BOSSIER CITY, LA (KSLA) - Dozens of Bossier City employees could be fired if the city approves of public-private partnership to outsource the management of a city department.
According to City Spokesman Mark Natale, city leaders believe outsourcing the management and oversight of the water and sewer department to private company, Manchac Consulting, is in the best interest of tax payers.
"By entering into a Public-Private Partnership Agreement with Manchac Consulting Group, operations of the city's Utilities Department will become more efficient, save money and avoid any immediate increase in fees for water and sewer customers."
According to Natale, 40 city positions would be cut if the public-private partnership is approved by the city council, but the agreement would save the city $3.5 million.
"A workforce reduction is an unfortunate component of this proposed agreement but the city has a fiduciary responsibility to its citizens by operating the Utilities Department within its means," Natale said.
According to the Public-Private Partnership Agreement, Manchac Consulting Group would be paid a lump sum of $1,042,755 for the first year. $120,000 will be invoiced upon the execution of the agreement and $83,886.00 for the next 11 months.
The fee for the second year will be negotiated with the city 60 days prior to the end of the first year. The lump sum includes compensation for engineer's services and services of engineer's consultants, if any. According to the agreement, appropriate amounts have been incorporated in the lump sum to account for labor, overhead, profit, and reimbursable expenses.
At-Large City Councilman Tim Larkin says outsourcing oversight of a city department has never been done before.
"I think one of the big decisions the council has on this tomorrow, is whether we want to try this," Larkin said and explained the main reasoning for the private-public partnership is to reduce the cost of operations of the water and sewer enterprise fund."
"I have come to understand that while there will be 40 public employees dismissed, there will be private employees, who will take new positions that theoretically will perform many of the tasks that the 40 did," Larkin said.
Manchac Consulting has a history of being involved in several projects in Bossier City and the company also has a history of donating to several city leaders' campaigns. According to campaign finance reports, in 2012, an uncontested Mayor Lo Walker received $2,500 in donations from Manchac Consulting Group and $1,000 from Manchac CEO Justin Haydel. Haydel also spent more than $2,000 dollars hosting a dinner fundraiser for the mayor.
Councilman David Montgomery, Scott Irwin, and Larkin have also received donations from Manchac or its CEO within the past 7 years.
KSLA News 12 asked Larkin if there is a conflict of interest because Manchac has donated to the mayor and council members.
"I certainly hope not," he replied. "I do think it is often in everyone's best interest that when you have consultants that they make minimal contributions to minimize that fear."
Larkin says he has more questions about the agreement before he decides whether to vote for it or not, "If we were to approve of the adoption of this recommendation from the administration and we were to begin this process, what happens if it doesn't work? You always have to say what if?" he said.
The council will vote on the first reading of the agreement Tuesday.