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Michigan bill to unravel privatization of non-instructional services heads to Whitmer’s desk

Privatization has been popular among Michigan school districts

A bill before the Michigan Senate would roll back three decades of private contracting for non-instructional school services, a widely used practice. House Bill 4356 do this by undoing a law that lets districts contract out for these services without having to negotiate with unions.

Under current law, unions for non-instructional services are treated “on an equal basis with other bidders,” per a House Fiscal Agency analysis of the bill. Prohibited topics of negotiation include the school’s decision to hire a third party and the identity of that third party. That prohibition would be eliminated if House Bill 4356 were enacted.

The bill passed the Michigan House last week and the Senate Labor Committee this week. It’s headed to the full Senate next. To be enacted into law, the bill would need to be passed in identical forms in the House and Senate, then signed by Gov. Gretchen Whitmer.

Read it for yourself: House Bill 4356 of 2023

A House Fiscal Agency explainer of the bill is pictured below:

The Senate Labor Committee held a hearing on this bill. Its advocates said the bill would benefit employees who “have taken a beating over the last decades” and would remove a law that “was made to punish school employees.”

Steve Delie, director of labor policy at the Mackinac Center, recently published a legislative testimony on this subject. In it, he said that school districts prefer to contract out some services to private entitities.

“Such a repeal would be shortsighted, as these services have been overwhelmingly popular with schools as the best available option on the market,” Delie testified.

Contracting out dates back to 1994 and has become more popular. In 2001, 30% of school districts contracted in one of the non-instructional fields: custodial, transportation services and food service. By 2020, 44.5% of districts contracted for food services, 50.5% contracted for custodial services, and 28.2% contracted for transportation services.

Michigan schools favor privatization. Some 86.1% of districts say they are satisfied with the current system, and only 1.4% say they are dissatisfied.

Ewan Hayes is a Michigan Capitol Confidential intern.

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.