Seeking to save millions, Palm Beach County schools to consider hiring private bus company

Next year's looming deficit has the Palm Beach County School Board's budget advisory committee exploring some drastic ways to reduce costs, such as hiring a private company to drive its big yellow buses.

The budget advisory committee on Friday will discuss whether the district could save any money by outsourcing transportation.

"We've got a $40-$50 million hole, and I don't know how we're going to deal with that," said Ed Tancer, the budget committee's chairman. "It is something you have to look at."

The school district is spending $41 million transporting students this year and spends the most on overtime of any department.

Tancer said hiring a private company could cut overtime costs. It could also lead to lower fuel costs because a large private company that buys large amounts of fuel nationwide could use its leverage to get a better price, Tancer said.

Chief Financial Officer Mike Burke said he is preparing a report for the committee comparing what the district spends on transportation to the experiences seen by other school districts that have outsourced their buses.

Only two school districts in Florida, Duval and Santa Rosa, use private companies to drive their buses, said Richard Duckworth, president-elect of the Florida Pupil Transportation Association.

The amount spent by Duval County per student was more than Palm Beach County's costs, according to statistics from the 2009-2010 school year. However, Palm Beach County spent more per student than Santa Rosa County, whose population of 115,000 is about one-tenth as large as Palm Beach County.

The Santa Rosa County School District has outsourced buses since 1998, said Jud Crane, its purchasing director.

He estimated personnel costs alone have been about one-third lower because of outsourcing.

Schools can save more than they realize by outsourcing because they don't factor in other costs such as mechanics and buildings, said David Hobson, spokesman for the National School Transportation Association, which represents private bus contractors.

The budget committee is only advisory and the school board would have to approve any proposal to hire a private company. Several board members seemed dubious of the idea.

In the late 1990s the district outsourced maintenance to ServiceMaster, a private company with offices nationwide, board member Marcia Andrews said. The quality of maintenance suffered and the district went back to doing the job itself, she said.

"You want to save money, but you can end up losing the public's confidence," Andrews said.

Another board member, Karen Brill, said the drivers do so much to keep their children safe that she is not interested in hiring a private company. Brill also said she would not want to lose that quality of service.

The school district has more than 600 drivers, represented by the Service Employees International Union, who could get a new boss or be out of a job if the district outsourced transportation. Rick Smith, the union's top negotiator, said he couldn't comment on the impact of outsourcing without seeing a specific proposal.

Hobson said most contractors absorb a district's existing drivers into their company when they take over. In Santa Rosa, the district gave existing drivers the chance either to go with the contractor or remain district employees, but all new drivers are employees of the contractor, Crane said.