San Francisco, according to its hometown paper, "has 21 ordinances that govern city contracting. They range from the banal–registering with the city tax collector–to the progressive–providing health care for employees and complying with a ban on tropical hardwood and virgin redwood." Shockingly, the requirements "are costing local taxpayers millions of dollars a year in overcharges." Some lowlights:
In one case, a Muni worker said the city paid $3,000 for a vehicle battery tray. Such parts can be found online for $12 to $300, depending on the type of vehicle. City officials said they couldn't verify that purchase, saying the trays are usually bought in bulk with the battery.
Other city purchasing policies, if followed, would mean paying about $240 for getting a copy of a key that actually cost a worker $1.35 to get done at a hardware store on his break, the employee said. Another city worker called the use of catalog pricing for supplies "Pentagon-style purchasing."
Markups from approved vendors range from 10 to 150 percent, employees said, with one calling the city's requirement that contractors provide health care benefits for domestic partners "the expensive white elephant standing in the middle of the room (that) no one wants to mention."
Some vendors are suspected of being little more than middlemen who comply with San Francisco's very specific requirements for contractors—like disclosing historic ties to slavery and providing domestic partner benefits, a provision known as 12B because of its chapter in the Administrative Code—then turn around and buy the products from companies that don't meet the restrictions, city officials acknowledge.
An analysis by the General Services Agency found that in the last complete fiscal year, 2009-10, the city paid $9.8 million to "possible third-party brokers"—vendors that may be pass-through companies.
Using the contracting process as a tool for social engineering almost always ends up in tears, as I once tried to explain in the L.A. Times (nothing makes a gal more libertarian than watching big-city public policy get made up close). Excerpt from that:
Contractors should be competing on how to provide essential services most efficiently (indeed, that's what they're contracted to do), not on how many admirable social goals they can help achieve. Each additional mandated hoop to jump through—living wage, minority ownership, zero-carbon emissions, whatever—reduces competition and pushes the contracter further afield from the original idea of earning taxpayer money by doing a job well.
And the process creates another, perhaps more worrisome side-effect—jurisdictional creep. Once politicians realize they can subcontract social policy wherever the private sector intersects with the public, the sky's the limit. So, a living wage ordinance that once affected only businesses that contracted directly with the city gets extended to companies that do business adjacent to LAX, because LAX is owned by the city. Developers who buy property to build projects that are legal under local zoning rules get squeezed during the permitting process to add affordable housing, create locally guaranteed jobs (unionized, *bien sur*), or slap on a green roof. People engaged in private activity are tasked with social-policy goals every time they visit City Hall.
Well, at least they wouldn't impose all those "social justice" surcharges on something as sacrosanct as retirement security, right?
Link via Ed Driscoll.
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