Council rejects Sanders on outsourcing plan

The City Council Tuesday rejected an effort by Mayor Jerry Sanders to impose a set of rules on San Diego’s two largest municipal unions that would govern the city’s voter-approved outsourcing program.

Casting aside the assertion that an impasse exists between the mayor’s office and the San Diego Municipal Employees’ Association and AFSCME Local 127 over implementing the managed competition program, the City Council voted 6-2 to direct the parties back to the negotiating table, then retreated behind closed doors to discuss the issue further.

Casting the dissenting votes were Councilmen Kevin Faulconer and Carl DeMaio.

Managed competition, which allows private companies to compete for jobs now performed by city workers, was approved by 63 percent of voters with the passage of Proposition C in 2006. It has yet to be realized.

The mayor’s office has been negotiating with San Diego’s labor unions for more than three years over how to implement managed competition, but both sides recently declared that talks had broken down.

At a news conference before Tuesday’s hearing, Sanders accused the unions of trying to “neuter” the will of the voters.

“The landslide vote was no fluke,” Sanders said. “San Diego taxpayers wanted managed competition then, and San Diego taxpayers want managed competition today. They will want it more than ever, given the difficult budget situation that we are facing.”

Sanders repeated his remarks at the start of Tuesday’s City Council hearing.

Union officials accused the mayor’s office of not playing on a level field.

“If a private company wants to profit by taking over your parks, maintenance or your trash collection, it must be held to the standards of equal opportunity so the lowest paid and the most ethnically diverse workforce in this city is not unfairly targeted for privatization,” said Joan Raymond, president of AFSCME Local 127.

The SDMEA’s Michael Zucchet, a former City Council member, called the process for getting managed competition going a “complete and colossal waste of time and money.”

The city has spent millions of dollars and hundreds of hours in negotiations with the labor unions, trying to establish the rules for managed competition.

The biggest sticking point in the talks has been over health care.

The unions want their health care benefits excluded from the bidding process. The mayor’s office originally agreed, but then reversed course over concerns that it would impede competition.

Zucchet said factoring in city workers’ health care into the bidding process gives private companies an “explicit” advantage, cost saving and incentive to provide jobs without coverage.

The mayor’s office argues that city employees already have a significant edge over private-sector bidders because services will only be outsourced if a company can guarantee a cost savings of at least 10 percent.

“It’s a fair deal,” Sanders said.

DeMaio said the city has “absolutely failed taxpayers on this measure.”

“The reality is there are some who do not want to see the voters’ will implemented,” DeMaio said.

Faulconer argued that managed competition will save the city money.

“I believe it’s a very important tool for the city of San Diego, but it’s not a tool we have been able to use at this point,” he said.

Sanders said if the city isn’t able to implement Proposition C, it’s likely a signature gathering effort will be launched to put another measure on the ballot in 2010, one that would allow outsourcing, but forgo the competition.