Here is what some people said when I posted this topic to GovLoop’s LinkedIn:
Matt Royer • Hi Allison, I work for company (SAFEbuilt, inc) that primarily provides building department services and other related services such as licensing and code enforcement to municipalities across the country. Most of these services are fee based services. The fees are intended to cover the cost of the service, but in sluggish times costs can exceed revenue for the service. What we’ve experienced is that communities can’t flex staffing levels easily with the ever changing construction industry. For services such as these a private company can move resources around to accomodate for the slow times and bring resources in to support the busy times. All of this can be structured to reduce or eliminate the risk of fixed costs exceeding revenue levels. The other benefit realized by municipalities is the competitive nature of a consultant raises the service level expectations and the need for continuous improvement. There are many excellent municipal building departments out there, so I don’t intend to say their aren’t. I can provide many examples of communities that have recognized savings and service improvements.
Charles Driggers PMP, ITILv3, Lean Six Sigma – Black Belt • An outside consultant can be extremely effective in many situations where his/her skills and emotional intelligence is needed. Let me know if you see such an opportunity in Detroit.
Eric Jasso • Privatizing rarely works. I don’t know how many thousands of dollars have been spent in nearly 20 years at studies to privatize parts of my and other departments. It doesn’t always add up, especially with ISF’s.
Adrienne Bitoy Jackson, MS Ed., B.S. PMP • Often people think privatization is a tremendous cost saver because it outsources/seems to save related employment costs. However, contractual agreements with poorly defined scope, quality compliance, and cost containment measures can make privatization a very risky and expensive proposition. With financially volatile industries, it can actually be ill-advised.
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