By Gregory Korte
The Cincinnati Enquirer

WEST END - Cincinnati Mayor Charlie Luken abandoned the city's two-year experiment in "managed competition" Monday, declaring that he would not support further privatizing city services.

Cincinnati Mayor Chrlie Luken's daughter Molly, 21, stopped by to offer encouragement as Luken prepped backstage. (Michael E. Keating photo)

Luken delivered the policy change in his State of the City Address on Monday, saying he could not in good conscience cut city jobs and replace them with lower-paying jobs with fewer benefits.

In reversing his managed competition initiative, Luken said, "I am now convinced that the savings from managed competition will come primarily from that wage and benefit reduction - and that change will not serve the working families of Cincinnati.

"Let us, together, continue to look for ways to provide better service for less dollars, but let us remove the threat of job loss from people who are serving us well every day," the mayor said.

Supporters of managed competition said they felt ambushed by the announcement.

"I can't believe it," said Republican Councilman Pat DeWine. "What he said today was political speak for, 'We're not going to make reforms that other cities have made to save taxpayers money and make services more efficient.' "

The union representing 2,500 city service workers applauded the move.

"It just proves the mayor is forward-thinking," said Randy Moore of the American Federation of State, County and Municipal Employees. "We pointed out the pitfalls of privatization, and he listened to us."

Indeed, just two years ago, Luken used the annual speech to embrace the concept of privatization.

"We are not afraid, and we will, look to the private sector to perform services traditionally done by government," he said in 2002.

City Council voted to privatize most of the city's street-sweeping operation last year with a $1.3 million, five-year contract that supporters said would save the city $897,529. Workers were reassigned to other city departments, and some jobs disappeared through attrition.

"No one was laid off. No one's pay was cut. No benefits were cut. We're sweeping twice as many streets," said Councilman David Pepper, a Democrat who has supported managed competition. "I don't know why you'd end a program that was working."

But Luken said city employees were doing such a good job that he had "rethought" his attitude about the issue.

"If you look at our service delivery in so many areas, we have shown that we can do the job - from garbage collection to health services, from road repair to snow removal - and do it well. Meanwhile, other cities that have gotten seriously into privatization are now paying for it - with higher costs and less control," Luken said.

And unlike his position on gay rights, which will require approval by Cincinnati voters in November, Luken's no-more-privatization policy is effective immediately. City Council has been divided 5-4 on managed competition, and it would take six votes to override a mayoral veto of any ordinance approving the privatization of a service.

Luken said he would not abandon the quest to save taxpayer money and improve services. He proposed changing the job description of the city's "managed competition czar" to "efficiency czar." Michele A. Kidd, hired as an assistant to the city manager from Procter & Gamble in November, would focus not on privatization but on finding cost savings in city government - "top to bottom."

But DeWine said the Luken plan lacks a key incentive for change at a time when city officials are predicting a $60 million budget deficit by 2008.

"Communist Russia had a lot of people who were efficiency czars, but the services didn't get any better because there was no competition," he said.

---

E-mail gkorte@enquirer.com