Portage Schools Turns Down $270K Savings

Portage Public Schools had an odd reaction to some good financial news this week, telling a company that could save it $270,000 a year "no thanks." That offer came from Grand Rapids Building Services, a facilities cleaning contractor that proposed taking over the school district’s first shift custodial duties.

GRBS is able to accomplish the same work at a lower cost primarily because it uses a different benefits package than Portage schools, one that doesn’t include overpriced health insurance from the Michigan Education Special Services Association or expensive contributions to the unsustainable school employee pension plan. GRBS’ more reasonable benefits packages mean it can provide the same service to the district for about $20,000 less per custodian, according to The Kalamazoo Gazette.

Portage’s refusal of GRBS’s offer is especially odd because it already contracts with the company to provide its second- and third-shift custodians, and has since 2009. In fact, the board appears content with that service as the proposal came at the same meeting where they renewed their contract for those second- and third-shift custodial services.

The reason the school board is turning down the offer appears to be one completely unrelated to fiscal prudence or concern for quality services. School Board President Bo Snyder told The Gazette the district walked away from the $270,000 savings because “prior boards have elected not to use the outsource model for the first-shift custodians in the buildings.”

In other words, the current board won’t make a sound financial decision because previous boards didn’t make a sound financial decision.

That kind of financial strategy is one reason why school districts always feel like they’re in a budget crunch, despite the fact per-pupil spending has risen steadily over the last 40 years. Districts like Portage need to remember their primary goal is not to perpetuate the status quo; they should be more focused on funding learning than funding insurance companies.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.