Architects Suggest Ammending School Legislation Bills SB1916/HB1132
We have been very reluctant to oppose this bill because we fully recognize the difficulty in obtaining financing for schools—or any building program at all. We further recognize the tremendous need for either new or renovated schools across the state; and we have urged that new buildings can be more economically built today because costs have gone down in the past two years; and putting architects and builders back to work is good for the economy. However, we have learned from school authorities and from architects that this leaseback process creates far more problems than would be solved, including:
First of all, the basic premise is flawed. Adding two profit centers--developer and construction manager--would either increase the cost of the school or reduce the building quality. Developers do not have a magic wand that allows them to build more cheaply than any other entity. While schools can avoid the initial capital outlay for school construction, their overall costs will be increased.
This process could encourage irresponsible budgeting as bond limits are imposed based on the ability of the municipality to repay the debt. Adding a second means of financing could allow school systems to spend beyond their ability to pay back their indebtedness.
Government has accepted the challenge and responsibility for providing quality public education. Turning over responsibility for the student’s physical environment to a private profit center is simply wrong, especially since Tennessee does not have state-wide design standards for schools. (Some communities have recognized the importance of quality building and created their own standards.)
Liability insurance experts have also advised us of increased claims exposure for architects and engineers, derived from inexperienced, underfinanced developers providing project direction.
Typical square footage costs for a school range from $120-150 per square foot, depending upon the location and local market conditions. Currently proposed school projects have a stipulated per square foot cost of less than $100. Quality design and construction, an appropriate environment for Tennessee’s students and code compliance simply cannot be executed with a cost reduction of 20-50%.
More important, a study of life cycle costs of a school, conducted by school authorities, yields the following information: design/construction accounts for 9% of the total cost; maintenance accounts for 50%. Cost cutting on the front end rarely benefits the school program in the long run.
The Tennessee State Fire Marshal and the International Building Code view schools, day care facilities and facilities for the aged as buildings for our most vulnerable populations—children and senior citizens. These types of cost cutting pressures put these populations at risk.
The life of the building and its components is a sustainability and maintenance concern. How does this fit in a lease arrangement? At the end of the lease term, will the school system be faced with a building that is not fit for occupancy?
Architects who participate in this process must provide basic design services without payment. Only the architect selected is paid for his/her services—a business model that will put architects out of business if widely embraced.
Brown Academy, Chattanooga, TN: unforeseen conditions are a reality in any building project. Brown Academy was hindered by soil conditions that added significantly to the project cost. Since the developer was locked into a guaranteed price, building components were sacrificed; and the finished building was sub-par.
UT Chattanooga Student Housing: 1,000 apartments were built based on a developer-leaseback arrangement, with UT Chattanooga owning the apartments after twenty years’ of rent and maintenance being paid. Unfortunately, the apartments are wood frame construction, and the buildings cannot sustain 20 years’ heavy use by students.
East Tennessee State University in Johnson City used a similar, developer led process in the late 1990’s to build an apartment style dormitory complex. The complex was poorly built, had very lax specifications and has been an ongoing maintenance problem ever since. The university has stated that they will never use this process again.
The proposed arrangement, placing the developer rather than the school board with oversight of the architect, inserts a third party between the school system’s needs and the building design. This will invariably lead to cost being the driving factor in the process rather than the well being of the students.
For all the reasons cited above, we respectfully suggest that this bill be amended to create a one-time pilot study of the Carter School project with a report back to the General Assembly about the long term viability of such an approach.