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Posted on Tue, Oct 9, 2012 : 2:16 p.m.

Ann Arbor school board to vote Wednesday on privatizing lunch supervisors

By Danielle Arndt

The Ann Arbor Public Schools Board of Education will decide Wednesday where paychecks for 250 to 300 noon-hour supervisors will come from.


The Ann Arbor school board will vote on a possible contract to privatize the district's 250 to 300 noon-hour supervisors Wednesday. file photo

The school board is expected to vote on a three-year contract to privatize Ann Arbor’s lunchtime employees, an act that would save the district $55,000 by eliminating the district's requirement to pay in to state pensions for these employees. The first reading of the proposed contract was Sept. 19.

The vote will not alter workers’ wages or responsibilities, just the name of the organization issuing the check.

Professional Contract Management Inc. (PCMI) was the only company that responded to the district’s request for proposals. The district also uses PCMI for its athletic coaches.

If the contract is approved, PCMI would charge AAPS an administrative fee equivalent to 25.83 percent of gross wages for employees.

District officials said the cost of providing employee management services has grown significantly over the years. This 25.83-percent bid is about 7 percent higher than bids the district received in previous years for similar services.

The higher administrative cost would reduce the overall savings to the district from a projected $75,000 to $55,000.

Privatizing workers will take away their state pension option. However, district officials said noon-hour supervisors do not work enough hours during the year to be eligible for the pension, even though AAPS is legally required to contribute to the Michigan Public School Employees Retirement System on their behalf.

In order to access their state pensions, public school employees must work a minimum of 1,000 hours per year with at least 10 years of service. AAPS noon-hour supervisors typically work a maximum of about 360 hours per year, approximately two hours per school day.

President Deb Mexicotte expressed a concern about the cost of contracting with PCMI for services at the school board’s Sept. 19 meeting.

“What is it that keeps us ... from contracting separately with each of the noon(-hour) supervisors?” Mexicotte said. “That 25-percent administrative cost is huge. … I have trouble wrapping my mind around how we can’t do better than this, since almost nothing’s changing.”

The board will conduct a second reading and discussion of the proposed contract Wednesday night and entertain a motion to approve it.

View the complete Ann Arbor school board meeting agenda here.

Previous coverage:

Danielle Arndt covers K-12 education for Follow her on Twitter @DanielleArndt or email her at



Wed, Oct 10, 2012 : 3:04 p.m.

I totally don't get the logic to this. Aside from apparently not understanding how the pension system they contribute to works, the schools are voting on something that doesn't even add up based on simple arithmetic. Add in pension reform changes and it makes even less sense. Start with arithmetic: Wasn't there just an article on within the past couple of months about new legislation that sets a limit to how much districts have to contribute to retirement at 24.46%? So to save 24.46% they are paying a private company 25.83%? Go to pension reform: That doesn't take into account all the pension 'reforms' of late. Current employees will have less contributed on their behalf as they will pay more; and new employees will be on a different system that costs the schools substantially less than the current one. Damaging to current workers: Employees still get credit for all the time they work. It is not like if they don't work 1020 hours in a year, the years goes away. If they work 360 hours, then they will get credit for .353 years. If they work 28 years or so, they will get a pension. Plus, if at any point they get a different job with the schools, then those earned hours carry with them. IF the new job involves more hours, then they accumulate time faster. So some of the employees may never get a pension, but others might. But nobody will with a private service. For employees, same wages, but loss of potential pension. For the schools, pay 25.83% vs 24.46% now - with future pension costs decreasing. The only winner here seems to be the private company that will now be involved.

Basic Bob

Wed, Oct 10, 2012 : 4:19 p.m.

The schools pay 7.62% payroll tax in addition to the pension. This is part of the fee. Certainly there are additional savings to the district in payroll processing which has not been considered. There are a lot of checks to cut.


Wed, Oct 10, 2012 : 1:15 p.m.

Let us farm out the care of our children to the lowest bidder, what could possibly go wrong?


Wed, Oct 10, 2012 : 5:32 p.m.

They did it with the bus drivers. They did with the lunch room. Guess what? Custodians are next. Their contract is up for bidding last June. BOE is going to eye them next. Get use to it. Privatization is the hit of the land.


Wed, Oct 10, 2012 : 11:37 a.m.

Private companies are ALWAYS in business to make a profit. If they weren't they wouldn't be in business. Period. This company will make a profit off of Ann Arbor Schools every year. And it is a mistake to assume that the lunch aides will never collect a pension. If they eventually go on to other positions in the district, they potentially could accumulate enough time to qualify for a pension. All service time within the district counts toward pension service hours, as long as it's not contracted through a third party. Substitute teaching used to fall into this category also ...... until all the districts privatized it. Now a teacher could sub for 2 or 3 years and never get any credit toward a future pension. Sad.


Wed, Oct 10, 2012 : 5:31 p.m.

Look at Trinity. They are a conglomerate. So is First Student and so on.


Wed, Oct 10, 2012 : 10:46 a.m.

Vote NO on privatization of the noon hour employees -- keep our present staff, most of whom do an awesome job and the children are who they wish to provide a safe and secure lunch time. Just take a look at the bussing situation -- this would cause the same type of concern. Please, for the children's sake -- vote NO.


Wed, Oct 10, 2012 : 5:30 p.m.

Carole? The BOE already has their mind set on privatization. Going to happen and I suggest if you don't like it? Volunteer to keep an eye on the employees that are hired to supervisor lunch.


Wed, Oct 10, 2012 : 10:44 a.m.

This article is full of holes. It seems none of these employees qualify for pensions based on limited hours worked. So doesn't the district eventually get the money back? If they have to contribute, since it is way under 25%, how does this make any sense? There are a bunch of changes in the works for pensions for school employees including not contributing to a pension but a retirement account instead. How does this impact the decision?

Charley Sullivan

Wed, Oct 10, 2012 : 8:12 a.m.

So, that "fee" is actually the salary of the people who work for PCMI, plus a level of profit for whoever owns the company. This is why Republicans like privatization; it provides them their livings, from government money, just sayin. So much for "I built it on my own."


Wed, Oct 10, 2012 : 3:13 p.m.

Mike, you seriously think that Mouron's Ambassador Bridge is better all the way around than the State of Michigan's Macinac Bridge? .


Wed, Oct 10, 2012 : 1:25 p.m.

The private sector can always do it less expensively and better than the public sector..........I have not found an example to the contrary


Tue, Oct 9, 2012 : 7:47 p.m.

I thought supervising lunch was a core competency of the Ann Arbor Schools?


Wed, Oct 10, 2012 : 5:29 p.m.

It is. But AAPS is tired of babysitting so they are sending it over to Chartwells. I don't trust Chartwells and I am glad we are done with the elementary side of this.


Tue, Oct 9, 2012 : 7:30 p.m.

How about actually approaching other companies who do this kind of work? If it was your money you would........


Tue, Oct 9, 2012 : 7:28 p.m.

However, district officials said noon-hour supervisors do not work enough hours during the year to be eligible for the pension, even though AAPS is legally required to contribute to the Michigan Public School Employees Retirement System on their behalf. This is going to go over big with the unions....................


Wed, Oct 10, 2012 : 5:28 p.m.

They are not union. So the union can't help them. When they privatized the lunch room 3 or 4 years ago last June, there was nothing the unions could do to help them. This was also true with the bus drivers who all lost their jobs to privatization. A lot of drivers never got their jobs back. The BOE will privatize this to make this section completely Chartwell territory. I really hate to say it, but when you privatize? You end up hiring someone who you have no idea is working with your children or not. They do not screen like the school system does.

tom swift jr.

Tue, Oct 9, 2012 : 6:59 p.m.

Slippery slope here, folks. You can bet that someone has done the calculations as to the amount of savings if teachers were hired through an outside contractor.


Wed, Oct 10, 2012 : 12:11 a.m.

Then their calculations would be a fun exercise as the article clearly states teachers work enough hours to qualify for state pensions. In addition, the article clearly states that AAPS is legally required to contribute to the pension fund for them - and that they will be eligible to actually use it. Quit fearmongering and a better question would be: how many years has AAPS contributed to the pension fund for lunch supervisors when they are not eligible to use it and why?


Tue, Oct 9, 2012 : 7:47 p.m.

I think that is a very good idea, nice suggestion. We could put the public schools on sound financial footing.


Tue, Oct 9, 2012 : 7:28 p.m.

Good idea tom.............

music to my ear

Tue, Oct 9, 2012 : 6:54 p.m.

I mean I"ll

music to my ear

Tue, Oct 9, 2012 : 6:54 p.m.

I get back to yous Wednesday. after I hear the decision.