U3A1-24 - Identify and Describe the New Service and Competency Inventory within the Public Organization...see details

Case Study #2: Privatization

A majority of the governing body has pledged to the voters that it would explore all avenues available to privatize city services. It has directed the chief administrative officer to present council with some options. After discussion with department heads, the CAO has suggested the following: The city can save some $500,000 annually if it privatizes its sanitation service. This savings could translate into a reduction in the property tax of some 5 percent.

Council member Rodriguez asks how this savings can be achieved and whether the present sanitation workers will lose their jobs. The CAO responds that based on conversations with him, the contractor would hire all of the displaced employees who apply. “However,” she adds, “a large amount of the savings probably would be achieved by reducing employee benefits, including health-care coverage. There will be no pension benefit.”

Council member Johnston indicates that 70 percent of the employees who will have to change jobs are racial minorities. He noted that the skill level of the sanitation workers is such that they will not have any choice but to accept the reduced standard of living.

Council member Reyes acknowledges Johnston’s concern but indicates that the savings will be reflected in a property tax reduction that should benefit the poorest landowners the most than those on fixed incomes in modest homes.

Council member Richardson suggests that the city’s economic development strategy is aimed at developing good-paying jobs. He asks if the privatization of sanitation services will advance that goal for minorities as well as other citizens and taxpayers.

Prior to the evening that the city council will discuss this item, the council members report that a number of taxpayers have called urging privatization and following through on campaign pledges. It appears to the council members that the majority of voters would favor the privatization.

At the evening the item is on the council’s agenda, and the room is packed. On one side are members of a taxpayer’s group in favor of the privatization. On the other side are about half the city’s sanitation employees, and a group of African-American and Hispanic clergy and community activists who are against privatization.

Questions

1. What makes this case so difficult?

2. What expressions of different values can you find?

3. Who should make the decision whether or not to privatize? Defend your choice.

(Klingner 101)

Klingner, Donald. Public Personnel Management, 6th Edition. Routledge, 20150717. VitalBook file.

The citation provided is a guideline. Please check each citation for accuracy before use.