Three companies bidding on outsourcing

Leaked email reveals site visits to UTK this week

The Posthas learned three companies are bidding on the state's extensive and controversial proposal that would outsource the overwhelming majority of custodial, maintenance and landscaping jobs at higher education facilities and other state agencies. The move has been championed by Gov. Bill Haslam, but critics say any initial cost savings will be offset by the harm done to state residents who suddenly have less stable jobs with worse benefits.

The companies helped craft the request for proposal itself over several months last year using the so-called "vested" method — a secret and virtually unprecedented processin state procurement that has drawn additional criticism. Until now, it was unknown how many companies have been involved in the process, much less which ones.

But according to an email sent by Chris Cimino, the University of Tennessee at Knoxville's Senior Vice Chancellor for Finance and Administration, to several employees in UTK's Facilities Services department, representatives of Aramark, Compass Group North America, and Jones Lang LaSallehad plans for a site visit on campus in Knoxville this week. A source says the three companies will also be touring the UT Health Science Center starting on Monday. It's unclear what, if any, further site visits are planned to campuses, correctional facilities or other state buildings.

Cimino was out of the office Thursday and reportedly unreachable by cell phone; UTK communications staff did not respond to a request to authenticate the leaked email. Michelle Martin, the spokesperson for the state Office of Customer Focused Government, which is overseeing the state outsourcing processes, said she couldn't confirm the names of anyone involved.

"Any information on any bidder is sealed until the RFP process is over, at which point it will all be made available for the public to look at," Martin said.

She also would not confirm if site visits had happened this week or were scheduled next week.

"I cannot discuss that information. But I can confirm that the state is conducting site visits in conjunction with the RFP as set out in that document," Martin said.

The RFP, which was issued on Dec. 1, 2015, detailed a processfor site visits but did not specify any dates.

Cimino's Jan. 2 email about the visit was to four people: UTK Associate Vice Chancellor Dave Irvin (who is the head of the entire Facilities Services department); Bob Caudill, the director of facilities operations and second-in-command behind Irvin over Building Services (the subset of Facilities Services over custodial, landscaping and maintenance services); Terry Ledford, director of zone maintenance; and Roy Warwick, director of utilities services. It read: "I've been informed the three companies visiting will be: Aramark Compass JLL. We will have 22 visitors total."

Cimino was originally on the CFG's Facilities Management Steering Committee, the 10-person, all-white, all-male group that has been meeting since the summer of 2015 to determine the outsourcing process for one of the lowest paid, most racially diverse group of state employees. Irvin was also originally on the facilities management "Core Group," a seven-person group of CFG staff/consultants with one representative each from the state's Central Procurement Office, UT and the Tennessee Board of Regents. According to several sources, both men were replaced in the first half of 2016 with UT representatives reportedly more friendly to the outsourcing goals. The phrasing of the email seems to suggest Cimino has not been kept fully up to date with the process since.

(As all FMSC meetings have been unannounced, closed to the public, and have not been recorded, Cimino and Irvin may have left the group for entirely different reasons. And it's worth noting that Irvin has a history of berating and physically threatening UTK custodial employeesand Caudill also is less than beloved. It's also worth noting some of that alleged abuse came during adjustments in the workforce in 2012 after UTK cancelled the limited custodial outsourcing contract it had to bring all employees back in house again.)

The three companies bidding on the RFP were among the top guesses of likely bidders by those paying attention. JLL, one of the largest managers of real estate in the nation (headquartered in Chicago; publicly traded and with $48 billion in assets managed), has already nabbed one outsourcing facilities management contract under Haslam's tenure, along with a contract (now expired) to conduct building assessments for the state and to review real estate management operations; the contract was amended to also allow JLL to act as a leasing broker for the state. The state comptroller's office found massive problems with the contracts' implementations in 2013and 2016. Haslam also used to have significant holdings in the company; it's unclear whether he still does. (Although an ostensibly blind trust has been managing his financial holdings since he took office, he has refused to disclose all the details of his holdings.) 

Aramark — based in Philadelphia, publicly traded and with $14 billion annually in revenues — already manages the outsourced food services at UTK, even driving faux food trucks around campus. The company also signed a contract with the statelast summer to manage food services for the Department of Corrections — despite the state of Michigan cancelling its correctional contract with Aramark 18 months early after issues like meal shortages, maggots and rodents in the food, and employees reportedly smuggling drugs into prisons and raping prisoners.

The Postwas unable to determine by press time what, if any, state contracts Compass Group has. The UK multinational company had revenues of $24.6 billionlast year. Its U.S. headquarters are in Charlotte, North Carolina, and it is reportedly the largest contract foodservice company in the world, with operations in over 50 countries. It manages multiple workplace vending operations in Tennessee and has lost at least one lawsuitover refusing to pay worker's compensation.

Both Aramark and Compass Group market their foodservice efforts more prominently than their other services — Compass even promotes its efforts in sourcing sustainable seafood, paying migrant tomato pickers more after lobbying by the Coalition of Immokalee Workers (which Aramark has also signed on to), and opposing HB2, the North Carolina anti-transgender "bathroom bill." (JLL has also been named one of the best companies for LGBT employees to work for, earning a perfect scoreon the Human Rights Campaign's Corporate Equality Index for three years running.)

However, food services are not a part of the RFP. A subsidiary of Compass took over the outsourcing at Texas A&M University — the primary model on which the state has based its projected savings from outsourcing. (Texas A&M outsourced both its food services and facilities management; FMSC PowerPoints seem to show Tennessee is subtracting the food services savings from its projected comparisons.)

State Rep. John Ray Clemmons, a vocal opponent of Haslam's multiple outsourcing plans, criticized the news of the companies involved.

"Out-of-state vultures are circling the local jobs that Haslam is killing with his outsourcing scheme. The Governor is taking direct aim at rural jobs and local economies by pushing this outsourcing plan, all the while denying it," Clemmons said.

Meanwhile, on Thursday afternoon, state employees protested a different outsourcing plan, one that would replace the hotel and food services at Fall Creek Falls State Park with outsourced service. In that RFP, employees are not even offered the pretense of being able to keep their current jobs.

This story has been updated to note JLL has had only one facilities management contract with the state and that its other contracts revolved around real estate services.