• 53.6 percent (295 out of 550) of districts contract for food, custodial or transportation services.
  • 57 total services were privatized in the past year.
  • Six districts brought a service back in-house.

Statewide savings on support services as a result of the new contracts are estimated at $7.87 million.

A total of 44 districts began new support service contracts in the past year. The majority of these districts chose to privatize only one service, but some chose to hire support staff in multiple areas using employee leasing agencies. One district, Ubly Community Schools, began hiring all  new support staff, including cafeteria workers, custodians and bus drivers, through PCMI. The district has saved 9.3 percent per contracted employee on its kitchen and custodial staff and 8 percent on its bus drivers thanks to this agreement

Graphic 1: Outsourcing by Michigan School

Graphic 1: Outsourcing by Michigan School - click to enlarge

Total first-year savings from districts that provided savings information are estimated at $7.87 million. Many other districts, particularly those that use employee leasing agencies, provided savings data as a percentage of money saved per contracted employee. In some cases, no concrete savings documentation could be obtained. However, when asked “did the contracting provide savings?” in reference to any new contracting, only two of the 44 relevant districts denied noticeable savings, and no districts reported noticeable losses. One of those districts reported that it contracted food services for the quality of its service provider. The other reported that transitional costs for the first year would negate savings, but that it expected to save money in the coming year. Savings details for individual contracts are included in the following sections.