Washington, D.C. Auditor Kathy Patterson’s office condemned the privatization of D.C. Public Schools’ food services for failing to deliver on promises to cut costs and improve quality in a 70-page report released Oct. 7.
The report recommended severing ties with contractors and reinstating in-house meal operations.
The District, enticed by the promise of saving $4 million each year in local expenditures, opted to switch to contractors from in-house services for food supply in 2008. DCPS paid its food vendors between $4.16 and $4.24 for each school lunch while it was only reimbursed $3.15 per meal by the federal government. This forced D.C. to cover the $9 million difference with taxpayer money.
Food vendors further failed to increase lunch participation from 51 percent to the expected 71.6 percent within the first year of the contract, which would have increased revenues from reimbursements per meal served.
Patterson said the transition to private contractors resulted in gross inefficiencies in the food distribution system, trapping DCPS in a perpetual cycle of losses.
“The school system moved to the unit price contract, whereby no matter what it cost the vendor to produce that meal, the District will pay the vendor the fixed price of four dollars and change,” Patterson said. “There’s no incentive there for keeping costs modest.”
DCPS Interim Chief Operating Officer Carla Watson, who received a draft of the report prior to its official release, defended the privatization system in a Sept. 26 letter responding to the D.C. Auditor’s report. Watson affirmed DCPS officials’ intention to remain committed to private preparation of food.
“DCPS’ new food service contracts are in their infancy and operations have been under way for only a matter of weeks,” Watson wrote. “We have confidence in our existing contracts, which require the highest levels of nutrition, food quality, customer service, innovation and community partnership.”
Until the current school year, DCPS employed Chartwells-Thompson Hospitality to provide food for DCPS students. However, the company was forced to pay a $19.4 million settlement to the city last year after an investigation spurred by a whistleblower lawsuit found Chartwells had mismanaged its food service programs in D.C. by serving rotten food to students and participating in a multi-million dollar fraud. Chartwells asked for and was granted a release from its contract with DCPS in July 2015.
In May, D.C. Central Kitchen and SodexoMagic — along with subcontractor Revolution Foods — assumed the mantle of providing meals to over 100 schools for breakfast, lunch, after-school dinner and summer food service. However, Sodexo was dogged by allegations of serving expired food and violating employee safety regulations, which lead to the settlement of a $20 million New York lawsuit in 2010.
Disturbed by the Chartwells lawsuit, D.C. Councilmember Mary Cheh (D-Ward 3) asked the D.C. Auditor’s office to examine the privatization of school food services in 2015. Cheh said to local radio station WTOP she was dismayed over the report’s results and advocated for reinstating in-house meal operations.
“I’ve been asking them for years to bring it back,” Cheh said. “It’s a failure of their responsibility, it’s a failure of their management effectiveness, it’s a failure of their commitment to our kids.”
The report recommends that DCPS prepare to serve food again by making short deals with smaller vendors until the city takeover process is complete. Patterson said the original decision to privatize the food services may have been advisable in 2008 if school administrators wanted to put a greater focus on academics rather than nutrition programs.
“I think one of the big factors has been the decision by the school system that the nutrition programs were not a core mission of the school system,” Patterson said. “Therefore, hiring an outside vendor to come in and provide the meal made sense from the school system’s perspective.”
Patterson estimates in-house food preparation will eventually be reinstated following pressure from the D.C. Council to cut costs.
“I think eventually it will be brought back in house, but that’s really just a guess,” Patterson said. “I think there’s councilmembers who are pushing in that direction. My suspicion is that the current administration will probably follow the lead of their school leaders.”