Why Are Some Districts Not Paying School-Bus Contractors During Coronavirus Closures?

March 31, 2020

Despite President Donald Trump signing a $2 trillion coronavirus stimulus package that includes a provision aimed at ensuring school district employees remain on the payroll during school closures, anxiety continues to build among student transporters, especially those who aren’t getting paid or have been recently furloughed.

A web poll at stnonline.com indicates nearly 63 percent of 777 viewers who had responded as of Tuesday night work at a district or bus company that is continuing to pay school bus drivers. However, that means 37 percent are not currently drawing paychecks.

Some readers who have emailed School Transportation News or commented on the magazine Facebook page regarding a previous article on the federal CARES Act signed last week. They report that they work at one of these school districts or bus contractors that are not paying at all, reducing pay or laying off workers.

One employee who works for a contractor located in the Midwest told STN that the company has asked employees to work reduced hours and utilize their vacation time so they can still get paid for a 40-hour week. But the staff member commented that many of the employees are now running out of vacation time. Meanwhile, the company is also continuing to deduct employee-paid premiums from paychecks, while each week asking the employees to work fewer and fewer hours.

Another employee from a different company said they and their coworkers were furloughed last week amid delays in the contractor receiving payment from the school district. A silver lining for that reader, their coworkers and an increasing number of student transporters nationwide is the temporary boost to unemployment checks that the CARES Act also provides.

STN Podcast – New Missions: Student Transportation Industry Responds to COVID-19 Crisis

At issue is the ability or willingness of school districts to pay their contractors, which in turn need the money to pay their employees. One contractor told STN last week that despite a recent order issued by the state the company operates in to continue payments, some school districts are apparently funneling transportation money to other programs.

Curt Macysyn, executive director for the National School Transportation Association, said he is perplexed as to why some school districts are not paying. He pointed out that student transportation budgets, and money to pay contractors for the 2019-2020 school year, have long been allocated and should still exist in district coffers.

“Some districts say, we don’t have [legal] guidance. Others say flat out, no, we aren’t doing this,” he added. “If drivers aren’t getting paid, that’s a sure sign the contractor is not getting paid, either.”

NSTA was instrumental in getting the language inserted into H.R. 478 last week that districts shall continue paying their transportation employees and contractors during school closures, or risk not receiving their shares of the new $30.5 billion Education Stabilization Fund.

He pointed out that the federal stimulus money passed last week will likely not start flowing for another month or two, and the funds are earmarked to assist schools with coronavirus response, such as disinfecting buses. But districts that don’t use existing money to pay their employees or contractors run the risk of not being able to provide school bus service once the school year resumes, or when the 2020-2021 school year commences later this summer.

He pointed to Pennsylvania as the only state to his knowledge that has so far passed legislation that amends the state code to clarify that school districts will continue to receive their transportation reimbursement for paying their contractors during coronavirus closures.

Arizona announced last week that school bus drivers and transportation employees who work for public school districts and charter schools will continue to get paid. Contractors are not mentioned, though a state department of education spokesman told STN on Monday that school districts had the authorization to pay their contractors. If they do, however, remains up in the air.

Elsewhere, districts that do not pay their contractors, whether urban or rural, run the risk of losing their drivers and their transportation operation, Macysyn explained. Suddenly, in only a matter of weeks before the start of the new school year, they may find themselves in need of hiring the contractor back or trying to, only then to realize the company is unable to provide service. Or, he added, the district will need to find a new provider from a limited number of local companies.

And even if the districts are successful at finding new contractors willing and able to provide service, Macysyn suggested that districts will need to quickly execute a contract and figure out how to onboard drivers, mechanics and other staff. There is also the potential issue of implementing an entirely new fleet of school buses, plus adopting a new student routing systems and determining if there are enough drivers amid the ongoing driver shortage affecting the industry.

Another option, he said, is to take school busing in-house. But then comes the reality of purchasing a new fleet of school buses, and the same issues of implementing the new routes as well as hiring and training drivers, Macysyn added. The list goes on and on.

“Some districts are really rolling the dice on this,” he said.

Podcast: STN Podcast Episode 1 – New Missions: Student Transportation Industry Responds to COVID-19 Crisis
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“Districts that continue to pay during this closure enable us to take care of our employees and resume service when school is back in session,” explained Claire Miller, senior vice president of strategy, business development, marketing and communications for First Group, the parent company of First Student. “With their support, drivers remain on staff and vehicles are maintained. This also enables us to contribute to the community in other ways such as food and curriculum delivery.”

She added that conversations over the past month with customers of the largest school bus contractor operating in North America “have largely been productive and successful.”

“The majority of customers have aligned with us to ensure that transportation service fully resumes when classroom instruction returns, whether it be this school year or in the fall,” she added.

But not all districts are choosing to pay.

“So, what are districts using their money for?” asked NSTA’s Macysyn.

How is the coronavirus school closures are affecting you? Email ryan@stnonline.com.