# Privatizing / Contract Inspections



## Code Neophyte

I'm looking for any and all feedback.  The City Manager has proposed that we consider contracting out our inspection services to a large national company.  Her concept is to introduce the concept gradually and attrition out current inspectors as they move on or retire (although we have a few that are mid-career and would otherwise plan to stay as much as 20 more years).  Our department additionally handles code enforcement and rental inspections.
Though the idea of reducing the number of civil servants is appealing to the administration, what are the real repercussions of making such a landshift structural change?  How much control does the jurisdiction retain over the contract employees (how does the private company mesh with the political machine)?  What efficiencies are gained?  Is the cost savings realized?  My initial thought is that this hybrid approach would not function well.
Please give me any thoughts you may have!


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## cda

Have not been involved 

Come close 

Yes not sure how you audit a company if they are applying all codes

And are they just doing numbers to keep thier personnel cost down???



Suggest you give Steve a call. I think he has been on both sides and would give you fair answers


http://www.coloradocode.net/AboutUs/Resumes/tabid/79/Default.aspx


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## tmurray

The real problem for cities is the loss of absolute control over inspection processes. There is generally not a great cost savings for most mid to large size cities based on what I've heard (just anecdotal evidence).
You will be the party stuck between contractors and this third party when ever there are disputes. 

Ultimately, this company exists to make money. The question you should ask yourself is how can they do it for less than a department that is not supposed to make money.


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## fatboy

There are two larger private companies that operate in CO, and a number of individual contractors. They catch most of the smaller jurisdictions that can't justify a inspection staff for the workload. As said, it gets a bit pricey when you get into a multiple position need, and it seems to be cheaper for a larger jurisdiction to provide their own services.


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## steveray

tmurray said:


> The real problem for cities is the loss of absolute control over inspection processes. There is generally not a great cost savings for most mid to large size cities based on what I've heard (just anecdotal evidence).
> You will be the party stuck between contractors and this third party when ever there are disputes.
> 
> Ultimately, this company exists to make money. The question you should ask yourself is how can they do it for less than a department that is not supposed to make money.



Easy....I took in $2.55 million last year on a $240,000 budget....


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## north star

*@ - @ - @*

IMO, ...the Contracted company should only observe
and report......The AHJ should \ will decide what to enforce
or not enforce.

The AHJ should have absolute control over the contracted
company, and the contracted company "should not" have
ANY political involvement whatsoever !......As* **tmurray***
stated above, the current Inspectors will get caught \
placed in between the contracted company & the AHJ.
The elected officials will not be the scapegoats under any
circumstances.

Any cost savings will be minimal.

I encourage you to "tune up" your resume and to keep it
"tuned up".......Keep your eyes & ears open for other
positive employment opportunities, and continue to
obtain as many certifications and training as you can.

*@ - @ - @*


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## cda

I wonder if the city gets sued, when its third party inspector takes a 2x4  to a contractor??


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## conarb

It's got to be done, public employees have raped the system to the point pension funds are going broke and medical is totally unaffordable, private companies can work without benefits, public benefits are usually equal to or more than the basic salaries. .



			
				East Bay Times said:
			
		

> “But there’s a big difference between total compensation and take-home pay,” said Garcia, who grossed $245,000 in regular pay and $19,000 in other pay, which can include uniform allowances and educational incentives. His benefits totaled $233,000 for medical insurance and employer-paid contributions to his retirement.
> 
> Alameda County Sheriff Greg Ahern topped all sheriff’s with $633,857 in pay and benefits, including $321,445 in benefits — the highest of more than 600,000 public employees listed in the survey.
> 
> In Oakland, Kenny Lau, an engineer in the city planning department, racked up $299,000 in overtime last year, records show. Oakland pay data obtained from the city since 2008 show Lau is routinely a top overtime earner. City officials have said most of his work is funded through fees for development applications. Lau grossed $494,000 in pay and benefits last year, data show.¹



Note that the city dismisses the planner's fees because we developers pay them, not the tax payers, 


¹ http://www.eastbaytimes.com/2017/05...ice-chief-highest-paid-in-state-survey-shows/


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## tmurray

steveray said:


> Easy....I took in $2.55 million last year on a $240,000 budget....



Wow, we can't charge more for a service than it costs to deliver it under federal law.


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## tmurray

conarb said:


> It's got to be done, public employees have raped the system to the point pension funds are going broke and medical is totally unaffordable, private companies can work without benefits, public benefits are usually equal to or more than the basic salaries. .
> 
> 
> 
> Note that the city dismisses the planner's fees because we developers pay them, not the tax payers,
> 
> 
> ¹ http://www.eastbaytimes.com/2017/05...ice-chief-highest-paid-in-state-survey-shows/



So why are the politicians letting them get away with this? That's an easy one, tax payers don't care. If they did, they would vote for people who would rein in overtime spending. If tax payers don't care the system won't change. Don't blame the government for doing what voters are approving.


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## steveray

tmurray said:


> Wow, we can't charge more for a service than it costs to deliver it under federal law.



I wish!....I could actually do my job then....That is how it is supposed to work here, but until there are a bunch of lawsuits, it won't change...


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## steveray

Conarb....The employees (well, most of them) are not raping the system. The system is broken and raping the taxpayer (maybe) unless those departments are self funding like development could/ should be...If there is more work than staff can handle and overtime is required, I shouldn't get chastised for that. (not that I get paid for overtime or a pension for that matter. Everyone keeps bashing the employees and not the twits that setup or manage the pensions. Raise the employee contribution or get rid of the pensions if you "can't afford them"...Just know that you may lose some of your better employees to somewhere that has better pay or bennys then...


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## tmurray

Ultimately, overtime looks better than increasing staff levels. Some people are smart enough to figure out that paying someone multiple times their annual salary in overtime is way more expensive than actually having proper staffing levels. 

Again, why do we allow these people to have such beneficial deals when it comes to benefits? Well, it comes down to negotiations during work stoppages. Tax payers just want their services back. They don't typically see the longterm consequences, so demands are met that never would be in the private sector. Toronto mayor Rob Ford actually handled a labour dispute very well when he was in power. The garbage collector's union waited until summer to strike the last time. The municipality gave in because people complained about having to smell the garbage everywhere they went in the city. Well, Rob wasn't going to let that happen this time, so he locked the union out in the middle of winter. No on cares that garbage is pilling up outside if it is frozen and covered in snow. The timing gave him plenty of leverage to get a better deal for tax payers.


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## mark handler

steveray said:


> ...The employees (well, most of them) are not raping the system. ...


If the Building department is fee based, including Inspections or plan checks, and the fees are based on what it cost to provide those services, there is no "raping" of anything or anyone.
If someone wants extra services, expedited or after hours, they should pay the extra expense to provide those services.


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## mark handler

LA City Firefighters Ranked As Top Overtime Earners In California For 2016
http://losangeles.cbslocal.com/2017/05/02/la-city-firefighters-top-overtime-earners/
A trio of Los Angeles city firefighters have earned the dubious distinction as the top public employee overtime earners in California, thanks to a generous overtime policy.
Transparent California found that Charles F. Ferrari, *a Los Angeles City Fire Captain II, collected $334,655 in overtime*, to earn a total of $483,770 in 2016.
Second only to Ferrari, James P. Vlach, a Los Angeles City Fire Captain I, earned $332,582 in overtime in 2016. His total pay and benefits last year was $483,730.
Rounding out California’s top overtime earners is Donn D. Thompson, a Firefighter III with the Los Angeles City Fire Department. He earned $307,542 in overtime, a substantial chunk of the $439,485 he earned in 2016.
All three LA City Firefighters also earned the most overtime pay in 2015.
While some of the huge overtime earnings by LAFD firefighters are legitimate, Transparent California’s Robert Fellner says a large portion is thanks to firefighters earning overtime on their vacation days. But, don’t expect any change to the policy any time soon, he says.
“If you go against the firefighter union and you say, ‘hey guys, to save taxpayer’s money, maybe we shouldn’t treat your vacation days as if you worked?’ That is then spun as you being anti-safety, anti-firefighter,” Fellner told KNX1070 Newsradio.
The amount of overtime paid out in such a manner is problematic because it leaves less money for other necessary services, he said.
“The only reason this matters is because *it’s money coming from residents who, on average, make about $40K a year, and it’s money coming out of the city budget that’s being taken away from other services*,” Fellner said. “You have less ability to hire more firefighters or cops, less to pay your teachers, less to pave in the roads.”


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## mark handler

Code Neophyte
I have worked with "Outside or contract inspectors" with no problems except familiarity with the city and Muni-Codes.
It saves cities on medical and retirement payouts. *Big expenses.*


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## conarb

steveray said:


> Conarb....The employees (well, most of them) are not raping the system. The system is broken and raping the taxpayer (maybe) unless those departments are self funding like development could/ should be...If there is more work than staff can handle and overtime is required, I shouldn't get chastised for that. (not that I get paid for overtime or a pension for that matter. Everyone keeps bashing the employees and not the twits that setup or manage the pensions. Raise the employee contribution or get rid of the pensions if you "can't afford them"...Just know that you may lose some of your better employees to somewhere that has better pay or bennys then...



Steve:

The problem is that the employee unions donate campaign funds to counsel members or boards of supervisors members, in turn the elected officials put up little resistance during bargaining for salaries and benefits and they become untenable usually long after those particular elected officials are gone, when the problems arise the current members say it's not their fault.  This happens throughout our political system, non profits' financials are public, the Clinton Global Initiative received hundreds of millions in donations from the nations of Saudi Arabia and Qatar, for years they have been trying to get pipelines through Syria to sell oil and gas to Europe, while Hillary was Secty of State she attacked and tried to overthrow the elected regime so that the pipelines could be built, favors for elected officials are endemic to our system, from the smallest city to the president.  BTW,  
	

	
	
		
		

		
			






Our first socialist president, FDR, warned us against public unions, now they are threatening to bring the entire economy to it's knees.



			
				New York Times said:
			
		

> *F.D.R. Warned Us About Public Sector Unions*
> 
> “It is impossible to bargain collectively with the government.”
> 
> That wasn’t Newt Gingrich, or Ron Paul, or Ronald Reagan talking. That was George Meany -- the former president of the A.F.L.-C.I.O -- in 1955. Government unions are unremarkable today, but the labor movement once thought the idea absurd.
> 
> Public sector unions insist on laws that serve their interests -- at the expense of the common good.
> The founders of the labor movement viewed unions as a vehicle to get workers more of the profits they help create. Government workers, however, don’t generate profits. They merely negotiate for more tax money. When government unions strike, they strike against taxpayers. F.D.R. considered this “unthinkable and intolerable.”
> 
> Government collective bargaining means voters do not have the final say on public policy. Instead their elected representatives must negotiate spending and policy decisions with unions. That is not exactly democratic – a fact that unions once recognized.
> 
> George Meany was not alone. Up through the 1950s, unions widely agreed that collective bargaining had no place in government. But starting with Wisconsin in 1959, states began to allow collective bargaining in government. The influx of dues and members quickly changed the union movement’s tune, and collective bargaining in government is now widespread. As a result unions can now insist on laws that serve their interests – at the expense of the common good. ¹




¹ https://www.nytimes.com/roomfordeba...yees/fdr-warned-us-about-public-sector-unions


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## steveray

OMG....Did you just say something positive about a socialist?


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## conarb

The purpose of government is to make money for the government, take Portland for instance, you can riot in the streets but ----



			
				The Daily Bell said:
			
		

> Should free speech cover criticizing the government? That is kind of the whole point, right?
> 
> An Oregon man is suing Portland for violating his first amendment right to free speech after he was fined $500 for calculating how long yellow lights stay yellow and then speaking publicly about it.
> 
> Free speech? No. The city considers making and disseminating calculations about public works “engineering without a license.”
> 
> The lawsuit states:
> 
> This is a civil-rights lawsuit to vindicate the right of Plaintiff Mats Järlström to talk and write freely without fear of government punishment. Järlström wants to write and speak publicly about a matter of local, state, and nationwide concern: the safety and fairness of traffic lights and traffic-light cameras. Specifically, Järlström wishes to communicate about the mathematics behind traffic-light timing. If he does so in Oregon, however, he will be exposed to government investigation and punishment for engaging in the unlicensed “practice of engineering.” In fact, between February 2015 and January 2017, Järlström was investigated and fined for “critiquing” the standard formula for calculating traffic-light timing and for sharing his ideas with “members of the public.” Under Oregon’s Professional Engineer Registration Act (Act), Or. Rev. Stat. §§ 672.002 et seq., only state-licensed professional engineers are entitled to speak publicly on these sorts of topics. For everyone else—in the words of the Oregon State Board of Examiners for Engineering and Land Surveying (Board)—sharing “reports, commentary, and testimony” on technical subjects is “clearly not protected speech.”
> 
> …But speech like Järlström’s is exactly what the First Amendment’s Speech and Petition Clauses exist to protect.
> 
> Obviously, the city is just trying to silence and intimidate him so they can keep making money off of red light cameras. His point was that the yellow lights were too short to properly allow motorists to stop.
> 
> By the government’s definition of free speech, you basically are not allowed to criticize or even petition the government at all.
> 
> What if this same standard was applied elsewhere in government?
> 
> We could easily get to a point where any speech about government actions is not protected unless you are an expert in the field–the government, of course, deciding who qualifies as an expert.¹



Building permits are no different than red lights, under the guise of safety they make money, then redistribute that money to their own.



¹ http://www.thedailybell.com/news-analysis/its-not-free-speech-if-you-dont-have-a-license/


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## fatboy

I think this has taken quite a leap from the OP regarding contracting with a 3rd Party vs. jurisdictional inspections.

Oil pipelines in the middle east....really?


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## conarb

fatboy said:


> I think this has taken quite a leap from the OP regarding contracting with a 3rd Party vs. jurisdictional inspections.
> 
> Oil pipelines in the middle east....really?


Yes, it gets right to the point, laws are bought, wars are bought, and public employee salaries and benefits are bought, those articles I posted show unbelievable several hundred thousand dollar costs of pensions and benefits contracted for by employee unions, by subcontracting code enforcement to private concerns there can be no benefits drastically lowering the costs of inspections.  Jeff who owns and runs this forum also owns and runs a private inspection firm, perhaps he can chime in and tell us how much he can save a jurisdiction by eliminating the costs of benefits.


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## tmurray

Another thing that I just thought of, we recently cleaned house in our inspection department and took it from a 3 person department to a 2 person department. If the town had opted to go to private sector, those savings would not have been realized by the town. I know this usually doesn't happen, but just something to keep in mind.


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## conarb

tmurray said:


> Another thing that I just thought of, we recently cleaned house in our inspection department and took it from a 3 person department to a 2 person department. If the town had opted to go to private sector, those savings would not have been realized by the town. I know this usually doesn't happen, but just something to keep in mind.



T Murray:

I don't know how serious government employee expenses are up in the Great White North but we have real problems here, cities are doing everything they can to keep their pension and health expenses viable, an example here is soda taxes, supposedly "to save the children", Oakland just passed them and is already diverting the income to pension expenses, but got caught:



			
				East Bay Times said:
			
		

> Because Measure HH, a penny-per-ounce tax on sugar-sweetened beverages, is a general tax, the funds could be used to pay for anything in the city’s general fund, but during the November 2016 campaign, supporters promised that wouldn’t happen.
> 
> “What is completely unacceptable is to just completely destroy the public trust that was built when we went door to door about these dollars,” Campbell Washington said. “Last night when I told my 10-year-old son what was happening here at City Council, his look of shock was heartbreaking because children got involved in this campaign.
> 
> “He said, ‘Mommy, that means anyone who voted for the soda tax is going to regret their vote.’”
> 
> More than two dozen speakers, many supporters of the soda tax, expressed shock and anger.
> 
> “This money grab may be legal but it’s not right,” said Barbara Benzwi, a doctor at La Clinica De La Raza in the Fruitvale district. “If you divert the funds, the next campaign I will work on and pound pavement for is one to unseat you,” referring to Schaaf.¹



They're so concerned about "the children" that they pass a soda tax, they also legalize marijuana projected to produce huge tax income to the city, nothing is more detrimental to childhood cognitive development than marijuana smoke.

Out of curiosity, you saw the numbers I posted above showing hundreds of thousands per year of pension and health care costs for each and every employee, do you know how much your elimination of one employee saved your jurisdiction?   You mentioned that you have a federal law prohibiting profiteering from building permits, we in California passed such a law, anything over and above the actual costs of delivery of services constitutes a tax and must be voted for by 2/3 of the electorate, at first many cities disregarded the law, got sued by the NAHB and had to refund monies and pay fines, now they have figured a workaround and have included other departments, like the Housing Department, within the Building Department so the permit fees can be used to subsidize low cost housing for the poor.


¹ http://www.eastbaytimes.com/2017/05/03/mayor-schaaf-backs-away-from-soda-tax-plan/


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## tmurray

conarb said:


> Out of curiosity, you saw the numbers I posted above showing hundreds of thousands per year of pension and health care costs for each and every employee, do you know how much your elimination of one employee saved your jurisdiction?



I think it was just under 100K a year. We don't get any overtime, just time off in lieu of time worked and our pension is 50% employer 50% employee supported. We do have fairly respectable health benefits, but since we have single payer health care, this is not an enormous cost like it would be there.


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## conarb

tmurray said:


> I think it was just under 100K a year. We don't get any overtime, just time off in lieu of time worked and our pension is 50% employer 50% employee supported. We do have fairly respectable health benefits, but since we have single payer health care, this is not an enormous cost like it would be there.


Ours doesn't sound like it's that much but just look at the totals in the post above, appears that with high paid employees pension and healthcare can run $200,000 per year, isn't any wonder these systems are going bankrupt nationwide?  Even in a conservative state like Texas cops and firemen are taking early retirement cashouts to try to take the money and run before the whole thing collapses.  So my question is how much are yours total?


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## Sifu

I have done both.  IMO, on the inspection level, there isn't much difference.  The same level of education, experience and competence exists among inspectors as it does anywhere, meaning some are better than others at any given time.  I have seen differences in how the managers/building officials operate, though even there it depends on the character of the individual.  Basically, I think that for-profit companies may be a little more inclined to "compromise" on some levels than non-profit.  I like compromise, but not based on whether they are in contract negotiations.  At times, for-profits may be slightly more inclined to put "sales" over safety.
On the other hand, a private company will generally have far less waste, and even though they are non-profit, there is plenty of budgeting and finance games being played in a gov't.  A private company is more inclined to invest back into itself and its services, so they can be better at what they do, while a gov't. may be more inclined to invest those dollars in ramps to nowhere (clever reference to another post!).
All in all, I think they both have pro's and con's, and the quality of each is determined by the individuals.  I do think a private can be an awful good asset to a small community without a lot of resources.


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