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March 12, 2010  |   Comments (0)   |   Post a comment

Contractor Roundtable: The Current Business Climate

School bus contractors offer insights on the advantages of contracting in the current economic climate as well as the impact of state and national regulatory issues.

by Claire Atkinson - Also by this author

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Dennis Gallagher, chairman/CEO, Student Transportation Inc., Wall, N.J.

Has the current economy impacted driver recruitment and retention?

Gallagher: I believe that it has positively affected retention. However, we spend a lot of time making our drivers feel like part of the STA-STC family. We look after each other, help each other out in tough times, and that also has helped us keep good drivers.

Fowler: In my case, I have not driven since the start of school one time. And when I’m in a bus, there’s no one else around. Unfortunately, most of the rural areas like where I am, it’s a totally part-time job. You only drive a couple hours in the morning and in the afternoon. And this year we’re totally full. So yes, it definitely helps us to recruit and retain, and we tend to get a little bit better drivers.

Thomas: I had a customer three days before school started this year that needed 25 routes. Now for me, 25 routes to add three days before school started — I didn’t have buses, I didn’t have drivers, I didn’t have anything. And pretty much on time, I was able to fulfill that service request.

Benish: The current economy has allowed all of us to have better, more qualified drivers. It has been a total change since two years ago.

Gatto: With the high rate of unemployment nationwide, the driver shortage that existed in the past does not hold any longer. Driver recruitment and retention has eased up, resulting in lower advertising and recruiting costs.  However, we continue to spend on driver training and ongoing refresher courses to maintain and improve the quality of drivers.

Are you currently concerned about security threats to school bus transportation?
Gallagher: Let me say we are always “aware” of that. It is the nature of the business to have safety and security a key part of our success. We believe the new technology today helps improve communications and we constantly are training our folks on what to look out for.

Fowler: I’m out in a rural area. I’m more concerned about a hostile parent than I am about the Taliban. With Homeland Security last July at [NSTA’s] conference in North Carolina, we had an extra day and a half of training with all types of security issues, so we still want to train our people and we have an excellent program that Homeland Security has put out, First Observer.

Thomas: The secretary of Defense and secretary of Homeland Security are saying the likelihood of a terrorist event in the near future is certain. With that, I’m just so thankful that First Observer is incorporated into school bus driver training because school bus drivers today, coast to coast, cannot ignore this or think that it’s unlikely. To have drivers with their antennas up and to have it incorporated into their annual in-service training is critical.

Benish: This is something we try to talk about with our managers on a regular basis. The drivers are always the eyes and ears of any bus company, if anything out of the ordinary is going to happen, they will notice first, and they need to know how to report it.

Duke: The safety and security of the 4 million students we transport to and from school each day is our core value. First Student buses offer a number of safety features such as GPS systems which allow us to pinpoint each bus’ exact location at all times, Child Check-Mate, an electronic reminder system designed to ensure that a child is not left unattended on a bus, and Theft-Mate, an onboard security system that protects our buses from unauthorized boarding while parked.

How are the EPA 2010 standards affecting your business and purchasing decisions?
Gallagher: We are very much in the forefront of new vehicles. We have one of the youngest fleets in the industry with an average age of about 5.8 years. We have new CNG, propane and other ULEV vehicles. This is an investment in our kids and our communities.

Fowler: I have not ordered any 2010s. I don’t know, when I have to make that decision, which way I’m going to go, whether I’ll go with EGR (exhaust gas recirculation) or urea [a component of selective catalytic reduction (SCR) systems]. I came from the shop, so I’m more to the bolts and the nuts than a lot of people are, and I just don’t have a clue.

Thomas: It’s exacerbating the funding situation, both for districts and for contractors. The reality is that there’s going to be less school buses on the road — that’s, I think, the net effect of the environmental standards — and the sad part about that is every bus that’s on the road takes 36 cars off the road. That’s why NSTA and the American School Bus Council (ASBC) are trying to work with Congress to let decision-makers know the importance of keeping yellow buses on the road.

Benish: The 2010 EPA standards are tough, but needed, especially because we carry children. Every bus we purchase now must be fully utilized throughout its useful life. We will be unable to purchase as many new buses this year due to the price increases.

Domenic Gatto, president/CEO, Atlantic Express Transportation Group, Staten Island, N.Y.

Gatto: The new EPA standards are the most stringent so far and mandate a huge reduction in nitrous oxide emissions by diesel engines, which will increase the prices of new vehicles and definitely add maintenance costs in servicing SCR (selective catalytic reduction) equipment in the future. Last year, we made a significantly large purchase of model 2009 buses prior to 2010 enforcement. Additionally, we are looking at alternative fuels allowed in states we operate in.

Duke: First Student recognizes its part in being a good corporate citizen. We will obviously be compliant with the new EPA legislation but also look at ways to reduce emissions in our current engines with fitted particulate traps and crankcase filters.

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Read more about: alternative fuels, Atlantic Express Transportation Corp., budget cuts, CDL, driver recruitment/retention, emissions, EPA, First Student Inc., FMCSA, NSTA, school bus security

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