BKW uses ‘value engineering’ to stay within budget for $20M project

The Enterprise — Melissa Hale-Spencer

Construction work continues apace as a backdrop to the Berne-Knox-Westerlo mascot, a statue of a bulldog that will center the new courtyard, while the school board deliberates over items to keep the project within budget.

BERNE — The school board here is faced with some tough choices as it decides what to eliminate, reduce, or swap to keep costs for its ongoing $20 million capital project within its target budget.

Last November, Berne-Knox-Westerlo voters, in a landslide, approved $14.8 million to improve infrastructure and technology at the elementary school as well as an additional $5 million to improve technology and update the secondary school.

Work at the secondary school is largely complete while construction at the elementary school will continue, in phases, throughout the school year as classes shift to various parts of the building.

In April, when bids were opened, the school board awarded $17.5 million in contracts, which was about $1.7 million over the project budget’s target of $15.8 million for construction work.

At its April meeting, the board unanimously passed a resolution, promising that the difference wouldn’t be made up from raiding reserves or increasing the taxpayers’ burden.

Instead, the district planned to use “value engineering” to find savings elsewhere, such as by looking at different parts of the project and seeing if they could be made more cost efficient.

Value engineering refers to changing the ratio of function to cost, such as by finding cheaper materials or improving an item’s design. 

Superintendent Timothy Mundell told The Enterprise this week that, in the months between voter approval and getting the green light from the State Education Department, “The market changed. A lot of districts were doing a lot of work; it became a very competitive market.”

This drove costs up from the original estimates.

Mundell went on, “Contractors have been very innovative … finding different ways to do things that are less expensive.”

Asked, with those modifications, how wide the once-$1.7 million gap is now, Mundell said, “I’m reluctant to put a dollar figure on it … We’re only a quarter of the way through the project.”

He went on, “Throughout the summer, what we paid at the end of each month was less than the budgeted money. I’m certain, when we get to April or May, we’ll have a much clearer picture.”

 

The list

At their meeting on Sept. 23, school board members looked at a list of proposed reductions and cuts, which The Enterprise requested. This week, the district gave The Enterprise a list labelled “Value Engineering Accepted Items.”

For the secondary school, the list included eliminating: locker restoration, a lobby help desk, a Pupil Personnel Services suite reception desk, laminate wall panels in corridors, sunshades, and auditorium work.

Also at the secondary school, the quantity of paintable textured wall panels could be reduced, the scope of the art storage room could be modified, and existing walls would remain for the acid waste room.

At the elementary school, there could be reductions in: locker replacement; the scope of masonry restoration, which would be limited to the front facade and structural items; areas of gypsum wallboard; and the quantity of window replacements.

Also metal panels on the exterior of the 1955 wing would be eliminated as would the requirement of window testing. And, instead of cast piping, PVC sanitary piping would be used and fiberglass reinforced panels could be used instead of steel for a fuel tank. Coordinated work could eliminate the need for a temporary heat exchanger.

Changes in site work could include deducting the playground allowance, using on-site stone excavated for natural stone slabs, modifying landscape plantings, reducing structural soil planting beds to only required areas, providing concrete curbs instead of granite, and eliminating a sidewalk on the north side of the elementary school’s 1955 wing.

Mundell told the school board the list it was looking at was a “good starting place” for consideration.

When the board’s vice president, Kimberly Lovell, asked about removing the $50,000 for acoustic padding in the auditorium, board member Matthew Tedeschi stressed that the list was “fluid.”

“That’s the one that jumps out at me,” said Lovell. “If it’s fluid, maybe keep an eye on it.”

“To be transparent,” Tedeschi said, “there’s cuts made.”

Mundell wrote in an email to The Enterprise this week, “Given the reality that the bids for the work on the BKW capital project came in over the established budget due to the fact that the market changed for capital construction between the time the project was approved by the voters and approval by NYSED [New York State Education Department], we have undertaken a process to bring project costs in line with the established budget, without changing the primary goals of the project.”

Mundell, on Tuesday, talked The Enterprise through the schedule of the district’s planning and approval for the capital project. “Plans were finalized and submitted to State Ed. in September of 2018,” he said.

“We did an expedited review process … where you can purchase a third party to do engineering, budget, and design review,” he said.

Once that was complete, BKW thought the State Education Department would do an oversite review in two weeks, Mundell said. BKW expected to put out bids in January and get contracts back in early February, he said.

However, Mundell said, “It got locked in a review pattern with someone doing a full review … going literally back to the beginning … It drastically shortened the lead time contractors had for their orders for materials on site.”

“We were very outspoken about our needs,” Mundell said of the district’s architects working with supervisors at the State Education Department.

However, the delay made for “a very tight summer construction schedule,” Mundell said.

“Since contracts were awarded in April 2019, the district has engaged in value engineering as a process to manage cost to meet the project budget,” Mundell wrote in his email, going on to list seven points about the process.

“It is important to note decisions made regarding value engineering were made based on prioritizing safety/security, repairing critical infrastructure, enhancing technology capacity, modernizing elementary classrooms, organizing the facilities to support the academic direction of the district, and enhancing community engagement with the campus,” he wrote. 

“Value engineering is a process used by the architects, engineers, construction management, and contractors to determine the most effective and efficient way to achieve project goals,” Mundell wrote, noting that it “prioritizes project items, analyzes projected budget for each item, examines materials to be used for each item, and coordinates the sequence of work for each item in the project.”

He went on, “Throughout the value engineering process, contractors have been able to identify savings on the established construction budget leading to costs that come within the total budget for the project ... The process is ongoing throughout the project and is fluid in terms of cost and savings.”

Mundell also said, “The further we move through the project, the clearer the final costs become. In some cases, items on the list have been eliminated from the project. If the process of value engineering closes the budget gap, items may be restored based on priority established by the board of education ... 

“The process also includes preserving contingency funds built into the project budget for unexpected issues, controlling costs for professional services, and managing specific costs assigned to the district.”

He concluded, “Project work continues in pursuit of the identified goals.”

More Hilltowns News

  • Berne’s latest farmers’ market, initiated as a response to the coronavirus, had its opening on Wednesday, Aug. 5, in what vendor Todd Gallup, of Berne’s Gallup Farms, told The Enterprise was an “extraordinary success.” The market will continue to operate Wednesdays from 3 until 5:30 p.m. at the Berne Town Park with no established end date. 

  • Berne-Knox-Westerlo has published its reopening plan on its website. Governor Andrew Cuomo will determine the first week of August whether schools will reopen statewide. 

  • The Berne Town Board has spent more than $15,000 on investigations according to documents received by The Enterprise through a Freedom of Information Law request. All the investigations appear to have been of Democratic town board members. One recently led to a censure by partisan vote; the others were unsubstantiated.

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