Table of Contents
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1. Trends 2. Cost Savings Potential 3. Best Practices/Case Studies 4. How-To Tips |
5. Contact Information 6. Research/Articles 7. Legislation 8. Links |
1. Trends
A 1995 study of 120 local governments in 34 states found that between 1987 and 1995, the percentage of cities contracting out for tree trimming services increased by about 15 percent, with a total of 32 percent of cities contracting out for this service.
Currently, Costa Mesa, Brea, Newport Beach, Orange, Tustin, Fullerton and dozens of other California cities contract out for tree-trimming service.
2. Cost Savings Potential
Cost savings from outsourcing tree trimming and landscaping services typically ranges from 16 percent to 35 percent.
In the past decade, private tree trimming has become far more competitive, forcing contractors to reduce prices. It now is possible to contract routine tree trimming services at a price well below in-house rates.
3. Best Practices/Case Studies
| Case Study 1: Newport Beach, CA — Competitive Contracting |
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In August 1993, the City of Newport Beach hired Integrated Urban Forestry, Inc., (IUF), a private consultant, to do a comprehensive study of its tree maintenance program, and found that Newport’s trim cost per tree in the 1993-94 fiscal year was $81. After studying the market rates for trim cost per tree and private services, IUF recommended that Newport Beach competitively contract its tree maintenance services. The IUF report found that a private contractor would save approximately $211,000 per year on its tree-trimming service, while providing more efficient and productive services. IUF found that city crews were compensated at a higher rate than private crews — in salaries, benefits and also in pay for non-productive time. IUF also found that city crews were on the whole less productive than private crews because city crews worked fewer hours and spent less time at the job site. Additionally, average daily productivity for city crews was 6.9 hours, while the average daily productivity for private crews was 9 hours. Since Newport Beach lacked an organized trim plan, crews were not being used to their maximum potential. In November 1993, a private contractor took over tree-trimming services in Newport Beach. At IUF’s recommendation, the city retained a small crew to handle emergencies and special requests. The private firm West Coast Arborists agreed to hire the displaced city workers at their existing rates for one year. Newport Beach saved $241,000 in the 1995-96 fiscal year on its tree trimming services, and estimates an accumulated savings of $609,000 by June 1997. |
| Case Study 2: Orange, CA — Competitive Contracting |
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Despite the city reducing its tree-trimming budget the following year, West Coast was able to maintain its profit margin and did not raise its unit cost. Pat Pine, field supervisor for the Orange Public Works Department, rated the West Coast crews well above city crews in terms of service, productivity, and management. |
| Case Study 3: Indianapolis, IN — Competitive Contracting |
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Indianapolis initially was contracting to have grass cut every six weeks. But seasonal weather variations make such a criterion meaningless — grass grows much faster during the spring. Furthermore, checking up on contractors is tedious — you have to track them down to make sure they’re really mowing when they claim they are. Then the city grew more sophisticated. After all, it didn’t really want the grass cut every six weeks — they wanted their grass to be kept short. Now, the city contracts with a company to keep the grass less than 4 inches high and pays by the acre. Monitoring is easier, too. At random times, someone simply goes out with a ruler. |
4. How-to-Tips
5. Contact Information
| Practitioners | David E. Niederhaus Director, General Services Department City of Newport Beach 3300 Newport Blvd. Newport Beach, CA 92659-8915 (714) 644-3055 |
Robert W. Hawkinson Special Projects Coordinator City of Indianapolis, Enterprise Development Suite 2460 City-County Building 200 E. Washington Street Indianapolis, IN 46204-3332 (317) 327-7854 |