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Keeping Contractors in Line
Limits on privatization consultant a victory for San Diego residents and taxpayers
After CPI shed light on Mayor Sanders' "indefinite" contract with a privatization consultant, the San Diego City Council this week slashed funding for the consultant to a third of the $1.5 million Sanders had sought.
The council also closed down the open-ended contract with the Virginia-based consultant, Grant Thornton LLP, a major federal contractor involved in the ill-fated privatization of airports screeners and Walter Reed Army Medical Center.
In a memo and testimony to the council, CPI Research and Policy Director Murtaza Baxamusa denounced the consulting contract because it was open-ended, wasteful, and had already begun without required council approval.
The resulting council vote is a victory for San Diego taxpayers and residents. It means:
- Payments to Grant Thornton are capped at $250,000 for the next year. The council also stopped a $400,000 payment to the consultant for the fiscal year ending this week.
- More than $1 million is freed up to restore needed community services like swimming pools, parks and libraries and to bolster reserves.
- The contract has to be rebid and opened to other companies if the consulting work is to continue. Sanders' staff had proposed a multiyear, "indefinite" amount contract with Grant Thornton.
- The city's dealings with Grant Thornton have been brought into the open, encouraging greater scrutiny from now on.
Sanders contracted with and began paying the firm in March 2007, three months after hiring a Grant Thornton employee to oversee his "managed competition" privatization process.
One big question remaining: Does the city really need a high-priced private consultant to help outsource city services to other contractors?
When San Diego voters green-lighted privatization by passing Proposition C in November 2006, they were told the program would save money and not require outside help. At that time, Sanders was advertising for the consultant bids.
On the ballot, Sanders' Prop C fiscal impact statement said:
"No significant new costs are anticipated as a result of the managed competition process. The Mayor would be responsible for oversight and contract utilizing existing City staff."
Help pass stronger enforcement of the Living Wage!
The 2005 passage of the Living Wage Ordinance was one of the proudest moments in San Diego's ongoing struggle for economic justice.
Now it's time to strengthen enforcement of the requirements for decent pay and healthcare coverage for employees of companies doing business with the city. CPI and our allies have uncovered several cases of city contractors skirting the law and still paying poverty wages.
On July 9, we will propose reforms to strengthen San Diego's Living Wage Ordinance. We need:
- A level playing field for responsible employers, with loopholes closed;
- A fair, open process of investigating violations;
- Strong deterrent-level penalties for lawbreakers.
This critical step for economic justice and the health of our local economy needs your support! Please make a call, write a letter, attend the meeting, or do all three!
9 a.m. Wednesday, July 9, 2008
City Council Budget and Finance Committee
12th floor, City Hall, 202 C Street, downtown San Diego
If you can't attend the hearing, call the committee members listed below or send them an e-mail.
Councilmember Jim Madaffer, Chair: (619) 236-6677
Councilmember Toni Atkins: (619) 236-6633
Councilmember Tony Young: (619) 236-6644
Councilmember Ben Hueso: (619) 236-6688
We must stop the flow of our tax dollars into the pockets of companies cheating their workers out of a fair wage. Employers who won't pay a living wage have no business getting city contracts. |
