P.O. Box 909 ● Trenton, NJ 08605-0909 ● Phone: 609.695.7600 ● Fax: 609.695.0413 ● Web: www.njsba.org/PI

NJSBA Survey: Subcontracting Produces Savings

TRENTON, November 19, 2009 — New Jersey school districts save at least $38.8 million annually by subcontracting non-instructional services such as maintenance, cafeteria operations and transportation, according to preliminary results of a New Jersey School Boards Association survey conducted this fall.

That amount is equivalent to the employment of 865 teachers at the average statewide starting salary of $44,826. The annual savings identified in NJSBA’s latest survey on subcontracting are markedly higher than those reported by the Association in 1999 and 2002.

Legislative Threat NJSBA collected the data as part of its effort to advocate the retention of subcontracting as a cost-saving strategy for local school boards. The Association opposes current legislation that would virtually eliminate the subcontracting option. The bill, A-4140 (Oliver), received Assembly Education Committee approval in June and could be acted on by the full house during the lame duck session

“For local school boards, the option to subcontract is critical, especially during the current economic downturn,” explained Marie Bilik, NJSBA executive director. “Our surveys show that subcontracting has enabled boards to direct limited resources to the classroom or to reduce the burden on local property taxpayers.”

Tax Relief, Staffing In the latest NJSBA survey, school officials said they applied the savings created by subcontracting toward property tax relief/budget redution; retaining or hiring staff; classroom programs, supplies and equipment; and non-instructional operations such as operating a self-sufficient food servces, as required by the state’s Accountability Regulation.

In all, 238 school districts, approximately 40 percent of the state’s operating school districts, participated in the electronic survey. (The $38.8 million of savings only represents the amounts reported by the 238 responding districts.)

NJSBA collected the responses from Sept. 16 through Oct. 20, 2009. The vast majority (88 percent) came from school business administrators, with the remaider from superintendents, other business office personnel and board presidents.

Subcontracted Services Over 82 percent of the responding districts indicated that they fully subcontract one or more of the following services:

• Food services (38.4%)
• Maintenance, buildings and grounds, or custodial services (24.5%)
• Transportation (20.3%)
• Other subcontracted services, including business office operations, child study teams, occupational/physical therapy, security and technology (16.9%)

In addition, 45.8 percent of school officials said their districts partially subcontract a variety of services. Almost one quarter of the responding districts are either considering expanding the number of services they currently subcontract or subcontracting for the first time.

The New Jersey School Boards Association, a federation of district boards of education, advocates the interests of school districts, trains local school board members, and provides resources for the advancement of public education.