City Outsourcing Functions With Restructuring of the Finance Department

Craig Koehler, So Pas finance director, and City Manager Stephanie DeWolfe at City Hall. Photos by Steve Whitmore

Outsourcing. The operation for companies that oftentimes spells disaster for the consumer but increases profitability for the business through cost-cutting. It does not have a good reputation among consumers.

As an example, it reared its ugly head at the last South Pasadena City Council meeting when Southern California Edison (SCE) officials told residents complaining about service to call their 800 number.

“Will there be a person answering the phone,” local resident, Jan Marshall, asked the SCE official. Marshall said later she was concerned that calling the 800 number would just get lost in the quagmire of a distant call center where the person on the other end of the phone line would not be familiar with the city and difficult to understand.

Now, if the So Pas City Council approves the restructuring of the Finance Department at its next meeting on Nov. 7, outsourcing will become a way-of-life locally regarding business licenses and payroll. The reason is to improve customer service, officials say.

“I think the bigger issue here is we’re doing a restructuring of the Finance Department and the outsourcing is just one portion of a larger plan for the Finance Department,” Stephanie DeWolfe, city manager, said during a sit-down interview in her City Hall office this week. “Customer service will increase significantly through this contract with HdL and it already has, even though they are doing a small fraction of what they can do for us. Customer service has already improved.” HdL Companies, founded by a former city manager and finance director in 1983, created software specifically for public agencies issuing business licenses. They have been handling the local business license process for more than three months, according to officials.

“It is their specialty,” DeWolfe said during the interview that was attended by the recently hired finance director, Craig Koehler, and the newly hired public information officer, John Pope. “We had been receiving a number of complaints from customers that it was taking too long to have a business licensed processed. Frequently people need their business license right away. Our customers were getting frustrated. After looking into the issue we did find that to be true and so under the new contract with HdL, customer service will be significantly improved. Both in speed and accuracy. It will also allow us to add on-line functioning, which is really the industry standard today and something we really want to be able to offer to our customers.” DeWolfe added that HdL will always answer the phone “The City of South Pasadena.”

DeWolfe and Koehler said people were waiting for more than 90 days on average and sometimes even longer to get a business license or renew one before HdL took over the process. That has changed to less than a couple of weeks, they said.

“Customer service is my number one priority,” said Koehler, who was hired in August of this year. “We should be able to give a business license in a reasonable amount of time which would be weeks or less but the city was experiencing significant delays processing them.” South Pasadena has 2,600 active business licenses, according to DeWolfe. The delay had been occurring since DeWolfe was hired in November 2017. She also said she did not know if it had been occurring before that time.

The restructuring of the department, if approved by the City Council, also will include outsourcing payroll, a function that has been handled by one person by hand for nearly three decades. There are currently four people in the Finance Department, including Koehler.

“Payroll has been processed by one person for the whole city and one person has been doing it, I think, for going on 30 years,” De Wolfe said. “It’s been the same person processing payroll and there was only one person trained to do that. She pretty much did not get sick or go on vacation for a very long time. It was not an appropriate situation either for the organization or the employee.” The city will contract with ADP for payroll.

“That’s all they do is payroll,” Koehler said. “They have offices all over. They are one of the top payroll processing companies in the world.”

The restructuring also includes laying off three people, one of whom is the person doing payroll for nearly 30 years, and hiring two management positions; an account manager and a finance manager.

The entire reason for the restructuring is to improve customer service, DeWolfe and Koehler said. In fact, they said, again if the council approves, residents of South Pasadena will be more than satisfied with the efficiency of the city’s operations.

“The goal here is to improve customer service,” DeWolfe said. “It’s to improve effectiveness and efficiency of operations. It’s to create better career ladders for our employees and it is to reduce liability to the city through better operations.”


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