Proposition P budget, now $86.7 million, may be increased by board
Despite recently identified savings in the Mehlville School District's $86.7 million Proposition P budget, administrators soon may recommend a budget adjustment — which would be the second time the Board of Education has increased the districtwide building improvement program's budget.
Voters in November 2000 approved Proposition P, a nearly $68.4 million bond issue funded by a 49-cent tax-rate increase.
However, the Board of Education last September adopted a revised Proposition P budget totaling more than $86.7 million.
Board members twice have delayed consideration of bids for air conditioning upgrades at Blades, Beasley and Point elementary schools that would cause a $1.189 million overage in the Proposition P construction budget — directing administrators to search for ways to lower the overages and finalize a fixed-fee contract with McCarthy Construction, the district's construction manager for Proposition P.
McCarthy Construction and Dickinson Hussman Architects, the district's architectural firm for Proposition P, have identified $203,566 in savings for renovation work at Blades, Beasley and Point elementary schools. The savings were scheduled to be presented the board Tuesday night — after the Call went to press. That savings, however, still would result in $723,125 in unanticipated costs for the district's Proposition P construction budget.
The Proposition P construction contingency fund, according to Feb. 10 district documents, totals $832,760 — which would leave $109,635 in money that would buffer any overages for Proposition P's three remaining projects — renovation work at Forder and Hagemann elementary schools and the construction of a new early childhood center.
Two weeks ago $876,020 in unanticipated costs for the three schools was projected, which would have depleted and exceeded the budgeted contingency funds.
The contingency figures, however, do not reflect McCarthy or Dickinson Hussman contract adjustments, Superintendent Tim Ricker told the Call — meaning that even with the savings, depletion of the contingency fund is likely.
The contract adjustments include increases in fees and general conditions, which primarily are reimbursables.
Board members recently approved a $56,716 increase to Dickinson Hussman's $4,562,471 contract, but administrators still were negotiating a contract with McCarthy when the Call went to press Monday. The board was scheduled to consider a finalized contract with McCarthy Tuesday.
"What we think, by looking at this (the savings), is that our contingency will increase," Ricker told the Call. "But the fixed rate on the fees and the GCs (general conditions) increased, so overall we'll probably have to go back and do a budget adjustment. So right now we're trying to figure out to what extent we'll have to do that in the near future."
Assistant Superintendent for Finance Randy Charles, who also serves as the district's chief financial officer, is conducting a cash-flow analysis, according to Ricker, that will help determine the amount of the adjustment and better determine the state of the Proposition P construction budget contingency fund after work at Blades, Beasley and Point is completed.
Board members were scheduled to consider the bids for the three schools Tuesday, according to Ricker, but an analysis of the Proposition P cash-flow situation is not scheduled to be presented to the board until March 9.
McCarthy and Dickinson Hussman identified a savings of $176,368 at Blades — which, as proposed, is $546,349 over budget with $464,349 in unanticipated costs. Two weeks ago, McCarthy and Dickinson Hussman predicted it only could find $82,683 in savings.
District documents indicate that the Trane Co. had priced a smaller chiller for the air conditioning renovations at Blades and a larger-capacity chiller needs to be purchased, which will cost the district an extra $34,054. With the additional cost and value engineering, the district predicts renovation at Blades would be $320,035 more than anticipated. The district was able to offset the Blades project by $82,000 through a state loan.
Board members were told Jan. 12 that Blades would be $127,976 over budget.
The board was scheduled to consider $1,514,713 in base bids for renovation work at Blades Tuesday — placing the school $546,349 over its $1,226,029 construction budget last revised in September — and then the net savings of $142,314 would be credited back to the district through change orders, according to Ricker, as work on the school progressed.
A possible savings of $26,030 was identified by McCarthy and Dickinson Hussman at Point two weeks ago — which, as proposed, is $476,388 over budget with $312,388 in unanticipated costs. The district was able to offset $164,000 of those costs through a state loan.
However, the two firms now have identified $22,800 in savings through value engineering, which would bring unanticipated costs for Point to $289,598.
McCarthy estimates presented to the board Jan. 12 revealed Point would be $21,704 under budget.
Board members were scheduled Tuesday to consider $1,359,619 in base bids for general, electric, HVAC and controls work, which would place Point $476,388 over its $1,060,554 budget last revised in September. The $22,800 in savings, according to Ricker, would be credited back to the district through change orders as work on Point progressed.
No cost-saving measures were identified for Beasley two weeks ago — which, as proposed, is $166,323 over budget with $99,523 in unanticipated costs since the district was able to offset $66,800 of those costs through a state loan. However, district documents indicate that there are $104,820 in unanticipated costs.
McCarthy and Dickinson Hussman representatives were scheduled Tuesday to present an additional $4,398 in savings they discovered through value engineering for Beasley.
The Trane Co., however, priced a smaller chiller size at the school, which will cost the district an additional $18,367 to purchase an appropriate chiller, according to board documents. With the value engineering and additional cost of a larger-capacity chiller, the district predicts costs at Blades will be $113,492 more than anticipated.
Board members were told Jan. 12 that Beasley would be $158,033 over its Proposition P budget, based on McCarthy estimates.
Board members were scheduled to consider $941,365 in general, control, electric and HVAC work, which — even with the $4,398 in savings — will send the construction funds at Blades $184,690 over budget once the chiller costs are realized.
With less than a handful of projects left with Proposition P, Ricker told the Call, administrators are recommending that McCarthy's role as construction manager be terminated Oct. 31.
The district's current full-time personnel will be able to handle remaining projects, he said.
Between now and Oct. 31, Ricker told the Call he expected a positive working relationship between McCarthy and the district, despite recent frustrations concerning higher-than-anticipated bids on the Blades, Beasley and Point projects.
"I don't want to give any pretense that there's consternation (between administrators and McCarthy) ... or even with the board and McCarthy," he said. "When you're in a situation like this and you have limited resources from the standpoint of you haven't been doing this in the past a lot and problems arise like this, I think that, you know, the natural, human reaction is to be surprised, be upset ..."
He continued, "But I think through the negotiations of this contract that we can amicably agree to these numbers ... What we can't forget is that while we have had consternation over the last several months, we've also had very good experience over the last three years ... The thing that we were working on was getting the best value for the tax dollar and doing that took a little bit of posturing.''