LOS ANGELES: While much attention has been focused on Fleishman-Hillard's contracts with the city of Los Angeles, Mayor James Hahn's (D) decision last week to order all city departments to stop using outside PR agencies affects many other PR outfits.
They include Rogers & Associates, which works with Los Angeles World Airports; Lee Andrews Group, which helps the Department of Water and Power and the Community Redevelopment Agency; and Cerrell Associates. Specialty shops subcontracted by larger firms also are impacted.
Hahn has weathered increasing criticism recently over how city contracts are awarded and administered.
Fleishman this month announced it would end all of its city work.
Hahn directed city GMs and department heads to immediately cease negotiations with PR firms for "future proposed contracts." Julie Wong, deputy mayor for communications, added that current contracts will be canceled, unless there is a monetary penalty for doing so.
Wong said that the decision was in no way connected to the recent controversy and that it was based solely on budgeting concerns.
But local PR industry insiders agreed that the action had political nuances, as well. City contracting practices and the investigations that they have sparked are a difficult issue for Hahn, who is campaigning for re-election.
Local and national PR professionals said Hahn's actions unfairly target and tarnish the entire industry.
"Singling out one profession, across the board, with no regard for the services that are being provided or the impact of the communications programs that are being conducted may be a short-sighted solution," said Del Galloway, 2004 PRSA president and CEO.