The
mayor’s privat-
ization blitzkrieg is officially in retreat. The revolution has been disabled
by a confused but unflagging counter-offensive led by Daryl Slusher last
Thursday, and major privatization initiatives proceeding through the
bureaucracy will be immediately suspended.
So what’s a mayor in his final year to do now? Bruce Todd’s dreams to hustle
numerous city services to the private sector, each worth a sizable lottery,
were shooting through the system faster than Travis County prisoners. As part
of his affordability strategy, the city manager had been mobilizing a citywide
garage sale on numerous fronts — largely on services the mayor proposed for
privatization a month ago — and the councilmembers were kept out of the loop.
How the mayor and City Manager Jesus Garza ended up on the same page is
uncertain — Todd won’t answer questions. Maybe hizonner is just portraying
Garza’s initiatives as his. Or perhaps Garza is doing the mayor’s bidding
behind the scenes. Either way, Todd’s colleagues are suspicious:
“In the past… we’ve had one councilmember set policy by setting staff in one
direction,” said Eric Mitchell from the dais. He didn’t name any names, but the
message of behind-the-scenes machinations was clear.
Which is a primary reason the council, save for Todd and Ronney Reynolds,
supported the call for stalling privatization. A winning resolution, passed by
Jackie Goodman, was a compromise of two others: a stricter one presented by
Slusher and a weaker one from Todd that would have allowed matters to continue
unaltered. According to Goodman, her resolution allows city staff to plan for
privatization but does not allow any official action without council approval.
Previously, city staff could issue a Request for Proposal (RFP) — which
solicits bids from suitors interested in managing a city service — at their
pleasure. The council would come last in the process, when it was time to
approve the recommended bid. But longtime city observers know that by the time
companies submit bids for council approval, the question is not a matter of
whether to sell, but to whom. “When an RFP returns, perception becomes reality
and companies assume you’re in pursuit of privatization,” says Goodman.
Slusher and his colleagues would rather see the policy reversed, with the
council notified at the beginning of the process. To date, that hasn’t been
happening. The council has known for some time that the city’s federally-funded
health care clinics, the convention center, and the landfill portion of Solid
Waste Services are all candidates for “outsourcing.” But that’s only the tip of
the iceberg, and knowledge about other goings-on has been almost impossible to
come by. Take last Thursday’s meeting as an example, when obtaining information
from staff seemed as difficult as getting wild animals to speak proper English.
At one juncture in the hour-long battle, Garza commented that he had recently
put to rest an outsourcing initiative in the Health and Human Services
Department (HHS). The decision had come, he said, after realizing the council
wasn’t keen on being kept out of the privatization loop. Still, he didn’t
mention the initiative by name, and the council doesn’t know what it is. The
day after the meeting, HHS director Sue Milam said the mystery section is a
“key” service, but she won’t disclose it either. She maintains that silence is
necessary to keep employee morale aloft; she’d rather the employees hear it
from her first.
Then there’s the Hornsby Bend Biosolids Management Facility, where Dillo Dirt
is manufactured. The initiative to privatize Hornsby Bend, discovered five
weeks ago, initiated the current debate over the bureaucracy’s outsourcing
efforts. In a June 19 memo from Water and Wastewater Utility (WWU) Director
director Randy Goss to the council — four days after Todd announced his
privatization dreams — the council learned that Goss was close to issuing an
RFP to manage Hornsby Bend.
According to Garza at last week’s meeting, the impetus for the Hornsby Bend
initiative came from “individuals” who said they could operate the plant more
efficiently than the city. Goss says he believed the WWU could learn crucial
operating techniques from private companies. He suggested a “managed
competition,” where the WWU could compete with private companies to see who
could offer the best service at the lowest cost, and says he has faith that the
WWU would win.
That may be the case, but Slusher’s concern was more with the nature of the
private companies that jump-started the Hornsby Bend initiative. “Here is a
perfect example of where you have private companies coming in and talking to
the city, and you have private companies initiating the privatization, not the
city council.”
When Slusher asked the companies’ names, WWU director Randy Goss responded
that there had been several. Nonetheless, he said, he couldn’t release the
names at that moment.
Slusher asked why not, and Goss got confused: “I’m not understanding your
question.”
“It’s pretty clear,” responded Slusher.
Then Goss took a different path. Suddenly, he was able to release the names
of several international companies who had discussed managing Hornsby Bend. But
he added that although all of those companies had made some kind of general
offer at one time or another, none were specific.
The cause for the confusion was uncertain, but perhaps Goodman’s resolution
will help to prevent it in the future. Garza is expected to present a
systematic process soon, illuminating at what point in the planning process
councilmembers will be informed of privatization initiatives. All of this
doesn’t sit well with Todd, who complains that the result will be greater tax
increases, since outsourcing figures heavily into Garza’s “affordability”
strategy. Still, it’s important to note that the vote wasn’t necessarily
against privatization, and may do nothing other than slow it down. “There’s a
cheaper way to do things, but that’s not the issue,” says Gus Garcia. Like
everyone but Todd and Reynolds, he believes that since privatization involves
matters as serious as the preservation of city services, the potential for less
public oversight, and the loss of employee benefits, that it should be
scrutinized carefully. Garza will simply have to spend additional time
presenting a case before privatization initiatives can move forward. And the
mayor will just have to wait.
n
This week in council: Jackie Goodman’s 6pm public hearing on maintaining
energy conservation at the city. Also, a Goodman resolution calling for a plan
on reducing greenhouse-effect emissions. n
This article appears in July 26 • 1996 and July 26 • 1996 (Cover).