Evaluating one viable option for food service

This story is the result of a NEWS investigation that began with a public record request of school board and district administrators’ e-mails spanning from January to August. The e-mails, requested in August, were received recently.

When the Stanwood-Camano School District re-hired Chartwells in August to manage the district’s food service program at a loss, the company was described as the only viable option.

The question becomes, how can a program with a consistent record of running in the red be considered the only option?

Justifying the cost

The district made cuts due to declining enrollment and a poor economy.

The projected loss for this year, $133,830, is equal to 2.4 of the 6.1 teaching positions cut last year. It is also the same amount that was eliminated from the district’s budget by cutting food service and custodian hours, ending district transportation for secondary students who live within a mile of school and cutting .3 of a teaching position.

School Board President Roger Myers said he believes the district has staff who are skilled in educating students. However, none are restaurant managers.

The purpose of the food service program is not to make money, Myers said. It provides nutrition that helps students learn.

“Am I happy about the deficit?,” he said. “No.”

However, it is part of the cost of educating kids, he said.

Reviewing the facts

The district first hired Chartwells to manage its food service program for the 2005-06 school year. Prior to that, the program was under the purview of an inhouse manager.

Since Chartwells was hired, the program has been at a loss except for the first year, when it predicted a gain, and reimbursed the district when the program had a loss.

Overall, the district lost $396,423 with the program in four years. Should the estimate for this year prove accurate, the loss will reach $530,253.

District employees have used various numbers describing the cost of the food service program. A statistic of 13 out of 14 surrounding districts with food service programs in the red has been brought up in board meetings and mentioned in e-mails received through a public record request.

However, those numbers come from a report from the state Office of the Superintendent of Public Instruction (OSPI) that includes indirect costs determined by a formula. That category is not something the Stanwood- Camano School District, or six other districts that responded to a NEWS public record request earlier this year, included in reports.

The most accurate information in loss and gain is from the information received directly from the district, said Gary Platt, district executive director of business services.

Using the information received from the Stanwood Camano, Oak Harbor, Mount Vernon, Arlington, Snohomish, Monroe and Lake Stevens school districts, Stanwood-Camano lost the most money in the period from 2002-03 to 2007-08 school years.

Only one viable option

The district told the public it received only one application from a food service company.

Although that was true, it was also misleading,

In fact, the district received an e-mailed proforma budget from Sodexo about 10 minutes before the May 29 deadline.

Part of the e-mail read: “I have attached a copy of what would have been (and would be) our FY 2009-10 budget from Sodexo for your food service program. In addition to being an unlimited guaranteed return of $11,395, Sodexo would (by way of a letter of agreement) offer a five-year unlimited break-even program.”

However, the e-mail did not fit the requirements of a proposal, said Supt. Jean Shumate, Ed.D.

“A single e-mail doesn’t do it,” she said. “There are certain standards that have to be met.”

The Chartwells proposal filled a binder. When accepted, it became a binding document, Platt said.

The pro-forma budget was only a piece of the proposal requirements, he said. The offer was also supposed to include items such as information on the intended on-site director, a sample menu, resumés of staff members supporting the on-site director, references from other districts and a marketing plan.

Comparing the two budgets is difficult, Platt said. There were roughly the same cost figures, but the difference was in the participation rates. Chartwells used 487,000 meals and Sodexo used 548,388.

Last year, 72,638 meals were served in the program. This year, the district projects a total of 75,678 meals.

In a June 7 e-mail, Sodexo requested that the district consider re-issuing a request for proposals.

The letter of agreement that Sodexo offered would have to be a side agreement, and not part of the contract, Platt said. Federal regulations limit the contract term to one year with an option to renew up to five years.

The federal government has created a strict bid process districts must follow, Platt said.

“The process is pretty strict,” Platt said. “Everybody knew about it. The goal is to provide a level playing field.”

In addition to advertising in the Everett Herald, the district e-mailed the opening to Chartwells and Sodexo and OSPI sent out the information, he said.

The district also had to consider what impact considering a late submission would have on its relationship with Chartwells, Platt said. Reissuing the request for proposals would mean rejecting Chartwells’ offer. The district must have valid reasons for denial.

The district also couldn’t use the information it had from Sodexo to evaluate Chartwells’ submission, he said.

In district e-mails received as part of a public records request, the Sodexo option was not mentioned to school board members or district employees. For example, in a June 17 e-mail to board member Patrick Patterson, Platt stated, “Sodexo agrees that they did receive the RFP1 but due to error on their part, failed to file a proposal.”

Platt went on to say, “The committee has three possible options for recommendation to the board: 1. Award the contract to Chartwells as the sole responder; 2. Reject the single proposal and re-advertise the RFP; 3. Reject and recommend hiring an in-house director.”

Platt said he couldn’t say on what level the school board understood the Sodexo issue. However, there was some discussion of it.

Platt did brief the school board about the Sodexo issue. However, Myers said he can’t recall exactly what was said. He does recall that Sodexo had not complied with the deadlines.

An in-house option

The in-house food service manager position was advertised starting June 2, after the deadline for the food service management proposals had passed.

“We wanted to consider all of our options,” Shumate said.

The position was posted on Web sites the district typically uses to announce positions and e-mailed to district employees, said Linda Littlefield, Ed.D., district executive director of human services.

The district received four applications for the position. All four were considered by the hiring committee, Platt said.

Two of the applicants were current employees of Chartwells, Littlefield said.

Due to the contract between Chartwells and the district, the district cannot hire a current Chartwells employee for a year after the contract ends.

The other two applicants were not qualified, as they did not have previous experience as the manager of a school district food service program, Littlefield said.

In the position description, the following are listed as requirements: knowledge and aptitude, a bachelor’s degree in a food service field and minimum of four years in the food service industry. No direct mention is made of the need to have already served as a district food service director.

One piece of the larger picture

According to the school district, the food service program is only a portion of the picture. It is only one area where the district uses local levy funding to make up the gap between state and federal funding and the cost of services, Shumate said.

This school year, the district is expected to use $2.8 million from the levy to fill gaps. Only 4.6 percent of that money is budgeted for the food service program. The majority, 57 percent, or $1.6 million, goes to special education. Transportation takes up 34 percent, or $980,000. The remaining 5 percent includes $105,000 for the Learning Assistance Program, $6,000 for the bilingual program and $2,000 for the highly capable program.

Still, the district has requested a study from Chartwells concerning how to decrease the deficit, Platt said. The report is expected in January.

The deficit isn’t as large of an issue as some people perceive, Myers said.

“Chartwells provides us with good service,” he said.