The Christian County Board of Education voted Thursday to request construction management services for a consolidated high school.
The board is considering this route after bids for Hopkinsville Christian County Academy came in too expensive a few weeks ago.
The decision does not immediately put the project back on track, but it will allow the board to explore an option for reducing the cost of the largest and most expensive school ever planned in Christian County.
Construction managers coordinate projects from idea to completion, managing the project’s schedule, cost, quality and safety. Instead of one general contractor building the entire school, a construction manager would work with several contractors for different parts of a project.
Assistant Superintendent Josh Hunt told school board members the district considered this option back in January but decided to go the route of finding a general contractor.
“We had done the interviews of construction management groups, but we went with the recommendation of the general contractor approach,” Hunt said. “If we do it again, rather than going out the same way we [did] it before, it would give us the opportunity to work with someone at the table representing us to really look at design and cost-saving options before it goes back out to bid again.”
One board member asked if they could use the proposals they got in January; however, school board attorney Jack Lackey suggested they put out a new request for proposals.
“You rejected those proposals, which really nullified those proposals,” Lackey said. “Could we get around the RFP? Yes, but is it going to affect the timeline, no.”
During further discussion, Lackey and Hunt said it would be closer to November or December before new construction bids would come up for approval by the board.
The construction manager could be reviewing a lot more bids for different parts of the build.
“It wouldn’t be three contractors submitting a bid for the project,” Lackey explained. “It would be 300 contractors submitting to do various parts of the project, and the construction manager would recommend which ones we would contract for different parts of the project.”
Lackey said usually he doesn’t suggest going this route because of the number of contractors and bonds needed for one project.
Hunt said further research showed that this route might get the cost down.
District officials initially estimated that the consolidated high school with a capacity for 2,500 students would cost $115 million — putting the project at the upper limit of the school system’s financing capacity. But in early July two general contractors submitted bids in the range of $200 million, and the board voted to reject both bids.
“We’ve got to figure out a way to get bids more attractive to bidders,” Hunt said at Thursday’s school board meeting. “We’ve got to have someone at the table that’s in the market and can help us break it down and look at where the cost was too high.”
Board member Jeff Moore asked if this would incur more costs to the district.
Hunt said the architect fees are already set, and the construction manager fee would be 1.7%.
The board voted 3-1 in favor of requesting proposals, with Moore, Tom Bell and Lindsey Clark voting yes, Mike Walker voting no. Tiffany Mumford Brame was absent.
At the July 21 school board meeting, members voted to remove a $126,000 payment to Hafer Architects from the agenda.
Superintendent Chris Bentzel said the board is paying its $4 million in architectural fees via “progress billing.”
“We do progress billing to pay our architect fees off as we move forward,” he said. “By rejecting the bids, we’re analyzing what we’re going to do next.”
At this time, the district holds $32 million in COVID relief money for school construction. Those relief funds have a liquidation deadline of 2024.
In addition, the district received a $10 million grant for building costs related to vocational education and has the bonding capacity to finance $70 million.
In a phone interview with Hoptown Chronicle on Wednesday, district finance director Jessica Darnell explained that bonding capacity fluctuates based on interest rates and the district’s current debt. Credit rating is also considered.
In 2019, the district’s bonding capacity was approximately $15.7 million. At that time, district officials hoped to use a nickel tax to finance two new high schools over roughly 10 years. But the tax approved by the school board was defeated in a voter referendum.
Darnell said the district has since paid off some of its previous bonds, raising its capacity to finance $70 million.
“We paid off debt, which opened up our bonding capacity,” she said. “Christian County Middle and MLK are now paid off.”
She likened bonding capacity to a home loan.
“You have to think about it just like you think about your home mortgage — think about what money you have coming in and how much of that money you can borrow against.”
Darnell noted that one misconception is that the district can use its annual budget to determine how much it can afford to bond.
“[The Kentucky Department of Education] won’t let us use all of our budget to determine how much we can bond,” Darnell said. “A lot of people think you can look at our overall budget, but we can’t calculate all of that. We can only use capital outlay and our building fund.”
Capital outlay funds provide money for construction projects based on the Support Educational Excellence in Kentucky, the state’s main allocation system for local school district.
Capital outlay funds are included in the SEEK formula and are determined by multiplying the district’s average daily attendance by $100, according to the School Facilities Construction Commission.
Capital outlay can be used either for direct construction costs or to pay off debt. Up to 80% of the total funds may be used for debt service, the commission website said.
Chay Ritter with the Kentucky Department of Education made a presentation July 20 about the rising cost of school construction projects across the state.
A graph using information from the U.S. Bureau of Labor Statistics shows a sharp increase in the producer price index for school building construction between July 2021 and April 2022. Construction bids across the state reflect that increase.
Menifee County received estimates for a new board of education office in August 2021 close to $2.5 million; however a May 2022 estimate for that project was $3.5 million. Basement/storage construction was removed from the project to save money, Ritter noted in the presentation.
Woodford County is also in the process of building a new high school. Init ial estimates in July 2019 were $36 million and recent bids came in at $73 million.
The local consolidated school project was also mentioned in the presentation. It noted that the consolidated high school was estimates increased over several months — from $117 million in February to $137 million in May. Bids came in at $199 million and nearly $204 million last month.
For the Christian County project, Ritter said in the presentation that a “reduction in scope of work is possible.”
Local officials have not said publicly where they might seek to scale back the project.
The presentation stated that “districts may also do the project in phases over a longer time or shelve the project altogether.”
With school starting Wednesday, Bentzel said the aging high schools went through summer maintenance like all of the facilities. New floors were installed in the front office at Hopkinsville High School, he noted.
“Even if the bids came back favorable, we still have two or three years in these schools, so maintenance is always going on,” he said.
While the project may be stalled for now, Bentzel said he stands by consolidating Hopkinsville and Christian County high schools, along with vocational programs, and is focused on the school year ahead.
“My plan is to get schools started next week,” he said. “Maybe we will finally have a school year without COVID or any hiccups.”
