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Revere food service program posts deficit; new vendor guarantees $100,000 return
Summary
District staff told the Sept. 9 committee the food services program ran a deficit last school year largely because of retroactive pay and vendor transition; a new vendor contract guarantees a $100,000 return for the coming year.
District finance staff presented a food services financial report on Sept. 9 that showed a deficit for the last school year and explained how the program will use fund balance and contract provisions to manage the shortfall.
Finance staff said the deficit resulted largely from retroactive pay following collective bargaining settlements for full- and part-time cafeteria staff as well as the transition between food-service management companies. “We know that there would be something of a deficit realized this year that encompass[es] both the previous and current fiscal year, and you can see that we were, amply prepared for it,” the presenter said.
Staff described a package of measures to cover the shortfall: charging fringe benefits for full-time cafeteria staff and some indirect costs (utilities and related charges) to the food services program, and drawing on a designated food services fund balance to replace equipment and cover intermittent deficits over the next two years. The presenter said cafeterias at Garfield Middle School received significant equipment replacements during fiscal years 2023 and 2024 and that some high school food-service costs will be covered by building campaign resources.
On contracts, staff said the district chose a new food-service vendor whose bid included a guaranteed minimum return to the program. The presenter explained the guarantee is based on a payroll figure cited in the bid documents: “given the $3,200,000 of payroll that you cited in the bid documents… we guarantee you that we will return a $100,000 to the program through operations. That's for this coming school year.” Staff said the district will monitor vendor performance in the first six months and negotiate renewal terms after that period.
Questions from the committee covered whether federal or state reimbursements were at risk and whether the Garfield unit ventilator replacement was a capital project or funded with grant money. Staff said the unit ventilator work at Garfield was a separate capital project and that the larger HVAC upgrades had been funded in part through ESSER federal funds — the presenter noted “we were able to redo that whole heating system” with ESSER-related money, and cited an amount “over $700,000” for the Garfield work.
Staff told the committee they will analyze year-end city fiscal figures and present carry-forward appropriation recommendations at the October meeting, with an interim Ways & Means discussion beforehand.
