Who picked this budget?…and other cost questions…

Cost FAQs: There are a number of interrelated questions that come up about the cost of the project and how we expect to stay on budget. Some variations include: Why is the budget $93.9M? Why didn’t we choose a budget and then do as much as we could for it? Home renovation projects always cost more than expected – will that happen to the school project?

Budget: Since we started talking about a school project a decade ago, there have been questions about why we started with a range of budget choices instead of one budget amount.

• In 2009, we did this because we were working with the Massachusetts School Building Authority (MSBA) and that is how their process works. The MSBA asks districts to identify all their needs/project goals and to then develop a range of solutions that meet different ranges of those needs. They expect to see the lowest-cost, most basic project at one end of the spectrum, and a “start from scratch and build it new” project at the other. Towns then choose a solution based on their own set of cost/value criteria.
• The current SBC is using the same process. Why? First, it would have been hard to choose a single budget without understanding whether or not it would meet our infrastructure and educational needs. Second, each of us probably had a different number in our heads when we thought about what the “right” budget number was. That is why we had a Special Town Meeting on June 9^th– the SBC provided a set of projects that each met a different range of needs at different budget levels, and asked the Town to collectively choose a budget (with a defined set of project objectives) to bring to a bonding vote in December.  Together we chose the $93.9M budget that would achieve our stated educational, sustainability, and basic infrastructure goals.
• Using this method not only sets the budget but sets the expectations for what we get for that budget. This leads to the FAQ about cost containment.

Cost Containment: What keeps this budget from going over $93.9M? There are several factors:

• The only way money gets spent is if the Town votes to make it happen. There is no way to get extra money for the project unless it is approved at a Town Meeting.
• The Town expects the SBC to stay on budget, and the SBC takes that charge very seriously. There will be 2-3 additional rounds of cost estimates and, if needed, value-engineering.
• We are still in the Schematic Design phase, and there are a number of contingencies built into the budget. The estimate includes contingencies to address the potential escalation of costs over time, and to address the fact that there is still significant “Design Development” work to do (after December 3rd).
• Construction Manager at Risk (CMR): This is a common construction method in which a construction manager is brought on to the project as soon as funding is approved.  The SBC just voted to recommend a CMR firm to the School Committee. There are a number of advantages to this process versus the traditional “design, bid, build” construction method:
  • The quality of construction firms bidding on projects under the CMR scenario is higher.
  • We get to meet the actual team of people who will be working on the project.
  • The CMR takes some responsibility for the budget process as soon as they are involved.
  • They work with us through design development to optimize the construction process, phasing, needed studies, etc.
  • The overall process of implementing site logistics and safety is better with a partner who is in on the design process.
  • This is a complex renovation project, and it will help contain cost to have a construction manager overseeing and managing the details to make sure the project is meeting our expectations.
• The budget-setting process described above. When we voted for the $93.9M budget, it came with a defined set of objectives and components – in a broad sense, we knew what we would get for that budget. The SBC’s job, with the support of relevant Town committees, is to make sure that as the details are developed, we make responsible decisions to ensure we stay on track.