In what will no doubt be viewed as a landmark decision, an interest arbitration panel has issued an award which will allow the New Haven Public Schools to privatize 86 of the 186 positions in its custodial and maintenance union, and in the process save nearly $4 million dollars.
Faced with skyrocketing pension and health insurance cost which are expected to outpace the growth in revenues over the foreseeable future, the City of New Haven and its Board of Education were forced to look for ways to substantially cut operating costs. Having already laid off nearly 300 employees over the last two fiscal years, the Board and the City began to look at other options.
Among the options considered was outsourcing services that could continue to be provided at a substantial savings. An option that emerged was the outsourcing of school custodial and related services, which cost the Board $16 million per year. As a result of an RFP, the Board found a national firm willing to perform the same services for just $8 million, which would mean a net savings to the budget of $8 million per year.