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Cutting $20 million from cost of new middle school not possible, city School Board learns

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It may be possible to cut $2 million or $3 million from the cost of the new Fredericksburg middle school, but getting down to the $57 million budgeted by City Council is “unlikely.”

“We are working very hard to put together cost-saving measures, but it’s unlikely that we will get down to the $57 million price tag,” Stephen Halsey of Mosely Architects told the School Board during a special meeting Tuesday afternoon.

Mosely Architects and English Construction together make up First Choice, LLC, the public-private partnership selected by the School Board to design and build the new school.

First Choice estimated earlier this month that the new school will cost $77 million, which is $20 million more than City Council has budgeted for the project.

The estimate is based on completion of 35 percent of the building’s design. Council members earlier this month balked at the price tag and School Board members on Tuesday also expressed dismay.

“[The estimate] was unexpected. I was shocked and disappointed,” School Board Chair Katie Pomeroy said, while also stressing that the School Board is “committed to a new middle school.”

Halsey told the board that the $77 million estimate was “disappointing” but “not a surprise, given the inflationary environment.”

“We are in a very challenging environment in terms of pricing,” he said, citing labor shortages, supply chain disruptions and the cost of fuel.

Halsey said that between February 2021 and February of this year, the new non-residential construction market experienced 22% inflation overall.

The price of steel is up 141%; aluminum is up 40%; copper and brass materials are up 38%; plastic is up 32%; and insulation is up 17%, he said.

“For roof insulation, there is a 50-week lead time to order and the cost is not known until shipping,” Halsey told the School Board.

Based on the rate of inflation—which is showing no signs of subsiding, Halsey said—the cost of the new school will increase by about $1 million each month.

Board member Matt Rowe pointed out that interest rates are also likely to increase, which means financing will cost more if there continues to be a delay in executing the agreement to build the school.

Halsey said the firm is looking to cut costs by substituting materials, reevaluating what site work is necessary and soliciting cost-saving ideas from sub-contractors and trade partners, but that the board can expect to cut only about $2 or $3 million from the total cost.

There is a possibility that the state will start contributing funds to school construction, deputy superintendent Matt Eberhardt told the board.

The General Assembly has set aside a pot of money for school construction. Eberhardt said that based on his understanding, school divisions will be eligible to receive between 10% and 30% of construction costs based on the community’s local composite index, or the locality’s ability to pay education costs.

Eberhardt said his understanding is that Fredericksburg City Public Schools would be eligible for 20% funding, but stressed that there has not yet been any official guidance from the Department of Education about how to apply for the funding, and nothing is expected before October or November.

He said division Superintendent Marci Catlett and City Manager Tim Baroody have written a letter to the VDOE expressing “gratitude for the new funding and interest in seeking the money, and offering assistance to make process go quickly.”

The School Board’s consensus Tuesday was that waiting for costs to come down will only lead to the school costing even more.

“We don’t have options. I’m of the opinion that we keep moving forward,” said School Board member-at-large Jarvis Bailey.

The School Board and City Council will hold a joint meeting in the next few weeks to determine how to proceed.

Adele Uphaus–Conner:

540/735-1973

auphaus@freelancestar.com

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