to beat the drum for real transparency. We have a situation here where you asked twice for Mr. DeMaio to tell you who the backers of his proposition are, and he refused to tell you.
DEMAIO: We have over 600 to 700 backers so…
EMERALD: Please, please, no…
DEMAIO: …I mean, it’s on the internet.
EMERALD: …the people who bankrolled it. Interesting, too, and maybe I shouldn’t bring it up but I will because, you know, we’re going to – if we’re going to be – put everything out on the table here, Mr. DeMaio and his friends are now threatening a recall to…
DEMAIO: That is absolutely not true.
EMERALD: Oh, it is.
DEMAIO: That’s absolutely not true.
CAVANAUGH: Well, a recall of what?
EMERALD: It’s…
DEMAIO: I did not – I have not had any – any…
EMERALD: To – to recall me. To recall me if I come out in support of a competing…
DEMAIO: Marti, you’re paranoid.
EMERALD: …ballot measure.
DEMAIO: You’re absolutely paranoid.
EMERALD: And his – his blogging friends are out there saying if Marti comes out in favor of these things, we’re going to – we’re going to tap the same people who bankrolled his proposition to get me out of the picture and why? Because I speak out in opposition to these – these causes. Mr. DeMaio, in his own inimitable way, leaned over and whispered to me the other day at council, don’t worry, I’m not going to back that. I’m not going to be involved at all, in an effort that only he and his friends know about. So, it’s…
CAVANAUGH: Carl, your response?
DEMAIO: Well, I – I gotta say, I don’t spend as much time as Marti...
EMERALD: This is – these are the tactics…
DEMAIO: …Emerald looking at the…
EMERALD: Excuse me. No-no-no.
DEMAIO: …blogs. And if that’s where she’s getting her information…
EMERALD: No.
DEMAIO: …that’s – that’s her source but…
EMERALD: Well, Mr. DeMaio is not telling the truth. The truth is that they’re going to ram – they’re going to try ramming this down the people’s throat with misinformation about the city’s lack of competition and transparency. I’ve given you a list of $216…
DEMAIO: You’ve heard, Maureen, a number of outrageous…
EMERALD: …million – No, please.
CAVANAUGH: We have about 30 seconds left.
DEMAIO: …accusations – outrageous accusations…
EMERALD: So – so if the money…
CAVANAUGH: I’ve got to give Carl the last word.
EMERALD: If the money isn’t going to – isn’t going to do the trick, they’ll…
DEMAIO: That’s all right, Maureen. I understand.
EMERALD: …make threats against people who are now speaking out against their well-financed effort to monopolize contracts in the city and create poverty level jobs…
DEMAIO: Look…
EMERALD: …in the City of San Diego.
CAVANAUGH: And Carl, your response to what…
DEMAIO: Absolutely.
CAVANAUGH: …Marti has said…
DEMAIO: Thank you.
CAVANAUGH: …and that’s all the time we have.
DEMAIO: This entire – this entire presentation from Miss Emerald is filled with misinformation and paranoia, these…
EMERALD: Absolutely not.
DEMAIO: …accuations – Why? Because she knows that she can’t stand on the truth, she can’t stand before the voters. And I think it’s pretty shameful. I think it’s pretty shameful the accusations that you’ve thrown. I – I’m sorry that you’re so concerned about a recall.
EMERALD: And I’m – and I’m…
DEMAIO: That’s something you need to consider what’s going on there…
EMERALD: And I’m very – and I’m very tired of a campaign of…
DEMAIO: …because I’m not involved in a recall of you.
EMERALD: …misinformation that began with his cuckoo clock on his website claiming that we’re missing opportunities to save hundreds of millions of dollars.
DEMAIO: I find it unfortunate that Miss Emerald…
EMERALD: And – and that through…
CAVANAUGH: I have to bring this to an end.
DEMAIO: …can’t have a civil conversation.
CAVANAUGH: Ladies and gentlemen, thank you so much. I think we’ve seen what the – kind of heat if not light that this proposition is going to be giving to San Diego during the next few months. My guests have been San Diego City Council member Carl DeMaio and San Diego City Council member Marti Emerald. If you’d like to comment, you can go online, KPBS.org/thesedays. Coming up, we’ll discuss the modern dad revolution. It’s next as These Days continues here on KPBS.
