MCPS partially ends contract with electric bus company after scathing report 

Business relationship to continue to maintain current fleet

February 3, 2025 2:55 p.m.

Montgomery County Public Schools (MCPS) has ended the remainder of its contract with its Massachusetts-based electric bus company following the county inspector general’s report that the district wasted “millions” of dollars by not enforcing the agreement, MCPS said late Friday afternoon in a statement.  

“Following the delivery of 50 EV [electric] school buses anticipated for July 2025, we have determined that it is in our best interest to terminate the remainder of our contract” with Highland Electric Fleets, MCPS spokesperson Liliana Lopez said Friday. “MCPS will continue to have a business relationship with Highland Electric in order to maintain our fleet of 285 EV school buses after accepting delivery of the last order of 50.”  

Lopez said the decision was based on continuing operational challenges, the district’s increasing need for special education buses that Highland Electric Fleets can’t provide and the instability of the electric school bus industry.  

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The district’s long-term concerns include problems with a growing number of the buses experiencing “extended periods of service interruption,” especially during colder weather;  the “current state of the EV school bus industry”; and recent changes that would “withhold federal grant funding related to alternative and sustainable” vehicles, Lopez said.  

Lopez did not respond Monday to questions about whether MCPS will consider contracting with another electric bus company or make other attempts to expand its electric bus fleet. 

In July, an investigation by the county’s Office of the Inspector General found that after the school district entered a contract in 2021 with Highland Electric Fleets, the company failed to meet the terms of the deal and MCPS failed to force the contractor to comply or to end the agreement.   

The district’s original $168.7 contract was for 326 buses that would be delivered Aug.1 of each fiscal year over a four-year period, according to the inspector general’s July report.

The inspector general’s report, released July 25, found Highland Electric Fleets didn’t deliver buses on time, and the contract didn’t include provisions to assess fees for late delivery. The contract did allow MCPS to assess fees for “downtime damages” for buses that were unavailable for use because of operational issues. MCPS didn’t charge these fees when buses were not operational and didn’t terminate the agreement when the contractor failed to meet its obligations.   

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In September, County Councilmember Andrew Friedson, serving as council president at the time, said during a meeting of the council’s Audit Committee that the district received a “failing grade for implementation” of the electric buses into its fleet.  

During that meeting, MCPS staff said that following the inspector general’s report, the district billed the bus company for $1.5 million for problems with performance and late delivery of buses during the time frame addressed in the report. The $1.5 million total was four times more than the amount that the inspector general’s office suggested MCPS was owed in its July report. 

MCPS staff also told Friedson that MCPS hadn’t considered terminating the contract in the past, but that it had the opportunity to do so moving forward according to the terms of the contract. 

In December, MCPS Superintendent Thomas Taylor told the council the district had recouped the $1.5 million in fees.  

“We are delighted to meet the minimum standard,” Taylor told the council in December as councilmembers laughed in response.  

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In an MCPS letter to Highland Electric provided to Bethesda Today, Taylor said he determined that it was “in the best interest” of the county school board and the district to partially terminate the contract.  

Taylor’s letter ended any obligation for the district to receive or pay for the last 40 buses that Highland Electric was contracted to provide ahead of the 2026-2027 school year, according to the letter.  

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