Cities Looking to One Another to Save Money : Government: Budget-conscious municipalities are going to their neighbors seeking services and equipment.
An enormous yellow City of Azusa truck sweeps through the hillside roads, removing browning fallen leaves, plastic foam cups and other litter as the sun breaks over the mountains.
What’s strange about this picture? Nothing, except that the streets aren’t in Azusa. They’re in Sierra Madre.
Every other week, the street-sweeping truck from the Azusa Public Works Department cleans streets in Sierra Madre and Duarte. The money from the contracts, in turn, helps Azusa pay for its own street sweeping every week.
Rather than laying off workers and reducing its sweeping services like some municipalities because of a budget crunch, two years ago Azusa turned entrepreneur, plying its services to surrounding communities.
The city is seeking to increase its street-sweeping jobs and is bidding on a graffiti-removal contract. It also provides water service to 40,000 people outside the city.
“It’s a new way of raising revenue without increasing taxes,” said Azusa Mayor Stephen J. Alexander.
Azusa is one example of a growing phenomenon--cities as entrepreneurs, working for one another to get services and equipment for less cost.
“Cities are changing from the traditional local government we used to know. They are adjusting to the tough financial circumstances, and some cities are turning to each other for help,” said Alan Heslop, professor of government at Claremont McKenna College.
“To go to a neighboring city for services has some of the benefits of privatization and allows for more local oversight.”
Azusa makes $137,000 a year with its street-sweeping service, of which about $27,000 is profit, according to city officials. That’s enough for the city to buy new equipment and cover the cost of sweeping some of its own streets, said Louie Pedrosa, Azusa’s public works director.
“We’ve provided job security for our employees and purchased four new sweepers in two years,” he said. “Before, I had equipment eight or nine years old.”
Duarte saves $10,000 and Sierra Madre at least $5,000 a year by contracting with Azusa instead of with a private company, say officials in each city.
“Residents often ask me how come the city of Azusa truck is cleaning our streets. And I tell them it works very well and costs them less,” Sierra Madre Councilman George A. Maurer said. “I think this is a sign of things to come.”
Added Duarte City Manager Jesse H. Duff: “If there’s a silver lining in the economic problems facing cities, this innovation is it.”
Azusa’s Pedrosa came up with the idea two years ago, when he was faced with the prospect of having to lay off two employees. After winning the first two contracts, he’s now set to bid on two more.
But his entrepreneurial spirit has angered private contractors, who complain that Azusa presents unfair competition, exposes the city to unnecessary liability and underestimates the true costs of sweeping the other cities.
“It’s an All-American city doing something un-American,” said Jerry Costello of California Street Maintenance of Gardena, which lost the contract to sweep Sierra Madre’s streets to Azusa.
The $2,800 a month that Azusa bid to get Sierra Madre’s contract cannot be covering the cost of a new sweeper it uses for the job, he said. “I think it’s a gift of Azusa taxpayers’ money. . . . Basically, it’s only a matter of time before this expensive attempt at running a business falls apart.”
California Street Maintenance bid $3,600 a month for the same contract. Costello said his company offers a reasonably priced service backed by years of experience, and that Azusa trucks driving to Sierra Madre open the city to liability with each freeway trip. “Cities should be conservative in what they do,” he said.
Pedrosa said Costello is reacting like a store owner who, after a decade without competition, suddenly discovers there is a new, cheaper shop down the street.
He also said that turning a profit on contracts is the bottom line for Azusa. “We wouldn’t be doing this unless it makes money and benefits our residents. . . . We had the city’s finance department and an independent consultant review the numbers.”
Street sweeping is not the only Azusa enterprise. The city last year bought the privately held Azusa Valley Water Co. that serves not only parts of Azusa but also 40,000 residents in Covina, West Covina, parts of Glendora and Irwindale, and some county areas.
Officials say the water company is just about breaking even, and will turn a profit for the city in three years, when it is fully integrated with Azusa’s own municipal water company and shares staff, equipment and water. In addition, the city is bidding on providing graffiti removal for an eastern San Gabriel Valley city and may open a city store similar to West Covina’s “City Haul” that sells old street signs, parking meters and fire hydrants.
The cities taking advantage of Azusa street sweeping are themselves serving others. Duarte maintains the lawns around Bradbury’s City Hall and other public areas, while Sierra Madre is negotiating to lease its water storage facilities to its neighbor Pasadena.
“Every city is trying to cut costs and improve services, and by combining resources we can reach an economy of scale that wasn’t possible before,” said Sean J. Joyce, Sierra Madre’s administrator.
The city is considering whether to contract some of its accounting and building-department work to neighboring Arcadia and is investigating the possibility of a shared vehicle fleet garage for local cities.
Sharing services is nothing new for Covina and West Covina. Since the early 1980s, the pair have contracted with each other for various tasks. West Covina supplies its smaller neighbor with sewer maintenance and striping for city roads. Covina supplies West Covina with an animal control officer.
Some local politicians have advocated combining the two cities. But Covina City Manager Fran Delach said most of the benefits of combining the cities can be obtained by sharing more services while maintaining separate political identities.
In addition, Baldwin Park, which has only a single jail cell, pays Covina $144,000 annually for additional jail space.
San Marino shares employees with surrounding cities, said Debbie Bell, assistant city manager. It shares the cost of an animal control officer with South Pasadena, and a part-time air quality/transportation administrator with San Gabriel.
Traditionally, many smaller cities have contracted with the county for law enforcement and other expensive services. But some are now turning to larger neighboring cities. In Diamond Bar, the City Council in 1991 contracted with its neighboring Orange County city of Brea for recreation programs.
Under the $307,000 contract, Brea this year will oversee more than 200 recreation classes offered in Diamond Bar. “We provide office space for (recreation staff) in Diamond Bar, and from a public perspective they’re dealing with our city employees, but actually they’re Brea’s employees,” said Bob Rose, Diamond Bar’s community services director.
Brea is now expressing an interest in bidding for many of the city’s public works contracts, Rose said.
When it comes to law enforcement and firefighting, cities are beginning to move beyond mutual-aid agreements for emergencies. Monrovia’s Fire Department last fall contracted to use neighboring Arcadia’s computer-aided dispatch system at a cost of $126,000 annually. Its Monrovia-based dispatchers became part of the Arcadia department’s staff.
Monrovia Fire Chief Ernest Mitchell Jr. said the city saved $60,000 the first year because it no longer has to pay for the salaries and benefits for these employees, or for electronic costs related to the dispatch system. The city expects to save $40,000 this year, he said.
In addition, the switch reduced insurance bills in Monrovia, Mitchell said. The Insurance Services Offices, which assesses fire departments for the insurance industry, improved the city’s rating because of its linkage with the Arcadia dispatch system.
San Gabriel officials are considering whether to contract with the county dispatch center, Monterey Park’s system or combine with their police department.
“Right now, the fire chief’s secretary answers (emergency fire) calls in the daytime and the firemen answer (calls) themselves at night,” said P. Michael Paules, city administrator.
San Gabriel already contracts out its Hazardous Materials Disclosure Program to Alhambra’s fire department. Alhambra since 1992 has kept records of San Gabriel businesses with hazardous materials, inspects premises and prepares emergency plans for leaks and spills.
The region’s biggest cities, Pasadena and Pomona, provide a handful of services to their smaller neighbors. Pasadena provides Dial-a-Ride service to San Marino and Altadena and administers a federal jobs programs in five western San Gabriel Valley cities.
Pomona Administrator Severo Esquivel said his city provides water services to surrounding cities and occasionally helps with minor traffic projects, such as the installation of traffic signals. In addition, he said, some nearby cities have inquired about Pomona operating their libraries.
Small cities are also piggybacking on deals that bigger cities make with private companies. Arcadia is buying a ladder firetruck for $200,000 less than it ordinarily would pay--about a 30% savings--by joining in an order with Los Angeles, which pays less per truck because of its large-quantity orders.
The tiny foothill city of Bradbury, meanwhile, expects to save about $4,000 in pothole-repair costs by piggybacking on Monrovia’s contract with a private company rather than contracting with the county, as usual.
“It’s not a huge amount of money,” said Bradbury City Manager Keene N. Wilson, “but it all adds up in the end.”