After 3 years of posting annual operating deficits (a/k/a, expenses exceeding revenues in the General Fund) that totaled in the $5 million range under the new, money-saving 7-member “Frimark” City Council, we hear that the City of Park Ridge – thanks to the leadership and, yes, the vetoes of Mayor Dave Schmidt – has produced only the second operating surplus in a decade (for the just-concluded fiscal year 2010-11), although we await the results of the annual audit for confirmation.

But because the mayor, the City Council, and City staff couldn’t seem to consistently agree on what were essential City government expenses and what were frills, Schmidt’s semi-austerity approach that encouraged these much-improved results still left the City short on things like sewer maintenance and repair, street resurfacing, tree trimming, and various other services that many residents consider “essential.”  Schmidt, the Council, and staff often clashed not just over hundred thousand dollar cuts, but even over cuts of a few thousand dollars. 

Every one of those cuts, however, took another bite out of those deficits.

So it’s in the light of that kind of nickel-and-dime budgeting and spending trench warfare that the City’s recent admission that it has been grossly neglecting the collection of outstanding parking tickets and other City fines totaling almost $1 million dollars was a decidedly unpleasant revelation. 

That’s right, campers: according to a report by City Finance Director Allison Stutts, the City is carrying on its books over $1 million of uncollected municipal fines, including penalties and interest!  And approximately $900,000 of that has accumulated just since 2008! 

How did this happen?

As we understand it, those unhappy totals include primarily parking tickets outsourced to Professional Account Management, LLC (“PAM”), a subsidiary of Duncan Solutions of Milwaukee, Wisconsin, pursuant to a contractual arrangement approved by the City Council’s Finance & Budget Committee on March 13, 2007; and subsequently unanimously approved by the full Council at its regular meeting on March 19, 2007, as can be seen from the relevant excerpts of those meeting minutes.

From the discussion at last night’s City Council meeting, what then-Finance & Budget chairman Ald. Don Crampton (1st) optimistically termed “a great advance” for the City’s collection of tickets was screwed up right from the start because no City employee, or even a department, was expressly tasked with monitoring the arrangement – although Ass’t City Manager Juliana Maller insisted that, while all four City departments agreed to giving the deal to PAM, “it was always the intent that the Finance Department would manage” PAM.

That’s the classic “empty-chair defense”: blaming someone who is gone and, therefore, unavailable to defend themselves.  In this case, the empty chair belongs to former Finance Director Diane Lembesis, who left her position in January 2010 for a similar position with the Village of Gurnee.  By laying the blame on Lembesis’ empty chair, accountability for the problem presumably doesn’t get beyond her to her former “supervisors.”

Can you say then-Deputy City Mgr. Maller and City Mgr. Jim Hock (who also threw Lembesis under the bus last night)?

This outsourcing effort seems to have been so badly botched from its inception that there appears to be not only mass confusion as to what PAM was going to do and what the City as going to do, but also no requirement that PAM even provide the City with regular reports about its collection performance!  And, according to Stutts, no member of the City staff bothered to ask for any reports until Stutts arrived early this year, discovered the problem, and began digging into it.

As Ald. Joe Sweeney noted last night, Stutts deserves major kudos for her efforts.  And perhaps, we might add, a “Sherlock Holmes” deerstalker hat in recognition of her sleuthing.

We’ve been a proponent of outsourcing by government of those services that can be obtained more economically from the private sector, so long as they are properly bid out, properly contracted for, and properly administered.  What the City has demonstrated so far with outsourcing, unfortunately, is not what we had in mind, or what the taxpayers deserve.

It does, however, fit the the model of incompetence established by the City through its years of throwing large-but-arbitrary amounts of tax dollars at private community groups for unspecified, un-quantified, no-bid, no-contract services for which, not surprisingly, no monitoring or reporting has occurred.  With a paradigm like that, this PAM fiasco almost begins to make sense, albeit in a perverse way.

So when it comes to Outsourcing 101, give the City an “F” on tickets and fines.  After all this time, and with all the problems Stutts identified, the City will be lucky to collect even half of the outstanding fines.

And for that reason, it might be time for the City Council to start grading what passes for “management” at City Hall.

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