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DOCUMENTS


The Tentacle


June 27, 2011

On Privatization

Michael Kurtianyk

So, the privatization report has been released. People have had a week or so now to review the consultant’s document. Some have graded the report an “A;” others have given it a “C.” Not surprisingly there’s an “F” stamped on some copies.

 

In broad terms, what are the advantages of privatization? There are a few:

 

• Potential monetary savings for the county and taxpayers;

• Having performance-based contracts; and

• Competitiveness for contracts (if there are enough vendors available and interested in doing that work);

 

Also in broad terms, what are the disadvantages of privatization?

 

• There are few options to “undo” contracts;

• Private companies have profit motives and tax ramifications which the county does not have to consider in making services cost effective; and

• The intangible aspect of losing a county employee who has taken ownership and pride in his or her job, and the accountability to that job.

 

If you would like to read the report for yourself and make your own determination, here’s a link to it. http://www.frederickcountymd.gov/documents/Board%20of%20County%20Commissioners/Frederick%20County%20Report%20FINAL%20%282011%2006%2016%29.PDF

 

Many of us had no issues with the $25,000 investment made by the county commissioners to hire a consultant to create this report. Oliver Porter, of PPP Associates, LLC, presented his 27-page document to the county commissioners on June 16.

 

According to the report, Frederick County could see savings ranging from $84 million to $109 million, over a five-year period, which would be a 25 to 32 percent annual savings over the current level of expenditures for certain services. In order to make this work, 528 county jobs could be outsourced.

 

The report identified these core services as “both appropriate and desirable for inclusion” for privatization:

 

• Human Resources

• Interagency Information Technology

• Financial Administration

• Fleet Services

• Facility Services

• Community Development Services

• Internal Audit

• Public Works

• Parks and Recreation

• Court

 

The privatization of all these services would reduce the county workforce by 528 people, which constitutes $67,415,147 of the FY11 budget.

 

Later in the report recommendations were made as follows:

 

Frederick County should consider the additional services that PPP Associates has identified in the “Findings” section of this report as potential areas for outsourcing to private firms, including:

 

1. Adult Detention Centers

2. Alternative Sentencing

3. Water and Wastewater Services

4. Solid Waste

5. Emergency Communications

6. Grant Funded Services

 

These additional services, if privatized, could reduce the county workforce by another 504 employees, which constitutes $80,703,876 of the FY11 budget.

 

Above all else, this report, and any report like this, presupposes that the commissioners have not reduced the services to the bare bones already. It also shows that the reduction in government services, which was championed by this slate of commissioners, has not been accomplished, and that more could be done.

 

Commission President Blaine Young has already stated that we must all remain calm, and to keep an open mind, since this is a new venture.

 

Good advice, as long as the commissioners listen to the citizens (and employees!) when the public meetings occur. Remember that these employees are real people, not some statistic on a privatization report.

 

Citizens can attend these public hearings, which will occur in Winchester Hall’s first floor meeting room, on these dates:

 

July 12, 7 P.M.

July 19, 9 A.M.

July 21, 1:30 P.M.

July 26, 7 P.M.

 

The first two hearings are intended for county employees, but the public is invited to attend; the other two are intended for the public, but employees are invited to attend.

 

 

Next week: An analysis of the core and additional services, department by department.

 

Michael.kurtianyk@gmail.com

 



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