Hot potato in the school cafeteria: more districts outsource their food services, but some raise questions about personnel relations and savings

School Administrator, Sept, 2004 by Kate Beem

"Could we do it? Yes," Barnes says. "Should we do it? And how will it impact our employees? We don't want any of our employees feeling displaced."

Sprague, the food service director in Great Bend, Kan., rarely has seen a school district move to contract management without causing some employee upheaval during his 30 years in the field. Longtime employees at the top of the pay scale contribute to the high cost of a self-operated food service. Generally, when contract management companies run the show, labor costs must be contained, often by turning full-time positions into part-time ones and reducing benefits. Lowering salaries and benefits makes it more difficult to attract reliable employees because "they drive off the good, old-time help," Sprague says.

Cost Issues

Districts with struggling food service programs have many places to turn to besides contract management companies, said Wittrock, the American School Food Service Association president. The ASFSA and state school food service associations can help evaluate programs, as can state departments of education and the Association of School Business Officials. Sometimes districts need stronger leadership in the food service department, and outside consultants may pick up on the weakness.

Still, Wittrock recommends that districts considering outsourcing thoroughly research their options before abandoning self-operated programs.

Requests for proposals from proprietary firms should be specific and detailed, and proffered contracts should be studied carefully, she says. District administrators should check with their state's department of education to make sure special rules don't govern such arrangements, too. Before making a decision, school boards should ask their district's current food service department to offer a proposal, keeping in mind it likely won't be as smooth as a for-profit company's pitch.

And if districts decide contract management is the right move, a district administrator still must audit the food service program to ensure that USDA guidelines are followed and that food quality is maintained, Wittrock says.

The Janesville, Wis., School District struck up a partnership in 1995 with Marriott Food Services, now owned by Sodexho. At the time, the 10,400-student district offered hot meals at its middle and high schools, but the kitchenless elementary schools served only prepackaged meals. The school board wanted to offer a better lunch option and turned to outside management.

As part of the district's agreement with Marriott, the company installed new equipment in the schools and offered employee training. The district agreed to pay back the company over time. The Janesville administration was satisfied overall with the services Marriott offered. "It could have been a long-term arrangement," says Doug Bunton, the district's finance director. "It just didn't work that way financially."

The arrangement cost the district more than it anticipated. Although Marriott paid service workers, union contracts stipulated employees be paid union wages, which drove up costs. The food service program operated in the red under Marriott's management, and the school board underwrote it with monies from the general fund, Bunton said.