Schools, especially K-12, present unique security challenges. To some extent, learning is at odds with security. Learning requires freedom — security demands control and observation. Given our unfortunate national history of protecting children in classrooms, we have had to place increasing importance on school security. While I have had clients profit while providing quality services to K-12 schools, security in schools provides a number of specific legal challenges. In today’s environment, make sure you know what you are doing if you do educational work.
The Bidding Process & Contracts
Most school contracts are publicly bid. That means bid conferences and an award to “lowest responsible, responsive bidder.” Generally, a district-issued request for proposal (RFP) sent to potential bidders asking for bid submissions forms the basis of the parties’ contract. There are likely to be a number of state and local legal requirements incorporated into the RFP.
Understand any special rules that apply to the contract. For example, the contract may require you to pay “prevailing wages” to those of your employees who work on the project. If so, make sure you understand prevailing wage rules and make sure you comply with them — if you don’t, you are asking for investigations, administrative proceedings, fines and contract debarment, which means your company cannot do public work for a period of time.
If you can get your contract signed by the district, do so. I am not a big fan of the “you sign mine and I’ll sign yours” approach to contracting; however, in this instance, it could provide your lawyers arguments if you get involved in litigation. That said, there are a number of defenses to the enforcement of a private contract with a public entity — was the contract duly authorized by the right body? Was the legal form of agreement approved by the body’s legal counsel? Are the provisions enforceable against the public body? And there are more.
I have had a number of clients who, over the years, have been able to retain educational institutions at a profit. Sometimes they end up becoming the entity’s preferred provider and that can translate into the award of additional contracts without having to go through the bidding process either because you have agreed to do additional work at set values or the district can award you more work without going through the applicable procurement laws.
Insurance
Assuming you don’t get your contract signed, insurance becomes the next line of defense on a liability claim. You need enough coverage (read: many, many millions of dollars of liability coverage) and the right coverage parts (consult your insurance professional for direction). Remember, you are still likely to be obligated to indemnify your monitoring facility without the benefit of your subscriber contract protecting you from subscriber claims. Plus, if you don’t have enough insurance, you will be putting your company at risk in a catastrophic liability loss.
Prepare for the Future
Public education contracts present challenges when you exit from business. Unlike a good industry services contract, virtually no public contract can be assigned by the security provider as a matter of right. That means you need to obtain the district’s consent to the assignment (which can be sensitive but not impossible) or you and your acquirer will need to enter into a novation, which is an agreement in which the buyer agrees to take over the contract effective as of the contract’s first date. Most motivated buyers are willing to do so.
Eric Pritchard is a Philadelphia Lawyer who spends his workday making the world safe for electronic security providers. He can be reached at [email protected]. This column does not constitute legal advice; please contact an attorney with questions.
