| Where’s the money for K-12 schools?
Soft Sell, Hard Numbers
Facility executives must do their homework on facility
conditions and costs while seeking public support
— By Karen M. Kroll, Contributing Editor
In 1998, America’s public schools spent $36 billion on capital investments — twice what was spent in 1990, according to the National Center for Education Statistics. The strength of the economy, along with the public’s and politicians’ interest in education, is driving these investments. Part of that money is intended to address the demographic and educational changes that are affecting school facilities. For example, the so-called baby boom echo has led to a bump in enrollment, which means more classrooms are needed. The call for smaller class sizes also equates to a need for additional classroom capacity. Finally, many older school facilities need some sort of technological retrofit.
Despite the jump in investment, however, many needs remain. American schools overall have more than $100 billion in unmet construction needs due to decades of skimping on maintenance and repair, says Dan Fuller, director, federal programs with the National School Boards Association in Alexandria, Va.
“Until the recent prosperity, money was very tight,” says Nicolas Andreadis, a New York City-based vice president with Turner Construction Company, Dallas. “The infrastructures of school buildings received very little attention.”
Districts that face problems resulting from both deferred maintenance and growing enrollment are getting hit particularly hard, says Richard Henry, a Sacramento-based vice president of education services with McCarthy Building Companies, Inc., St. Louis, Mo.
In order to secure the funding that’s needed to bring school buildings up to par and allow for new construction, facility executives and their colleagues need to become familiar with the capital planning process. “The role of people involved in facilities is changing and being elevated,” says Peter Cholakis, vice president of VFA, a Boston-based facilities management software and services company. “They’re being heard at the school board level, at departments of education.” To act as effective advocates for the capital needs at their institutions, facility executives will need to be able to draw upon their management, communication and technical skills to a greater degree than before.
Some good things are definitely happening in the school funding arena. Voters in the Mount Vernon, N.Y., School District, for instance, recently passed a $100 million referendum on school funding. In one New Jersey district, the courts have opened the door to more state funding. The public schools there will get $8.6 billion as a result of a recent court case alleging disparities between different school districts, says Ed Brzezowski, a consultant in Chester, N.J.
But no school district or university can count on funding, even in flush times. That’s why it’s important that facilities executives take a methodical approach to the capital planning process. Doing so can mean the difference between success and failure. While each school district is different, those who have been there agree on these steps:
- Let the academic plan and enrollment picture drive the capital investment plan. “It’s important that planning is in sync with the district’s overall strategic plan and mission statement,” says Tom Getz, director of capital planning programming with Broward (Fla.) county. “It can’t be done in isolation.”
Such initiatives as class-size reduction have a major impact on facilities. Joseph Lavorgna, director of planning with the Montgomery County, Md., school district, points out that a school with 20 classrooms and a student-teacher ratio of 25 to 1 can hold 500 students. Reduce the ratio to 24 to 1, and the school will need an extra classroom to maintain its 500 students.
- Determine how things currently stack up. Facility executives and school officials need to look at the condition and capacity of the buildings in relation to the district’s academic plans and enrollment projections. The gist of capital planning, says Cholakis of VFA, is this: “What do we have, what condition is it in, what do we need, what are the costs?”
Although details are important, taking a big picture, district-wide approach is key. For one thing, it helps ensure that the district will attack the most pressing problems first. In addition, voters want to know that the school district is trying to treat all children equitably, says Andreadis of Turner Construction.
In Montgomery County, Md., for instance, all buildings up for renovation receive an independent assessment from outside construction professionals who help determine the degree of renovation necessary, says Lavorgna. They compare the condition of each building’s structures and systems to a pre-determined set of criteria. The consultants can then, as objectively as possible, rank the buildings according to their needs.
It’s not always easy adhering to the plan, acknowledges Lavorgna. “There’s a lot of pressure to vary, depending on whose parents lobby for more dollars.”
- Figure out where you want to go. “Identify the goal condition that you want buildings to be in,” says Sarah Woodhead, a Reston, Va.-based project manager with SHW Group Inc., Dallas. The goal may focus on class size or meeting current codes for children with disabilities.
The Milwaukee, Wis., school district, with 105,000 students and about 150 facilities, has taken a methodical, by-the-numbers approach to identifying its capital goals. Richard Moore, director of the division of facilities and maintenance services, explains the system: The district identified 37 major components of each building, such as roofs, boilers and windows, and calculated the estimated life of each component. Each year, facilities professionals assess the condition of each component at all 150 facilities.
This information forms the basis of the district’s long-range plan, which projects out 70 years, or the estimated useful life of a new building, says Moore. With this data, the district has a clear picture of likely upcoming maintenance projects. Moore gives an example: Assume the district has 8.5 million square feet of roof space, with an average useful life of 25 years, which was installed at various times over the past several decades. It’s a matter of crunching the numbers to figure out how much the district will need to spend on roof repairs each year.
Taking a long-term approach, as the Milwaukee district is doing, can help school officials avoid piecemeal, incremental decisions that seem less expensive but can actually end up costing more in the long run, says Woodhead. Suppose school officials in some district put a pool in a building that had unused space. The next year they realize that they need more classroom space, and that the area where the pool is would have been the right spot. “A piecemeal approach that feels safer and more cautious can be more expensive,” says Woodhead.
- Identify the stakeholders, or those who will be affected by the capital investments. Then, identify the lines of communication and decision making authority, says Henry of McCarthy Building. Do this early on, and it’s less likely that someone will be left out of the process.
- Get the community involved. Those who’ve been through the process — on both the school and construction sides — are unanimous and vocal on this point. “The community is part of the funding source, so it’s important that they understand the project,” says Kim Hassell and partner with Milwaukee-based Plunkett Raysich Architects. Getz of Broward County agrees. “Then the community gets a better understanding of the programs offered in the school and the facility needs of the programs.”
How can facilities professionals and school officials get the community involved? Both old and new media can play a role. The district can publish brochures or articles in the local paper on the project. It can also use the Web to let citizens know what is happening. Town hall meetings or public comment sessions are also key components, as they let residents air their concerns. Equally important, voters can learn exactly what a project entails, so that by the time the measure appears on a ballot, they understand the issues.
- Prepare for tough questions and the potential that the project may change, says Andreadis of Turner Construction. Citizens are sophisticated, and many understand financial concepts like lifecycle cost analysis, he says. They will want to see thoughtful, intelligent answers to their questions. “The common mistake is to come off like, ‘Hey, give us $20 million, and you’ll like what we do for you,’” says Andreadis.
To be sure, a proposed project may be changed by public input. For instance, district officials may plan to build a new gymnasium, only to find that the community is adamantly opposed to spending money on one. Those voices need to be heeded. “If not, the project will fail,” says Andreadis.
While tough questions are likely, it’s important to note that parents can be effective allies of school and facilities officials, says Brzezowski. In one affluent community, school administrators had a tough time trying to convince voters to fund proposed capital improvements. One parent made a video comparing the community’s schools to those of a similar community, which were in better condition. The video aired on the local cable channel, and the measure passed.
- Use discretion in choosing the architects, engineers and construction managers who will be working on the projects, says Henry of McCarthy Building. Often, price becomes the overriding factor. This can backfire, however, if the firm isn’t up to the job. And if there is a sense that the wrong firm was chosen, it isn’t always possible to make a change. “You get to the point where you can’t turn back,” Henry says. “A heavily price-based selection is somewhat risky.”
Ronald Ross, superintendent of the Mt. Vernon school district in New York, adamantly agrees. “In my experience, costs spiral when the people aren’t reputable.” It’s not just first costs that can shoot out of control. Ross points out that voters often feel directly connected to local school issues. If budgets are overrun, the public relations fallout could hurt the chances for future referendums. Maintaining credibility with voters is another critical reason to be sure to work with solid firms.
In addition, school and facility officials may face pressure to work with local firms. While this isn’t necessarily wrong, it can create additional pressure, as the firms may find themselves drawn into the politics, says Cholakis of VFA.
- Retain an experienced public relations team, says Ross. Given that most districts have more households without kids in school than they do households with kids in school, it’s important to get an accurate story out. “You have to show why it needs to be done, and how it benefits the kids.” Voters in his district recently approved a $100 million construction bond issue. Ross is working with Turner Construction on the projects.
- Be smart buyers. “We go through all projects fairly carefully once they’re designed, and usually are able to get 5 to 10 percent of the cost out of them by making adjustments that don’t have major consequences,” says Tallman Trask III, executive vice president with Duke University in Durham, N.C. For instance, school officials may be able to change the type of windows to ones that are still durable and look good, but are less expensive.
- Think creatively. While some might assume that doing so will increase costs, the opposite can often be true, especially as you look long term, says Woodhead.
Consultant Brzezowski provides an example. He worked on a project bringing data outlets into school classrooms. The team working on the project also installed several outlets in the mechanical equipment room. These would enable the building manager to use a computer network to monitor the systems from outside the building, thus allowing him or her to oversee several facilities.
Admittedly, the steps involved in capital planning make it a drawn-out and somewhat messy affair. However, that’s exactly as it should be, says Allen Abend, chief of school facilities with Maryland schools. “The process should be tedious and participatory,” he says. “The process backfires when there hasn’t been enough involvement.”
Karen Kroll is a business writer with experience in real estate and facilities issues.
E-mail comments and questions.
Where’s the money for colleges?
Taking the Long View on Facilities
Capital renewal for aging facilities is a key funding challenge
— By Karen M. Kroll, Contributing Editor
Some studies have indicated that prospective college students make up their minds about enrolling at a particular school within six seconds of setting foot on the campus, says Peter Cholakis, vice president of marketing with VFA, a Boston-based facilities management software and services company. As a result, facilities become incredibly important to the overall success of colleges and universities.
However, that’s not to say that obtaining funding for capital projects is any easier at the college or university level than it is at the K-12 level. “I still think we have a mixture of success and work to do in financing and funding capital projects and deferred maintenance,” says E. Lander Medlin, executive vice president of the Alexandria, Va.-based Association of Higher Education Facilities Officers (APPA). For instance, community colleges in Washington state just received word that they’ll be facing a 2 percent cut in non-instructional programs, says Jeanne Rynne, dean of capital facilities at South Puget Sound Community College in Olympia, Wash.
Tight budgets are nothing new, of course. According to a 1996 study conducted by APPA, The National Association of College and University Business Officers and Sallie Mae, the cost to eliminate deferred maintenance at America’s colleges and universities topped $26 billion. The numbers are still relevant, says Medlin.
The hefty deferred maintenance bill isn’t surprising when one considers that the average age of many buildings at public facilities is about 40 years, according to Medlin. Things are a bit better at private institutions, where the buildings are, on average, about a decade younger. In either case, however, if school officials have skimped on maintenance — very likely the case — the buildings will have deteriorated even beyond their chronological age.
And, while funding for capital investments rarely comes quickly, the route at public schools is typically even longer, says Medlin, simply because school officials have to go to their state legislature or the voters.
Another hitch that can arise when facility executives try to obtain capital funds at the university or college level is that money is frequently tied to an endowment. Often, these monies are earmarked for new buildings and don’t help existing infrastructure that may be crumbling. “No one wants to endow a new roof,” says Medlin.
However, facility executives on college campuses have some advantages that their colleagues in primary schools often don’t. For starters, most higher education construction projects exert less of an emotional pull on the surrounding community. “K-12 projects are more visible and a lot closer to the community,” says Nicolas Andreadis, a New York City-based vice president with Turner Construction Company, Dallas. As a result, the process of obtaining funds for higher education projects may be somewhat less volatile and emotional.
In addition, school administrators and officials in colleges and universities typically are in their jobs and at the same institution for longer periods of time than is the case with most K-12 school boards and officials. Thus, they may take more of a long-term outlook and have greater experience with construction projects, says VFA’s Cholakis.
When it comes to making a case for obtaining capital funds, the same steps that apply with capital planning for K-12 facilities are also relevant at the university level. The first step is to tie the facilities plan to an overall master plan that covers the academic vision, student enrollment and the finances of the institution, says Tallman Trask, executive vice president at Duke University in Durham, N.C. “The capital plan has to drive off the academic plan. We spend a fair amount of time thinking through what we’re trying to do.”
Then it’s a matter of identifying the current condition of the facilities. “You need to come from a fact-based, data-driven model, identifying the condition of the facilities, why they exist, how they’re expending current funds, and how that overlays to need,” says APPA’s Medlin. Finally, this information needs to be effectively conveyed to whoever holds the purse strings for the institution, which may be a governing board, the state legislature or the voting public.
One institution that appears to have done an effective job of getting its message across is the University of North Carolina system. Voters recently approved a $3.1 billion bond referendum for capital investments within the state’s universities and community colleges — a record amount for higher education, says Kevin MacNaughton, the Chapel Hill-based associate vice president for finance with the system.
A great deal of work preceded the vote. Facilities and finance officials within the system, aided by outside consultants, studied both the capacity and conditions of the facilities within the system’s 16 universities and 59 community colleges.
To determine capacity, MacNaughton and his colleagues took an inventory of all classrooms, analyzed their uses and compared overall capacity to the estimated growth in enrollment across the system. Despite an increase in enrollment over the next 10 years from 150,000 to 200,000 students, MacNaughton found the system didn’t need a lot of additional capacity. What he found instead was a need to use the classes more effectively.
To assess conditions, MacNaughton worked with VFA to develop a questionnaire that was distributed via the Web, in which the facility professionals on site could state whether a building was in decent shape, needed minor repairs or a re-organization, or required total gutting. From this, he was able to get a cost of renovating every building in the system.
MacNaughton and his team took the information — which filled three 3-inch binders — to the state legislature. Given the dollar amount at stake, the legislature decided to put the funding request to the voters. It passed by more than two-thirds. The lesson in all this? “Doing your homework is key,” says MacNaughton.
Karen Kroll is a business writer with experience in real estate and facilities issues.
E-mail comments and questions.
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