D.C. Public Schools promised that it would save millions of dollars if it paid a private company to prepare and serve meals to its students, but a new report released Friday reveals the school system has not saved much money at all since it made the switch in 2008.
The report, from the D.C. auditor’s office, shows that D.C. Public Schools spends more on meals than other similar U.S. school systems, and the report says that DCPS has no clear plan to control its costs under private contractors.
The auditor recommended that DCPS go back to managing its own meals program, arguing that officials could better control the cost of preparing meals and the cost of labor than it does now.
“Bringing this critical service back under the control of individuals who are directly accountable to the Mayor and the Council offers the hope of better participation by students, and a reduction” in costs, D.C. Auditor Kathy Patterson said in a statement.
The school system opposes that recommendation, saying there are risks to bringing the program back into the school system, such as a need to employ food-service workers, a new warehouse and logistics related to food distribution. DCPS acknowledged that there could be some long-term benefits to bringing food service in-house but also said that it would prefer to stick with private sources.
“We have confidence in our existing contracts, which require the highest level of nutrition, food quality, customer service, innovation and community partnership,” Carla D. Watson, interim chief operating officer, wrote in a DCPS response to the audit.
The report notes that former chief operating officer Nathaniel Beers said the system’s focus needs to be on educating children.
“We had a hugely broken school system. We concentrated on getting the academics right,” Beers told the auditors. “Our fear of bringing it back in-house is that it would become all-encompassing.”
The school system serves breakfast, lunch and snacks to thousands of its students each day. Many of its students, especially those who live in poverty, depend on those daily meals. But the cost of feeding students is high because federal subsidies often do not cover the entire cost of preparing and serving meals.
School systems also must deal with increasing regulation of school lunches, as there are now mandates relating to the amount of sugar or salt food can contain, and schools are being pushed to increase the quality of their food. DCPS has said that an outside company can better handle it.
DCPS has been under scrutiny for its food service, and it agreed to pay $19 million last year to settle a whistleblower lawsuit alleging that Chartwells-Thompson Hospitality, its largest food vendor at the time, overcharged the city and mismanaged the school district’s meals programs.
Chartwells withdrew as the school system’s food vendor earlier this year. In July, the D.C. Council begrudgingly approved a one-year, $35 million contract with a new food-service vendor, SodexoMagic, which settled its own dispute in New York after it allegedly overcharged more than 20 of the state’s school districts for food service.
Before 2008, meals were prepared by DCPS employees in full-service kitchens. But the school system said its food-service department was inefficient, and it made a case for hiring a private company to feed its students. The council and mayor approved the move.
At the time, the school district estimated that it would lower its costs by 73 percent by 2011, but the auditor found that the actual savings came in at 5 percent.
The auditor found that the school system is paying contractors much more money than it receives in federal dollars. DCPS pays its contractor between $4.16 and $4.24 for each school lunch, but the federal government reimburses the school system for $3.15. The city has to cover the rest of the cost — close to $9 million last year.
While other school districts often pay money out of their own budgets to cover school meals, the auditor found that DCPS is paying more per meal than other districts it studied that are roughly the same size. DCPS paid $3.90 per meal in fiscal 2015 while serving 9.2 million meals. Baltimore served 14.1 million meals at a cost of $2.95 per meal, and New Haven, Conn., served 4.5 million meals at $3.10 per meal.
DCPS’s projected savings in 2008 also relied on a projected increase in students opting to eat school-provided lunch and breakfast. Participation has declined slightly: In 2008, 67 percent of DCPS students ate school lunches, and in 2015, 64 percent did.
The school system’s director of the Office of Food and Nutrition Services told the auditor that one reason it hasn’t boosted participation rates is that students do not like the more healthful food.
Michelle Lerner, a school system spokeswoman, said the program under its new contractor is “going in a positive direction.”
“We have almost doubled the number of schools that are offering supper, in our after-school program, and new this year we are offering fresh salads at all of our schools,” Lerner said.