Moorhead schools accept $1.2 million state grant, OK contracts to buy three electric buses

The Moorhead Area Public Schools board on Aug. 18 approved two contracts to accept a $1.2 million electric school bus grant from the Minnesota Department of Commerce and to hire Highland Fleets to provide procurement, infrastructure installation and long-term operations and maintenance for three electric buses.

District staff told the board the grant covers roughly 90% of each bus and 95% of the charging infrastructure, and that Highland Fleets will provide a 10-year service agreement. "The grant will cover 90 percent of the bus cost and 95 percent of the charging infrastructure costs," said Sean Schneider, the district's transportation director. Schneider said Highland Fleets will offer a fixed-cost support agreement of $24,000 per bus per year for 10 years.

Board members framed the purchase as a way to reduce emissions, lower some operating costs and support student health. "They're very sustainable and will help us in our cost savings," Schneider said, adding district staff estimate about $150,000 in annual operating savings after Highland's contract costs are included. Staff said an electric bus currently costs about $400,000 versus roughly $150,000 for a diesel bus, and that the district plans to use the buses on centrally routed, short runs out of its heated garage to reduce range and cold-weather concerns.

Board member Cassidy moved to approve the two contracts; Keith seconded. The motion passed with the board voting to approve both agreements.

District staff said Highland Fleets will install chargers, provide maintenance support and help train drivers. The project timeline presented to the board targets charger installation in early 2026 and full implementation for the 2026–27 school year, with bus delivery and driver training during the school year prior to full service. Staff said the chargers will collect runtime and charging data that Highland will report to the state as part of the grant agreement.

The board-approved contracts cited in the motion were: a grant contract with the Minnesota Department of Commerce and a procurement/operations contract with Highland Fleets. The board's action included no capital outlay from the district for the uncovered portion of bus and charger costs, which staff said Highland will cover under the service contract.

District staff said they do not intend to use the electric buses on long-distance field trips and plan to base operations on shorter contractor routes to ensure reliable daily service. Highland's contract includes battery- and vehicle-service guarantees and an obligation to dispose of buses and batteries at end of service life.

Board discussion asked about cold-weather battery performance, reporting requirements to the state and how many drivers would be trained. Staff said the buses will be kept in a heated garage and that Highland will manage most reporting and technical uncertainty.

The board approved the two contracts in a single motion. The grant and contract approvals were presented as an opportunity to implement electric transportation without a district capital purchase and with expected net operational savings.