It’s been more than six years since San Diego voters asked the city to put some services out for bid but progress has been slow.
Tense labor negotiations initially sidelined the managed competition measure approved in 2006. City staffers eventually won five bids after an agreement was reached in late 2010. Since then, only the city’s publishing shop has actually completed the managed competition process, saving about $1 million in its first year.
Last year, the city’s chief operating officer projected as much as $12.2 million in savings each year if all five of the approved contracts are implemented.
In the time since, the arrival of a new mayor and city staff turnover complicated efforts to finalize the contracts. There was even confusion about which staffer handles the issue.
When City Councilman Kevin Faulconer recently asked who was responsible for overseeing managed competition, he wasn’t amused by Financial Management Director Mark Leonard’s reply.
“Well, that’s probably me,” Leonard said, explaining that he had recently started overseeing additional staffers after a resignation and shifts following Mayor Bob Filner’s swearing-in.
But things could speed up in coming months.
Filner, who had previously panned the contracts, said last week that he’ll allow those already in the works to go forward. He has the sole discretion to forward potential managed competition contracts to the City Council.
During his first weeks in office, Filner appeared to direct staffers to halt managed competition contracts, creating uncertainty about the future of the program. Filner later said staffers misinterpreted him and that he only intended to put holds on managed competition contracts that have yet to go out for bid.
A week before Filner clarified his intentions, Faulconer and other Republican council members who support managed competition questioned the mayor’s directive and his request for an audit of a contract that hasn’t yet been implemented.
The council also learned that delays — most of which preceded Filner — could force the city to cut almost $3 million from this year’s budget and add to next year’s growing shortfall.
Filner resolved some of those concerns in a Thursday memo urging staffers to continue work on four managed competition contracts.
Filner’s new orders about managed competition could mean Leonard and city department heads spend more time on the issue in coming weeks.
Despite his previous criticism of the contracts, the mayor chalked up the delay to a miscommunication and insisted he never meant to hold up in-progress managed competition contracts.
“I come in the middle of things,” Filner said last week. “You can’t go back over everything, like if the council has decided, I’ve gotta move forward unless there’s some legal challenge.”
Public Works Director Tony Heinrichs, who has overseen some managed competition processes, provided an update on where each contract stands:
City Vehicle Maintenance and Repairs
Projected Savings: $4.2 million
Status: City staffers need to prepare four contracts that require outsourcing, including an agreement with an auto-parts supplier and a towing company. Those will need council approval.
The winning contract requires the city to lay off about 26 staffers and eliminate about 50 vacant positions before managed competition can be fully implemented. That will likely happen in late spring or early summer.
Street Sweeping
Projected Savings: $559,000
Status: Agreements have been reached with city employee unions and the city has started the implementation process, which will require eliminating two positions.
Landfill Operations
Projected Savings: $5.6 million
Status: City leaders are almost finished negotiating with city employee unions on agreements related to the contract.
Street/Sidewalk Maintenance
Projected Savings: $875,000
Status: The city has not begun negotiating with its employee unions. No schedule has been set.
There are other contracts on the table, too. Filner would need to forward potential requests for bids to the council to start the managed competition process.
The mayor said last week he won’t do that without further evaluation.
That means five other potential contracts, including trash collection and transportation engineering operations, remain on hold.
Lisa Halverstadt is a reporter at Voice of San Diego. Know of something she should check out? You can contact her directly at lisa.halverstadt@voiceofsandiego.org or 619.325.0528.
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