Few Districts Privatize Custodial Services, Auditors Say

By Ann Bradley — January 08, 1992 5 min read

School districts have lagged behind municipal governments, hospitals, and airports in hiring private companies to provide cleaning and maintenance services, management consultants say.

It is more common, they note, for districts to contract with private firms for security and food services.

School boards tend to be “tradition bound” when it comes to privatization of services, according to Lawrence S. Herman, a partner in the consulting firm KPMG Peat Marwick who has studied the management of several school districts.

But Mr. Herman added that the increasing fiscal pressures caused by the recession provide an incentive for considering privatizing nearly any non-instructional tasks.

“The data suggest if you are up against the wall today and are looking for an opportunity for saving money or reallocating the resources you have, you have to explore this,” Mr. Herman said.

Although saving money is a primary reason for “contracting out” services, consultants also point out that such arrangements can free overburdened administrators from time-consuming management tasks.

“School districts need to look at ways to channel as many human resources and energies into the area of quality education” as possible, said Leonard Fuller, a Detroit-based management consultant who has advised several school districts.

New York City To Try Idea

Clark Godshall, the chairman of the maintenance-and operation-research committee of the Association of School Business Officials, said labor contracts in some school districts prevent subcontracting of services.

“You really have to look at the contract in terms of what you can and cannot do,” he said.

Generally, he added, contracting out services is most cost-effective in medium- to large-sized school districts.

In New York City, Schools Chancellor Joseph A. Fernandez is moving ahead with a plan to contract out custodial services to a private company in up to 100 schools over the next two years. The move comes as the board of education is negotiating a new contract with the union that represents school custodians and engineers.

The company’s employees would replace the “custodial helpers” who are now hired by the city’s building engineers to clean the schools.

In Chicago, top school administrators have discussed hiring private firms to provide custodial services, but they have put any such plans on hold until current union contracts expire in two years.

Mayor Richard M. Daley has put the issue on the front burner in Chicago by privatizing some city services to save money. The Mayor has called on the board of education to follow suit.

“The trend in local government agencies here seems to be definitely heading toward privatization--a better utilization of taxpayers’ money,” said Linda Matsumoto, the board’s spokesman.

When the unions’ contracts expire, she added, “we will not leave any stone unturned” in exploring cost-saving options.

Loss of Jobs Feared

But the issue of turning over relatively well-paying public jobs to the private sector is a sensitive one for school districts.

In addition to opposition from employee unions, observers say, school boards are likely to face pressure from community members concerned about the potential loss of jobs.

“School districts appropriately feel some degree of commitment to their employees,” Mr. Fuller, the Detroit consultant, said. “In many instances, these are the parents of the students at the schools.”

Jarvis Williams, the president of Local 46 of the Public Service Employees Union, which represents about 2,800 Chicago custodians, said he opposes the idea of hiring private firms to clean Chicago’s schools because it could cost his members their jobs.

“It is the binding, visible mission of this board of education to provide opportunities for the community to take care of their families,” Mr. Williams said. “If you have a very, very large institution where you are dependent upon the community to run it, you’d better damn well be prepared to give that community something back.”

“And if that’s translated into jobs,” he said, “then that’s what it means.”

But Mr. Fuller and other experts say there are several ways to protect employees’ jobs while still reaping the benefits of private-sector management techniques. For example, they say, companies can be encouraged to hire current employees.

Kansas City Arrangement

Other school districts contract with companies to manage and train custodial workers, who remain employees of the school district.

That is what the Kansas City, Mo., district did when it contracted last August with Servicemaster to manage the schools’ 600 custodial, maintenance, and groundskeeping employees.

Owing to a desegregation mandate, the district has one of the most expensive school-construction and renovation programs in the country.

Arthur Sykes, the district’s associate superintendent for maintenance, operations, and security, said district officials hired Servicemaster because they wanted to take proper care of the schools, but did not have enough managers to oversee employees, or the money and time to provide them with the training they needed.

Servicemaster divided the school district into zones and brought in 11 new managers, according to Chris Kinman, a senior vice president with the company.

The company has guaranteed that it will save the district $200,000 in its first year, he said.

Over the life of the five-year contract, Mr. Sykes said the district expects to save $3 million.

Already, he said, employees have been through numerous training programs in such areas as swimming-pool care, basic cleaning techniques, and floor care.

Crews of maintenance employees have begun repairing auditorium seats, fixing doors and locks, replacing downspouts, adjusting drinking fountains, and installing and replacing toilets in the schools.

The crews tackle all of the outstanding work orders at a particular school at one time before moving on to the next, Mr. Sykes said.

“It’s been going very well,” Mr. Sykes added. “In close to four months, we’ve cleaned up a number of work orders in maintenance that had been standing for one, two, or three years.”

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A version of this article appeared in the January 08, 1992 edition of Education Week as Few Districts Privatize Custodial Services, Auditors Say