Bus company drops service to South Allegheny schools

After more than 25 years of service, South Allegheny School District’s student transportation provider announced that it terminated its agreement with the district on Friday due to over $800,000 in outstanding payments related to the COVID-19 pandemic.

David I.L. Sunstein, president of Sun Coach Lines LLC, which provides transportation services to several school districts in the Pittsburgh area, said South Allegheny has refused to make previously agreed upon full payments to the company for more than 10 months dating to the outbreak of the coronavirus.

As a result, Mr. Sunstein said Sun Coach could not continue to operate with the district as of Monday, leaving the district’s students without a reliable source of transportation to school.

The district said on its website that students would attend school virtually on Monday due to the dispute, as it works to find alternative means of transportation. It also accused Sun Coach of withdrawing from mediation and of breaking its promise not to halt service.

“We have done everything possible to remain vigilant about serving the needs of district families despite not being timely and fully compensated for our efforts. We simply cannot continue work without pay,” Mr. Sunstein said. “It has been our sincere hope that the district would have met its obligations in this matter so its students can continue receiving the safe and reliable transportation services that we have capably provided since the contract began, without fail.”

Under the terms of their agreement, according to a statement from Sun Coach, the company provided all of the district’s transportation needs for a set amount of compensation, broken down into 10 monthly installments. The agreement also said that if fewer than normal buses were needed, the district assumed the risk, whereas if more buses were needed, the company assumed the risk.

The district’s nonpayment issue began in March, the statement said, when the school transitioned to remote learning due to the COVID-19 pandemic.

Despite the need for Sun Coach to pay its staff and its operational costs to be at standby for the district to resume in-person learning, the company said the district refused to pay the nearly $400,000 it owed in March, April and May of 2020 for the 2019-2020 school year.

Regardless of the nonpayment, Sun Coach said it continued to provide the district with its services in fall 2020 as well while the district delayed in-person learning, including transportation for parochial, charter and special-needs students.

Once the district did resume in-person learning on Oct. 1, however, its demand for bus services skyrocketed due to social distancing restrictions, meaning that Sun Coach incurred significant costs to hire more drivers and buses. The district is not required to pay back those costs, as per their agreement with the company.

According to the statement, Sun Coach attempted to resolve the issue of nonpayment through mediation, but the district refused to participate in good faith, sending representatives who lacked settlement authority, prematurely ending the mediation and never responding to a counteroffer.

Through a Right-to-Know request, the company said it also learned that the district did not request any money from the state to pay for its transportation costs through the Coronavirus Aid, Relief and Economic Security Act, even though it could have done so.

Likewise, the company said the district had not filed an application with the state to receive money to pay for transportation costs through SB 1216, which went into law on Nov. 18.

Due to the district’s refusal to make the payments it owes to Sun Coach, the company said it has lost drivers who ultimately needed to find alternative means of employment.

“We know that the unusual circumstances of the current school year are difficult for everyone — administrations, teachers, staff, students and vendors alike,” Mr. Sunstein said. “We also know that due to nationwide bus driver shortages, demand for the services we provide is higher than ever before.”

In its own statement on Friday, the district called Mr. Sunstein and Sun Coach’s representation of the dispute “self-serving” and “factually and legally inaccurate.”

The district said that it believes the existing contract’s language entitled it to a reduction or elimination of the amount owed to Sun Coach during the school shutdown when little-to-no transportation services were being provided. It also claims that Sun Coach initially refused to engage in mediation and that the termination of its contract with the district on Friday comes as a new mediation session was in the midst of being scheduled.

According to the statement, the district said it has continued to pay the company for actual services rendered during the school years, approximately $250,000. The district also argued that it did not appeal to the state for funding because student transportation services were not eligible for reimbursement through the CARES Act.

“Sun Coach agreed to mediate the issues, a mediator had been proposed and a resolution could have occurred during the summer months prior to the 20202021 school year,” the statement said. “However, on the eve of the new school year, without any warning, Sun Coach refused to participate in the mediation and threatened to discontinue student transportation services. This forced the School District to file litigation and an emergency motion for injunctive relief with the Court of Common Pleas of Allegheny County.

“Since the filing of that litigation in the beginning of the current school year, Sun Coach has repeatedly represented to the Court that it would not discontinue student transportation services while the matter was being litigated. This unexpected announcement by Sun Coach today is directly contrary to its representations to the Court,” the statement said.

“The School District Solicitors will be taking immediate action with the Court to address these recent actions of Sun Coach,” it said.

The district serves approximately 1,480 students from Glassport, Liberty, Lincoln and Port Vue.