To: Dick ZaisFrom: Kevin WrenRe: Journal Entry 5 – “Contracting Tradeoffs”February 29, 2016

Council-Manager municipalities must rely on contracting out several services and their administration to the private sector, a non-profit agency, or to another local government entity in order to balance the budget, meet community needs, and implement policies. Using principles of the ICMA’s Fiscal Crisis: Taking Stock and Looking Forward and the MRSC’s Contracting for Services, negotiating and bargaining contracts for police and fire protection services, solid waste disposal, and parks and recreation programs are exercised regularly about every few years. Based on class lectures from Rich Conrad, Justin Marlowe, and David Zabell, the realities of contracting require analyzing the tradeoffs, opportunities, and threats between the three – often competing - sectors that have serious economic and political implications. Below is a deeper analysis:

Economic AdvantagePrivate Sector Non-profit Agency Local Gov. Entity

Police/Fire: Public safety “is the paramount responsibility of cities” according to the Small City Resource Manual, so an organization like Blackwater may be able to provide less expensive private security services depending on need. Solid Waste Disposal: “Common contracts with private firms include solid waste” according to X due to its affordability. Examples include X and Y, though at a fee.Parks/Rec: Contracting with a maintenance organization or engineering firm can help lower the cost of negotiating within the city or another department.

Police/Fire: RCW 43.101.200(1) requires all newly hired peace officers, except volunteers, to engage in basic law enforcement training which complies with the standards adopted by the Washington Criminal Justice Training Commission (CJTC), so you can save on hiring and training volunteer safety personnel. Solid Waste Disposal: Organizations like Zero Waste exist that help with waste removal, though specifically recycling. These can help support other services at no or low cost, but cannot be relied upon for wraparound solid waste removal and disposal. Parks/Rec: Volunteers are attracted to cultural NGOs that can help with basic service delivery at relative no cost, but solely as a support service.

Police/Fire: Contracting with the local Sheriff or District Fire is an effective way to deliver qualiy safety services, but at varying costs based on contracts and needs.Solid Waste Disposal: Partnering with neighbors for solid waste collection is a viable opportunity that is more affordable than building a new system. Parks/Rec: Park districts provide a way to finance park programs, which is often used when the people who will use a city’s recreational facilities live both in and outside the city. Additionally, partnering with another jurisdiction is another cost effective alternative as opposed to providing in-house services.

Economic DisadvantagePrivate Sector Non-profit Agency Local Gov. Entity

Police/Fire: Strategies for partnering might include improving pay and benefits, recruiting officers with the right skills for community policing, changing job roles to enhance officers’ satisfaction, improving career development, changing residency requirements, and creating incentives for retirement-

Police/Fire: While not needing training, volunteer safety personnel provide a basic level of service that cannot substitute the quality paid, trained officers. Solid Waste Disposal: Volunteer waste services are often small scale and are ill equipped for servicing large

Police/Fire: For governments that forgo due diligence, choose ill-equipped contractors and fail to monitor progress, outsourcing deals can turn into costly disasters. Creating the right mix of parts, like Sheriffs and police requires considerable time, and money to planning.Solid Waste Disposal: “A service

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eligible officers to remain with the agency, which will be a greater draw on resources.Solid Waste Disposal: If the contracted rates of a private organization are low, the workers may strike for additional pay or log significant overtime hours.Parks/Rec: For a small scale system, only a handful of individuals need to be contracted to meet the needs of parks/rec, like maintenance, animal control, and engineering.

areas. Relying on prisoners through the jail system could help with collection and possibly disposal. Parks/Rec: Volunteers and non-profits can provide maintenance services, but more complex functions, like engineering or construction, need to be sourced through a contract with either a private entity or government department .

agreement, one agency providing service for another, the provider agency is responsible for delivering the service and exercises administrative and managerial controls over the resources employed in the process.” This can be expensive though effective depending on the contract.Parks/Rec: Park districts provide a way to finance park programs. This financing method is often used when the people who will use a city’s recreational facilities live both in and outside the city.

Political AdvantagePrivate Sector Non-profit Agency Local Gov. Entity

Police/Fire: Risk management and liability issues related to law enforcement are a significant concern for cities. To reduce liability, many city insuranceprograms have training programs and have specific requirements, such as procedures for hiring police chiefs. Hiring a private contractor can achieve expected service levels at less cost. Solid Waste Disposal: RCW 35.21.156 ensured that contracts with vendors for solid waste go through a selection procedure to determine fit and prevent risk.Parks/Rec: The conomic advantages of hiring private sector employees corresponds to political capital, since you are saving the city money by providing basic services.

Police/Fire: Allowing community members to help protect their neighborhoods, like the Guardian Angels, can increase neighborhood unity while making the city safer. Solid Waste Disposal: Aside from cost savings, partnering with an NGO can also support a political vision or mission that aims to dispose of waste in the “greenest way as possible.Parks/Rec: Engaging the community in maintaining parks helps foster stronger bonds between residents and their city.

Police/Fire: Patterning with another government agency for safety protection, like Sheriffs, is a politically neutral way to provide services while not establishing them in-house. Risk is owned by the Sheriffs and not within city management. Solid Waste Disposal: As long as the service is provided effectively and efficiently by a neighboring town or jurisdiction, residents will have no qualms. Parks/Rec: The quality of life in cities is better when families and friends can enjoy a picnic in the park, a swim in a pool, a softball game or a walk on a trail through open space.

Political DisadvantagePrivate Sector Non-profit Agency Local Gov. Entity

Police/Fire: The quality of service is unknown for private enterprises providing security/ Additionally, an outside organizations does not fully understand community or city priorities. The likelihood of an incident involving one of these officers causing political

Police/Fire: Incidents of Guardian Angels being the target of violence undermines the point of partnering with a safety NGO. In this case, the support agency becomes a liability.Solid Waste Disposal: These services are not effective in

Police/Fire: Hiring an outside government entity for safety services might be at odds with community values, like relying on Sheriffs services in liey of community policingSolid Waste Disposal: If the partner provides sub-par services, the community may blame council for

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backlash is steep.Solid Waste Disposal: Contracting for waste disposal can be expensive if the workers want to renegotiate a contract and leverage not collecting trash as a bargaining tool that causes political backlash.Parks/Rec: If the bidding process is flawed, there is a risk of hiring a fraudulent or incapable service that can create political turmoil for those who chose to contract.

the large scale cities and are more of a solution for neighborhoods or individuals as opposed to whole municipalities. Relying on them to fully service the city may beyond thir scope and create problems of effective service delivery.Parks/Rec: Residents may feel they are being used, if the city relies purely for residents to provide maintenance services.

this breakdown Parks/Rec: The Growth Management Act (GMA) requires the fastest growing counties and the cities within them to plan extensively in order to be consistent with state goals on open space and recreation. The state requirement includes retaining open space, enhancing recreational opportunities, conserving fish and wildlife habitat, increasing access to natural resource lands and water, and developing parks and recreation facilities.

Recommending a suite of options of private, public, or non-profit for these basic services is sometimes legally required and can help the city save resources through a competitive bidding process. A selection process like this will also help weed out any potential bas or incapable vendors. Furthermore, if these groups unionize, the city can conduct collective bargaining to help balance the budget, deliver quality service, and implement policies.

I would advise my council to choose between three and five candidates for each service. As you noted in class, I would not rank them myself in order to prevent bias. I would also ask them to rule out their least favorite candidates or the ones they can’t possibly work with in order to assess the best candidates. As with the interviews for the city attorney RFP in Woodinville, I would be an equanimous advisor and give even counsel like above, showing tradeoffs.

An article in Governing discussing New Jersey’s Privatization Task Force found “Sterile philosophical debates about ‘public versus private’ are often detached from the day-to-day world of public management. Over the last several decades, in governments at all levels throughout the world, the public sector’s role has increasingly evolved from direct service provider to that of an indirect provider or broker of services; governments are relying far more on networks of public, private and nonprofit organizations to deliver services.”

While the disadvantages might be severe, like cost for quality and potential political drawbacks for each option, the level of savings is significant by making a competitive bidding process. Ultimately, getting candidates from each sector is integral for determingin which candidate can provide the most effective service, then negotiating on cost, is the best process for making an ethical and informed decision.

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