Taken For a Ride: Competition Returns For Hawaii School Bus Contracts
For the first time in five years, Hawaii’s school bus companies have bid against each other for contracts to transport students to and from school.
Bids opened Thursday by Hawaii Department of Education officials also included offers from a new local company and one from the mainland. Hawaii’s biggest school transportation provider, Roberts Hawaii, also undercut competitors and appears to have won 12 of the 18 contracts up for bid, and could be earning about $7 million a year for both regular and special education routes on Oahu once the contracts are finalized.
The 18 contracts appear to have a total cost to taxpayers of $9.6 million.
But an initial review of bid documents shows the prices are still high. For instance, one route for which Kauai-based Akita Enterprises was paid $310 per day in 2006 is now going for $375 a day. The state had taken it over for a few years but put it back in the mix this year.
Civil Beat‘s Taken For a Ride series has been examining how the lack of competition among local bus companies is at least partly to blame for runaway transportation costs. School bus costs have more than doubled in the last six years. For the past four years, not a single regular education bus contract has been awarded in a competitive process. Companies have been telling the department what they will charge, and district officials have been paying their price.
Thursday’s bid opening revealed that the fresh challengers were able to offer a low enough price that they likely won some jobs away from established companies. The contracts start next year.
Hawaiian Discovery, which lists its corporate address on the Big Island, and Utah-based . won millions of dollars in work.
Wasatch bid on every available contract and appeared to be the successful bidder on four in West Hawaii — two for special education routes and two for regular education ones. Together, the four contracts contain 14 routes and amount to about $2 million per year.
Hawaiian Discovery appears to have won the only contract it made an offer on and would be paid $395,000 per year to operate five regular routes in West Hawaii.
Durham School Services of Chicago, which recently asked the state for bid documents, did not participate in this round of bidding.
Perhaps most notably, though, for the first time since 2007, existing local contractors bid against each other on a regular education contract. (Companies have continued to compete on occasion for special education jobs, and this year was no exception.)
Akita Enterprises beat out both Wasatch and longtime rival Roberts Hawaii for two routes in East Hawaii, with a $135,000 bid. Wasatch bid $179,000 and Roberts offered $189,000.
The costs of contracts still appear to be high, however.
One reason may be that some of the routes up for bid is this round were so rural that bus companies and the Department of Education itself have had difficulty finding qualified drivers to run them.
The department is still expected to submit a report to the Legislature soon that details ways it could hold down runaway bus costs. Lawmakers have said if district officials don’t cut costs it will only fund special education routes next year.
