In a move to close a potential $4.2 million budget deficit in 2005, East Lansing Public Schools this year endorsed the continued privatization of the district’s custodial operations. Administration officials had built a trial year into the school system’s contract with Jani-King International Inc., so they could assess the company’s first-year performance before deciding whether to complete the remainder of the five-year contract they signed with the firm. Having decided this year that the company had provided good service, the district has now entered into the second year of its contract with the commercial cleaning organization, which bills itself as the “King of Clean.”
Initially, the proposed contract was met with strong opposition from a coalition of district employees and unions, including the Michigan Education Association. But the school board voted in June 2003 to approve the contract, anticipating that privatization would help to address the budget crisis then facing the school district.
The decision paid off.
After the private custodial company’s first year of work for the district, the district’s finance department reported savings of roughly $800,000. The savings were a result of the lower cost of services provided under the contract.
Maria Bolen, director of finance for East Lansing Public Schools, is pleased with the decision and its effects in the previous year. “There is a lot more administrative control,” Bolen said. “We have much more control over the custodial staff, and we are able to put in people of our choosing.” Bolen also noted positive changes after the newly contracted company replaced the former public employees, such as more appropriate use of employee vacation time.
In contrast to some school districts, which have only outsourced parts of their janitorial services, East Lansing Public Schools decided to privatize all aspects of its custodial operation. Bolen believes that the decision will have some influence on other schools’ consideration of similar outsourcing, particularly the many school districts in surrounding areas that are facing budget crises. “We’re getting all kinds of calls from districts around the state to see how it has worked out,” she said. “I feel like we’re the wave of the future, on the cutting edge.”
The decision by the school board to privatize came roughly a decade after a recommendation published by the Mackinac Center for Public Policy suggested that East Lansing Public Schools begin outsourcing its custodial services, since the district was paying four to five times more for janitorial services than local businesses were.
As schools statewide face budget shortfalls, privatization is gaining popularity. According to Chris West, a former Jani-King employee, this trend will be of enormous benefit to all involved. When interviewed by Michigan Privatization Report, he said, “A lot of what we come across in schools is a real grandfathered tradition of getting away with not having to work all that hard,” West said. “There are those who take it seriously, but the vast majority do not.”
Jani-King is careful to monitor the quality of its staff. According to Richard Grant of Jani-King, the company "does extensive background checks on employees, and school administrators get the last say on who works on school property."
The East Lansing district also considered outsourcing its food and transportation services this year. The decision would have saved the district significant sums, in part through the removal of such budget items as new school buses.
But Bolen stated: “It doesn’t look like it will be a go for other privatization right now. The board wanted to maintain some stability.” The board unanimously approved keeping its food services staff after the staff submitted a proposal to retain their jobs that nearly matched outside bids. Bolen predicts, however, that the suggestion of further outsourcing will become routine in the next few years, as enrollment drops and the district continues to see its budget problems grow.
Privatizing schools’ noninstructional services, such as custodial operations, allows school districts not only to save money, but in many cases to improve the quality of service. After little more than a year, East Lansing Public Schools is already reaping the rewards.
Jon B. Perdue is education policy research associate with the Mackinac Center for Public Policy. Bryan M. Dahl served as an education policy intern at the Center last summer.