School construction costs began to accelerate in 2016 and continued in 2017. The natural disasters in Texas, Florida, as well as the fires in California are expected to influence such costs in 2018.
During the last period when substantial increases in construction costs occurred in 2004 – 2007, all school districts in California were impacted. The effect was dramatic. Anticipated future projects expected to be built with local and state bonds in some districts did not materialize because the funds designated for those projects were required for use to complete projects listed earlier on construction schedules. In other circumstances, districts in the state’s Financial Hardship Program were forced to eliminate whole buildings such as libraries, multi-purpose rooms or gyms in order to be able to afford to build classrooms. In many communities’ school boards, citizen oversight committees and local bond supporters were not prepared for what had happened and blamed Superintendents, Chief Business Officers (CBOs) and those in charge of the district’s facilities for mismanagement. In the private sector some filed bankruptcy leaving districts with uncompleted projects.
Attendees at this workshop will learn from industry professionals what to expect in construction cost acceleration in 2018, 2019 and beyond. Attendees will also hear from construction industry practitioners about strategies that may allow them to control future project costs through early planning/design, advanced purchases of materials, and construction delivery method decisions. Three active projects will be offered by districts as case study examples of construction cost control.
It is important to note that the increases experienced now were recognized early in 2017 by the Division of the State Architect (DSA). That recognition caused DSA to work on hastening the plan submittal and review process by moving to the six-week plan submittal reservation system, and thereafter committing to electronic plan submittal and review as a common practice for 2018. Progress on the DSA efforts will also be discussed.