Opinion: TPS Facility / Sinking Fund Plan
Pros, Cons, and everything in between
Josh Mattison, our Director of Operations, gave a facilities brief at the February 24th school board meeting. There was a friendly debate amongst board members on how best to proceed, and an update on Herrick Park. David Panian recently covered the lack of bids for Herrick Park Elementary here:
Tecumseh School Board Reviewing Options for Herrick Park (behind a paywall).
Given the discussion on facilities recently, I thought it was a good time to go a little deeper into the subject.
Facility Projects / Sinking Fund
Mr. Mattison was kind enough to respond to my request for greater detail on facility projects. He clarified his position as follows:
The discussion at the February 24th meeting was about moving forward with a Construction Management company as part of the sinking fund project team moving forward. We posted a Request for Qualifications for Construction Management Services, to work with TPS and the approved Architectural and Engineering firm (Wightman). This is a common structure for bond or sinking fund renovations.
Mr. Mattison also pointed out that this is the same structure used by:
Clinton Public Schools - $34.8 Million
Blissfield Community Schools - $23.6 Million
Adrian Public Schools - $29.4 Million
Tecumseh Public Schools - $7.5 Million + $3.5 Million (3% Capital Reserved)
He also confirmed that the focus of the February 24th board meeting debate on facilities was between approving a Construction Manager (CM) for the entire 5-year sinking fund term, or bringing in companies as needed for each project. Mr. Mattison’s position rests on two main points:
Continuity of service between projects and locations
Cost savings over the 5 years. (2.5% CM fee for the entire project list, with a fixed budget, over 5 years, or 6-8% on a per project rate).
The only dissenting opinion seemed to come from Trustee Simpson, who felt that we should go about the projects differently. I’ll let Tim explain in his own words (see below). Some of the following clips have been sped up or amplified, but remain otherwise unedited.
Mr. Mattison prefers the fixed cost / fixed scope model versus the Cost+ model, as the fixed cost model insulates us from rising costs over the length of the project. Conversely, Mr. Simpson felt that we may not have the money up-front to go this route, and seemed to doubt that costs would rise. Below, Trustee Davis accepts Trustee Simpson’s point, but asks the board to consider the opportunity to attract school of choice students with a functioning pool. She also points out that the sinking fund project is a chance for the school board to show good stewardship.
Mr. Simpson assures Mr. Mattison (below) that he does not discount Mr. Mattison’s work, but simply has a differing opinion. He then suggested that savings from a Cost+ model could be used for things like tennis courts.
Trustee Martinez then counters by suggesting a “bird in the hand” argument, arguing that savings from a Cost+ model may not materialize and therefore would not be able to fund a tennis court, while money spent on a construction manager would ensure value for the district. He then acknowledges that Simpson has experience in these matters, but says he’s not comfortable disagreeing with Mr. Mattison. He also disagrees with the notion that hiring a CM would be “throwing money down the drain”.
Trustee Lewis then weighs in and reminds the board that this is their one shot to do this right. “Excuses don’t matter” he states in reference to the potential of coming up short on funds. He states that he doesn’t want to have egg on his face in this case, to which Mr. Mattison assures the board that he will be flowing information out to the board and the community every step of the way on priority and progress.
There were other board member comments, so I would encourage the public to take a look at the full video on TPS’s YouTube channel: TPS Full Meetings
Herrick Park
Also in the February 24th meeting, Mr. Hilton brought up an option for the empty Herrick Park building. This option involved signing the building over to a state organization, who would likely demolish it to reappropriate the land for housing projects. Herrick park was recently placed up for bid, but as Mr. Panian reported, no one showed interest. As Mr. Hilton said previously, empty buildings are a liability.
One commenter on the article suggested this course of action was silly, as new housing would bring in new residents, necessitating a new school, defeating the purpose of closing Herrick Park. I believe this logic is flawed for two reasons:
Michigan is currently experiencing a mass exodus of residents. Even if new housing were to bring in additional residents, this process could take ten years and nothing guarantees residents will move in.
District population is declining today, so we need a solution today. This option, only one of many that Mr. Hilton suggested, comes at no cost to the district. I view this as responsible.
I will continue to report on the progress with Herrick Park as new options are discussed.
My Thoughts
Construction Management
Paying for projects as we have the funds, as Mr. Simpson suggested, does seem like the responsible thing to do at first. I’m no construction expert, but my “day job” is spent talking to government officials (both US and foreign) who wanted to save money by doing the a-la-carte option and now regret their decision. They pride themselves on being fiscally conservative, but sometimes cheaper up front means more expensive down the road. I would also argue that the a-la-carte method is not wise when the projects required are a necessity. The board presented a plan to the community, and the community voted on that plan. As a voter and member of this community, I agree with the majority that we should stick to the plan laid out by Mr. Mattison.
Quiet Hiring
In the clip above, Mr. Simpson suggests that we don’t need a construction manager (CM) for HVAC projects because Mr. Mattison is already qualified in HVAC. It sounds like Mr. Simpson was merely joking, but I would point to the potential conflict of interest that this would pose, asking Mr. Mattison to be both contractor and director. Asking an employee to save the organization money by performing skilled tasks outside their scope is also considered quiet hiring, and is generally frowned upon.
Conclusion
I read some comments on social media where folks blasted the district, insinuating “those in charge” don’t know what they’re doing in regard to Herrick Park. I beg to differ. We have the best in the business (Mattison) laying out a facility plan (seriously, you should see his resume). We have board members engaging in healthy debate over how best to save the district money. We have a Director of Operations and a Superintendent more than willing to keep the public informed. We’re in good hands.
Well done, TPS. Well done.