Competitive bidding is an essential part of every school district's budgeting process.
A choice of purchasing options allows a school district to locate the most cost-effective
supplier. The district can make cost/quality comparisons and contract with those firms
which best suit its needs. According to the state of Michigan, public school districts
must acquire competitive bids for most purchases costing more than $13,557.34
At the same time, the selection of insurance administrators major expenditure in every
district's budget - is a mandatory subject of collective bargaining, rather than a
free-market business decision. And when a collective bargaining agent has a vested
interest in a certain insurance administrator, the market is effectively closed. In almost
every instance where competitive bidding has been successfully utilized, the public
interest has been served because school districts have minimized expenditures and
maximized quality of service. Without competitive bidding, as in the case of negotiated
administration of insurance benefits, there is no guarantee that the chosen firm will
perform up to any standards of efficiency. This is one of the main problems with MESSA.
Public school employees have always been concerned that a move to competitive bidding
of their insurance would cause a reduction in their benefits. This is simply not true.
School districts would still have to negotiate the level of benefits with the union, and
the bidding process would be based upon the corresponding level of negotiated benefits.
Any change in the amount of employee benefits would be conditional on the union's consent
during the collective bargaining process. In any event, with the exception of the MEA,
competitive bidding would function in the best interest of everyone involved, including
public school employees.