Warehouse Closures

The April 1 article criticizing our efforts to save taxpayers’ money by closing certain warehouse operations and making state government more competitive missed the mark.

More than a year ago, we started the process of reforming how the state buys the $4 billion worth of goods and services it needs each year. To help us, we went to the private sector and asked accounting firms from around the country to submit bids for their work, ultimately selecting the firm of Ernst & Young.

Among the first money-saving opportunities we found were warehouse operations in Northern and Southern California that stored and shipped office supplies--pencils, pens, paper, etc.--to government offices around the state. The small staff who worked in this area were diligent in their jobs, but for the same reasons that Price Club, WalMart, the Pentagon and others have begun closing their warehouses, we found we could save $1.3 million a year by getting out of the stationery supply business, and having pre-approved suppliers ship their products directly to state offices. We are currently working to place the staff in other jobs.

We knew that since this was our first major step in procurement reform, we would need accurate and complete data to show the Legislature and the public that we were making the right decision. Therefore, we delayed closing the warehouse operations for six months to ask our employees and our accountant for more detailed information.

Reaching this decision cost $175,000, not the millions suggested in the article, and in just the first year, taxpayers will save that amount of money seven or eight times over.

JOANNE CORDAY KOZBERG

Secretary of State & Consumer

Services, Sacramento