A budget panel’s proposal to outsource food service, transportation and maintenance work wouldn’t save the Rockford School District much money next year.
That’s because the food service workers’ union contract doesn’t expire until 2012, the transportation union contract doesn’t expire until 2013, and the Illinois School Code was recently amended to say that any benefits package for outsourced workers must be “comparable to the benefits package” provided to the district employees who perform those services.
The only immediate savings might be found with the building maintenance union, which is working under an expired contract and in negotiations on a new deal now.
While the district hasn’t calculated how much savings it would reap if union work is outsourced, what is clear is that any savings won’t be immediate.
But savings could come in future contracts with private employees, said General Counsel Lori Hoadley. Those labor agreements could look much different from the wages, pension and health care contributions now paid to union workers.
Still, the new law could be a deal-breaker for any outsourced labor, said Richard Fairgrieves, superintendent of the Boone Winnebago Regional Office of Education. The district could end up in court defending itself against an unfair labor practice claim if its former union employees claim wages to nonunion workers aren’t “comparable,” as the law requires.
“The unions will have to look at those figures, and it could possibly end in court,” he said.
That doesn’t bode well for District 205, which is looking to slash a projected $50 million budget shortfall in the 2011-12 school year.
Jay Ferraro, the local representative of the American Federation of State County and Municipal Employees, which represents two of the three unions, said no big savings could come from cutting or outsourcing those employees.
“It’s not like we’re talking about a teacher’s pay. We’re talking about some jobs so they can make a little money, have some benefits,” Ferraro said.
Food service workers and transportation union members make between $9,000 and $12,000 each year, which is a fraction of some teachers’ salaries.
In the district’s current budget structure, transportation workers receive about $10 million; building maintenance workers receive about $6 million; and food service workers receive about $3.2 million, according to the budget committee — nowhere near the roughly $214 million paid in salaries and benefits to the district’s teachers.
But it’s not like it hasn’t been done before. The district outsourced custodial services in 2005, and officials estimated the switch saves about $3.5 million a year. That deal was executed, however, before the change in the Illinois School Code.
Rockford Education Association President Molly Phalen said she’s still not sure the district can cut its budget by $50 million in one cycle.
“It’s just going way beyond what makes sense,” she said.
Phalen wouldn’t offer other ideas for cost savings, but Ferraro doesn’t want the district to dismiss the idea of spending its reserve cash in fiscal 2012. The district has that rainy day fund for a reason, he said.
“It’s been raining,” he said. “If this isn’t considered a major storm and a reason to use that balance to keep people employed, then what (is)?”
District officials disagree. They’re already planning to spend about $26 million in reserves to balance this year’s budget and avoid deep cuts. That means the district’s reserves will drop to about $85.5 million — less than the ideal $100 million the district should have on hand, School Board President David Kelley said.
District officials should plan to keep three months’ worth of funding in its reserve fund at any given time, he said.
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