Public Employee Press

Bloomberg veto rejected 48-0
City Council toughens contract-out law

By GREGORY N. HEIRES

This year, the Bloomberg administration has to end its usual practice of approving contracts worth millions of dollars with little public oversight and no cost benefit analysis.

On Dec. 8, the City Council voted unanimously to override Mayor Michael R. Bloomberg's veto of an amendment that strengthens Local Law 35, which was enacted nearly two decades ago but has failed to restrict contracting out.

The amendment, the Outsourcing Accountability Act (Intro 624-A), requires cost-benefit analyses on proposed and existing contracts. In addition, the amended law, which takes effect in March, will make the procurement process more transparent and let public employees compete for the work.

Curbing corruption

"This vote puts in place checks and balances to protect taxpayers' dollars, public services and the dedicated public employees who provide them," said DC 37 Executive Director Lillian Roberts, who has made monitoring contracts a union priority for eight years.

"It also helps safeguard against a repeat of the CityTime contract, which involved millions of dollars in cost overruns, fraud and corruption," she said. Federal indictments have charged CityTime contractors with bilking the city of more than $80 million in the automated payroll project, whose budget skyrocketed from $63 million to more than $700 million in a dozen years.

DC 37 Associate Director Henry Garrido and Political Action Director Wanda Williams applauded the veto override as a victory for good government.

"The experience of the city with contracts demanded that the process become more open," said Garrido, who heads the union's efforts on contracting out and revenue enhancement. "The city's procurement budget is over $10 billion a year, but the corruption and criminality in CityTime and other contracts showed that the administration was not watching the public's money."

"This watchdog legislation will give unions a better chance to monitor contracts and show that our members can do the work more efficiently than
outsiders," Williams said.

The greater oversight required by the new law should help the city save money in these troubled economic times, said City Council Contract Committee Chair Darlene Mealy Dec. 8 as the Council prepared to vote on Bloomberg's veto.

"This fiscally responsible, common-sense legislation will certify that the city routinely weighs the necessity of outside contracts that cost taxpayers billions of dollars each year," City Council Speaker Christine C. Quinn said as she opened discussion on the bill.

In addition to Quinn and Mealy, City Council members Charles Barron, Robert Jackson, and James Sanders Jr., chair of the Civil Service and Labor Committee, spoke in favor of the amendment as the Council considered several bills at the Dec. 8 meeting. "If our workers can do the job, they should do it," Sanders said.

Enacted in 1994, Local Law 35 fell short of its intention of controlling costs and protecting civil servants from being displaced when the city contracted out work.

Union research showed that the city routinely evaded the requirement to report if a proposed contract would displace municipal employees. In 50,000 contractual transactions since 2005, the city didn't acknowledge a single instance in which civil servants would be displaced.

More protection against layoffs

While the old law didn't define displacement in detail, the amended law states clearly that displacement includes any reduction of positions through attrition, layoffs, demotions, bumping or involuntary transfers.

The new law also adds the Health and Hospitals Corp., the Housing Authority and the Dept. of Education to the public entities covered by the procurement rules. It calls for the oversight of contracts of over $25,000 for a broad range of services, such as technical consulting, legal work, and emergency procurement.

Several corrupt information technology contracts have come to light in recent years, and City Council member Letitia James, a former chair of the Contracts Committee, plans to propose a bill to include oversight of information technology contracts.