School project overages state’s responsibility
It’s a familiar refrain, one that many communities in the commonwealth undergoing school building projects can attest.
Tyngsboro Town Manager Matt Hanson recently told the Select Board that construction costs for its newmiddle school have risen about $2.5 million over the amount budgeted.
In a subsequent presentation before the School Committee, David Saindon, executive project manager for LeftField, the project management company, attributed the deficit to supply- chain issues, the escalation of diesel fuel prices, ongoing labor shortages and the effect of severe weather on the distribution of material.
“Material prices have risen at an unprecedented rate,” he said. Material costs rose 52% from 2021 through 2022. “This has never happened before,” he said.
But Saindon shouldn’t have been surprised, given all the other Covid-caused cost overruns that have occurred at other school projects.
The cost for the newmiddle school was set last February at $82.5 million, of which the town’s taxpayers’ share was $54.1 million The rest of the funds, $28.4 million, were to come as a grant from the Massachusetts School Building Authority.
Town officials brought a plan to last spring’s annual Town Meeting that would fund $1 million annually of the middle school debt within the existing operating budget. This required a debt exclusion vote to override requirements of Proposition 2½ to borrow the money.
Saindon said options available to control the deficit include appealing to the state Department of Revenue to increase the debt exclusion amount with Town Meeting approval but without a townwide ballot.
Additionally, American Rescue Plan Act funds, if available, could be applied to the project.
As mentioned, Tyngsboro’s not the only community experiencing school construction sticker shock.
Groton ($16 million), Stoneham ($19 million) and Somerville ($30 million), among others, find themselves with costs substantially exceeding their approved budgets.
And of course, Lowell’s high school rehab- construction project overage tops them all.
In 2019, the Massachusetts School Building Authority committed $210 million to Lowell’s then-$344 million project. In March 2022, representatives from Suffolk Construction and project manager Skanska said construction costs were going to be higher from supply-chain increases due to COVID.
Those budget overruns raised the project to its current $381 million cost, with the $38.5 million difference the responsibility of the city and its taxpayers.
Lowell city councilors have long argued the unanticipated costs should be the responsibility of the state.
Ed Kennedy, Lowell’s state senator and a former city councilor, concurs.
A bill he filed aims to help Lowell and other communities address the cost overruns in their school building projects.
Currently listed as Senate Docket 2395, it would earmark no less than $150 million of federal COVID-19 recovery funds for the School Modernization and Reconstruction Trust Fund.
The MSBA uses that source to fund school building projects.
“There are a lot of communities who went to THEMSBA and got funding to move ahead with their project,” said Kennedy, a Lowell Democrat. “They found out later that the building material costs had skyrocketed, and had raised the price.”
Specifically, Kennedy’s legislation would use federal American Rescue Plan Act money to address the financial gaps.
“The commonwealth still has $1.75 billion in ARPA funds left over that have not been expended,” he said. “My legislation asks for no less than $150 million for the communities who have been impacted by the rising cost in building materials.”
Lowell state Reps. Rodney Elliott, Vanna Howard and Radymom have signed on as co-sponsors to Kennedy’s bill, with Elliott filing a similar bill in the House on behalf of the delegation.
The legislation has also been endorsed by Worcester and Middlesex District Sen. John J. Cronin, D-lunenburg, and 5th Middlesex District
Sen. Jason M. Lewis, D-winchester.
Kennedy’s actively seeking additional co-sponsorships from his Statehouse colleagues. “It certainly would be helpful, and those communities would appreciate it a lot if the commonwealth were to step in and give themahelping hand.”
Kennedy said his legislation is important, not only for communities like Lowell with projects already underway, but also for those with school building projects in the planning stage.
The MSBA should have already built an inflation- cost escalator into its funding formula. The COVID-19 pandemic has shown the financial pain that shortsighted omission has caused.
The Legislature created the MSBA in 2004 to streamline the school funding assistance process.
Lawmakers must now — through Kennedy’s bill or similar legislation — amend that inflation-adjustment oversight.