House Bill 1347 The Facts

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House Bill 1347 The Facts

• Joseph J. Perkoski
• Robbins, Schwartz, Nicholas, Lifton Taylor,
  Ltd.
• 20 North Clark Street, Suite 900
• Chicago, IL 60602
• p. [phone]
• f. [phone]
• jperkoski_at_rsnlt.com
• www.rsnlt.com

ROBBINS, SCHWARTZ, NICHOLAS, LIFTON TAYLOR, LTD.
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PA 095-0241

• This new measure significantly limits the
  practice of school districts contracting out for
  non-instructional services.
• Signed into law on August 17, 2007, places
  restrictions on a school districts ability to
  contract with a third party to perform
  non-instructional services.
• The School Code is amended by changing Section
  10-22.34c.

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Sec. 10-22.34c Third Party Non-Instructional
Services

• (a) A Notwithstanding any other law of this
  State, nothing in this Code prevents a board of
  education may enter from entering into a contract
  with a third party for non-instructional services
  currently performed by any employee or bargaining
  unit member or lay from laying off those
  educational support personnel employees upon 90
  30 days written notice to the affected employees,
  provided that
• (1) a contract must not be entered into and
  become effective during the term of a collective
  bargaining agreement, as that term is set forth
  in the agreement, covering any employees who
  perform the non-instructional services
• (2) a contract may only take effect upon the
  expiration of an existing collective bargaining
  agreement

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• (3) any third party that submits a bid to
  perform the non-instructional services shall
  provide the following
• (A) evidence of liability insurance in scope and
  amount equivalent to the liability insurance
  provided by the school board pursuant to Section
  10-22.3 of this Code
• (B) a benefits package for the third party's
  employees who will perform the non-instructional
  services comparable to the benefits package
  provided to school board employees who perform
  those services

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• (C) a list of the number of employees who will
  provide the non-instructional services, the job
  classifications of those employees, and the wages
  the third party will pay those employees
• (D) a minimum 3-year cost projection, using
  generally accepted accounting principles and
  which the third party is prohibited from
  increasing if the bid is accepted by the school
  board, for each and every expenditure category
  and account for performing the non-instructional
  services

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• (E) composite information about the criminal and
  disciplinary records, including alcohol or other
  substance abuse, Department of Children and
  Family Services complaints and investigations,
  traffic violations, and license revocations or
  any other licensure problems, of any employees
  who may perform the non-instructional services,
  provided that the individual names and other
  identifying information of employees need not be
  provided with the submission of the bid, but must
  be made available upon request of the school
  board and
• (F) an affidavit, notarized by the president or
  chief executive officer of the third party, that
  each of its employees has completed a criminal
  background check as required by Section 10-21.9
  of this Code within 3 months prior to submission
  of the bid, provided that the results of such
  background checks need not be provided with the
  submission of the bid, but must be made available
  upon request of the school board.

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• (4) a contract must not be entered into unless
  the school board provides a cost comparison,
  using generally accepted accounting principles,
  of each and every expenditure category and
  account that the school board projects it would
  incur over the term of the contract if it
  continued to perform the non-instructional
  services using its own employees with each and
  every expenditure category and account that is
  projected a third party would incur if a third
  party performed the non-instructional services
• (5) review and consideration of all bids by
  third parties to perform the non-instructional
  services shall take place in open session of a
  regularly scheduled school board meeting, unless
  the exclusive bargaining representative of the
  employees who perform the non-instructional
  services, if any such exclusive bargaining
  representative exists, agrees in writing that
  such review and consideration can take place in
  open session at a specially scheduled school
  board meeting

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• (6) a minimum of one public hearing, conducted
  by the school board prior to a regularly
  scheduled school board meeting, to discuss the
  school board's proposal to contract with a third
  party to perform the non-instructional services
  must be held before the school board may enter
  into such a contract the school board must
  provide notice to the public of the date, time,
  and location of the first public hearing on or
  before the initial date that bids to provide the
  non-instructional services are solicited or a
  minimum of 30 days prior to entering into such a
  contract, whichever provides a greater period of
  notice
• (7) a contract shall contain provisions
  requiring the contractor to offer available
  employee positions pursuant to the contract to
  qualified school district employees whose
  employment is terminated because of the contract
  and

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• (8) a contract shall contain provisions
  requiring the contractor to comply with a policy
  of nondiscrimination and equal employment
  opportunity for all persons and to take
  affirmative steps to provide equal opportunity
  for all persons.
• (b) Notwithstanding subsection (a) of this
  Section, a board of education may enter into a
  contract, of no longer than 3 months in duration,
  with a third party for non-instructional services
  currently performed by an employee or bargaining
  unit member for the purpose of augmenting the
  current workforce in an emergency situation that
  threatens the safety or health of the school
  district's students or staff, provided that the
  school board meets all of its obligations under
  the Illinois Educational Labor Relations Act.

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• (c) The changes to this Section made by this
  amendatory Act of the 95th General Assembly are
  not applicable to non-instructional services of a
  school district that on the effective date of
  this amendatory Act of the 95th General Assembly
  are performed for the school district by a third
  party.
• (Source P.A. 90-548, eff. 1-1-98.)
• Section 90. The State Mandates Act is amended by
  adding
• Section 8.31 as follows
• (30 ILCS 805/8.31 new)
• Sec. 8.31. Exempt mandate. Notwithstanding
  Sections 6 and 8 of this Act, no reimbursement by
  the State is required for the implementation of
  any mandate created by this amendatory Act of the
  95th General Assembly.
• Section 99. Effective date. This Act takes
  effect upon becoming law.

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Scenario One

• James K. Polk School District has subcontracted
  its bus services with Round Round Bus Company
  since 2002. The Districts current contract with
  the Round Round Bus Company expires on June 30,
  2008.
• In September 2007, the District encountered
  problems with two of its rural routes.
  Specifically, there were numerous missed pickups
  and several parents complained directly to the
  Board. The Districts attempts to resolve the
  matter with Round Round were unsuccessful.
• As a stop-gap measure, in December 2007, the
  District deployed two of its custodians (who
  happen to be certified) to run the routes while
  the District continued to work out the problem
  with Round Round. The parents are happy again.
  Now, the District has decided that because of
  Round Rounds failure to address the problems,
  it would end its relationship with the company
  when the contract expires on June 30th and re-bid
  the entire bus contract and in the meantime
  continue to use the two custodians on the rural
  routes until the new bus company come into
  service.
• Are there any implications in light of the new
  law?

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Scenario Two

• Zachary Taylor School District (home of the
  Fighting Whigs) has three middle schools and
  seven elementary schools in its system. Each
  school in the District has one non-certified
  nurse aide on staff. As of August 2007, two of
  the middle schools and three of the elementary
  schools were using subcontracted nurse aides from
  the Merry Aides Nurse Company. The other
  schools in the District were using nurse aides
  directly employed by the District.
• Due to the influx of new students, and MSRA
  outbreaks, the District has decided that it needs
  to increase its nurse aide staff. It contacts
  Merry Aides to immediately send over three
  additional nurse aides. Merry Aides has none
  available. The District turns to a Merry Aides
  competitor, NA on the Spot. On the Spot
  quickly provides four nurse aides to the Zachary
  Taylor School District.
• Should the District have reviewed the new
  subcontracting law before it retained the
  additional nurse aides?

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Scenario Three

• Martin Van Buren Consolidated School District
  decided to subcontract its food service employees
  in December 2007 despite the new subcontracting
  law. The ESP collective bargaining agreement
  which covers the food service employees is about
  to expire on June 30, 2008.
• The District provided the proper notice under the
  new subcontracting law to the Union and followed
  the bidding procedures. The District also
  complied with providing a three-year cost
  projection and all of the other requirements
  under the new law. Despite all of the hurdles in
  complying with the new law, the District was able
  to show a slight cost savings in using a
  subcontractor, Yum Yum Foods (YYF) primarily
  because YYF could provide comparable benefits at
  a lower price due to its ability to acquire lower
  cost workers compensation insurance and health
  insurance for its employees. A two-year contract
  was then executed with YYF.
• Unfortunately, as the 2008-2009 school year
  progresses, it becomes clear that YYF is not
  providing edible food for the Districts
  students. The District decides to exercise its
  termination rights under the contract and
  proceeds to re-bid the service.

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Scenario Three

• Must the District again comply with the same
  biding/notice requirements of the new
  subcontracting law?
• If not, must the District comply with the
  three-year cost projections that were provided
  from the original bidding process?

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ANY QUESTIONS?
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