Chicago School Board members unanimously voted to privatize building engineers in almost 50 schools, potentially putting engineers out of work and giving more control over school maintenance to two companies that principals have widely criticized for two years.
District officials have said the additions to existing contracts with Aramark and SodexoMAGIC are cost neutral and touted the change as a way to give principals a single “point of contact” for supervising engineers and custodial staff.
But critics worry the plan will exacerbate maintenance problems at schools, cost the district more in the long term and cause problems for the municipal pension fund by reducing the number of employees paying in.
“No privatization scheme ever worked out with public money,” said William Iacullo, president of International Union of Operating Engineers Local 143, to the board at Wednesday’s regular meeting. “You’re giving public money to a private company to make money.”
Iacullo and other critics warn that CPS and schools will end up in worse shape. When Aramark first took over some janitorial services in 2014, principals widely complained of dirty schools and a lack of janitorial staff. In its first year, the contract left CPS with a bill $22 million over budget.
Under the amended contract, Aramark will provide engineering services to 18 of the schools in which it already provides custodians. Engineers’ jobs include maintaining heating and cooling systems, fixing windows, sealing leaky pipes and mowing lawns, while custodians perform cleaning and other janitorial duties.
SodexoMAGIC, which already provides engineers and custodians at 33 pilot “integrated facilities management” CPS schools, will also provide these services at an additional 30. (See a list of all impacted schools here.)
The district says no current engineers will be laid off, as all schools that are part of the newly extended pilot are understaffed or have an engineer who will retire at the end of the school year. The salaries and benefits of 50 or so engineers currently costs CPS about $5.8 million.
In 2014, Aramark was awarded a $260 million contract, while SodexoMAGIC—owned by basketball superstar-turned-businessman Earvin “Magic” Johnson, a major contributor to Mayor Rahm Emanuel’s re-election campaign—had a contract worth $80 million.
CPS is still at the beginning of an RFP to do “integrated facilities management” throughout the system—essentially privatizing all custodial and building engineering staff sometime in 2018. The current Sodexo and Aramark contracts are up next February.
“The results of the initial pilot have shown us that the IFM model has the potential to improve facility services without increasing costs, and we will evaluate the modified pilot to determine if a larger transition to IFM is warranted,” CPS spokesman Michael Passman said in a statement.
Adding a middle-man, losing pension funds
Outgoing Chicago Principals and Administrators Association President Clarice Berry pointed out that bringing in private companies only adds an unnecessary middle-man to maintenance and janitorial work. “[Principals] want cleaner schools, and we had that before Aramark, when custodians reported to engineers and engineers reported to principals,” she said.
There are currently just over 500 building engineers at CPS. Most high schools have two, while many elementary schools share one engineer or have only one working full-time.
Iacullo said he repeatedly pointed out the high cost of privatizing engineers and management during contract negotiations with CPS in recent weeks, but was told that privatization was about increasing efficiency, not saving money.
The engineers union was so opposed to the deal that it agreed to cut jobs, eliminate a 7-percent pension pick-up by the district and forego raises for two years instead. But CPS forged ahead anyway and the union’s contract expires next month.
“They don’t seem to care what we say,” Iacullo said earlier. “It’s disheartening. They just want to go ahead with privatization and not even a generous offer from us can stop them.”
One of Iacullo’s greatest concerns is the impact that increasing privatization could have on pensions. As more engineers become privatized, there are fewer public employees paying into the Municipal Employees’ Annuity and Benefit Fund of Chicago.
In a letter earlier this month to Anthony Clancy, Local 143’s pension representative, the municipal fund’s executive director James Mohler said that the total amount of lost contributions could reach around $7.3 million a year if CPS privatizes all building engineers.
Mohler’s letter also pointed out that privatizing may lead more CPS engineers to retire earlier than they typically would, if eligible—putting further financial strain on the fund. If at least half chose this option, it could cost the fund an additional $120 million over 10 years. As a result, the pension fund would be stuck paying massive retirement expenses without a sustainable stream of new money coming in.
There are also fears that engineers may not really have an option to “retire early”—they might just not be rehired at CPS schools.
In a letter to principals last month, CPS Chief Administrative Officer Jose Alfonso de Hoyos-Acosta said the district is “requiring all prospective … vendors to employ impacted CPS engineers.”
However, SodexoMAGIC’s pilot schools hired engineers from IUOE Local 399, not Iacullo’s local. Some engineers from Iacullo’s union found jobs at other Chicago schools or in the suburbs rather than switch to Local 399.
Building age is also a factor. Of SodexoMAGIC’s 33 pilot schools, 26 are less than 30 years old. Many CPS buildings are almost a century old, and principals from non-pilot schools have expressed concern that new engineers won’t have the experience to maintain these older buildings, or that engineering staff will be cut too much to give the buildings adequate maintenance.
“Sodexo didn’t get the schools that were old,” Berry said. “And I don’t know how quickly they’ll be able to get up to speed in older buildings without hiring more staff. We’re going to be right back where we were with Aramark.”
Catalyst associate editor Melissa Sanchez contributed to this report.