Weekly Outrage: Coast Janitors to be Laid Off - USM Forum -- Message Board

Date: Apr 18, 2005

Weekly Outrage: Coast Janitors to be Laid Off

Date: Apr 18, 2005

I am curious if this outsourcing was put out to competitve bid.....?

I am on the bid list for state and federal contracts in Mississippi, I dont recall seeing the
RFP

Date: Apr 18, 2005

no it wasn't, and therefore it's another worthless rumor.

Date: Apr 18, 2005

quote:
Originally posted by: Gone Coastal
"Found out today that USM-Gulf Coast is privatizing its janitorial services. As a result, about 15 janitors, a number of them with over a decade of service, will be laid off, with only two weeks' notice. According to a source in the administration, the net savings from these lay-offs is projected to be about $30,000 a year. Some of these janitors are people I've known since 1992. In other words, our magnificent administration is now willing to throw away experienced, dedicated people so that it can save about $2,000 per year per person. From where the administration stands, this looks like "economic development" I guess. It looks like "making the most of our resources," I guess. "lean managment" and "cost cutting" and all that crap. From where I stand, though, it looks like a goddammed, lowdown, disgusting betrayal of decent hardworking people. And for what? For $30,000! Maybe we could arrange to have the savings paid to the SOB who figured this out in $1000 silver pieces. 30 of them. Staff Council needs to take note. The same person who gave me the word on the janitors' lay off had also heard that the same fate might be in store for the maintenance staff at Gulf Park. Some of these folks have been with USM-GC for over twenty years. And what's good for Gulf Park is good for the home campus, isn't it?"

There's been talk of outsourcing custodial and other types of work done through the Physical Plant on both campuses for several years (pre-Thames administration even).

Date: Apr 18, 2005

Way it was described to me was that this janitorial contractor doing a special job at Gulf Park told the administration that his/her firm could do the cleaning there w/considerable savings to the U. This contractor submitted a formal bid that was accepted. My source made no mention of a formal RFP or anything resembling competitive bidding. Given the source I got this from, it''s not probable that this is misinformation.

Question: If the way I heard it from this person is the way it went down, has a law been broken?

Date: Apr 18, 2005

It wouldn't make any difference if the law was broken or not. Just ask the state auditor.

Date: Apr 18, 2005

How about the Attorney General?

Date: Apr 18, 2005

tweedle dee, tweedle dum

Date: Apr 18, 2005

quote:
Originally posted by: Gone Coastal
" Way it was described to me was that this janitorial contractor doing a special job at Gulf Park told the administration that his/her firm could do the cleaning there w/considerable savings to the U. "

Did the janitorial contractor in question happen to be Hanbury and Dvorak ?

Date: Apr 19, 2005

quote:
Originally posted by: Austin Eagle
"Did the janitorial contractor in question happen to be Hanbury and Dvorak ? "

Tweedle dum, tweedle dumber.

Date: Apr 19, 2005

quote:
Originally posted by: Gone Coastal
" Way it was described to me was that this janitorial contractor doing a special job at Gulf Park told the administration that his/her firm could do the cleaning there w/considerable savings to the U. This contractor submitted a formal bid that was accepted. My source made no mention of a formal RFP or anything resembling competitive bidding. Given the source I got this from, it''s not probable that this is misinformation. Question: If the way I heard it from this person is the way it went down, has a law been broken?"

This is what Thamesian economic development is all about: helpin' yo' friends make mo' money.

Date: Apr 19, 2005

quote:
Originally posted by: Gone Coastal
" Way it was described to me was that this janitorial contractor doing a special job at Gulf Park told the administration that his/her firm could do the cleaning there w/considerable savings to the U. This contractor submitted a formal bid that was accepted. My source made no mention of a formal RFP or anything resembling competitive bidding. Given the source I got this from, it''s not probable that this is misinformation. Question: If the way I heard it from this person is the way it went down, has a law been broken?"

i see request from governmen agencies daily for good and services...the key is not if a law is broken but the appearance. most government funded agencies who want to appear fair(even if bid is not technically required) place it on the bid net work that goes to all interested parties

Date: Apr 19, 2005

Whether or not the transition from public to private janitorial services is being done according to established state regulations may be important, but an even more important issue is whether the displaced employees who, after giving years of service to the university, will continue to be eligible for state benefits such as health insurance, retirement, and the college tuition break for their kids. Further, even if the same public employees are rehired by watever private-sector vendor is contracted to to the work, if there is to be a cost savings it would seem that those employees would have to be paid considerably less. I understand that the savings would be something like $30,000. That is a mere drop in the bucket compared to the salaries some fat cat administrators make in a very short time. I'd like to know the whole stoy on this decision.

Date: Apr 19, 2005

once again people, the only way something can be outsourced would be for an RFP (or in the case of Aramark and B&N - an ITN) to be issued by the purchasing office (Joe Morgan), a committee formed, and an evaluation process to take place, a vote taken, and the results sent to Jackson and IHL. In most situations we are going to deal with 10 year contract which will require IE signature and IHL approval.

Stop with the stupid rumors.

Date: Apr 19, 2005

quote:
Originally posted by: Yacht docked at the marina
"Whether or not the transition from public to private janitorial services is being done according to established state regulations may be important, but an even more important issue is whether the displaced employees who, after giving years of service to the university, will continue to be eligible for state benefits such as health insurance, retirement, and the college tuition break for their kids. Further, even if the same public employees are rehired by watever private-sector vendor is contracted to to the work, if there is to be a cost savings it would seem that those employees would have to be paid considerably less. I understand that the savings would be something like $30,000. That is a mere drop in the bucket compared to the salaries some fat cat administrators make in a very short time. I'd like to know the whole stoy on this decision."

BTW, the average salary/wage increase for our "outsourced" employees of the dining and bookstore operations was 7% this year - while we received nothing. This combined with better benefits puts them in a much better place then the rest of us gubment employees.

don't you understand the economies of scale these private industries can utilize?

Date: Apr 19, 2005

quote:
Originally posted by: once again
"once again people, the only way something can be outsourced would be for an RFP (or in the case of Aramark and B&N - an ITN) to be issued by the purchasing office (Joe Morgan), a committee formed, and an evaluation process to take place, a vote taken, and the results sent to Jackson and IHL. In most situations we are going to deal with 10 year contract which will require IE signature and IHL approval. Stop with the stupid rumors."

I don't know anything about the janitorial services at Gulf Park, RFPs, ITNs or the veracity of this thread. In general I agree with your "no stupid rumors" line of thought but something about your post doesn't ring true. Administrators who are paid from multiple accounts just under the IHL approval levels and consulting contracts just under the IHL approval levels seem to contradict your position.

Date: Apr 19, 2005

quote:
Originally posted by: once again
"the average salary/wage increase for our "outsourced" employees of the dining and bookstore operations was 7% this year - while we received nothing. This combined with better benefits puts them in a much better place then the rest of us gubment employees. don't you understand the economies of scale these private industries can utilize? "

You make a good point. But outsourcing services such as the bookstore is quite different from outsourcing janitorial services. Specifically, the bookstore has a product to sell and can charged whatever their little heart desires to make a profit. Janitorial services, on the other hand, do not have a product to sell (unless they plan to negotiate with each member of the Coast faculty to empty their trashcans and wax their floors). Their profit must come from the flat-rate the university agrees to pay them. Where could the $30,000 savings come from? My guess is that it would be from lower wages, fewer benefits, or a decrease in services. Maybe there is another source of savings, but for the life of me I can't think what that might be.

Date: Apr 19, 2005

Faculty will empty their own trashcans and report it on their FARs?

Date: Apr 19, 2005

quote:
Originally posted by: FAR-fetched
"Faculty will empty their own trashcans and report it on their FARs?"

A white glove inspection every morning except weekends.

Date: Apr 19, 2005

quote:
Originally posted by: once again
" don't you understand the economies of scale these private industries can utilize? "

I understand that when buying in quantity, the buyer can realize some savings per unit. Typically, the greater the quantity, the greater the per unit savings. That's why I can buy a TV at Sam's cheaper than a traditional retailer can buy at wholesale. (Hence, the traditional retailer has to stay in business by providing superior service, not pricing.)

So, Aramark and B&N are able to buy stuff so cheap that they can pay the workers 7% more plus pony up a few million to rework the powerplant? BTW, is that 7% per individual? in the aggregate? above what was paid by USM? or above the last year pay from ARAMARK?

Could a contractor buy janitorial supplies at such a deep discount? Is there a way to buy labor in quantity? I mean legally.

I really don't know. Please explain it to me. Preferably in words of one syllable. ("Use" means the same thing as "utilize" to someone as stupid as I am.

Date: Apr 19, 2005

quote:
Originally posted by: Yacht docked at the marina
"You make a good point. But outsourcing services such as the bookstore is quite different from outsourcing janitorial services. Specifically, the bookstore has a product to sell and can charged whatever their little heart desires to make a profit. Janitorial services, on the other hand, do not have a product to sell (unless they plan to negotiate with each member of the Coast faculty to empty their trashcans and wax their floors). Their profit must come from the flat-rate the university agrees to pay them. Where could the $30,000 savings come from? My guess is that it would be from lower wages, fewer benefits, or a decrease in services. Maybe there is another source of savings, but for the life of me I can't think what that might be."

sorry, you're right. Here's an example of how even those "private partners" of ours can do the job cheaper, better, and afford to pay their people better. Our family insurance premium is approximately $460 - crazy right? Well, that includes the institution picking up part of the premium and paying all of the premium of the employee. Last year when rates increased the appropriated increase from the legislature was absorbed by the increase. The insurance rates obtained by powerhouses such as B&N and Aramark cost 50% of ours and the deductible is lower and the coverage better. Go figure. Everyday negotiation occur that attract better, broader based services, for less money. Simply put, private industry is more efficient/effective.

Date: Apr 19, 2005

quote:
Originally posted by: Dumb as The Rock
" I understand that when buying in quantity, the buyer can realize some savings per unit. Typically, the greater the quantity, the greater the per unit savings. That's why I can buy a TV at Sam's cheaper than a traditional retailer can buy at wholesale. (Hence, the traditional retailer has to stay in business by providing superior service, not pricing.) So, Aramark and B&N are able to buy stuff so cheap that they can pay the workers 7% more plus pony up a few million to rework the powerplant? BTW, is that 7% per individual? in the aggregate? above what was paid by USM? or above the last year pay from ARAMARK? Could a contractor buy janitorial supplies at such a deep discount? Is there a way to buy labor in quantity? I mean legally. I really don't know. Please explain it to me. Preferably in words of one syllable. ("Use" means the same thing as "utilize" to someone as stupid as I am."

I just wrote a long reply which was somehow lost. Anyway, they (B&N and Aramark) will take a loss for the first 3 or 4 years and then begin making money. They will grow the business on campus by leaps and bounds over the next few years and do so without increasing price over inflation. My other post was about efficientcies and their effectiveness - a story about wait times during rush in the textbook center - I thought it was rather good. Anyway, another example, we wrote off approximately $800K last year in bookstore due to poor inventory carry practices. The examples of our private partners doing "business better" is endless.

Date: Apr 19, 2005

Custodians at Gulf Park were today told that they had until 1 July to find another job. Speculation among informed parties on the Coast is that the lack of a legitimate bid process is what accounts for the delay in privatizing. Perhaps Lee Gore caught on to what "once again" is calling a "stupid rumor"?

An attorney friend with political connections tells me that state "bid laws" are, in fact, usually somewhat scrupulously observed in MS. People can really go to jail if they are not, and the failure to practice legitimate bidding practices for state contracts can impact state bond ratings and other measures of state fiscal integrity.

All this aside, though, I'm once again depressed by the relative political naivety of my fellow citizens, on this board. If the reason that outside contractors can "do things cheaper" than the state is because of their vaunted "economies of scale" why can't the state itself take advantage of its thousands of employees to negotiate with medical insurance and pharmaceutical companies for bargains? Why can't bargains be cut that reflect the state employee pool's comparatively large potential market share? The fact that the state doesn't do this indicates how badly the state is led, how inept, inert and unimaginative its administrators are at every level. The reason corporations do stuff like this is because they're run by smart, talented (and often ruthless and amoral) people who have to answer to shareholders and a board of directors who are equally smart (and often ruthless and amoral).

So please, spare me this crap about "economies of scale" and the "inherent superiority" of the market and bidness men when it comes to all solving public and social problems. The last time that kind of business-centric rhetoric was as thick as it is now was the fall of 1929. Something happened right after that that sort of took the wind out of the sails of all those self-inflated business types. What was it? Oh yeah, the Great Depression . . .

Date: Apr 19, 2005

Gone Coastal, I agree with you about the lack of leadership in some State agencies, that is evident in the insurance arrangement; but if you don't wake up to the "market truth" then . . . you(we) lose. Ineffcient and broke, or effective and healthy - our choice.

Oh, btw, quit thinking that all "bidness" persons are amoral - that's just not the truth. Most are as honorable and upstanding as any faculty or staff and you know this.

Date: Apr 19, 2005

Already Gone: You can't really believe that the American for-profit healthcare "system" is healthy and sound, can you? And most of the time I've looked at it, "market truth" in whatever other context you'd wish to name has only been proven "true" to the extent that it was propped up by enormous government subsidies of one form or another. Karl Hayek, and the Vienna School, Milton Friedmann, the Chicago Boysans other prophets of "market truth" are blatant ideologues, and their propaganda has inspired the greatest misdistribution of wealth in human history, the wholesale devastation of the environment and the emmiseration of a larger proportion of the global population than anything since the Black Plague. Those janitors on the Coast are merely the latest victims of the privatization plague. A plague on your "market truth", sir.

Date: Apr 19, 2005

you're telling me you disagree with market capitalism?

Date: Apr 19, 2005

you know what, never mind, this is useless. i'll accept your plague - and you still lose. . . yeah, you will.

Date: Apr 19, 2005

quote:
Originally posted by: Gone Coastal
"Already Gone: You can't really believe that the American for-profit healthcare "system" is healthy and sound, can you? And most of the time I've looked at it, "market truth" in whatever other context you'd wish to name has only been proven "true" to the extent that it was propped up by enormous government subsidies of one form or another. Karl Hayek, and the Vienna School, Milton Friedmann, the Chicago Boysans other prophets of "market truth" are blatant ideologues, and their propaganda has inspired the greatest misdistribution of wealth in human history, the wholesale devastation of the environment and the emmiseration of a larger proportion of the global population than anything since the Black Plague. Those janitors on the Coast are merely the latest victims of the privatization plague. A plague on your "market truth", sir."

Welcome to the board comrade. I've been feeling very isolated lately, and I'm delighted to learn there's a kindred spirit among this band of filthy amoral capitalists.

Date: Apr 19, 2005

quote:
Originally posted by: once again
"sorry, you're right. Here's an example of how even those "private partners" of ours can do the job cheaper, better, and afford to pay their people better. Our family insurance premium is approximately $460 - crazy right? Well, that includes the institution picking up part of the premium and paying all of the premium of the employee. Last year when rates increased the appropriated increase from the legislature was absorbed by the increase. The insurance rates obtained by powerhouses such as B&N and Aramark cost 50% of ours and the deductible is lower and the coverage better. Go figure. Everyday negotiation occur that attract better, broader based services, for less money. Simply put, private industry is more efficient/effective. "

Because the state of Mississippi is self insured the premiums reflect the actual cost of the program. There is no profit built in, and recently the program has run at a deficit. No one can negotiate a premium at 50% cost, no matter how big they are. Private enterprise insurance companies must make a profit.

Date: Apr 19, 2005

Aramark and B&N don't even do things cheaper. Meal plan prices and book costs are officially and unofficially higher, respectively. What is happening is prices are being raised for lower-income residents of the dorms and an attempt is being made to raise prices for all students. Part of the higher prices gets diverted to the administration which then, of course, diverts the money to instruction or airplanes, or light poles, or street beautification, or . . . This is the best-case scenario that assumes the administration cut a good deal. The companies negotiate these contracts all the time and administrators only do it once in a while. Guess who wins in that deal? Sort of like buying a car. A final problem is that once a school has shut down its internal operation, it can't go back. What if the food is bad, the books are too high, or the floors aren't clean? The companies are usually just as ethical as the law allows, not a bit more, not a bit less. Aramarks mongering doesn't surprise me. B&Ns does. There's a lot of students leaving U.S. campuses these days with less than fond memories of B&N. They'll have more choices as grownups and many won't chose B&N.

Outsourcing can work. You had just better think damn careful about it before signing that contract.