In a chilling rebuke, Chancellor Kaya Henderson has disavowed the ambitious plans for improved D.C. school food set forth by DCPS food services Director Jeffrey Mills and instead has ordered her staff to proceed immediately with a new contract to outsource cafeteria operations and try to stem the mounting deficits attributed to the system’s current vendor, Chartwells.
In a letter to D.C. Council Member Mary Cheh (D-Ward 3), Henderson distanced herself from some 1,500 pages of documents Mills’ staff had recently sent the Council detailing how Chartwells has helped run up some $14 million in red ink over the past year. Meanwhile, Henderson and her key management staff have refused to hear Mills’ proposal to ditch Chartwells and bring much of the system’s food service operations in-house.
Mills sent the proposal, in the form of a PowerPoint presentation, to Cheh. But Henderson withdrew it, saying “the views in the PowerPoint do not reflect the direction that DCPS food services is moving in….”
Henderson told Cheh that “some of my staff members may not necessarily agree with my decision” and that she was sending a revised response to questions generated by Cheh. Echoing former Chancellor Michelle Rhee’s decision to hire Chartwells four years ago, Henderson wrote that “food service (like facilities maintenance and construction) is not a core competence of ours,” adding that “the option of bringing food service back in house is premature at this point.”
Henderson is scheduled to appear for questioning before the Council today, and Cheh, author of the city’s Healthy Schools Act, plans to ask the chancellor a number of food-related questions. School officials have yet to explain whether annual deficit spending–now averaging more than $12 per year–is supporting better food, high labor costs, waste and inefficiency, corporate profits for Chartwells, or some combination of all of the above.
The emerging schism between Henderson and Mills casts a pall over a food service operation that otherwise was thought to be showing great progress since Mills was hired two years ago. Mills had forced Chartwells to completely revamp its menus, removing things like Pop-Tarts, chicken nuggets and strawberry milk in favor of low-sugar cereals, fresh vegetables and more lunch items prepared from scratch by school kitchen staff. But while Chartwells ostensibly was hired to gain control of budget shortfalls in school food service, the deficits according to Mills have only gotten worse.
For instance, in 2007-2008, the last year DCPS self-operated food service, the average loss per school totaled $80,000. That jumped to $115,447 the first year Chartwells took over, and in subsequent years has run around $90,000 per school.
The total food service deficit for the current school year is expected to reach $14.35 million, or more than double the red ink DCPS cafeterias generated in 2004, when the schools ran their own food service.
According to Mills’ staff, Chartwells’ average cost per meal is $4.21, compared to $3.06 for D.C. Central Kitchen, which prepares meals for seven schools under a pilot program, and $2.87 per meal for Revolution Foods, which caters to another seven schools. Officials said Chartwells runs up the cost with numerous contractor fees, and by paying inflated prices for many supplies and ingredients. Mills’ plan to sever ties with Chartwells called for eliminating food service deficits by 2016.
Chartwells also collects millions of dollars in rebates from its suppliers. Under federal law, Chartwells is supposed to pass those rebates on to the schools, but officials said they still aren’t sure they are receiving all of the funds to which they are entitled.
Chartwells has a “cost reimbursable” contract with the schools, meaning it is reimbursed for all of its expenses, as well as being paid an annual management fee and a small fee for each meal it services. Under its contract with the schools, Chartwells is supposed to hold deficit spending to no more than $6 million annually or forfeit its management fee. But according to one official, Chartwells has forfeited its management fee every year the contract has been in place while deficits have ballooned out of control.
Mills, whose background was in developing restaurant concepts in New York prior to being hired as food services director for the schools here, has chafed under the Chartwells contract, hoping eventually to build a system in which the schools produced their own meals from whole ingredients. In anticipation of such a system, the Healthy School Act called on the city to provide a central kitchen and food processing facility that has yet to materialize.
According to Mills, only 8 of the nation’s 135 largest school districts outsource their cafeteria operations to large food service companies such as Chartwells, Sodexo and Aramark. Neighboring Fairfax County, for instance, runs its own food service without creating deficits. But the food served there also is regarded a far inferior to the meals children in D.C. receive.
But in light of the school chancellor’s latest move, Mills’ vision for meals cooked fresh by local chefs may be a long way off.