Fuzzy Math in Philadelphia: Edison Overstates Savings Possible Through Outsourcing School District Maintenance and Operations Work

David Bradley
Publication Date: 
March 1, 2002

Under contract to the Commonwealth of Pennsylvania, Edison Schools Inc. (Edison) last fall prepared an 80-page assessment of the Philadelphia schools and outlined strategies for improving school performance financially and academically.

One section of the Edison report estimated that cost savings of between 10 and 30 percent could be achieved by outsourcing school maintenance and operations. This category includes custodial work, groundskeeping, and maintaining and operating heating, ventilating, and air conditioning systems.

This briefing paper examines the methodology behind Edison’s estimate of the savings possible through outsourcing maintenance and operations functions. It finds that:

  • In concluding that the Philadelphia School District (PSD) has high maintenance and operations costs, Edison compares PSD with a sample of school districts which is 52 percent rural and has no school with more than 37 percent the number of students in Philadelphia.

  • When compared to other large, urban school districts, the PSD has average or slightly below average maintenance and operations costs.

  • Salaries for the District’s maintenance and operations staff are also in line with average salaries in the Philadelphia metropolitan area.

  • The mid-point of the hourly wage range for PSD building engineers is $17.19 compared to a metropolitan area average wage of $19.52.

  • The mid-point of the hourly wage range for PSD cleaners is $11.03, compared to a metropolitan area average wage of $9.89.

  • PSD had moderate or low operations and maintenance costs despite having older facilities and a longer heating season than many other large, urban districts.

At present, maintenance and operations account for 10.7 percent of PSD costs, about half of which is labor costs. The available evidence indicates that it would be difficult to save more than a few tenths of a percent of the PSD budget, if that, through outsourcing these operations.

Any savings that are attainable would likely turn family-sustaining jobs into poverty-wage jobs. When a major challenge faced by PSD is a high concentration of children from families living below the poverty line, penny pinching by creating more poverty in Philadelphia is not a sensible reform strategy.

This document is an on-line summary of a Keystone Research Center report. The entire report is available for download as a PDF file at the KRC Web site www.keystoneresearch.org © 2001 Keystone Research Center