WELLINGTON CTY. – Local school board officials have offered a different view of events following a protest by independent school bus operators earlier this month in Mount Forest.
The Advertiser asked Upper Grand District School Board executive director Martha Rogers about the request for proposals process as it affected bus students and independent school bus operators.
She responded in writing, and cited a past Ministry of Education memorandum telling boards of education “the government intends to require consortia and will determine effective ways to implement consortia and efficiency measures.”
Rogers said one memo outlined which boards were to purchase services from each consortium.
“Our board, as well as Wellington Catholic, Dufferin-Peel Catholic, and the two local public and Catholic French boards, were to purchase services from one consortium,” she said.
Rogers added the efficiency of the local consortium, Wellington-Dufferin Student Transportation Services, was measured in 2007 by a Ministry of Education review team led by Deloitte & Touche LLP, which criticized the consortium for not being a legal entity and for not having a competitive procurement process.
As a result, Rogers said, “The consortium became a legal entity with its own staff, as well as its own letters patent, corporate bylaws, governance structure and policies.”
That effectively took decision making out of the hands of any of the boards of education involved.
The consortium took part in “a ministry pilot project in 2009 in which the ministry required the consortium to include 25% of [its] routes in an open, fair, transparent and accountable procurement process.
“The remainder of the routes were included in a similar process in 2010. The Ministry of Finance audited the 2010 process and found no shortcomings.”
Rogers added, “The next ministry efficiency review awarded the consortium a ‘high’ rating on its governance, policies and practices.”
She said, “There was certainly no moratorium on procurement processes,” as school bus protesters stated.
The result of the high rating was the five boards purchasing services from the consortium received the maximum transportation grants, she wrote.
“In terms of your question about accountability to the local school boards, the consortium … is responsible to the five boards for day-to-day operations. These responsibilities in our board are contained in board policy 304. The other four school boards would have similar policies.”
She said, “Since the consortium is an independent legal entity, it has a number of its own policies. One of these is their purchasing policy. The consortium is responsible to its own board of directors for the implementation of this policy, not to the five school boards.
“The five school boards do not have trustees on the consortium board of directors.”
Additional information on the policies and procedures of the consortium are at www.consortium.com.
Information from that website includes the following information on what the consortium is, its policies, and how it operates:
– The consortium provides transportation for eligible students living in Wellington and Dufferin counties.
– A transportation management committee acts as the board of directors. There are six members, one appointed by each of the member school boards and the general manager of transportation.
– That board meets monthly, and operates at arm’s length from the member boards to oversee policies and procedures and develop long and short term goals.
– School boards receive grants for transportation from the province based on the number of students who are provided with service. Each member board must pay the consortium the full amount of the cost of transporting its students, even if the grants do not cover the total amount. Three per cent of each board’s transportation expenditure is allocated to the administrative cost of operating the consortium.
– The consortium supports a central purchasing system as a means of obtaining maximum value for each dollar spent, consistent with the educational goals for students and fair business principles.
– In order to implement that administrative procedure, the general manager, under the authority of the board of directors, will adopt and practise recognized purchasing procedures.
– The adopted procedures will ensure cost effectiveness and efficiency and provide quality materials, supplies and services consistent with the needs and in the best interests of the consortium.
– The general manager, in consultation with the board of directors, has the authority to obtain goods and-or services in an alternate manner, provided it is in the best interest of consortium. (for example, taxi services governed by municipal rate structures).
The group also expects honesty and integrity, professionalism, responsible management and the serving of public interest to be primary values in its procurement decisions.
No vote for trustees
In response to similar questions regarding the consortium, its accountability, and the request for proposal process that school bus operators were forced to use, Upper Grand District School Board superintendent of finance Janice Wright, who is her board’s representative on the consortium, said in a brief telephone interview that while she agreed that UGDSB trustees did not vote on the matter, they do not typically vote on the day-to-day business on every aspect of the operations.
Wright added the move to the RFP had saved a considerable amount of money for the school board, which, in turn, allowed for shorter walking distances for some students.
In terms of accountability, Wright said the consortium is accountable in working to get the best value for the school boards for which it provides services. She also believed the consortium arrangement was working quite well for the boards.
Wright agreed with the portion of the Advertiser’s article on the Mount Forest protest in which Perth-Wellington MPP John Wilkinson stated, “It was an open and transparent process and they did not win those contracts.”
Later, Wright provided an emailed with an outline of what, has and, is happening with school bus transportation.
History
Wright stated that prior to 2006, the Upper Grand board was spending about $2.5-million more on transportation than it received from the province for transportation. To balance its budget, money was taken from the textbooks and classroom supplies portion of the provincial grants.
“The Ministry of Education decided that student transportation would be more efficient and effective if it was provided by consortia that would serve the needs of all the school boards. This was not optional.”
Since the board was already working with two other boards, joining with the two remaining boards to form a five board consortium was fairly quick. As soon as the consortium was organized the first ministry efficiency and effectiveness review was done (in 2007). The rating was only “moderate.”
There were three critical recommendations in that report. One was “Revising the current contract process, which involves negotiating with the local Bus Operators Association, to include a competitive process that is based on detailed service requirements and market rates.”
In order to address the criticism of its procurement practices, the consortium was given the opportunity to participate in a pilot RFP for 25% of its routes in the fall of 2008. The Ministry of Education spent considerable effort to provide consortia with standard contracts and templates, and retained the services of a consultant who helped smaller bus operators respond to an RFP. The remaining 75% of routes were part of a similar process the following year.
After the first RFP, each company bidding was debriefed and informed about its strengths and weaknesses to help owners improve their performance in the second RFP. Each bidder was debriefed after the second RFP as well.
The evaluation criteria were described in each RFP. The scoring was weighted at 65% for non financial factors and 35% for financial.
After those RFPs were completed, the consortium had agreements with eight bus operators; three small, two mid-sized, and three large nationals or multinationals. All three of the small operators had more routes after the RFP than before. The two mid-sized operators were new to the consortium. Two of the large operators ended up with fewer routes after the RFP than they had before them.
The second review of the process was conducted in the summer of 2009 and resulted in a “high” rating.
The financial impact of the positive results of the two reviews was that the Ministry of Education increased the transportation grants to the Upper Grand board so it could balance its transportation budget without taking funds from textbooks grant.
In addition to the reviews, Deloitte & Touche LLP conducted a cost benchmark study on behalf of the Ministry of Education in 2007. That provided a provincial average cost to operate a 72 passenger bus. The cost to operate a bus at UGDSB at that time was significantly higher than the provincial average.
The financial impact of the RFP process was a reduced cost of transporting students to school. The savings (approximately $850,000) allowed the Upper Grand board to reduce its walking distance for grade 7 to 12 students from 4.8kms (the longest allowable in the Education Act). Effective September 2010, grade 7 and 8 students walk 3.2kms and grade 9 to 12 students walk 3.5kms.
Wright said the exercise has been a long and difficult process for all parties. However for UGDSB, the results have been positive for students. All of the textbook funding is now spent in the classroom and the walking distances have been significantly reduced.
Governance
One of the roles of school trustees is to set policy. Policy 304, Transportation, has been approved by the trustees. It directs the consortium to implement the policy in consultation with the appropriate superintendent and in compliance with policies and procedures of the consortium.
School Boards are obliged, through the Broader Public Sector Procurement Directive and sound business practices, to obtain the best goods and services at the best price possible through an open, competitive process. This is often accomplished through a request for proposal. Trustees are not asked to approve each RFP that the board issues to acquire goods and services. In this case, it was not a board initiative. The RFP was issued by the consortium. It was an open and transparent process and was audited by the Ministry of Finance.
Accountability
The UGDSB’s transportation policy makes the consortium and the superintendent responsible for administration of its policy. As such, the superintendent of finance is currently the UGDSB representative on the board of directors of the consortium, and she has one of the five votes on that board. The consortium board has entered into agreements with the eight bus operators and deals with day to day operating issues of the consortium. It also estimates the transportation costs for all five member school boards.
The consortium general manager is accountable to the consortium board of directors and provides periodic financial statements and forecasts. He is responsible for ensuring the consortium’s spending is in line with its budget.
Wright, the superintendent of finance is accountable to the Upper Grand trustees and also provides periodic financial reports and forecasts.
Transportation spending is one component of those financial reports. Wright answers to the trustees and the Director of Education (Rogers) for any over- or under-spending in the transportation budget.
