Earlier this month, the San Diego County Board of Supervisors voted unanimously to outsource nearly 200 health service jobs in the county's Health and Human Services Agency. The positions include 198 caseworkers and other employees, and will be outsourced to private-sector contractors and nonprofit organizations. The move is expected to save the county approximately $6.8 million.
"We're looking at a troubling financial forecast," said Board of Supervisors Chairwoman Dianne Jacob. "We have a responsibility to the taxpayers to explore any and all cost-saving measures."
According to the San Diego Union-Tribune article that reported on the issue, the county supervisors eliminated 800 positions from the county government's work force earlier this year.
Since the 1990s, San Diego County has embarked on a number of successful privatization and outsourcing efforts. The City of San Diego, which is in an even bigger budget hole, should follow the county's lead. In 2007, Reason published a study that conservatively estimated that the city could save $80 million to $200 million a year by competitively bidding for services such as water/wastewater maintenance, parks and recreation, library operations, street maintenance, trash and recycling collection, vehicle fleet maintenance, printing and copying, facilities management, and information technology. A couple of months later, voters approved a measure to allow the city to force government agencies to compete with the private sector for contracts to provide services. After three years, however, the city has yet to implement the program, as the city employees' labor unions have thus far effectively stonewalled it.
As state and local governments across the country continue to struggle with tight budgets and the effects of the economic downturn, it is more important than ever to get the best value for taxpayers' dollars. To that end, privatization and outsourcing should become vital tools and governments should conduct top-to-bottom "Yellow Pages tests" to see where private-sector vendors and nonprofit agencies may provide services more cheaply and/or of better quality than government agencies.
Other Resources:
» Reason study: Streamlining San Diego: Achieving Taxpayer Savings and Government Reforms Through Managed Competition
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