Custodians turn up heat to keep jobs at schools

By DON McINTOSH, Staff Reporter

With state and local government budgets bleeding revenue in the current recession, some public administrators are looking to replace public employees with low-wage private contractors as a way to save money.

Among those at immediate risk are 330 custodians at Portland Public Schools and 120 food service, custodial and transportation workers at the Estacada School District.

To save their jobs, the unions that represent them are offering contract concessions and taking their case to school boards that contracting out would be a mistake.

At Portland Public Schools, interim Superintendent Jim Scherzinger predicts a $36 million shortfall for the 2002-2003 school year, which he blames on a $10 million increase in health care costs and an expected $11 million cut by a State Legislature more willing to cut services than raise revenues.

To deal with this shortfall, Scherzinger proposes to close two elementary schools, shorten the school year by eight days, cap the employer contribution to health care coverage at $600 per month for all employees, eliminate cost-of-living increases for all employees, increase the student-teacher ratio from 1:28 to 1:30, eliminate outdoor school, eliminate performance bonuses for management, furlough unrepresented staff for five days in June, and contract out all custodial work.

School officials say none of these steps are desirable, but all are necessary for the school to prioritize its bottom-line mission of educating students during such an acute shortfall.

Many of the proposals are opposed by the district's unions, particularly Service Employee International Union (SEIU) Local 140, which opposes the elimination of its custodial members' jobs, and the Portland Association of Teachers, which opposes the wage, hour and benefit cuts.

Local 140, with considerable support from sister SEIU Local 503, Oregon Public Employees Union, is campaigning to avert contracting out at the same time that it negotiates alternative cost savings.

At a Feb. 25 school board meeting, a dozen parents, teachers, and students testified against privatization and custodians turned in over 4,000 signatures on a petition against the proposal, while outside over 200 supporters rallied. The union is filing a lawsuit alleging that contracting out would violate Oregon's civil service law. It's running radio and print ads calling on the public to oppose contracting out, and has been mobilizing supporters to testify at budget hearings held by the school board.

Portland Public Schools spokes-person Lew Frederick said the district estimates that its contracting out proposal, slated to begin July 1, would save $4.5 million in the 2002-03 school year. The figure is based on a survey of the costs of private custodial services at other local government entities. Those agencies paid private companies $13 to $16 per hour of custodial work. The district chose to base its estimate on $15 an hour, which compared with the $26 an hour average cost of wages and benefits of its existing employees, yields $4.5 million. It's not clear how much of that $15 an hour the private sector custodians would be paid, though the district says it's committed to ensuring a living wage of $9 an hour, plus minimal benefits.

A number of observers predict the district would likely go with a union contractor. Frederick said the district is now seeking estimates from several contractors.

Union leaders question whether contracting out would save the district money. Local 140 President Grant Walter said the union hasn't seen any details explaining the $4.5 million figure, but that the district would need to add to that the costs of training new workers and the severance costs associated with laying off the existing workers.

Opponents of the proposal also argue that the costs and risks of contracting out are unacceptable. The relationships custodians have with teachers and students, and their familiarity and experience with their aging school buildings, would be lost. Lower-paid workers might be less reliable, and the 300 percent average annual turnover of private contractors could compromise school security, they said.

They stress the unfairness that the district's most severe cuts should come at the expense of its least-paid and most diverse workforce, many of whom are war veterans, and many of whom are near retirement.

Finally, once the district gets rid of its own equipment and custodians, they predict, contractors would have the district "over a barrel" and could jack up bids in subsequent years.

At a March 4 contract bargaining session, Local 140 agreed with the district's proposal for employees district-wide to give up a cost-of-living increase, accept a cap on employer health care contributions, and have a nine-day shorter work year. A response from human resources chief Steve Goldschmidt was expected at a March 13 bargaining session (wich met after this issue went to press).

The Portland Association of Teachers, an affiliate of the independent Oregon Education Association, opposes such concessions, and said the board needs to look at executive salaries.

At a March 11 school board meeting, SEIU questioned the school district's budget choices. How can the district propose to terminate 300 loyal employees for a supposed savings of $4.5 million, SEIU asked, when the same budget includes a new "contingency reserve" fund of $5 million, and makes an additional $4 million in cuts to "allow flexibility and options" in labor negotiations?

"A contingency fund is for crisis periods," Walter said. "We couldn't get any more in a crisis mode than we are now." Portland isn't the only district looking to contracting out.

"A lot of districts are looking at privatizing food service, transportation, and custodial work in a misguided effort to save money," said Victor Musial, director of field operations for the 20,000-member Oregon School Employees Association (OSEA). OSEA represents school bus drivers, custodians, educational assistants, food service workers, clerical workers and maintenance workers at school districts around the state.

OSEA field representative Dan Morris predicted the superintendent of the Estacada School District would propose contracting out food and custodial services, transportation, and teacher assistants at a March 13 meeting of the school board. About 120 jobs would be at risk if the district privatized these services.

The Portland School Board plans to approve the district budget at its March 18 meeting, though the Legislature won't have finalized the state budget by that time. That means the district won't yet know how much money the state will provide when it makes its budget decisions.

Board member Marc Abrams suggests that the budget will be a planning document, not a finely-detailed blueprint. The board could budget a $4.5 million cut from custodial services, for example, but decide later whether that would come from contract concessions or privatizing. Any contract with Local 140 or with any private contractor would have to be approved by the board.

Board members have been asked by district staff not to comment on what decision they'll make on privatization, since it's the subject of ongoing bargaining. But Walter is worried, and says he's gotten no commitments from any of the board members, even those who had been supportive in the past: "I get the sense they've made up their minds. It kind of sickens me that they're not open to some kind of middle ground."

Abrams said he has long been an opponent of contracting out, but that he and other board members face daunting choices: Since 83 percent of the district's budget goes to personnel costs, any budget cut means layoffs or cuts in salary and benefits for at least some of the workforce.

"It's a horrible place to be put in by the Legislature," Abrams said. "We'll end up looking like the villains for their decisions. This state has a disconnect between what it wants and what it wants to pay for. That severely undercuts our ability to deal fairly with our workers."

Though the district's unions may disagree with each other and with Scherzinger about how to deal with the current budget crisis, there's no disagreement about the need for a long-term solution.

Scherzinger said school districts throughout the state have suffered a gradual disinvestment in education as the state's tax burden has dropped from 12th highest in the nation to the sixth lowest.

"It's a popular belief among many people that there is some way to reduce spending and get more services," Scherzinger wrote in a letter to the Portland School Board. "It doesn't work for individual families and it doesn't work for the larger family that is our state."

In the meantime, Local 140 is calling on opponents of privatization to contact the school board and to attend rallies at 501 N. Dixon, at noon and 6 p.m. Monday, March 18, the day the board will decide its budget.

March 15, 2002 issue

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