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Mayor Jim Hahn's directive to city officials last week to end expensive outside public relations contracts appears to exempt many services, the L.A. Business Journal reports (free) on the front page. Contracts that PR agencies hold to provide community outreach, marketing and advertising help are not affected. For instance, the Lee Andrews Group, which has received $13.8 million in consulting contracts from the Department of Water and Power, says it is not a PR firm, even though it was a sub-contractor to Fleishman-Hillard for some of its work. Hal Dash, of Cerrell Associates, puts Hahn's ban in perspective in the piece: "These contracts will be put in suspense, but they will be back because government needs them."
Just to clarify: Deputy Mayor Julie Wong called to emphasize that the mayor is still receiving reports on what the city departments spend on such services. The deciding factor, she stressed, would be whether the work can be done more economically or efficently by city workers.
Also: A story last week on O'Dwyer's PR Daily, a newsletter for the industry, quotes [sorry, no link available] rival PR executive Ron Rogers saying that Fleishman-Hillard has done nothing wrong. But he implies his firm, Rogers & Associates, was punished for not supporting Hahn in the last election:
"What has essentially happened, is that the mayor's office, either directly or indirectly through his appointees, has said, ‘Here's who you're going to hire, here's who you're not going to hire.'..."During the last mayoral election, I supported a different candidate. Within a short period of time, almost all of the contracts and business we did with the city disappeared."