Riehl World: Wrong Jobs to outsource?

by Richard J. Riehl on August 25, 2011

The August edition of Carlsbad Currents, the city’s bi-monthly publication mailed to city residents, carries the headline, “Carlsbad maintains good financial health.” The story boasts of a budget balanced by reducing the size of the city’s workforce and operating more efficiently. The city’s 2011-12 budget report explains the workforce was cut back by eliminating 10 currently vacant positions, including a fire marshal, a graphic artist, a building inspector and two custodians.

We learn from the newsletter that sales and hotel taxes are expected to grow, while property tax is projected to decrease slightly. Finance Director Chuck McBride assures us that investment in the city created by new hotel, retail and commercial projects puts the city “in a good position to capitalize on opportunities as the economy recovers.” It appears happy times are here again.

Follow the jump for the rest of the storyBut maybe not for the city’s worker bees. Here’s why.

1. A projected $600,000 surplus in the 2011-12 budget will add to the city’s current $53 million in reserve. That’s 47 percent of the 2010-2011 budget. City policy requires only 30 percent in reserve.

2. There’s enough room in the budget for a $1.8 million direct subsidy to bail out golf course operations again. City Manager Lisa Hildebrand explained it “no longer made sense” to call the annual bailouts loans that have to be repaid (“Budget plan gives and takes away,” NC Times, June 6).

3. This year’s contract with city employees imposed a 7 percent pay cut for the lowest paid city workers, resulting from a wage freeze combined with shifting to employees the share of pension contributions the city has formerly paid on their behalf.

4. Despite the city’s projected prosperity, council members are considering outsourcing city services.

Outsourcing leads to layoffs or lower pay or both. With the latest uptick in the local unemployment rate from 9.6 in May to 10.5 in July, you’d think outsourcing would be an acceptable option only if the city were going broke or if residents were complaining about the quality of city services.

In this case, there’s no evidence of either. Word from city hall is that the budget’s in great shape. The city’s latest “Public Opinion Survey and State of Effectiveness Report,” showed 92 percent of those surveyed were satisfied with city services (60 percent very satisfied/32 percent satisfied), causing council member Ann Kulchin to gush about city workers, “This is your report card. As a parent I feel like I’d like to take you all out for an ice cream cone.”

When it comes to confidence in city government, 78 percent reported they were satisfied (22 percent very satisfied/55 percent somewhat).

Comparing report cards, I’d say it would make more sense to outsource city government than city services.

Richard Riehl writes from Carlsbadistan. Email him at fogcutter1@yahoo.com.

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