Last month, Mayor Jerry Sanders announced a plan to open the city’s information technology services, currently provided by San Diego Data Processing Corporation (DPC), to private competition. In the first phase of the plan, a contract for help desk services was awarded to the Los Angeles-based En Pointe Technologies. In the coming months, the city will be seeking bids on all other DPC services.

In a Jan.14 press conference, Sanders said En Pointe Technologies could provide help desk services for $1.19 million a year, compared to DPC’s $2.8 million a year for the same services—a 55 percent difference.  Although the mayor said the plan will reduce costs to San Diego taxpayers, many DPC employees are concerned about job security.

Nine other vendors, including DPC, put in bids for the contract. According to Naresh Lachmandas, who sits on DPC’s board of directors and is the city’s information technology director, En Pointe was chosen on criteria that included responsiveness to the request for proposal, staffing plan, their ability to provide services and expertise, past performance, compliance with the Equal Opportunity Contracting Program and cost. Lachmandas said the city is confident En Pointe will be able to provide services equal in quality to DPC.

“At the end of the day, we’re trying to find the best value for the city for the services we’re getting,” said Lachmandas.

Reed Vickerman, who chairs DPC’s board of directors, said he is optimistic DPC can win bids for future work and does not believe the mayor is attempting to dismantle DPC altogether.

“We really want to make sure that we’re in a position to do what we can and come out on top in the bidding process. We have every reason to believe we’ll get the work.” said Vickerman.

He also said the city provides more than 90 percent of DPC’s business, and if the corporation were to lose the city contracts, the company would not survive.

However, many employees feel strongly that DPC provides superior services to what a non-San Diego-based and/or a for-profit company would provide.  DPC has 30 years of partnership with the city and total budget transparency. Also, DPC returns any surplus money to the city at the end of the year due to their nonprofit status.

“We know the city’s business,” said Bill Reilly, a 12-year employee of DPC, who also said DPC has received many “best of class” awards from Gartner, an independent group that evaluates information technology firms.

“We’ve been here for 30 years, we’ve been dealing with the 30-plus departments in the city for 30 years, we know the players, and we know their business.”

Reilly also disputed the numbers the mayor used in the press conference, saying the city pays $2.2 million annually, not $2.8 million for DPC’s services, and that DPC’s bid was $1.6 million, not $1.8 million.

Lachmandas said the city arrived at the higher figures because an increase was added to the estimates of all vendors in the final stages of the selection process to account for a possible 20 percent increase in call volumes.

Reilly also said DPC often has provided the city with emergency services at no cost. During the wildfires of 2003 and 2007, DPC set up a response center in six hours.

“What happens when the next fire hits? As a citizen, what happens the next time?” said Reilly. “They’re not going to have anybody to respond like that.”

Reilly also feels the mayor’s plan could have negative effects for the local economy if San Diego jobs are outsourced to non-local companies. If the city eventually decides business with the new entity is unsatisfactory, it would be impossible to reassemble the same group of individuals who did the job before at DPC. 

“The people who used to do that job so well, that were Gartner’s best in class, they’re gone,” said Reilly. “They’re gone to other cities or they’re looking for other work in San Diego.

Nina Woods, a DPC employee, said DPC’s nonprofit status makes their partnership with the city more cost-effective than a potential partnership with an outside private corporation, as DPC exists to serve the city’s needs while a private company would charge extra for services.

“[The city] puts in a request and even if the scope changes, we for most intents and purposes, don’t charge extra. Is that going to be said for a for-profit company?” said Woods.

Woods also expressed concerns about security, as help desk and desk-top often deal with secure matters, often for police and fire departments.

“We’re contained, our security is contained, we have control over what is coming in and out of our network,” said Woods. “So what’s going to happen if that communication has to go to Los Angeles?”

The city council is expected to vote on En Pointe’s contract this month. If approved, the contract could begin in July.

                                        

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