Tilting at Windmills at City Hall

by Gary Toebben

The position of Chief Administrative Officer for the City of Los Angeles is intended to be a clarion voice. The CAO is not an elected official and reports to both the City Council and the Mayor. The CAO's performance is based on his/her independence, personal integrity and management expertise.

Unfortunately for the citizens of Los Angeles, the CAO is often faced with a mayor or city council that is more interested in politics than policy and chooses to please special interests rather than protecting the interests of the taxpayers. That was never more evident than during the recent City Council committee hearing on the issue of franchising of commercial refuse collection.

Shortly before the hearing, CAO Miguel Santana produced a thorough report outlining the fiscal and practical reasons why the City should adopt a non-exclusive franchising system. The plan he outlined would allow any hauler that meets a number of environmental, waste diversion and safety standards to participate in a franchise, allowing commercial and multi-family unit owners the freedom to decide which hauler best suits their individual needs. He cited the following facts:

1) The city would generate more than $100 million from a non-exclusive franchise system in the time that would be required to implement the costly bureaucracy required for an exclusive franchise system.

2) The city will be able to begin generating significant revenue, nearly $30 million for the beleaguered city budget as soon as the first quarter of 2013.

3) A non-exclusive franchise arrangement will protect high-paying jobs and allow small, family-owned businesses to compete; and preserve the competition that keep rates affordable for consumers.

The CAO pointed out that an exclusive franchise system would drive small waste hauling companies out of business, give no options to customers and create a new and costly bureaucracy in the City of Los Angeles.

The solution seemed obvious, but only Councilmember Tony Cardenas voted to consider the option of implementing a non-exclusive system. Other councilmembers in attendance dismissed the CAO's report. Why? For the same reason the City Council has made so many decisions that got us into the current financial mess…the desire to appease political allies over the best interests of citizens and businesses as a whole.

In the words of Ghandi: "Even if you are a minority of one, the truth is the truth." Miguel Santana was the independent voice of truth. He had no axe to grind or special interest to make happy. His report recommended what is practical, economical and in the best interest of taxpayers and businesses. Ignoring this kind of good advice is why we have a budget deficit, dwindling city services and one of the highest unemployment rates of any big city in America. 

And that's The Business Perspective.