School districts privatize bus service

Valley View Local Schools is the latest area district to contract with a private company to handle student busing.

The district’s move this spring follows Xenia Community Schools’ decision to outsource transportation last year.

Valley View Superintendent Bill Kirby said it was a financial decision based on “the dire situation we found ourselves in” to contract with Cincinnati-based First Student, Inc. for bus service beginning in the 2013-14 school year.

The district, which had to make $1.5 million in budget cuts for the next school year, sold its 21 buses to First Student and is also leasing transportation space to the company. District Treasurer Dan Schall said the deal will result in a first-year total savings for the district — including the sale of buses, lease space, operations and bus updates — of $770,000.

“Each year after will be a savings of over $30,000 plus the cost of replacing and repairing buses (as much as $160,000 per year),” Schall said. The district is getting a check for $547,770 for the buses and leased space, he said.

Kirby said that revenue helped the district avoid cutting 12-14 staff positions, although it still had to cut 12 staff positions as part of the 2013-14 budget reductions.

First Student spokeswoman Jen Biddinger said they are pleased Valley View has chosen the company to be its student transportation provider.

“We are currently working to hire current Valley View drivers who pass our employment checks. They are a tremendous asset because they know the community, students and routes. One hundred percent of the current staff, which consists of 16 drivers, four monitors, one mechanic and two office employees have applied to join the First Student team,” Biddinger said.

Kirby pointed out benefits like health insurance cost more for employees of First Student than they do for Valley View employees. If hired by First Student, the transportation employees would have to pay for their health insurance, which is different from the school district, which covered 85 percent of that cost, he said.

The wages ares similar, however, and the bus drivers will have an opportunity to make more money on the side by driving chartered buses for organizations outside the district if they choose, Kirby added.

Valley View had already been looking at reducing transportation costs and possibly taking away high school busing and moving the walking distance for students from one to two miles. “That was all in the planning. We were looking at five to six jobs lost in transportation,” Kirby said.

That’s why the school board decided to outsource transportation, because of the opportunity to save jobs and knowing the transportation employees whose jobs were at risk would have a chance to apply for a job with First Student, he said.

The contract is for five years, with the opportunity to extend it to 10 years.

Kirby said there is a clause in the contract that would allow the district to buy back the fleet of buses at fair market value if the board decides at some point it wants to handle its transportation in-house again.

First Student serves more than 1,400 school districts across the country, including Xenia Community Schools, Cincinnati Public Schools and Lorain City Schools in Ohio, Biddinger said.

“Many districts are increasingly required to assess their operations to determine how best to balance budgets,” she said. “Districts that were hesitant to partner with a provider like First Student are now looking at partnerships as a way to bring more resources back into the classroom without sacrificing safety.”

In Xenia, the outsourcing move created quite a bit of controversy.

Christy Fielding, director of business and technology for Xenia Community Schools, said the district has a five-year contract with First Student that started July 1, 2012.

“Outsourcing transportation was part of a larger move to outsource IT staffing, transportation services including mechanics, and maintenance, grounds and custodial services. This was done as an effort to cut operational costs while still providing necessary services. We were also able to get newer buses added to our fleet, GPS units and digital cameras installed in every bus, and cleaning equipment and mowers purchased that we may not have otherwise been able to afford,” she said.

Fielding said they estimate outsourcing all of those services will save approximately $3 million over five years, but she was unable to provide the estimated savings for just transportation because she was out of the office.

“Every bus driver that applied to work for First Student was hired,” she said, noting the district retained its bus fleet but did have some spare buses that it was able to sell.

“We are currently finishing up our first year with First Student and I have been extremely satisfied with their services,” Fielding wrote in an email. “We have been able to save slightly more than expected because FS was able to find greater efficiencies in the routes. The district has built a relationship with FS staff that I look forward to continuing beyond our current five-year contract.”

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