I currently sit on the Living Wage Advisory Committee. The committee formed a subcommittee to investigate living wage enforcement problems, I was tasked with determining the number of non-city-resident contractors bidding and winning living wage contracts with the City.
In examining the July 1, 2010 custodial services bids, we found that there were a total of 11 bids, ranging from $100,212 to $602,688. If these, only three were from inside the city of Santa Barbara. (One was from Goleta, three were from Los Angeles, three from Ventura, one from San Luis Obispo.) The winning bid was by a contractor in San Luis Obispo who was fired after one year due to poor performance.
As of this July 1, the Living Wage can be as much a $16.39, and contracts paid to contractors outside of Santa Barbara may be up to millions of dollars. (The full description for the wage tiers can be found in section 9.128 of the municipal code.)
These large city contracts combined with the high living wage attract bidding from contractors outside the City of Santa Barbara. This can lead to city money, ideally used to pay local employees and local contractors within the city, being outsourced to contractors and employees outside of Santa Barbara. The living wage ordinance was put into place to try and help balance the very high cost of living in Santa Barbara with a “living wage.” If contracts are being awarded to companies outside the City of Santa Barbara, it defeats the purpose of paying a living wage to local workers.
Furthermore, it is unrealistic for the City of Santa Barbara to audit every contractor and there is no actual way to determine if these workers are being paid the standard living wage or just getting paid minimum wage, while out-of-city contractors keep the money as profit.