The City of Fresno (Calif.) is saving millions of dollars through private contracting for golf, transit, and custodial services.

In 1989, Petaluma-based EbitGolf was awarded a ten-year lease to operate Fresno's Riverside Golf Course. They guarantee the city $125,000 a year in rent and $1 per round of golf. The city also gets $575,000 worth of capital improvements over the life of the contract. Some improvements needed to be done right away because the course had been allowed to go downhill, so the city "front-loaded" the agreement and put $200,000 into improvements in the first year.

The Palm Lakes Golf Course was leased to James Moore in 1985 when the city first acquired the course. Moore's contract was extended in May of 1995 to the year 2000. He guarantees the city $75,000 a year and fifty cents per round played. All income at the courses goes directly to capital improvements or to retire debt on improvements already made at the courses.

"The city asked for both a set rent and a percentage of the businesses to assure the city that even in times of recession, they still have that rent money coming in, and if the course business becomes tremendously successful, the city will share in that success," said interim Director of the Parks and Recreation Dept. Ron Primavera. "One of the criteria that the city council gave us is they did not want the golf courses or the recreation of the golfer to cost the general taxpayer any money. And it's not. The golfers pay for the courses themselves." The city serves a population of about 354,000.

Fresno also contracted out their para-transit services for the handicapped after the Americans with Disabilities Act passed in 1990. This law mandated that all para-transit service for the handicapped match the same number of hours as fixed-route bus service, which meant the city had to expand their hours of service by 40 percent. The city signed a three-year contract with Mayflower Contract Services in 1993. With the expanded hours, the city's cost would have been roughly $4.8 million for the life of the contract. Mayflower is providing the service at a $1.6 million savings.

A custodial contract that started at the new City Hall in 1992 with American Building Maintenance is so successful that in 1994 the company was awarded a second contract. According to Barry Lockton, facilities manager, "[T]he firm has performed excellently." American now serves City Hall Annex and Fresno Police headquarters, among other buildings. Both contracts continue until 1997.

"It costs us almost twice as much in-house, and I would say it's almost all labor costs," said Lockton.

In exchange for agreeing to the second contract, the labor union asked the city to put a hold on privatizing anything else in the industry for the life of the contract.