May 8, 2015 at 4:00 PM - Superintendent's Weekly Update to the Board of Education

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Please see attached three separate deferred maintenance lists to be completed by the School District, Winkelman, and ARY. Everything the School District does on its own avoids "soft costs."  Winkelman charges 10% for CM fees on the deferred maintenance items.  ARY has us budget 20% but receives 7% according to their contract with the School District.  The other 13% is for possible permits, testing, etc.  It dose NOT mean the whole 20% is spent, but rather budgeted to cover all potential costs.

The School District is saving approximately $200,000 by completing some items itself.  These extra dollars are helpful in paying for the following additional items:

1.  Improve elementary playground and upgrade surface (old budget $5,000 ~ new budget $150,000)
2.  Replace elementary classroom roofs (old budget $185,400 for 20,600 SF ~ new budget $288,000 for 32,000 SF)
3.  Remodel elementary gym from floor to ceiling (old budget $45,100 ~ new budget $131,536)
4.  Add secure front entrance and expand lunchroom at elementary (old budget $105,000 ~ new budget $250,000)
5.  Replace hallway carpets in MS-HS with epoxy terrazzo (old budget $72,000 for 3,500 SF ~ new budget $198,000 for 11,000 SF)

We added in total $165,803 in new deferred maintenance costs.  Don't worry we have it covered in the overall budget.  And look at all the REALLY NICE improvements!!!     

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Please see attached the updated ARY designs ready for board discussion and approval.

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Please see attached a sampling of the progression that occurred during design phase in regard to square feet.  Paul color coded them by dates when the lists were updated.  However, the SF and designs changed hundreds of times throughout the process.

The green column created on 5-5-15 is the final recommendation to the board for approval.  some more notable space changes are the following:

Grades 6 - 12
1.  Greenhouse is now its own separate structure near the varsity football gate.  Mr. Bratsch has taken charge of constructing it.  He and Robert traveled around looking at others.  The amount we budgeted for their anticipated cost is $50,000.
2.  400 SF were added to the new science labs to make them similar to the design at Kingsland High School.  Paul had them undersized from the beginning and was reluctant to make them larger.  The group visit to SE Minnesota helped us better identify the accurate need of 1,457 SF.
3.  The MS science lab is going to be advertised as an alternate bid.  If prices come back favorable we'll add this to the construction project and ag will get it's own instructional classroom.
4.  We separated out the weight lifting and cardio equipment into two rooms.  This allowed for us to add all the weights needed for PE, athletic programs, and the community.  And some people feel more comfortable doing cardio exercise in a separate room from young men lifting weights.
5.  We added 2,108 SF to the north end where the new grades 9-12 lockers will be.  This new area will be a great place for students to do independent college level coursework, grade level class meetings, etc. 

Pre-k - K
1.  We re-sized the preschool and kindergarten classrooms to match in SF.
2.  We are going to advertise one additional preschool room and kindergarten classroom as an alternate bid.  If prices come back favorable we'll add these to the construction project.
3.  The serving kitchen in the cefetorium is now sized to be a full prep and serving kitchen.  It will be able to prepare and serve food to several hundred children.

Description: 
I will share these two documents at the special board meeting on Monday.  They are Paul's updated costs at the conclusion of our many design meetings since January.  The columns to focus on are colored in green and black.  The purple and red colored columns were updates along the four month journey.

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We've added $2,085,953 in new costs to create additional learning spaces and address lots more deferred maintenance needs in both buildings.  Fortunately, these new items can and will be covered through a variety of funding sources identified in the attached document.  In a nutshell, we're able to balance the new costs with available dollars.  I will explain this in greater detail at the special board meeting.  

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My recommendation is to no longer pursue solar panels for the school roofs. In my Friday Letter to the Board on April 24, I suggested it'd be a good deal for the Royalton School District if ....

1.  Royalton School District agrees to pay Olson Energy $0.0569 /kWh for the energy produced by the solar panels.  You can see this in the attached cash flow document you provided to us.
2.  Royalton School District agrees to pay Olson Energy $10,000/year from year 7 through 16.  A total of $100,000 over ten years.  You can see this in the cash flow document you provided to us.
3.  There will be no other costs or expenses to the Royalton School District.  All of the equipment will be handed over to the Royalton School District after the 1st quarter of the 6th year (this is how I understood Bob Olson).
4.  Olson Energy will pay all installation and materials costs. Total approximate installation cost is $1,792,800.
5.  Olson Energy will pay all interconnection, engineering, and O & M costs.

Today I received two game changers.  David emailed a message stating "the investors have repeated that the Power Purchase Agreement (PPA) needs to stay at the 8.99 cents per kilowatt hour to make it cash flow for them."  He also stated "Our engineers are not yet convinced that the tenK Duo system is the best selection of solar panels for your buildings."

This is continued bait and switching happening here.  If it smells bad, it likely will taste bad too.

The second game changer is a letter sent to us from Innovative Structural Solutions, P.A.  In summary, our existing MS/HS roofs were designed off an old Minnesota State Building Code (i.e., 30 pounds per square foot).  This code has changed in recent years and what was once acceptable is no longer.  The new code requirement is 46 pounds per square foot.  This is an increase of 53%.

We'd be throwing away thousands of dollars to further investigate our roof load capacities.  And then throw away tens of thousands of dollars or more to bring the load capacity up to code.  All of this is more clear in the attached letter.              

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Please see attached the weekly bills for your approval.