Company opts out of some bus runs

New contract could be needed after First Student opted out of agreement for non-public school students

The North Penn School Board has learned that the clock has started ticking for the district to find a new contract for transportation for certain students.

Director of Business Administration Steve Skrocki told the school board Thursday night that bus company First Student has opted out of extending their current contract with the district.

“We’re in our third year of a five-year contract. However, the fourth and fifth years of those contracts are what are called option years, meaning the school district or First Student could opt out by February 1st,” Skrocki said.

“First Student has elected to opt out of the contract, which means effective the end of July, we will no longer have a contract,” he said.

First Student currently provides 36 bus runs for non-public school students and 11 runs for public schools, and Skrocki said those 11 have been added to the initial contract as drivers on district staff have retired over the past three years. In addition to the contract with First Student, North Penn employs 168 school bus drivers and aides, using 133 district-owned buses and other vehicles to transport nearly 14,000 students each day.

The cost of the contract is roughly $2 million per year, Skrocki told the school board, acting in their capacity as the board’s finance committee. Once First Student notified district finance staff this week that they plan to opt out, Skrocki said, he asked the company to provide another pricing proposal for a new contract.

“One option would be to consider a new

contract with First Student for one, two, or three years. However, I don’t know what those economic terms are yet. They have not provided that to me,” he said.

The board could wait to take any action until it has heard more back from First

Student, or could move ahead with seeking terms from other companies, but either way a decision will need to be made soon.

“My concern is, we’re into February now, and the process of bringing on a new provider can take several months. So I’m concerned about the timeline,” Skrocki said.

School board member Christian Fusco asked if

staff had anticipated that opt-out, and Skrocki said the first indication he had was in meetings within the last two weeks, when the company asked questions that indicated they had problems with the terms of the contract that specified a 2.5 percent price increase in each option year.

“I know their costs are escalating higher than 2.5

percent per year, just like our costs are escalating higher than 2.5 percent” in certain categories like personnel and retirement costs, Skrocki said.

Board member Terry Prykowski asked if the district could also start seeking bids from other companies, and Skrocki said they could, but more information could be available as soon as next week on whether the company

has another proposal. Prykowski also asked if the cost increases were related to whether the bus drivers had decided to unionize, and Skrocki said as far as he knew, the company’s drivers for North Penn students are not unionized, but others are elsewhere.

“At this point, what we’ve done is asked Steve to have the discussion with First Student and see what

they’re looking for,” said finance committee chairman Ed Diasio.

“We don’t want to jump the gun on anything. We want to see what they’re looking for,” he said.

The North Penn School Board next meets at 7:30 p.m. on Feb. 6 at the district Educational Services Center, 401 E. Hancock St. For more information visit www.NPenn.org.