According to an article from the Seattle Daily Journal of Commerce (http://www.djc.com/news/co/12111485.html), Seattle is the 7th most costly place to build worldwide. Because Bainbridge Island directly competes with Seattle for labor resources and materials, our region is facing unprecedented escalation and historic market conditions stemming from a construction boom. This boom, coupled with tariffs, tax increases and additional code compliance requirements, has caused BISD construction expenses to outpace the funds available from the 2016 Bond. 

On May 31, 2018, the board directed the superintendent to establish a committee for the purpose of identifying funding options to complete the 2016 Bond projects. A deadline of early fall was established for a final committee report and recommendation.

Superintendent Peter Bang-Knudsen formed the Superintendent’s Advisory Workshop (SAW) to review and address funding alternatives. The committee was comprised of board members, staff, administrators, union and community members. The SAW committee met on three occasions and at its final meeting, unanimously agreed that the best option for completing capital projects and providing essential renovation money through 2025, is a six-year $15 million levy. Based on an average assessed value of $660,520 the impact per household is approximately $198 per year (.30/$1000). [UPDATED AMOUNT AS OF 10/24/18.]

 

FREQUENTLY ASKED QUESTIONS:

1. What is the Superintendent’s Advisory Workgroup?

A: The Superintendent's Advisory Workgroup (SAW) is comprised of staff (district-based, classified and certificated) and board and community members. The group met throughout the summer of 2018 to:

• Analyze: Why is there not enough money to complete the district’s capital projects that were identified in the 2016 bond?
• Consider possible solutions
• Analyze survey results
• Make a recommendation to the board

At the final SAW meeting, the committee voted unanimously to recommend that the School Board run a six-year, $15 million levy on the February 2019 ballot.

2. What amount did voters approve in the 2016 bond measure?

A: In 2016, voters approved an $81.2 million bond measure that included $39 million towards replacing Blakely Elementary, $30 million towards replacing the Bainbridge High School 100 Building and $12.2 million towards district-wide repairs and renovations. In addition to the bond money, the district identified in 2015 $10.5 million in anticipated funds that would go towards the bond projects.

3. How were the costs estimated at the time of the election?

A: The district worked with a professional cost estimating firm, The Robinson Company, who considers many factors when projecting costs such as escalation (fuel, energy, supplies) current market conditions which includes materials, supplies and labor availability (which are difficult to predict far in advance), district construction standards, site conditions and recent and projected bond passage or requests.

4. I have heard that the construction boom currently happening in the Seattle-metropolitan area has affected the price for construction on Bainbridge. Can you explain this?

A: Competition for materials and skilled laborers continue to significantly impact construction costs. Overall market costs in the Seattle area are currently outpacing national trends. Articles in the Seattle Daily Journal of Commerce reported “disappointing” school bid results, with sub-contractor availability particularly challenging. The article continued to say, “General contractors and cost estimating firms continue to be surprised by the rate of cost increase in the past few months.”

Additionally, an article (May 29, 2018) in the Seattle Daily Journal of Commerce cited a new survey from Turner & Townsend which ranks Seattle as the seventh most expensive place to build in the world. This directly correlates to rising expenses for BISD, as the materials and skilled laborers needed for BISD projects come from the Seattle market.

5. Along with unprecedented escalation and market conditions, are there other factors that attribute to the shortfall?

A: Yes. Additional factors include:

• Conservative request to taxpayers in 2016 (to maintain tax stability)
• Lower fund balance due to prioritizing essential renovations
• Did not receive class size reduction grant ($1.2M)
• State Match eligibility (BHS) OSPI Calculation was reduced to $1.750M (Were told $2.6M October 2015)
• Competition in school construction market due to billions of bonds approved in the greater Seattle area
• New COBI code revisions
• Kitsap County Sales Tax Increase (0.03%)
  
  

Our current cost estimates project a $10.2 million shortfall for the Blakely and BHS 100 Building.

6. Why doesn’t the district put the projects on hold and wait for the construction industry to slow down?

A:  This would only provide a tempory solution and it comes with a cost. Given the current condition of the BHS 100 building, the district would need to invest capital dollars into postponing, patching and repairing many areas, including roof replacement and infrastructure (fire, electrical, structural) improvements. This would only provide temporary solutions and the buildings would still need to eventually be replaced.  Postponing new construction by repairing the old buildings does not improve educational spaces nor support 21st Century Learning.

Additionally, due to increases in population in the greater-Seattle area and aging school buildings, school districts have passed $5 billion in school bonds in recent years with billions more coming to voters over the next few years. It is unlikely that the market will soften anytime in the near future.

7. Why doesn’t the district scale-back the construction projects?

A: Throughout the entire design process the team has focused on opportunities for value engineering (cost reductions).  

The district elected early in the Blakely replacement project to gain approval from the state to use an alternative construction delivery method called general contractor/construction management (GC/CM). This method allows the contractor to work alongside the district and architect to use cost-effective designs, materials and minimize site costs.  

The district is committed to building 50+ year schools that have a high degree of energy efficiency and ease of maintenance. The district’s buildings are designed to meet 21st Century Learning environments while maximizing flexibility. As educational programs evolve, our buildings need to support change and provide the ability to address changes to the island’s population in the future.

8. If this is a regional issue, how are other school districts handling the escalating expenses?

A: In normal circumstances, a district can direct the architect or contractor to develop a variety of cost-saving measures. Some examples that help meet a project’s budget may include modifications to the building design, reduction in energy efficiencies, minimizing building materials, reducing building square footage. Further, a district can phase portions of a project.  

However, we are currently experiencing anything but normal circumstances in the Puget Sound construction market. Many districts in the area, most of which are considerably larger than BISD, are able to reallocate funds from one project to fully-fund another. The unbuilt projects will be placed before the voters on future bond requests.  

Bellingham Public Schools was faced with a similar situation as BISD is and in February 2018, Bellingham Public Schools went to the voters requesting a $155 million bond. This bond request included money to complete projects from its earlier 2013 bond request. More than seventy percent of Bellingham voters approved the 2018 request.  

9. I’ve heard discussions that BISD is considering a $15 million levy measure on the February 2019 ballot. Is that correct?

A: Yes, that is correct. At the Oct. 11, 2018 School Board Meeting, the SAW Committee made a recommendation to the School Board to place a $15 million levy measure on the February 2019 ballot. The School Board will vote at either the Oct. 25, 2018  or November 8, 2018 School Board Meeting whether to move ahead with the levy election.

The $15 million levy will provide funding to complete both the Blakely and 100 Building projects and provide our Essential Renovations Fund with an additional $4.8 million — for a total Essential Renovations Fund of $10.49 million — through 2025.

10. What are the tax implications of the proposed levy?

A: If approved, the six-year levy would cost Bainbridge Island homeowners $0.30 per thousand assessed value, or about $198 per year for the average Bainbridge Island Home (average assessed value is estimated to be $660,520). [UPDATED AMOUNT AS OF 10/24/18.] The levy would be collected through 2025.  

11. Did you gauge the public’s opinion on this proposed levy? What did you learn?

A: Yes. We used the services of CFM Communications who are experts in creating and executing surveys and are used by many school districts in our region. CFM Communications implemented telephone and online surveys to Bainbridge Island residents.

The results of the surveys found strong, widespread support for a $15 million levy. Nearly seven out of ten favored the levy — well above the 50% threshold need to approve the measure.