FROM BUILDING TO MAINTAINING
- By Ellen Kollie
- February 1st, 2004
In the past decade, school districts across the country have infused billions of dollars into construction of new facilities, as well as renovation and expansion of existing facilities. A lot of that construction was to accommodate expanding enrollment, but replacing worn-out facilities also accounts for some of it.
With growth starting to stabilize, a nagging question arises: How are we going to maintain these facilities and thus avoid rabid deferred maintenance issues 20, 30, 40 and more years from now? A look at a handful of districts offers some insight..
School District, Texas
The state of Texas has no requirement for facility maintenance, notes Robert Sands, Jr., REFP, executive director of Facilities at Plano Independent School District (PISD) in Texas. Most readers will not be surprised by that. Their states don’t, either. In fact, of the five districts in this article, only one has a state requirement for facility maintenance..
Texas does offer what Sands and his colleagues call the Robin Hood Plan, where property-wealthy school districts keep only a percentage of their tax dollars — the rest of it goes to poorer school districts. Unfortunately for Sands, his district is property wealthy.For every dollar we collect on property value here, we only keep $.70, he says.We’ll write a check to the state for $130 million this coming year..
This means that PISD, which has 54,000 children on 70 campuses and a $450-million annual budget, must budget carefully for facility maintenance..
Adding even more financial pressure is the growth that Texas has experienced. They allow us great latitude into building, and we have in the last 10 to 12 years because our population through the last decade in the state of Texas has grown by 750,000 students, Sands says. And, more than 90 percent of that growth is Hispanic children. So, we have grown in standard curriculum, but we’ve also had to influx a lot of extra programs to educate all our children well..
One way that PISD manages its budget is by outsourcing. We outsource our custodial department completely, Sands says. We are in the process of outsourcing our maintenance department from a management standpoint, and we’re looking into outsourcing some of our food service..
It gets rid of personnel and insurance issues. It works well because, if I have a custodian who is not doing his job, all I have to do is pick up the phone and say ‘you need to fix this.’.
Fairbanks North Star
School District, Alaska
Alaska, which has grown considerably in the last 20 years, has built and renovated many schools in that time. It’s the one state in this article that has a facilities maintenance requirement. For any capital funds on which you have voter-approved bonding, the state will reimburse between 60 percent and 70 percent, depending on conditions, notes Dave Ferree, director of Facilities Management at Fairbanks North Star School District. However, the state does have minimum requirements to be eligible to participate..
You have to have preventive maintenance plans, a planned custodial effort, plans for major maintenance, and you have to show a working maintenance work order system and that you’re training your personnel, Ferree says..
Alaska’s program is just about five years old. It was created in response to a wide variation in the quality of maintenance and upkeep from one district to the next, says Ferree. There was some concern that the state was pouring millions of dollars into new facilities and, in some instances, the new facilities weren’t lasting nearly as long as they should have, even at a minimum. The requirements are fairly basic. And, if you’re paying attention at all to your facilities, I don’t think any of the requirements are earthshaking..
The district enrolls 15,000 students in 30 schools with an annual budget of $125 million. Ferree notes that local support has been good. The local elected officials have understood that they need to keep a fairly consistent funding stream going to their facilities. We are facing, like a lot of other states, budget crunches. There will be difficult decisions made in the next two months to two years..
Ferree notes that nationally, state and local money has gotten extremely tight in the last couple of years. The vast majority of states are facing deficits and requirements to trim the budget. That has got to eventually impact school operations. Another thing that’s happening is that No Child Left Behind has a number of underfunded mandates that are requiring districts to repurpose resources. I think it’s inevitable that some of that will come from facilities..
Ferree’s solution? Most people don’t like the ‘T’ word, but that’s what it boils down to. The way you sell it is through a prudent argument: We can pay a small amount on an annual basis, or we can defer it and have a large balloon payment down the road..
Nebraska’s Omaha Public Schools (OPS) passed a bond issue in 1999 that accommodated some growth but also was used to move students back into their own neighborhoods. We went from a voluntary desegregation program to a neighborhood policy, says Mark Warneke, REFP, director of Buildings and Grounds for OPS. We needed to have the bond issue passed to bring the buildings up to speed. Our district looks a lot better than it did, Warneke says. But it was only a third to a half of what we need. Is there money to support what we’ve done? I’d say the answer is no. The operations and maintenance of the schools comes out of the general budget, and that budget in the last few years has been getting tighter and tighter..
Compounding the budget cut challenges, Warneke believes, is that facilities have become more complex to maintain, therefore more expensive to maintain. He cites heat pumps, motion detectors on lighting and more. He understands that these items are designed to help the district save dollars in energy conversation and try to get long life out of our products. On the other hand, we then create maintenance problems because we have to provide training. It just raises other types of questions..
This district, which has 46,000 students on 83 school campuses and a general budget of $311 million, does not use outsourcing as a means of saving money. We think we get a better service from our employees, says Warneke. On the operations side, which is the custodial services, we feel that our custodians know the kids, have an ownership in the buildings and that they take better care of the buildings than someone who’s contracted and may not live in the community or have any ties to it. We buy our products on bulk, so I think we get a good savings on that. We have had companies come in and show us some savings, but I’m not sure I’d always get the service from them because they’re very rigid. If I need them to come in after hours, there’s a cost increase. Their salaries are, granted, lower than ours, but sometimes salary indicates quality of work and experience, too..
The district is working in other areas to efficiently maintain their facilities. Some of our craft lines may decrease if we don’t get any more budget, Warneke says, so we’re going to have to realign staff to meet some of these complexities. And, we continue to look at getting better equipment for better efficiencies..
The Milwaukee Board of Education in Wisconsin has a policy that says the district is to have a 10-year facilities master plan current at all times, as well as a five-year budget plan. The budget capital plan has two parts: preservation capacity and expansion capacity.
We are fortunate because, to pay for some of the expansion capacity, we have a state-authorized program called the Neighborhood Schools Initiative, says Edward McMilin, REFP, Facilities planner for Milwaukee Public Schools. It’s a $98-million program that issues redevelopment authority bonds to build new schools or additions in overcrowded neighborhoods. It allows the children who are being transported by bus out of their neighborhoods because there’s no space for them in their local schools to return to their local schools. The bonds are being paid for with the transportation savings. It requires taking 11,000 children off busses. The 20-year bonds are being issued in a five-year program, and the last set of bonds will be issued by September 2005.
McMilin notes, In Wisconsin, all schools are under revenue limits — not levy limits — where we are limited to the number of dollars by which we’re allowed to increase our budget. It’s an attempt by the legislature to keep the property tax down..
What that has done is to build into the district budget a structural deficit, because we cannot have a cost continue because that cost is above the amount of money that we can spend for the following year. The structural deficit this year was about $40 million.
McMilin expresses concern about balancing the 670,000 sq. ft. of additions created by the Neighborhood Schools Initiative program with the budget cuts. In the last two years, we’ve lost more than 100 maintenance people, and we get no more dollars and no more people. Ultimately, it will catch up, and we’re going to need to allocate more dollars or the buildings are going to start to deteriorate.
One way the district, which educates 103,000 students in 163 schools with an annual budget of $1.1 billion, keeps a lid on costs is through decentralization, which has become a national trend.
At the same time we began putting our capital budget together in 1990, we began decentralization, says McMilin. Now, about 97 percent of the $1.1-billion dollar district budget is decentralized. The schools get to decide how they want to spend those dollars, rather than the district.
Some things they get automatically charged for, McMilin says. Payroll, for example. It’s something we call a chargeback. On issues where it is not necessary for a function to be kept centrally, we call it a buyback; it means people have a choice of whether to buy that service or go somewhere else to get it.
St. Paul Public
To the west of Wisconsin’s Milwaukee Public Schools is Minnesota’s St. Paul Public Schools. Minnesota has a Health and Safety Levy, which is used for health and safety matters and is highly restricted. What the state found, after a number of complaints from school districts, was there wasn’t enough money in the Health and Safety Levy for maintenance. So the Alternative Bonding
program was created in 1994.
If you’re a certain size district, you are authorized to sell bonds with your school board’s approval. The bonds can be used for the same health and safety work, and also for deferred maintenance and handicapped accessibility improvements. That’s a long way of saying that we sell $11 million per year in general obligation bonds, says Patrick Quinn, AIA, REFP, executive director of School Services for St. Paul Public Schools. Of that $11 million, the majority goes to maintenance.
In general, because we have the alternative bonds, we don’t spend much of our capital bonds on maintenance, says Quinn. And, although we have the Alternative Bonds, given pressures from the taxpayers, we are nervous about the potential of losing the authority to sell the bonds. We’ve become dependent on this funding source by moving more and more expenses out of the general fund because the general fund was being squeezed down. It was a way to make room for directly supporting the educational effort. The problem is, if the bonds ever go away because of voter pressure, we will come crashing back into the general fund just to get enough money to maintain things as they are.
The district, which supports 43,000 students in 80 facilities on an annual budget of $540 million, has increased its building area by 746,400 sq. ft., or 11.4 percent, since 1993. We’ve cut $34 million in the last three years, and we’re looking at cutting another $15 million this year, says Quinn. But, our test scores are going up. We’re making sure the classroom gets the money it needs and that teachers are trained to focus on exactly what the students’ needs are.