The Trust Fund makes it possible for ISBOA to sustain our public, media and government relations strategy. Only through the contributions of industry friends and ISBOA members have we been able to fundamentally change the focus of the debate.

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Competitive Procurement – A Full Analysis of Competitiveness in the School Bus Industry

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Osborne Task Force Report Officially Released

Professor James Cooper
February 25, 2012

Question Period February 21 at the 

Legislative Assembly of Ontario 

To listen to Question Period and two questions about the Drummond Commission recommendations regarding student transportation,  

1. Click on the link below: 

http://www.ontla.on.ca/web/go2.jsp?Page=/webcast/webcast_main&locale=en&menuItem=dandp_webcast

2. Click on "House Video Archive" (right side);

3. Select February 21, 2012;

4. Drag the "play video" tab to 44:27 (min, sec);

5. End of questions at 47:27 (min, sec). 

Please find below the excerpt from the draft version of the Hansard from February 21, 2012, which contains a question on School Transportation.

 

Ms. Lisa MacLeod: My question is for the Minister of Education. Both on January 11 and February 1, I asked you to release Coulter Osborne’s report on school busing. I know the minister has received this report and I know it contains recommendations on the RFP process that has forced small businesses in many of our communities to stop their school bus routes. Last week, Don Drummond’s report recommended the moratorium on the RFP process be lifted as soon as possible.

Minister, is the reason you’re keeping the Osborne report secret, because it cautions against monopolies in school busing and conflicts with Drummond’s report?

Hon. Laurel C. Broten: I know that for many parents like myself and like the member opposite, perhaps, the school day begins the moment we put our kids on the bus. We know that that is so critically important that our bus system and our school transportation system be safe, efficient and accountable. We know that school boards and operators share that goal with us. So, yes, I want to thank the task force for the efforts to study what is a very complex issue and look at the many competing interests and needs.

I want you to know that I appreciate the sector’s support of the task force and the work and advice that they’ve given. I’m currently reviewing the report and its recommendations ...

(Hon. Laurel C. Broten)

... appreciate the sector’s support of the task force and the work and advice that they’ve given. I am currently reviewing the report and its recommendations, and it will provide guidance as we make decisions, moving forward, on such a critically important issue.

The Speaker (Hon. Dave Levac): Supplementary?

Ms. Lisa MacLeod: She’s had the Osborne report for a month and she’s still reviewing it. Meanwhile, the school boards and consortiums have already gone out to tender.

I have a quick question for the minister. You saw the Osborn and Drummond reports before anyone else in the education sector. You’ve strung small independent operators along for months now. Why are you hiding the Osborn report? Does it conflict with Drummond, and does it caution you against creating monopolies like Ornge in the bus sector?

Hon. Laurel Broten: I think the complexity of the issue is evident from the member opposite’s question. Her leader has said that their party would implement the entirety of Don Drummond’s report. At the same time, we hear a query with respect to what advice have we gotten from another group of experts, led by Coulter Osborne, who brought together a group of diverse interests to give us some advice. It’s incumbent upon me, as the minister, to take that advice and examine it in the context of how do we ensure that public education, that starts when you put your kids on the bus, is safe and efficient and accountable as well.

That’s what we are doing: We’re taking a look at the report. And unlike the members opposite, we won’t move aggressively and immediately without examining the facts and the circumstances and taking that advice and reflecting upon it.

 

ISBOA President Steve Hull - Message to Members 

 ISBOA Perspective - Osborne Report trumps Drummond Report

February 16, 2012

Dear Industry Friends and Colleagues:

Yesterday’s release of the much-awaited Drummond Report may seem, at first blush, to be the final nail in the school bus industry coffin.  As a quick summary, it calls for the immediate lifting of the Moratorium (proof that the Drummond Report is working with old information) so that competitive bids can be used for 2012-13.  Follow this link for the details of Recommendations 6-15, 6-16 & 6-17.

http://www.fin.gov.on.ca/en/reformcommission/chapters/ch6.html#ch6-i

From ISBOA’s perspective, the report merely repeats the government’s current thinking with respect to RFP’s, and does not benefit from the work of the Coulter Osborne Task Force.  In our February 8^th letter to Education Minister Laurel Broten (here), ISBOA reiterates our call for the release of the report.  Now, in the wake of the Drummond Report, it is even more important that the Minister release the Osborne Report, to let everyone read for themselves the recommendations and the fuller understanding of the student transportation industry that was developed through that exercise.

ISBOA Executive Director Karen Cameron, and our consultant Denis Chamberland, are meeting with Minister Broten’s staff tomorrow, and will use this opportunity to confirm the Minister’s support for the win-win approach that we believe is contained in the Task Force Report.  We have also met with nearly 20 MPP’s in recent weeks, and we know there is great support for ISBOA’s position – to avoid the creation of monopolies through RFPs, and develop more appropriate procurement options for school boards than just the RFP approach that has been required to date.

ISBOA’s February 25^th Workshop will feature Denis Chamberland, Procurement Lawyer, Baker and McKenzie and will prepare our members for the challenge ahead.  This workshop is your opportunity to hear first-hand the latest information about the Task Force, the moratorium, and the 2013 deadline – be it accelerated or delayed.  Go to http://www.isboa.ca/Default.aspx?pageId=1169901 to register.

To go into more detail about the Drummond Report, a fuller reading of the Report adds some context.  For example:

“As indicated in Table 6.2, the Commission has identified other potential restraint measures in non-salary expenditures related to textbooks, learning materials, classroom supplies and computers. Permanent funding reductions in capital renewal and student transportation can be considered, although they would remain the lowest-priority measures recommended by the Commission.”  (See Table 6.1)  Indeed, student transportation across the entire province costs $800 Million annually, for actual service delivery to families on a daily basis.  By contrast, the government’s portion alone of the contribution to teacher pensions is $1.3 Billion annually.

The incomplete nature of the Drummond Report review of Student Transportation cannot be overstated.  For example, the report states that, in spite of efficiencies through co-operation and creation of consortia, student transportation expenses have continued to increase, from $629 million in 2002–03, to an anticipated $845 million in 2011–12, an increase of 34%.  This has nothing to do with competitive procurement.  To suggest as much is grossly misleading.

A quick look at the three main costs in the industry - wages, bus costs and fuel – tell the real story.

• The minimum wage in 2002 was $6.85 per hour.  In 2012, it is $10.25 per hour – a 50% increase.  It was the government of Ontario, not school bus operators, that imposed those wage increases.
• Bus costs in 2002 were $81,802.  In 2011 $93,503.  This increase was largely due to EPA emission standards and increased safety standards, regulations mandated by governments.  What is more telling though is the reduction in age limits for school buses.  Assuming a change from 15 years in 2002 to 12 today, the capital cost per year increased from $5,453,47 per bus to $7,791.92 per bus or 42%.
• Fuel - In 2004 the average price was $0.63 per litre.  In 2011 it was $1.05, for an increase of 67%.

To prove this point, one of our members has taken the 2007 cost benchmark study and taken out wages, fuel and capital costs.  By inserting the 2002 numbers, then repeating the exercise by inserting the 2011-12 numbers, you get a 32% increase which equates to $829 million.    Clearly, any increase in student transportation costs can be laid squarely at the feet of government.

Our commitment to our members is to get this analysis and perspective into the hands of local decision-makers.  You can help by using the MPP Backgrounder attached, and this email, recent media coverage (on the ISBOA website at this link:

  http://www.chathamdailynews.ca/ArticleDisplay.aspx?e=3473288 

to let your local Reeves and Deputy Reeves, Chambers of Commerce, Rotary Clubs, and trustees know the real story – that small business and student transportation is under attack yet again.

Looking forward to seeing everyone on February 25^th.

Steve Hull

President, ISBOA

Our members in Action!