HomeMy WebLinkAbout08 - OB-3 - Request for Hearing by CM Leece - 3/15/2011I
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SUBJECT:
DATE:
CITY COUNCIL AGENDA REPORT
MEETING DATE: March 1, 2011
OUTSOURCING OF CITY SERVICES
FEBRUARY 24, 2011
ITEM NUMBER: NB -4
FROM: CITY MANAGER'S DEPARTMENT
PRESENTATION BY: THOMAS R. HATCH, ASSISTANT CITY MANAGER
FOR FURTHER INFORMATION CONTACT: THOMAS R. HATCH @ (714) 754-5328
RECOMMENDATION:
The City Council Budget Working Group is recommending that the City Council
outsource the City services listed in this staff report and direct the Assistant City
Manager to begin the process of noticing employees of this action.
DISCUSSION:
At the City Council Study Session of February 8, 2011, the City Attorney presented a
staff report (Attachment A) that outlined the requirements for noticing employees for
outsourcing or layoffs. This report was requested by the City Council Budget Working
Group in an effort to understand the process for appropriately notifying employees of
future outsourcing. The report states, "For layoffs which would result from contracting
out a specific service, each affected employee would be entitled to at least six months'
notice pursuant to Administrative Regulation 2.26 and the City is also required to meet
and consult with the applicable bargaining units (or employees if not part of a bargaining
unit) to identify the specific employees/positions which would be subject to layoff as well
as the impact of such layoffs/contracting out on the remaining members of the unit."
The City Council Budget Working Group is concerned that a six-month noticing
requirement per applicable Memorandum Of Understandings and/or Administrative
Regulations will not allow for implementation of changes until several months into the
next fiscal year. Any decision to outsource services by the City Council on March 1,
2011, would not become effective until September 1, 2011 or later date. The financial
concern is that with the noticing requirements any budgetary savings from a change in
the system for delivering services would not be realized at the beginning of the next
fiscal year and likely would not be effective until well into the new fiscal year.
Given the constraints identified above for a six-month noticing process and given the
successful outsourcing of similar services by other cities, the Budget Working Group is
recommending that the City Council act now to decide on outsourcing these identified
City services:
• The entire Fire Department operations;
• Street Sweeping services;
• Graffiti Abatement services;
• Park Maintenance services;
• Parkway and Median Maintenance services;
• Fleet Maintenance services;
• Street Maintenance services;
• Facility Maintenance services;
• Animal Control services;
• City Jail services;
• Special Event Safety services;
• Information Technology services;
• Telecommunications services;
• Building Inspection services;
• Reprographic services;
• Graphic Design services;
• Payroll services; and
• Employee Benefit Administration services.
Per the City Council's direction, the City has commenced a complete organizational
review of the structure of how municipal services are provided to the community. This
process is expected to take up to six months or more to complete. As portions of this
comprehensive review are completed, the detailed analysis and alternatives for service
delivery will be provided to the public and employees for review and input prior to the
City Council deliberating and determining the new structure for service delivery of each
identified service. The options for new service delivery could include the following: a
private vendor, another public agency or joint powers agreement, a non-profit agency,
restructured City staff operations, or another method still to be determined. As this
process moves forward, the formation of recommendations about new service delivery
systems will be based on the thorough evaluation of the best and most efficient method
for delivering a particular service to the community and may likely require formal bidding
processes.
ALTERNATIVES CONSIDERED:
The City Council may decide not to outsource all or some of the services identified.
FISCAL REVIEW:
The fiscal impact for outsourcing the identified City services is unknown at this time.
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CONCLUSION:
After discussing alternatives and the timing constraints for outsourcing, the Budget
Working Group is recommending that the City Council outsource the City services listed
in this staff report and direct management staff take the appropriate legal steps to notice
employees of this action.
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homas R. Hatch
Assistant City Manager
Attachment: Attachment 1
Kimberly Hall Barlow
City Attorney
Staff Report on Noticing Requirements
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ATTACHMENT 1
CITY COUNCIL STUDY SSSS/ON
REPORT
MEETING DATE: February 8, 2011 ITEM NUMBER: 5
SUBJECT: NOTICING REQUIREMENTS FOR OUTSOURCING OR LAYOFFS
DATE: FEBRUARY 4, 2011
FROM: THE CITY ATTORNEY'S OFFICE
PRESENTATION BY: KIMBERLY HALL BARLOW, CITY ATTORNEY
FOR FURTHER INFORMATION CONTACT: KIMBERLY HALL BARLOW AT (714) 754-5152
RECOMMENDATION:
That the City Council receive the information and provide direction to staff on any possible
areas of contracting that staff should explore and bring back for Council consideration.
BACKGROUND:
The City Council Budget Working Group requested that staff provide information on the
legal requirements if Council should determine to contract for specific services or
determine to eliminate or reduce certain City services to address budgetary concerns.
A number of statutes, City policies and agreement/MOU provisions would come into
play should the Council determine to contract out for specific services or to reduce or
eliminate specific City services, resulting in layoffs or elimination of positions. A general
overview is provided; more specific requirements can be identified if Council identifies a
specific service to be contracted for or eliminated.
ANALYSIS:
Is the City required to give notice to each bargaining unit before issuing
layoff notices to its members?
Yes. Rule 14, Section 5 of the Personnel Rules and Regulations, as well as
Administrative Regulation 2.26' require notice be provided to the bargaining units
' A.R. 2.26: In accordance with Rule 14, Section [5] of the Personnel Rules and Regulations, thirty (30)
calendar days before the effective date of layoff, the appointing authority shall notify Personnel of
the intended action with reasons therefore. In the event a decision is made by the City to contract
out for a specific service performed by City employees, the City will give the affected employees a
minimum of six (6) months advance notification in which to evaluate their own situation and assist in
planning for the future. The City shall meet and consult with the concerned employee organization
on such matters as the timing of the layoff and the number and identity of the employees affected
by the layoff.
ATTACHMENT 1
and to each affected employee. For layoffs which are not the result -of
contracting out a specific service, the City must give to each affected employee,
as well as the bargaining unit of which they are a member, at least thirty days'
notice. In addition, the City would be required to meet and consult with the
applicable bargaining unit to identify and address impacts' to any remaining
members of the unit. These requirements aro incorporated into the MOUs with
each bargaining group to varying degrees. See Article 19.2 of the CMCEA MOU,
Article 19.1 of CMPA MOU, Article 19 of CMPMA MOU, Article 24 of CMFA
MOU.
For layoffs which would result from contracting out a specific service, each
affected employee would be entitled to at least -six months' notice pursuant to
Administrative Regulation 2,26 and the City is also required to meet and consult
with the applicable bargaining units (or employees if not part of a bargaining unit)
to identify the specific employees/positions which would be subject to layoff as
well as the impact of such layoffs/contracting out on the remaining members of
the unit.
2. Is the City required to be specific as to the servicelprogram being
considered for contracting out? In other words, can the City Council issue
a blanket notice to all employees of its intent to contract out all services to
keep all options open?
No. The Council must first consider and determine which specific services would
be contracted for and then give the required six months' notice to affected
employees and bargaining units. Article 19.2 with CMCEA states that once "a
decision" is made by the City to contract out for a specific service the required
notice' is given. Staff believes this requires that notice be given out after the
decision to contract out, not before.
As to the possibility of contracting with OCFA, the existing rules would require
giving six months' notice to CMFA members. However, the transition time for
such contracting out would be subject to negotiation with CMFA and OCFA and
could potentially be shorter.
It should be noted that in the event of a layoff, part-time positions are eliminated
first. In addition, employees who are notified of layoffs are required to exercise
their "bumping" rights within five working days of receiving layoff notification's.
Thus, whether thirty days' notice or six months' notice is given to specific
employees, the notified employees will have to notify management of any
position which they elect to displace into, which would in turn trigger layoff
notices to those effected who otherwise would not have been laid off.
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ATTACHMENT 1
3. May the City withdraw its notice at any time over the 6 months' notice
period?
The City could elect to rescind any thirty days' or six months' notices required to
be given. However, employees who receive such notices may seek positions
elsewhere during the notice period and thus rescission would not necessarily
result in any given employee continuing employment with the City.
Staff would need to assess the impacts of any possible staff reduction or
contracting out, and per the requirements of the Meyers-Millias Brown Act, the
City would need to meet with the bargaining units to discuss possible impacts to
their working conditions as a result elimination of positions or contracting out for
services.
ALTERNATIVES CONSIDERED:
None at this time.
FISCAL REVIEW:
The potential financial impact of eliminating, reducing or contracting out specific
services cannot be determined until the specific positions/services are identified.
LEGAL REVIEW:
'The City Attorney prepared this report with input from Human Resources staff.
CONCLUSION:
Staff is seeking direction as to any particular service Council is interested in contracting
out or reducing or eliminating so that appropriate studies, impact analysis, etc. can be
performed and brought forward for City Council action.
KIMBERLY`HALL BARLOW
City Attorney
BOBBY(jO ING'U'
Budget and Research Officer
STEVE MANDOKI
Administrative Services Director
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