News and Tribune

November 13, 2012

NA-FC custodial company wants better deal

Sodexo says it can't sustain what it initially promisede

By JEROD CLAPP
jerod.clapp@newsandtribune.com

NEW ALBANY — Questions, accusations and threats of litigation arose from a contract renegotiation with Sodexo, New Albany-Floyd County Consolidated School Corp.’s custodial services provider, that was brought to the board.

While the district realized about $1 million in savings this year, the company told the board that they could not sustain the losses they were on track to face in 2013 and requested some changes to the contract.

The company took over custodial operations at the beginning of the year for the district, promising savings at a loss to the company of $500,000 in two years. Instead, they said the lost that amount in one year. To make up for the projected loss in 2013, the company suggested moving over to a different type of contract, taking the district’s savings from $1 million to $600,000.

Bill Wiseheart, director of facilities for the district, said after trying to work the issues out with the company over the summer, Sodexo submitted its intent to withdraw from the contract with the school system in October.

But Mark Boone, board president, grilled Sodexo management over the news the board was just given.

“They assured us they were a billion dollar company and [they] know what [they’re] doing,” Boone said. “I’m looking at this and you didn’t know what you were doing. I hate to be so frank, but a $400,000 difference is huge, and now as [board member] Roger [Whaley] said, it looks like we’re giving up a lot.”

If they agreed to the changes, the district would have to lay off about 10 custodians and move all management to the company.

Wiseheart said part of the problem stemmed from the number of employees who were grandfathered in at their pay rates from the district, which Sodexo said was more than what they expected.

Whaley said it appeared Sodexo was misleading the board from the start.

“Bill, I have to agree with Mark,” Whaley said. “It sounds like shell games. They knew they were going to lose money and suddenly, ‘Oh golly, we’re going to lose money.’ So now they’ve got one arm twisted up behind your back saying ‘we lost money, you guys put us on the road to wellness.’”

Boone also said he was upset with what Sodexo was saying.

“They’ve already shown us they’re not looking out for our best interests to put it frankly,” Boone said. “This is about money to them, which we told them up front, ‘you’re going to lose money.’”

Wiseheart suggested the board allow Sodexo to give a presentation to help work out some of the issues at its work session Nov. 27, but Boone said he wanted some assurance from the company.

Marty McGaughey, a district manager from Sodexo gave a “30-second elevator speech” requested from Boone about why they should continue services with them.

“We want to make sure we can be the best stewards of the community’s monies,” McGaughey said. “We do not like this anymore than you do whatsoever. But to bring synergies back together, we’re still a company with the resources above the unit. We can still bring value to the school district in purchasing of employees, supplies.

“We’re not a different company than we were to start with, we just made some bad assumptions.”

Boone said other bidders for the contract told the board they were “crazy” for thinking they could actually get the savings Sodexo promised, but they made the move to save money anyway.

Lee Cotner, board member, said he wasn’t convinced that the company hadn’t breached the contract with the district.

“I think we need to bring counsel into this and see if Sodexo didn’t negotiate in bad faith,” Cotner said. “This has litigation written all over it. I think we were sold a bill of goods.”

After getting nods of approval from the board, Boone said he wanted Sodexo to attend the work session in two weeks to work out the situation and convince the board they shouldn’t seek out other options.

“Rehearse your elevator speech, that’s my advice to you,” Boone said. “Because that was not very good. And I’m not trying to be rude... actually, I am trying to be rude. You have to sell us [on it] Nov. 27. I’m going to take a day off work to listen to your speech. [Brad Snyder, deputy superintendent is] going to have to support it and [Wiseheart’s] going to have to support it, but at the end of the day, we’re going to have to vote on it.”



GRADING SYSTEM

The board also denied a request for a hearing about grading systems at the district’s two high schools.

Jesse Renn, a senior at Floyd Central High School, and his father Neal, said since the grades at his school aren’t weighted the same way they are at New Albany High School, Jesse didn’t qualify for a scholarship at Indiana University.

Boone said he admired the fact that Neal had followed the proper channels in the chain of command up to the board, but didn’t appreciate the negative media attention sought by Neal after he was told the grading systems would not change.

He also said by changing the system, the class rankings of students could shift to negatively affect high-achieving students and that might open them up to litigation.

The board voted against giving the Renns a hearing, with Cotner and Becky Gardenour, board member, voting to allow it. Whaley abstained from the vote.

After the meeting, Jesse Renn said students are encouraged to take Advanced Placement courses, but the weighting system gives students at New Albany High School a decidedly higher point advantage.

Boone said the family knew the grading system would have a different effect on the class of 2013, but that the district was still trying to help Jesse Renn get the scholarship.

He said Louis Jensen, director of high schools, has written letters to Indiana University on his behalf explaining what the GPA would look like if it were weighted at New Albany High School.