Testimony of Council Member Garodnick in Opposition to Extension of School Bus Driver Grant Program

Testimony of New York Council Member Dan Garodnick

On Amendments to Section 11-87 of Title 66 of the Rules of the City of New York

Pertaining to School Bus Drivers

Before the New York City Department of Small Business Services

November 15, 2017



Good Morning, and thank you for the opportunity to testify today.  My name is Dan Garodnick and I am a Member of the City Council representing the Fourth District of Manhattan.


I am here today to again raise concerns about the legality of the School Bus Drivers Grant Program.  This program, when originally proposed to the City Council in 2014, was designed to supplement the wages of senior school bus drivers who lost their employee protection provisions in 2011.  I voted against this program when the legislation was introduced because I believed that it was inconsistent with the New York State Constitution, as well as with our procurement laws. Subsequently, in January of 2017, when the SBS held a hearing to reauthorize the program, I raised the additional objection that SBS does not have the authority to take action without City Council approval. I continue to object to this rule change today.

At the City Council’s August 19, 2014 hearing on this matter, the Administration testified that the legislation was for one year only, and that the request for supplemental wages would not be pursued again.  Chris Berner, the Chief of Staff in the Mayor’s Office of Labor Relations, testified that the bill would encourage school bus companies to offer better wages and benefits to senior drivers only “for the upcoming school year.”[1]  He went on to say that the bill would “ensure smooth services for the year, and give the city time in the next several months to seek state legislation” to provide for retention of senior drivers.[2] (emphasis added)   Mr. Berner represented to the Council his confidence that the City would be able to secure a change in relevant state law.


The bill the Council passed was applicable for one year and faced a sunset on December 31, 2015. After the bill’s sunset, rather than return to the City Council, SBS passed an extension to the expired law by rule on November 20, 2015 and seeks to continue this practice today.


What was intended to be a single vote for a single year’s payment has become a permanent practice. Three years after the City Council’s action, the administration has been unable to secure a change in state law, and has not come back to the City Council for reauthorization of our now expired law.  SBS should not continue the practice of awarding wages outside the rules of procurement.


The Executive Plan included a total of 32.6 million in Fiscal 2017 and Fiscal 2018 to fund the School Bus Grant Program.[3] During the City Council executive budget hearing on May 9th of this year, Commissioner Bishop testified that the grant program cost $28 million in the first year and $32.8 million in the second year. He projected that, in this year, it would cost the city $31.5 million.[4]


Additionally, I asked the commissioner precisely how many drivers had gotten extra money as a result of this program.[5] The Commissioner said he would have to get back to us.  Recently, SBS said: “There isn’t any extra money that anyone receives on top of their paychecks for this program. The city reimburses the bus company the delta for qualified employee payments of wages, pension and healthcare costs per the terms of the program.”[6]  


Of course, this misses the point. There is some knowable number of bus drivers whose wages are higher as a result of the bus company’s access to these taxpayer dollars.  It is troubling in the extreme that SBS is writing a check to bus companies and seems to not know the exact number of bus drivers who are benefiting from this program. 


The New York State Constitution prohibits New York City from giving any money directly to a private interest unless there is a predominant public purpose. At the City Council hearing in August 2014, the Administration articulated the public purpose to be the “smooth delivery” of a service for a single, upcoming school year -- which many of us interpreted to mean the avoidance of a strike.  Before extending the program by rule in November 2015, SBS articulated the public purpose as “securing efficient and reliable bus service for the City’s school children and avoiding layoffs and wage and benefit cuts to the drivers and attendants operating the City’s school buses.”[7] Such a rationale could justify supplementing the wages of nearly every employee of a city contractor, and notably, SBS’ proposed rule this year does not even offer a public purpose. 


Offering additional money to a private company outside a settled contract can only reasonably be viewed as a predominantly private purpose, and continues to set a terrible precedent for procurement.  The bus companies that lost the bid here lost it because they were willing to pay more money to their workers without the additional grant of money and addition of EPP’s.  The companies that won the bid were the ones who were willing to cut salaries. As a result, we are distorting the normal competitive bidding process and failing to conduct ourselves fairly with respect to all bidders. There are ways to ensure fair wages, but this grant program is not one of them.


Let me conclude by saying that I have great respect for our senior school bus drivers.  They do an extraordinary job keeping our kids safe and secure.  However, while the grant program’s goals are admirable -- we all want to see uninterrupted school bus service by experienced drivers -- we nonetheless need to respect the law.  SBS should reject this rule not only because it is illegal to allocate funds in this manner, but also because the authority to perpetuate this program falls solely within the jurisdiction of the City Council. 


Thank you for your time.

[1]Testimony of Chris Berner, Mayor’s Office of Labor Relations, to the New York City Council Committee on Education, Aug. 19, 2014


[3]Executive Budget Hearing of the New York City Council Committees on Economic Development and Small Business Services May 9, 2017, at p. 9.

[4]Executive Budget Hearing of the New York City Council Committees on Economic Development and Small Business Services May 9, 2017, at p. 148.

[5]Executive Budget Hearing of the New York City Council Committees on Economic Development and Small Business Services May 9, 2017, at p. 150.

[6]Email from Warren Gardiner of the New York City Department of Small Business Services to Aliya Ali at the Finance Division of the New York City Council Nov. 9, 2017.

[7]Grants To Companies That Provide School Bus Transportation, New York City Department Of Small Business Services, Nov. 30, 2015, available at http://rules.cityofnewyork.us/content/grants-companies-provide-school-bus-transportation-0