Contracting Services to Save Anaheim $800,000 This Year

The city will save an estimated $800,000 this year by contracting out services that otherwise would be done by city employees, according to a city report on privatization released this month.

The savings are a result of 18 contracts valued at $2.4 million the city has entered into since 1992, the report said.

The city began privatizing scores of services several years ago in an effort to cope with declining revenue. Overall, the city pays some $141 million to contractors who provide 359 different services.

Seventeen city departments contract services. Human resources, maintenance and stadium departments account for nearly half of the city’s annual privatization budget. The contracts pay for services such as building demolition, computer repair and maintenance, legal research and graffiti removal.

The largest new contract was for $1 million to build a fiber optics telecommunications network. City workers had no experience in this field, the report stated.

The report also conceded that privatization has its shortcomings. For example, it often requires laying off city workers, harming employee morale. Also, the city sometimes loses control over service quality, the report said.

In spite of the drawbacks, city officials say privatization is a “vital tool” in streamlining government costs and they will continue to use it.

“We will continue to aggressively scrutinize services for possible privatization in the future,” City Manager James D. Ruth said. “And we will enter into contracts with the private sector where responsible cost cutting and improved efficiency is clearly evident.”