Outsourcing Transparency? Not So Much...
So, getting back in the groove after several days off, I watched Dane Bora present the Costa Mesa Minute this afternoon. He does a great job, especially during football season, when his predictions set him up for ridicule by at least half the population of the city.
4 MILLION? REALLY?
Anyhow, this morning Dane mentioned the Outsourcing Chart that is presently part of the scroll on the City home page and told us that it reflects great success with the program. He talked about annual savings in excess of $4 million and $22
million over five years. That got my attention, so I dug a little deeper.
NUMBERS ARE "MISLEADING" - AT LEAST
If you go to that four-page chart, HERE, you will find lots of large numbers, but almost every significant "savings" being touted by The City will not be realized until, and if, the pending litigation is resolved. The City MAY NOT contract out city services to private companies until the judge gives her OK on it. So, those heady numbers are VERY misleading - in fact, they are not true.
For example, the first item on the chart is Jail Operations, which the current council has agreed to outsource to the foreign company, G4S Security Solution, that would result in annual savings of $603,460. The City is counting that as "savings" attributable to outsourcing, which it is NOT - yet.
They take "outsourcing credit" for staffing changes in our Animal Control operations to the tune of $98,007, but those dollars are NOT outsourcing changes - they are management changes that shifted staffing.
They show an annual savings for the hybrid plan for Building Inspections of $214,780, but that's not the result of outsourcing - we had already been using outside services to supplement staff for that function.
They tell us that by contracting our Street Sweeping Services to Athens Services we are reaping an annual savings of $87,707 plus a one-time savings of $1,060,000, but those numbers cannot be counted until the litigation is resolved.
PARKS AND LANDSCAPE MAINTENANCE
They tell us that we'll see an annual savings of $1,370,373 plus a one-time savings of $100,000 by contracting our Parks and Landscape Maintenance Services to Merchants Landscape Services, Inc., but they shouldn't be counting that yet since it is still under the same legal restraint.
They attempt to give credit to "outsourcing" for savings in the Fire Service when the recently-negotiated side letter with the Firefighters and Interim Fire Chief Tom Arnold's restructuring plan is really a change in management policy that resulted in the presumed $1,813,000. Those numbers will not be realized until early next year due to the need to staff up and acquire equipment.
My point here is that The City is jumping the gun in their enthusiastic touting of the "savings" realized by "outsourcing". So far, any real savings attributable to "outsourcing" is negligible. Those "pending" numbers are in excess of $4.1 million and the presumed one time savings is $1.16 million - but that's in funny money. Those dollars are NOT yet realized and should NOT be reported as such. I'm all for Transparency, but let's just make it accurate...