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NLS, Russell's reach tentative agreement on bus contract

A New London-Spicer school bus waits Feb. 27 outside of the bus garage in New London. NLS and Russell's Bus Service of New London have reached a tentative deal for the 2009-10 and 2010-11 school years. Tribune photo by Ron Adams

NEW LONDON -- The New London-Spicer School District and Russell's Bus Service reached a tentative agreement Monday regarding the district's transportation contract for the 2009-10 and 2010-11 school years.

Superintendent Paul Carlson said the deal was during a phone conference between the two parties.

With the tentative agreement, he said, Russell's indicated it would cut its previous contract offer by the $37,774 that separated it from the district's lowest contract offer.

"We appreciate Russell's Bus Service for realizing the situation the district is in," and its willingness to work with the district "and keep our partnership going," Carlson said. "It's really appreciated."

Carlson said Greg Holt of Cokato -- one of the five business partners who own New London-based Russell's -- contacted the district Feb. 27, indicating Russell's wanted to reopen negotiations.

During Monday's phone conference, Russell's sweetened its contract offer. Carlson said Russell's matched the price of competitor American Student Transportation of Maple Grove, and offered a further $5,000 in savings if NLS accepted a two-year extension to the 2009-11 contract.

The savings appeal to the school district as it prepares for massive budget reductions in 2009-10. Carlson told the Tribune last week that NLS is anticipating up to $300,000 in budget reductions in 2009-10, as it expects to lose enrollment-related state funding and $70,000 in special education aid.

"We're going to be cutting more than our average $200,000," said Carlson, who indicated the district has made similar budget reductions for each of his seven years as superintendent.

In addition to the savings, Carlson said, Russell's also indicated it would try to meet the district's new bus specifications requiring a newer fleet of buses. (See related story.)

NLS introduced the bus age specifications after Russell's rejected the district's contract extension offer in November.

Based on the district's Feb. 23 quotes, Russell's average bus age was 14 years. Mike Nelson of New London, one of Russell's business partners and a 20-year employee, said Tuesday the agreement will not include a bus age limit, but Russell's will buy three buses -- each 5 years old or younger -- each year of the contract, including for the two-year contract extension. The purchases will improve the average age of Russell's fleet for NLS over the length of the "2+2 contract," Carlson said.

On Feb. 23, NLS did almost everything but award the contract to another bus company during a School Board meeting attended by nearly 50 people, most of whom supported Russell's Bus Service -- a division of Peterson Bus Service in New London. The local company has exclusively provided transportation for NLS for the last decade and for a majority of the company's 46-year history.

After more than two hours of discussion at the meeting, Transportation Committee members David Kilpatrick and Mike O'Brien motioned and seconded for NLS to accept a contract with American Student Transportation of Maple Grove that cost about $37,774 less than Russell's proposal.

Kilpatrick withdrew his motion after other School Board members indicated they wanted more time to consider the decision. The board postponed the decision to its March 9 meeting.

Nelson said Russell's attended the Feb. 23 meeting "to see what would happen." Afterward, Nelson said he talked to Carlson about how difficult the contract decision was becoming for the community and both parties involved. The district soon contacted Russell's after the meeting, Nelson said.

The agreement is a relief for Russell's. Last week, Nelson told the Tribune that if Russell's lost the contract, Peterson Bus Service would close its doors in New London.

"Everyone had enough I guess," Nelson said. " ... It's big news for west central Minnesota. It's a good feeling."

Carlson said the district transportation committee is working on a written contract to present at the NLS School Board's March 9 meeting.