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home : schools : schools March 27, 2017

1/24/2017 2:15:00 PM
D65 Life/Safety Survey Recommends $38 Million in Building Work
By Larry Gavin


Richard Cozzi, an architect with ARCON, presented a 10-year Life Safety Survey to the Finance Committee of the District 65 School Board on Jan. 17. The survey, which is required to be done every 10 years by the Illinois State Board of Education (ISBE), identifies work that is either required or recommended for the District’s 16 school buildings and the Joseph E. Hill Administration Building. The total estimated cost of the work identified in ARCON’s life/safety survey is $38.3 million.

Superintendent Paul Goren said if the work identified in the life/safety survey is combined with the work listed in the District’s Master Building Work Summary, “the needs for the District now are about $105 million.”

The District could issue bonds totaling about $5.6 million during the next eight years to pay for capital projects under its Debt Service Extension Base (DSEB), said Dr. Goren in prior meetings in which he explained the need for a $14.5 million operating referendum. If the proposed operating referendum is approved by voters on April 4, an additional $15.2 million would become available for capital projects over the next eight years.  

Coupled with the amount available through the DSEB, the District would then have about $20.8 million for capital projects during the next eight years.

ARCON’s Life/Safety Survey.

Mr. Cozzi said that ISBE requires school districts to hire an architect to inspect their school buildings every 10 years and to identify work that is “urgent,” “required,” or “recommended.” Work classified as “urgent” is directly related to the health or safety of a student and must be done within one year. Work classified as “required” must be completed within five years. Work classified as “recommended,” he said, “is just that, recommended, not required to be completed.”

ARCON did not categorize any work in the District 65 life/safety survey as “urgent,” and, after some reclassifications, there will only be about $270,000 of work that will be catetorized as “required,” Mr. Cozzi said. The vast bulk of the work is thus in the “recommended” category.

The type and estimated cost of work identified in ARCON’s life/safety survey is summarized as follows:

  • Architectural work - $27.9 million. Approximately $24.4 million of architectural work is for roofing and masonry work; and about $500,000 is to provide safe entrances to schools. The balance is replacing stairway guardrails, removing asbestos-containing material, replacing portions of ceilings, and various other building repairs.
  • Site work - $2.3 million. This work is primarily to repair pavement for parking lots, fixing uneven surfaces used for playfields, and repairing drainage.
  • Mechanical work - $7.4 million. The vast majority of this work is to replace classroom ventilation units that are used to heat, and in some cases cool, classrooms.
  • Plumbing work - $162,000. Most of the work in this category is to make various repairs to boilers and hot water heaters.
  • Electrical work - $613,000. The vast majority of this work is to replace existing lighting with energy efficient lighting.

 

While the total amount of the work, $38.3 million, may seem large, the District already knew about many of the projects listed in ARCON’s life/safety survey and many of the projects were already on the District’s Master Building Work Summary, said Mary Brown, Assistant Superintendent of  Business Services.  

For example, Dr. Brown said, approximately $21 million of the roofing and masonry work listed in ARCON’s  life/safety survey was  previously listed in the District’s master summary.  

After excluding work that is now listed in ARCON’s life/safety survey, the District’s master summary identifies a total of $66.9 million in projects that are needed or desired for the District’s school buildings, said Dr. Brown.

The larger expenditures on the District’s master summary are $25.7 million to provide air conditioning for entire buildings, $11 million to provide sprinkler systems for entire buildings, $7.3 million to add music and art rooms to schools lacking them, $3.8 million to add a lunch room, $3.1 million for plumbing related repairs, $3 million for air-handling units, $2.3 million to add an elevator, $1.6 million for additional parking, $1.3 million to convert an auditorium into a multipurpose room, and $1 million for cabinetry and countertops

About $4.8 million of the work on the master summary is categorized as falling into a mid-level priority, said Dr. Brown, and the balance is in the lowest of three priority levels.  

Available Funding  

For the past 10 years the District has been funding its capital projects through its DSEB. These projects have included building expansions to provide additional classrooms and expanded cafeteria space, extensive roof and masonry repairs, the replacement of boilers in the schools, installing double-vestibules in most schools to provide safe entrances, improving technology infrastructure, and numerous other projects.

Much of this work was done to provide classroom and cafeteria space for an influx of about 1,500 K-8 students in the last 10 years. At this point, the District’s ability to fund capital projects through its DSEB is extremely limited.

Absent a referendum, the District may issue bonds to pay for capital projects only if the District’s debt service on the new and outstanding bonds does not exceed the District’s DSEB, said Dr. Brown. A school district’s DSEB equals the amount of its non-referendum bond payments in 1994, said Dr. Brown. For District 65, that amount was $4,858,295.

One key factor in determining the amount of bonds that may be issued under a school district’s DSEB is the interest rate. If the interest rate goes up, this has the effect of reducing the dollar amount of bonds that may be issued.

Another factor is the Consumer Price Index (CPI). In 2009, the legislature passed a law that provides that the DSEB will increase by the amount of the CPI. For the last five years, the average CPI has been about 1.5%.

In April 2016, Spears Financial, the District’s then financial adviser, calculated that the District could issue about $2.6 million in bonds under its DSEB in 2017, and projected that about $2.5 million would become available under the DSEB in each subsequent year for the next 20 years.

Dr. Brown told the RoundTable that the District subsequently retained new financial advisers who, on a more conservative basis, estimate that the total amount of bonds the District will be able to issue for capital projects under its DSEB will be $5.6 million through FY’25.

If the proposed operating referendum passes, the District plans to fund technology through operating funds made possible through the referendum. The referendum would also provide about $15.4 million in funds for capital projects, said Dr. Goren.

This would enable the District to fund priority capital projects such as double-vestibule entrances for five remaining schools by the summer of 2019 and to make priority replacement of some air handler units and boilers, and make roofing and masonry repairs, Dr. Goren said.

On Jan. 23, the District 65 School Board voted to accept ARCON’s life/safety survey report.







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