City Council Kills El Paso Jobs a Week Before Christmas

I was perusing the KDBC Channel 4 site for their coverage of all things police brutality and came across a story that has me pretty pissed off.

The title reads "El Paso Jobs Outsourced" you can see if for yourself HERE.

I thought for sure this would be some kind of attack on a private business owner here in El Paso who is leaving town because our City Council hates all things business.  Unfortunately, the story was worse than that.

The story says that the city terminated a contract almost two years early with a local firm in order to give it to an out of town firm.  I went and checked the city council agenda for December 14, 2010 and found it under item 8B on the regular agenda.  See for yourself HERE.

It appears that the termination and award take place at the same time, which always raises my suspicions.  I would have loved to have heard what the excuse was for terminating a local firm and hiring an out of town firm for whatever service these companies provide.

The firm that got the award is from Ft. Lauderdale, Florida.  Their name is Advanced Data Processing Inc. and a quick internet search shows that they are not ADP - the employer who moved into the northwest corporate center a few years back. 

My first impression of the company is a bad one since a google search gives me a link that says it's for Advanced Data Processing Inc., but sends me to a website for "Intermedix Corp."  Give it a look by clicking HERE.  You'll notice that there's not a single mention of Advanced Data Processing Inc. on the page.  It's weird and stands in violation of my cardinal internet company rule:

David K's Cardinal Internet Company Rule -

If you get redirected to some kind of "parent company" or affiliate of the business you are actually looking for - something isn't right. 

I'm not saying anybody is doing anything wrong here as ambulance billing goes (I have, through the course of writing this, figured out what the contract is for and am too lazy to go back above and re-work my initial thoughts - sorry), but my first impression is a bad one.

My rub here is that El Pasoans are losing their jobs and it's the city council donning the executioner's hood.  We heard last week that we are poorer now than we were ten years ago and now I know why - we send jobs to Florida every chance we get.  You might remember that the city hired a group out of Florida to do a bunch of master planning here in El Paso (ASARCO, Oregon Street) even though there are at least five qualified local firms who could have done the same job located right here in El Paso.  And by "located in El Paso" I mean owned an operated by an El Pasoan and their location here in El Paso is their headquarters.  Any company can rent a ten by ten office, hook up a phone and call it their "El PasoOffice."  That doesn't mean they have any El Pasoans on staff.

I'd like to hear from city council immediately why they think it was okay to put a company (Currey Adkins - when I played little league there was a "cook" on the end of the name, right?) in a position where they had to layoff workers a week before Christmas.  What kind of assholes pull a stunt like that? 

Regardless of the time of year it's a bad move to outsource something that can be done here locally and I'm tired of seeing this happen with our tax dollars.  And yes - I don't mind spending a little extra on a contract if it means local people have jobs.  At least I know their paychecks are going to be spent here in El Paso and taxed here in El Paso.  Maybe if we retained a few jobs around here, I wouldn't have to sit around worrying about how much my property taxes are going to go up because there's one less (or hundreds less) taxpayer out there sharing the burden with me.

I can't put into words just how pissed I am about this whole thing and that's really saying something. (That's an amazingly dumb sentence and I love it.) 

I'm sure those of you reading this aren't happy either.  You haven't have had to be laid-off at Christmas to know that being laid-off at Christmas sucks. 

Let's pray for a Christmas miracle... even though we shouldn't have to since these people should know better.  And remember that City Council voted for this contract to strip El Pasoans of jobs the next time any of them make some ridiculous claim about how much they love El Paso and want it to have a bright future.  If any of them say that you can yell "BULLSHIT," and I hope you do.

Ba-humbug to them!

(just so you know - I hated Christmas until I had a daughter... kids really do change people)

Comments

[Gossip Girl]

How did the individual members vote on this? Any correlation to campaign contributions?

[Susie Byrd]

Just for a little bit of background: When Chief Drozd was applying for the position of chief, he reviewed the budget in preparation for the interview. One of the things that stood out for him was the charges for medical billing which were at least twice what the industry standard was. He also felt like the contract was not bringing in enough revenue. When he was hired he started working on the issue, talking with the current vendor about improving their service. He also started reviewing what was happening in the industry to see if we could get a better deal. The Fire Departmennt talked to vendors and other cities to see how they operated medical billing, how much revenue was coming in and how much was charged for the service. They discovered that indeed local taxpayers were paying more than twice the industry standard. One of the reasons that Chief Drozd was hired is that he identified many significant ways that we could provide better service at lower costs. Medical billing was one of those areas.

At this point, they alerted the current vendor that they were going to rebid to see if they could get a better deal. The current vendor was awarded the bid for nine years in 2003. The bid expires in 2012. It is unusual for a bid to be awarded for this long of a period. We normally do five year contracts with options to renew. In this case, the award was a five year contract with two two year options but they were all awarded at the same time, effectively making it a 9 year contract.

There were five companies that bid on the new contract. The current bidder declined to put in a bid even though they were very active in asking questions during the bidding period, indicating that they were interested in bidding. We awarded the bid to the company with the best product. Now instead of paying an average of 20% of fees collected, we will be paying 10.9%. And the new bidder estimates that they will be able to bring in substantially more revenue.

To Gossip Girl, I have not reviewed campaign contributions to see if there are any correlations but I do know that not many city council members actively solicit campaign contributions except at election time. For exampe, I've closed my account. We have to report contributions over $500 on our city council agenda and no one has done that for some time. You can find all contributions online at www.elpasotexas.gov, then go to the Municipal Clerk's page.

Susie Byrd

[David K]

Sorry Susie, but you know as well as I do now (I recieved a few emails since I wrote this) that the new proposal requirements excluded any local firm from bidding.

You also know that the bid is not "hard" and can change immediately after award without needing any city approval. Just look at the language in the item on the agenda "The cost under this requirements contract is only an estimated minimum value. The actual cost of this contract may be higher or lower than the total estimated minimum value and will be the sum total at the end of the contract term, so long as increased funds are appropriated in the budget." You're lying if you promise this will be cheaper because there's nothing saying it will be other than an initial bid.

The winning bidder has no local office and therefore can not receive "walk up" customers who come to settle their ambulance debts in person.

Susie has missed or flat out ignores other allegations that have come to light. My question is - does Drozd have a prior relationship with this firm? Is their home office located any part of the country the chief has previously worked?

The story doesn't add up Mrs. Byrd and the hammer is coming.

You tell the 30 people out of work that they lost their job because you were told this new company is a "better deal," when you didn't get a better deal.

You should have picked another local firm at the minimum.

[curious]

Was there any attempt by the city to renegotiate fees with the current local contractor before terminating the contract? All contracts can be amended.

So the local guy that lost the contract didn't bid after all? If you have ever been involved in the public bid process you do get a sense that certain RFP's/IFB's are written for a very specific vendor. It's not rocket science. Happens every day in public sector bidding and abused the most in the "services" side of the bidding.

[Carl Starr]

I have not followed issue as close but not sure all contracts must be put out to bid re professional etc, not sure this issue is re city emergency services and any narrow exceptions etc but my guess is it may be legal what the city did...60 minutes tonight had a story on how many cities and counties will fail next year and default on bonds etc...so while its sad city did not go local just to save cash, its likely harder choices await most American cities anyways and times are tough...the 60min story mentioned AZ state was forced to sell its state capital and supreme court buildings to deal with cash flow troubles and then lease it back from the private corporation which i assume is from NV or DE State anyways. Plus there are NAFTA debates too re general issue, big giant one world economy marketplace I guess. Protectism, state rights, federalism etc.

Nat'l Solid Waste Mgmt. Ass'n v. Pine Belt Reg'l Solid Waste Mgmt. Auth., 389 F.3d 491, 500 n.16 (5th Cir. 2004) ("However, the rationale behind the dormant Commerce Clause is to protect against local economic protectionism at the expense of out-of-state interests, Carbone, 114 S. Ct. at 1682, not to protect any economic interests. In our opinion, the Houlton court simply viewed too broadly the zone of interests protected by the dormant Commerce Clause."), cert. denied, 126 S. Ct. 332 (2005).

[wood]

i think it'd be interesting to know what percentage of the services the city acquires are down by el paso businesses.

[blog reader]

susie didnt respond so i assume you are right david. although as far as the hammer coming down i doubt miss byrd is concerned because of her new upcoming job at the county. maybe(i said "maybe") the florida firm offered a free trip to disney world for her and her kids. it wouldnt be the first time for an elected official in el paso to receive a gift and probably wouldnt be the last.

[chuck]

Dave, you haven't even come close on all the out of town firms that have city contracts over our in-town businesses. why dont you make a list for us and show how many outside firms received jobs and which in-town firms lost out. if you could it would be nice and informative and would probably drive city council crazy.

[David K]

chuck et al,

I took the last night to look further into this issue and have found the "backup" for the bid. It's interesting - 19 firms in El Paso were asked to bid ZERO RESPONDED. Something scared them away.

I will see what other out of towners are getting contracts, but I know it's a lot. I've only focused recently on the ones I know of.

More to come I hope.

[Carl Starr]

Journal of Law 2010 18 J.L. & Pol'y 607 In Wyoming, state or local authorities can only award local offers based upon preferential price differentials when purchasing agricultural products, or constructing and maintaining public structures, so long as they are not inferior to materials offered from out-of-state suppliers. n115 A five percent price differential preference may be given for Wyoming materials when the contract is less than $ 5,000,000. n116 Additionally, the statute prohibits a resident bidder from sub-contracting more than thirty percent to non-residents. The Supreme Court of Wyoming has upheld this local purchasing preference against Equal Protection and Due Process claims under both Wyoming and United States Constitutions. In Galesburg Constr. Co., Inc. of Wyoming v. Bd. of Trs. of Memorial Hosp. of Converse County, an out-of-state construction company was the lowest bidder, but lost a construction bid because its bid was less than five percent lower than that of the lowest residential bidder. n118 After determining that the statute should not be examined under a strict scrutiny standard, the court examined whether the statute served a legitimate state interest and whether the statute was rationally related to advancement of that interest. In so doing, the court upheld the statute, finding that the local purchasing preference furthered the state's legitimate intent to encourage local business through enhancing and stabilizing the local economy and tax base by keeping revenues within the state.

Villanova Environmental Law Journal 2000 11 Vill. Envtl. L.J. 393 The Court addressed the principles behind the dormant Commerce Clause and stated that the prevention of economic balkanization is at the core of the doctrine. Therefore "if local legislation leaves all comers with equal access to the local market, it does not offend the dormant Commerce Clause." The court reasoned that no Commerce Clause violation occurs if both in-state and out-of-state interests are allowed unrestricted access to a municipality's bidding process and the municipality awards its contract to the lowest bidder. This, the court said, is because in-state interests are not given preferential treatment and out-of-state interests are not subject to discrimination. The First Circuit applied these principles to the 1997 Ordinance and found no violation of the dormant Commerce Clause. The Town had argued that it had a bidding process that was open to all prospective bidders, both in-state and out-of-state. The record indicated no signs that the Town's decision was slanted in any way to favor in-state interests even though Andino, a local firm and low bidder, was awarded the contract. Because the court found an even playing field, it held that the Town's garbage disposal ordinance did not per se violate the dormant Commerce Clause. n145 The First Circuit completed its analysis by applying the balancing test set forth in Pike v. Bruce Church, Inc. n146 The court concluded that the 1997 Ordinance placed virtually no burden on interstate commerce, and it found a "strong local interest in efficient and effective waste management." After comparing the two interests, the court concluded that "Houlton passed [the] test with flying colors."

[ELPbizLOLLOLLOLLOL]

Poor El Paso business, Poor Poor Poor me. Woe is me.

Regards,

SamCorp, ReadyOne, Bernardo Lucero (architect), Access Healthcare, etc etc etc etc etc etc etc etc etc etc etc etc

[Eric]

David K says:

"You might remember that the city hired a group out of Florida to do a bunch of master planning here in El Paso (ASARCO, Oregon Street) even though there are at least five qualified local firms who could have done the same job located right here in El Paso."

Yes, but are they the best in the Nation at what they do? No they're not, Dover and Kohl however are one of the top city planning businesses in the Nation. That's why city council did that. If you want the city to progress, you need to hire people who have dealt with progress not doing the same thing over and over again.

Look the issue sux but you republican capitalists are all about outsourcing to reduce costs. Any economics class will teach you this which is unfortunate but true. When taking these classes I just think about my morals b4 money so I won't become a republican haha. So now that the citizens of El Paso are demanding to not increase taxes, politicians are listening and finding things to cut. I didn't see you crying when those old people in Fabens lost their meals.

My family had to use these services this past year and the insurance company is denying payment because the rates are ridiculous. They told us not to pay it either because they are a rip off. This is coming from blue cross blue shield too. My dad was thrilled when he heard about this because it has affected him all year. I asked him, don't you feel bad for these people? And he said ya it sux, but sometimes you have to hurt a few so it can benefit many others. You take a risk when you work for the govt. or a company that depends on govt. contracts

Personally I'm indifferent, its not like we outsourced good jobs, these are service jobs we lost. If they were engineering or doctor jobs then I would be pissed! These 20 people can go to Redcats, SBC, ADP, etc to get another job. We live in El Paso, the American version of India!

ps. I noticed you posted the KDBC link, heres the KTSM link with the video still there

http://www.ktsm.com/news/el-paso-jobs-outsourced

[concerned]

I love how Susie Byrd is quoting that the previous company was charging 20% yet the news said 17% yet the actual contract showed even less.

I also like how she also said that the new company awarded the contract is claiming that they will bring in more revenue when they in fact guaranteed a lower return on actual billing compared to what the exisiting contractor actually is doing.

I can't wait for the whole truth to come out. Especially when the El Paso public finds that that the Fire Chief had in fact used the new contractor before and had them help him write the new proposal for bid.

The El Paso County has already had issues with public corruption and had the FBI raiding their offices. Wonder what Susie will do when they hit up her office.

[Smierciarz]

Good job to the Chief and council! You bring those costs down.

[yyyy]

Let me tell you Ms. Byrd loves to send your tax money out of town. Be it for 80,000 for some public art or hiring an out of country company that charged the city $75 per hour for simple carpentry work that a kid in 4H could have done.

[yyyy]

talked with a business owner today about doing work for the city. they said no way would they do work for the city and the reason given was they take forever and a day to pay the bill. that is probably why most el paso businesses don 't do work for the city.

[chuck]

the fire chief had to do something with this ? that makes the odds even higher that someone is getting a kickback.

[Pinole]

Otto Drozd may be apppearing to reduce EMS costs for the city. However as clearly illustrated in this article the evidence indicates that this may be false.
In the process of "cutting" costs he has "thrown EMS in El Paso under the bus". Some examples of this include: eliminating a contract with Texas Tech Health Sciences Center for medical education; quality assurance; medical direction and control and infection control that had been in place since 1979, reducing Paramedic education form 1200 hours to 700 hours despite a national recommendation of 1300+ hours, eliminating El Pasoans ability to choose a hospital destination when using City EMS services through the use of "catchment areas" which are used to transport patients to those hospitals that the Fire Department prefers, adopting a practice of responding to emergency calls;triaging the patient on arriival and if deemed a non-emergency by the paramedic on the scene transferring the transport to a private service-the city then doesn't bill for the response thus further reducing the revenue for the city.
In the final analysis the citzens of El Paso are getting a lesser service than they used to with an apparent reduced potential for revenue in the city's coffers.
The whole thing stinks.