One morning you wake up to discover that your job is gone. You have been working for a steadily growing company with a 35-year history of providing innovative, reputable service. But, poof, your job is gone. You ask your boss, “What the—?”
Incredibly, your boss tells you this: “A government-subsidized nonprofit endorsed two of our competitors and began a substantial advertising campaign on their behalf. During that three-month period, our business evaporated. Poof. Gone, just like that.”
You would then ask, “Why did they support our competitors and not us?”
The answer, in this very real case: “Because our competitors agreed to pay the government-supported agency a 5 percent commission on every sale they generated.”
Absurd? Unfair? Yes.
But this is exactly what happened last fall when the Economic Vitality Corporation of San Luis Obispo County—a nonprofit agency that receives annual subsidies from all the cities in the county as well as the Board of Supervisors—endorsed two companies that install solar rooftop panels. In so doing, the EVC ignored a dozen other reputable installers that provide the same service. Full disclosure: The EVC did not promote my business; I declined to pay the commission.
Why these two? Because they agreed to pay the EVC a 5 percent commission for marketing their solar services. That’s it; paying the marketing commission was the only requirement (aside from submitting documents for the application) for receiving the EVC’s “preferred vendor” status.
During that period last fall, the EVC collected more than $100,000 in commissions from its “preferred’’ installers of solar rooftop systems.
Compounding the destruction of jobs, the EVC gave 75 percent of the profit—approximately $78,000—to an out-of-county nonprofit agency, the Community Environmental Council (CEC) of Santa Barbara, the organization that brought this marketing scheme to the EVC.
The program is called Solarize SLO. The program is inherently limited to three or fewer vendors, and this summer the EVC is going to repeat this unwarranted intrusion in the marketplace, once again choosing private-sector “winners and losers.”
Poof—more lost business and more lost work. And once again the EVC will collect fees from the so-called “preferred vendors,” and then once again the EVC will ship 75 percent of the money (paid by local consumers) out of county to the Santa Barbara-based CEC.
This despite the EVC’s mission statement “to stimulate the economic vitality of San Luis Obispo County” and foster job creation, not job destruction.
Why has the EVC decided to partner with a Santa Barbara nonprofit to pay for a marketing campaign instead of partnering with SLO County nonprofits, such as EcoSlo or GreenBuild or the Land Conservancy? EVC officials tell me that it’s to promote the solar industry. Perhaps that’s true. But that could just as easily be achieved other ways and with partners based in San Luis Obispo County. Or perhaps the EVC simply likes the $26,000 that this marketing scheme delivered to the EVC’s coffers last year.
Who decided this program is worthwhile? The EVC executive director brought the idea to the 35-member Board of Directors for approval. The board includes nine elected officials representing the SLO County Board of Supervisors and the cities of SLO County. Each of those government agencies provides money to support the EVC programs.
What can you do?
If you are in the market for installing a solar system, there are at least 12 reputable solar electric contracting companies in San Luis Obispo County that do not levy the EVC marketing surcharge on their customers. Contact one of them for a competitive quote and give your savings to a local nonprofit of your choice. Then contact your elected representative and ask, “Why are you in the business of promoting some companies over others? And why do you support sending our money to Santa Barbara?”
John Ewan is the owner of Pacific Energy Company, founded in 1980. He is a former member of the San Luis Obispo City Council and of the EVC Board of Directors. He has chaired several local civic boards including the SLO Chamber of Commerce, EcoSLO, SLO GreenBuild, and the San Luis Obispo Air Pollution Control Board. Send comments to the executive editor at firstname.lastname@example.org.