Michigan Trails Only Pennsylvania in Contracting Out for School Services

Graph: States’ Percentage of Contracting

A telephone survey of more than 2,300 conventional public school districts across five states, including Michigan, has revealed widely varying rates of using competitive contracting for noninstructional services. The survey investigates the degree to which districts contract out for food, custodial and bus transportation services. The Mackinac Center began surveying districts in the Great Lake State in 2001.

We expanded our survey this year to include Georgia, Ohio, Pennsylvania and Texas. This was due to its popularity and usefulness, not just among other states’ school officials, but also among research groups who wanted to know: Is our state a leader or laggard when it comes to competitive contracting?

The Michigan survey shows yet another overall rate increase over the previous year.  Nearly 71 percent of Michigan’s conventional public schools now contract out for at least one of the three major noninstructional services. This is up from 66.6 percent in 2014. The survey research is typically conducted between May and August. Every one of Michigan’s districts responded to our questions.

What we found this year is that Michigan — while maintaining a robust contracting rate — is not the overall leader in our gang of five states.

That honor goes to Pennsylvania, with a contracting rate of 75.2 percent statewide. The reason Pennsylvania’s rate is so high is that districts are very comfortable with bus contracting. A survey-leading 66.4 percent of all districts in the Keystone State contract out for busing. More than 44.0 percent of districts in the state contract out for custodial work and 9.0 percent contract out for food services.

By contrast, the Buckeye State came out at the low end of the spectrum. Only 16.6 percent of the state’s 614 conventional public school districts contract out for at least one of the three major noninstructional services. Ohio State may be national football champs but on the field of school contracting Buckeyes get trounced by Wolverines.

Michigan school transportation, food service and custodial service contracting rates are 26.6 percent, 42.8 percent and 52.2 percent of all districts, respectively. In Ohio, only 6.5 percent of school districts contract out for transportation services, 10.7 percent contract out for food services and 4.2 percent contract out for custodial services. While Ohio has the lowest overall rates of contracting, they do not have the lowest rates in every category. That distinction goes to Georgia.

The Peach State isn’t so peachy when it comes to contracting for food and transportation services. Of the 180 school districts, only 2.2 percent contract for food services and only 1.7 percent contract for transportation services. But Georgia is not overtly hostile to contracting in general. A surprising 36.7 percent of districts there contract out for custodial services.

Texas was the largest state surveyed, both by number of districts and geography. More than 22 percent of all districts contract out for one of the three major services.

The survey results were covered in a variety of op-eds and news stories, from the Columbus Dispatch in Ohio to the Austin-American Statesman in Texas, Atlanta CEO in Georgia and The Detroit News here in Michigan.

As the results show, competitive contracting for noninstructional services is proceeding at uneven rates. Regardless, districts across the nation are finding it to be a tool for managing their affairs.