Each dot on this map represents one of the nearly 180 school districts that have privatized at least one non-instructional service.
Every week brings new cost-saving developments from around
Michigan as public schools try to direct more money to the classroom and protect
teachers’ jobs by outsourcing non-instructional services.
"I think you’re going to see this happen more and more,"
according to Lisa Brewer, a spokeswoman for the Michigan Association of School
Business Officials, a professional association of school financial
administrators. "It’s been going on for a while now, but it seems people are
more aware of it."
A biennial study by
Michigan Privatization Report, a
publication of the Mackinac Center for Public Policy, shows more than one-third
of public schools in Michigan now privatize at least one service. That figure
has steadily risen, from 31 percent in 2001 to 34 percent in 2003 and 35.5
percent in 2005.
The most common services privatized by schools are
janitorial, food service and busing. Some school districts, however, are
starting to look at other operations in which costs can be cut. With large
increases each year in the state-run pension system for school employees and
high-cost health insurance plans, districts are becoming more creative.
Ithaca Public Schools, for example, privately contracts for
psychological services, a move that has reduced costs by $32,000 a year,
compared to what the school was paying the Gratiot County Intermediate School
District. Lakeview Public Schools, in suburban Detroit, is spending $1 million
less on operations and maintenance after privatizing its custodial work. The
decrease takes into account money not spent on increased wages and benefits,
inflationary costs and equipment and supplies.
"We are starting to see this approach in a number of
different ways," Brewer said. "Administrators and school board members are
focused on how to get the best value out of whatever service they’re looking
Among the most creative approaches to privatization is a plan
to contract out for the jobs of three top administrators in the Ypsilanti Public
Schools. The positions of chief financial officer, director of human resources
and superintendent were being considered for just such a move, which the
district said would reduce annual costs by about $130,000.
Over the past year, schools have reduced expenses by as much
as $250,000, as was the case in Albion when that district privatized custodial
services. In Grosse Pointe, a potential $50,000 loss was turned into $90,000 of
revenue when food services were privatized.
Cooperative approaches also are being pursued. The Muskegon
Area ISD is investigating privatized busing for six local districts that could
reduce costs by up to $280,000. Ypsilanti and neighboring districts Willow Run
and Lincoln have also joined in an effort to investigate cost reductions through
Lincoln Consolidated Schools Superintendent Fred Williams
told The Ann Arbor News that his district spends $60,000 a year on each of its
65 buses, and that one private company said they could do it for $40,000 per bus
As Ypsilanti, Lincoln and Willow Run discussed potential
savings through privatized busing, the issue of job losses again came up. John
Fulton, Ypsilanti’s director of human resources, told The News that such fears
"If they take over three districts, they need to hire
drivers," Fulton said. "So they’re going to be looking at the three districts to
hire the best drivers."
When considering such a decision, schools can look to the
success of Pinckney for direction. Pinckney Community Schools privatized its
busing operations in 1994 and, according to The Ann Arbor News, has renewed the
contract four times. Linda Moskalik, assistant superintendent for finance, said
the contract will be renewed again this year.
Union activists say privatization puts custodians and bus
drivers out of work, although in Pinckney’s case, 90 percent of the drivers went
to work for Laidlaw Transit, all at the same hourly pay rate the district was
Aside from the revenue of selling its buses to Laidlaw,
Pinckney no longer must deal with the expenses of union negotiations or
grievances from transportation staff.
"We’re saving a lot of administrative work," Moskalik told The News.