When it comes to dealing with municipal fiscal woes and rising pension costs, Costa Mesa and San Bernardino offer an interesting contrast, especially when it comes to using outsourcing as a means of lowering costs and ensuring the continued delivery of public services, according to an op-ed piece on Friday in The Press-Enterprise. In the wake of the Great Recession, officials in then-cash-strapped Costa Mesa attempted to privatize nearly half of the city’s workforce to lower costs, but were rebuked by the courts. Since then, city officials have negotiated with unions to contract out street sweeping and jail operations, but they recently reached a legal settlement with unions that will prevent all but one future privatization effort (parks maintenance) for four years. In addition to granting a virtual moratorium on privatization, officials also granted employees a 4 percent pay increase. Contrast this with San Bernardino, whose bankruptcy exit plan relies heavily on outsourcing as a primary strategy for restoring fiscal solvency. In May, its city council overwhelmingly approved a bankruptcy plan that includes large-scale proposals to contract out 15 city services, which it estimates would produce at least $9 million in annual cost savings. Even more notable is that the proposed outsourcing list includes fire services, traditionally an area immune to competition. In fact, the bankruptcy plan relies on contracting out fire and emergency medical services to save at least $7 million a year.
