PEP, April 2009: Roberts: Massive waste at a time of need

By GREGORY N. HEIRES

A new DC 37 white paper identifies 10 cases where the city could save about $130 million by eliminating wasteful outside contracts and highly paid consultants doing municipal work.

DC 37 Executive Director Lillian Roberts released the report, “Massive Waste at a Time of Need,” on the steps of City Hall on Feb. 25.

The news conference was followed by a City Council hearing on the report’s finding that the city could save $14.5 million by replacing outside contracts for custodial work with participants from a city jobs training program (see below). In coming weeks, the Council will hold additional hearings to explore other findings of the 36-page paper. “Our members have an expertise and a knowledge base no outsider can match,” Roberts said at the news conference, where she was accompanied by DC 37’s top officers and several local union presidents.

“Our white paper shows dollar-for-dollar just how valuable our members are compared with the inefficiency of consultants and management,” Roberts said.

The new report, prepared by DC 37 Assistant Associate Director Henry Garrido, comes six years after the union initially put the city’s wasteful contracting practices under the spotlight with a white paper called “We Can Do the Work.” The report described the city’s use of a “shadow government” that employs a parallel workforce of 100,000 people hired without the merit and fitness examinations and background checks required of civil servants.

Skyrocketing contracts
Following the 2002 report, the city cut spending on outside contracts by $175 million, largely by bringing computer work in-house. But, since 2005, city contracting out has exploded from $6.7 billion to $9.2 billion — a 36 percent increase — according to the new study. Contracting for computer work has skyrocketed by 147 percent. Overall, the city’s 18,000 contracts account for a sixth of its budget.

The union is calling for cutbacks in contracting to help close the city’s $4 billion budget gap, while Mayor Michael R. Bloomberg seeks deep cuts in services and $500 million in health-care givebacks.

On March 5, over 50,000 workers and community activists protested proposed state and city budget cuts and called for a tax hike on the wealthy to help address the fiscal crisis (see pages 14-15).

“No responsible government can in good conscience cut vital services and lay off hardworking public employees while real savings are within reach,” Roberts said.

The union’s new report focuses on 10 contracts in eight mayoral agencies to show how the city could save nearly $130 million by shifting work from contractors and consultants to civil servants.

The examples include:

Saving over $8.8 million by canceling contracts with temp agencies for clerical workers at the Dept. of Health.
Saving more than $51 million at the Dept. of Homeless Services by referring homeless families to the Housing Authority rather than to private facilities at hotels and motels.
Saving more than $3.9 million by eliminating contracts with private school food delivery companies.
Saving $5.4 million by performing bookkeeping and accounting work in-house at the Fire Dept.