X Mark the Spots
Navigating the Evolving Map of School Purchasing
By David Bein, Ph.D., SFO
Retired
Ken Florey
Partner
Robbins Schwartz
Dan Noonan
Associate
Robbins Schwartz
Purchasing is a key responsibility of business managers and their staff. Keeping track of legal changes is vital to ensure that districts are in compliance with the law as well as deliver the most value to their communities. Low price has been the longstanding general rule, however recent changes in the law provide flexibility to ensure that bidding results in the best value for districts.
The Illinois School Code public bidding requirements (contained in Section 10-20.21 of the Illinois School Code, 105 ILCS 5/10-20.21) have evolved over the years to provide school business officials with more discretion and flexibility to choose the best provider for the school district’s needs rather than only selecting the lowest bidder. These changes started with student transportation contracts and providers. At one time, Illinois public schools had to select their student transportation provider based solely on the lowest, responsible and responsive bidder. Choosing the lowest bidder, particularly with student transportation contracts, many times led to a provider that, for a variety of reasons, could not provide safe and quality transportation for schools. Some districts were forced to terminate student transportation contracts midway through the school year and then scramble to find a replacement contractor while trying to minimize disruptions to student transportation. These same provider problems occurred with food service, which was addressed by similar statutory changes. The same challenge still exists with custodial and maintenance provider contracts, which have not yet been addressed with statutory changes.
Student Transportation Contracts
In response to the low bidder selection problems with student transportation, the General Assembly approved Public Act 97-0951 in 2012. The Illinois General Assembly understood the challenges that the law presented and acted to provide school districts with flexibility and discretion when selecting a student transportation provider. The General Assembly’s changes did not eliminate the bidding requirement for transportation contracts, but the new law mandated that such contracts be publicly advertised in the same manner as competitive bids and awarded based on “first considering the bidder most able to provide safety and comfort for the pupils, stability of service and any other factors set forth in the request for proposal.” This changed the bid selection process from focusing on lowest price to the consideration of safety and other criteria. Additionally, the Public Act established that a complaint by a provider that was not selected cannot be brought against a school board for awarding a transportation contract unless the claim is based on fraudulent conduct. In other words, the only legal basis for challenging a school board’s decision to award such a contract is an allegation of fraud, which is very unlikely to occur and difficult to prove. Additionally, the General Assembly amended the statutory language to allow the length of a student transportation contracts to be up to ten years before going out to re-bid.
School Food Service Contracts
Based on work by members of Illinois ASBO, in 2021, the General Assembly further amended the Illinois School Code bidding language to modify the bidding requirements for contracts for goods, services or management in the operation of a school district’s food service programs. This change applies to all schools including those participating in the U.S. Department of Agriculture’s child nutrition programs and is intended to streamline the procurement process for school food services. Similar to student transportation contracts, food service providers can now be selected based on criteria other than the lowest bidder. Such alternate criteria include providers who best promote the health and well-being of students, use minimally processed foods, source local food products, use hormone and pest management best practices and increase opportunities for businesses owned and operated by minorities, women or persons with disabilities. This has been a substantial change for food service bids and has shifted the criteria from a basic pass/fail mindset to criteria that provide meaningful distinctions for meeting local needs. School districts that utilize state and federal subsidies must continue to follow ISBE bidding requirements that are different than those contained in the School Code.
Bidding Threshold
Finally, the School Code bidding requirements were amended in 2024, by Public Act 103-0008, to increase the bidding threshold for contracts involving the purchase of supplies, materials or work services from $25,000 to $35,000 or a lower threshold if required by the District’s Board Policy. This has been an important step to factor in the impact of inflation on the bid threshold. This latest increase in the bidding threshold only brings it up to approximately 2013 pricing. The prior bidding threshold was in existence since 2008.
Cooperative Purchasing
In addition to changes to the School Code affecting public bidding requirements, the Governmental Joint Purchasing Act, 30 ILCS 525/0.01, has also been amended over the past several years to provide school districts with procurement flexibility. The Joint Purchasing Act allows public bodies, including school districts, to purchase materials and work, including construction project work, with a contractor who has been selected and ranked by a qualified cooperative or the user school district as the contractor best suited to the project requirements. This change, which Illinois ASBO assisted in accomplishing, provides another option for schools other than the traditional low bid process.
Conclusion
While significant progress has been made with these amendments to the School Code bidding requirements and the Joint Purchasing Act to provide school business officials with flexibility and the ability to choose a provider other than the low bidder, additional changes will be needed, particularly around bidding for safety, security, maintenance and custodial provider contracts. Illinois ASBO has been working on implementing the statutory changes needed to cover safety, security and custodial and maintenance contracts in the same manner as the student transportation and food service contracts. Future changes are intended to ensure that the best value for taxpayers is realized, given the variations in local criteria and conditions.