- The Washington Times - Wednesday, November 15, 2000

D.C. police officials failed to heed warnings of consultants to fix its in-house vehicle maintenance department before it decided to hire a private company to repair police cars, documents obtained by The Washington Times show.

Over the past five years, consultants to the Metropolitan Police and the D.C. financial control board have criticized the in-house fleet maintenance department as mismanaged and underfunded. Consultants have also said the department is staffed by poorly trained employees. At least three consultants hired by the city recommended pumping more money and training into fleet maintenance.

Instead of taking the advice and improving the in-house department, police officials hired an outside contractor, Serco, in September 1999. Since then, the original $3.5 million Serco contract has had cost overruns of almost $1 million.

The consultant studies also contradict statements made by Eric Coard, the police department's director of corporate support services.

Mr. Coard testified to the D.C. Council in October that Public Financial Management and Apex Corporation, two of the consulting firms hired for $25,000 each, recommended that handing fleet maintenance over to a private company would provide substantial benefits to the police department.

But neither company's recommendation went quite that far. In their reports, the firms urged the Metropolitan Police Department to restructure its in-house services while it explored hiring an outside company. The companies said a comparison with a private company could only be made if the in-house fleet services were improved.

Mr. Coard said yesterday that was one of the recommendations the department did not follow. Instead it decided to hire a company without making any improvements to its in-house services or doing an analysis.

"That was not the recommendation we chose. We chose to outsource," Mr. Coard said yesterday.

"The decision was made based on the information that repairing police cars is not the core function of the police department," Mr. Coard said.

Mr. Coard defended the decision to privatize because police vehicles are in better condition now then at any other time in recent history. He also said that cost savings will be realized over a four-year period.

Council Member Kathy Patterson, Ward 3 Democrat and chairman of the Government Operations Committee, said a complete financial analysis of privatizing government services must be done to show a 5 percent savings. She said that includes improving in-house services so they can be compared with services offered by a private company.

"It appears they missed a couple of steps," Mrs. Patterson said. "They missed the steps of improving and analysis of the 5 percent savings. There is no way they can make a case that they would save 5 percent."

Mr. Coard said that he does not agree that city agencies should have to prove a cost reduction of 5 percent before hiring a private company to replace in-house services.

"I think the city needs to take a look at the 5 percent savings rule. It is hard to make a [comparison to a] dysfunctional [department]," Mr. Coard said.

The D.C. Council's Judiciary Committee today will continue its hearing from four weeks ago to find out why the contract with Serco was so costly. The committee also wants to know why police officials did not ask the council for additional funds to budget the overruns in the current year.

The hearings were originally called in October after The Washington Times reported the $900,000 overrun while police vehicles went unrepaired.

"My concern is whether this contract is going to be efficient and cost-effective," said council member Harold Brazil, at-large Democrat and Judiciary Committee chairman, who called the hearings.

"I want to be sure we are monitoring the contract better so we know we are getting our bang for the bucks," Mr. Brazil said.

Police employees said that during the last year vehicle maintenance was done in-house, the budget was insufficient and the number of mechanics on staff was cut. They said they could barely keep up with oil changes.

"Fleet was cut to the bone," said a police official familiar with the problem. "They were set up to fail so they could privatize."

Booz-Allen & Hamilton, the consultant to the financial control board, reviewed the issue in September 1997 and determined in its report that privatization was futile and costly unless reforms were made first.

Booz-Allen also recommended that MPD "redesign existing organization" by making "organizational changes, improve service and cost effectiveness."

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