A week after San Diego City Attorney Jan Goldsmith opened the door to the privatization of city services without competition from city employees, Mayor Jerry Sanders’ office is leaving it open.

“We just got this (opinion),” City COO Jay Goldstone said. “I just think it’s too early for us to take a hard-line position one way or the other.”

The city attorney’s opinion said San Diego voters approved an outsourcing initiative three years ago, not a competition initiative. The city, the opinion said, could outsource services without soliciting a bid from city departments for those services.

Until last week, discussion on the initiative has focused on “managed competition,” or the ability for private industry to compete for services with city departments. The initiative was carefully labeled “managed competition” — not “privatization” — during and after the 2006 campaign Sanders waged to have voters give him the ability to outsource. Since being approved by voters, the effort has stalled for various reasons and the city and affected labor unions are now at impasse.

Goldstone said the city attorney opinion gives the city a tool it didn’t know it had in addressing cost and efficiency issues. There’s nothing inconsistent between the opinion and the proposition’s original intent, he added.

“The intent was to allow the city to contract out for services through whatever means,” Goldstone said. “Whether it was through just pure outsourcing or through managed comp, it was to contract out for services.”

Reaction from organized labor to Goldsmith’s opinion and the mayor’s response was fierce. The San Diego-Imperial Counties Labor Council issued a press release yesterday morning calling Goldsmith’s interpretation “farfetched” and called on Sanders to denounce it. The release linked to an advertisement from the 2006 campaign on the ballot measure. In the ad, Sanders refers to competition between city departments and private companies, not outsourcing.

In an interview, Lorena Gonzalez, the secretary-treasurer and CEO of the Labor Council, called Goldsmith’s opinion “political bullshit” and part of “political power plays.”

Clearly the City Attorney is doing nothing more than playing politics before the impasse hearing on the managed competition guide. This was never presented as an outsourcing initiative. This was always presented as a way to have the city workers bid on their work. I want to know if any of the elected officials who campaigned for this who voted to put it on the ballot who presented this to the San Diego voters ever believed or promoted that idea that this was an outsourcing initiative. What San Diegan thinks they voted for a Halliburton-style outsourcing initiative?

Told of Sanders’ intentions, Gonzalez’s chief deputy Evan McLaughlin called it “a complete flip-flop.”

“We just want him to reaffirm his position that there’s going to be competition,” McLaughlin said.

Regardless, Gonzalez didn’t expect City Council to outsource any services without city workers having an opportunity to bid. On Tuesday, a spokesman for Councilman Kevin Faulconer, a managed competition proponent, declined to support outsourcing without a city bid.

Goldsmith denied his interpretation was political.

“It’s nice to call it political, but it’s not,” Goldsmith said. “If [Gonzalez] wants to discuss it, you discuss it on my level which is the legal analysis of the section rather than getting it into the political arena. It’s up to the policymakers to decide whether they want to go beyond private-public competition and bids. It’s up to us to interpret whether they have that opportunity or not.”

Goldsmith added he realized discussion on the issue has centered on competition, but it wasn’t his job to interpret anything other than the charter’s language and accompanying ballot measure.

In an interview, Mike Aguirre, who was city attorney when it passed and supported the initiative, called the key section in Goldsmith’s opinion “ambiguous.” That section refers to charter language that Goldsmith said does not require city departments to bid.

Because of the ambiguity, Aguirre said the City Attorney’s Office could look to evidence outside the charter to determine the section’s meaning.

“This would be an incomplete opinion,” Aguirre said.

— LIAM DILLON

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