001Uh good morning. Um it is now 8:30 and we will call the uh special board meeting on May 24th to order. Uh stand for the pledge of >> allegiance. United States of America to the republic for it stands one nation under God indivisible. >> Mr. Davis will please do the roll call. >> Mrs. Iicults >> here. >> Mr. Marks >> here. >> Mrs. Singh >> here. >> Mr. Sum >> here. >> Mr. Tullus >> here. >> Can I get a motion to adopt the special meeting agenda, please? >> Still move. >> Second. >> All in favor? >> I. >> And with that, we'll move into the work session. >> Do you want to board members? We're going to be looking at the approval of some construction contracts this morning. We have the project team members
002here and our consultants. if you have any questions uh as we move through uh the GMPS. There are three to look at today and we're going to start with um number seven um at the top there under number under a number one and uh there was a summary page sent to you yesterday that was then updated and sent to you again this morning. Um and we have I think most of the project team here if there was any high level questions you have uh in review of these GMPS. So just one quick question is that the oh hold on so the prices that you have said that it has for example for the middle school you said that the uh middle school base project scope uh it is almost 75% bid out and it has
003gone 15% over the budget. So, is it 15% over the cushion that we had or with the cushion? >> When you say cushion, do you mean contingency? >> Yes. Sorry, that's >> it's on. >> Okay. Um, and so that would be 15% over that um that contingency that we have within there. So we do still have contingencies left and we want to keep those somewhat intact because we do know that change orders do arise on a on a basis and that um there is a lot of moving parts within the construction uh thing. We also have uh CMR contingency built within. So if there do need to be schedule enhancements or or other pieces that and certain buyout that needs to happen with amongst the subcontractors, we still have some of those intact. So right
004now when we're looking at that, we're looking at the hard costs that are coming in from the marketplace at this point. >> Thank you. >> The cost increase here, the cumulative increase of 15%. Is that can you quantify how much that is inflation versus how much of that is everything else that could lead to a cost increase be it project scope enhancements general increases and the like. So, if if we're looking at an overall total, not just talking about the middle school here, but right now within the market, what we're looking at is um just for the hard costs when we're going to the subcontractors, when we're bidding this work, we're looking at a $6 million total overage of what we had originally looked at as a project team before. Um four of that is
005pure market conditions at this point. um probably 2 million of that is um what we thought we would do better on buyout quite honestly with the subm market and we were expecting some of the material increases with those market conditions but with some of the labor markets right now we are that's where some of that $2 million struggle is right there. So when we're looking at the middle school, that's probably about 4.5 million as an overage total >> of I'm sorry. So it's about 4 million on hard cost and 2 million on labor ballpark. >> 2 million would be a blend between labor and material that we anticipated you know a a strong buyout within our numbers. So I discounted sorry what do you mean by buyout? So what I did is when we were
006reconciling DD, you know, our estimate was here, you know, years of doing uh build buying K12 buildings specifically. I'm saying, you know, there there's, you know, typically the estimates come in and we always put the job out on the street and buy it at a better value. So I discounted our estimate at DD submission because I felt strong going into the end of the year hitting the first quarter that we were going to get that. That didn't happen. What I should have done is not taken the buyout, you know, and then our numbers would only reflect the crazy market we're in with material escalations and the tight labor market and then in and instead of the additional amount. So the net six right now overall is off the hard cost construction subcontract value that we're
007working our way down. Um there's still work to do. I think we got about 21 million left to buy um and go through the process. So just taking a step back then the original budget we had for the middle school >> that what was that number we said on day one what do we think the middle school was going to be right here >> I guess I'm trying to get at is we I think we was 40 million somewhere in that neighborhood right >> yeah it is that's >> yeah and I'm trying to figure out how much if we do all of these how much contingency funds do we have left after today what have we used and what do we have left. >> Well, we have about I would say 1.2 in construction or
008CMR contingency at this point. And then we have um 3.6 plus 1.6. Um what is it? >> Yeah. 3.2 million in owner contingencies. >> So, are we not depleting the contingency fund? or we just coming up to this extra money out of I guess I'm trying to Yeah. >> So, we didn't want to deplete the contingency fund because overall we usually use about at least we try to budget for 5% of what the construction value is for new buildings and about 7% contingency because of um unforeseen conditions um change orders. As we move through the process, when we get out of the ground, we have less risk. When we get a building shell, we have less risk. So over time, we can probably take some of that contingency money and use it for overages. But
009right now, I would advise against it. >> So then we say 75% of the middle school is out to bid >> this contract we're signing to that we're going to approve today. >> What portion of the work is that? And then what's left as far as we talking building materials? I'm trying to understand what the risk is. >> The shell of the building is $6 million for the building shell. >> Yeah, we're looking at cold um cold form metal framing >> and we're also looking at roofing. >> Okay. >> Which is a long lead item and why we we're trying to get it out early. So on the on the middle school loan, we have about hang on pull it up here remaining left to bid 10 10 11 million left. Do you have any
010idea where you are on that? Have you done any >> We take remaining numbers at the end of uh May for the rest of the building package. the entire remaining middle school. The middle schools were the biggest overages. The middle school building packages come in 27 >> 26. >> Mhm. >> You know, and obviously we've been doing a lot of uh what we want to do is come with costsaving ideas. For example, on this package in the roofing originally was a million more than the number we're carrying. We sat down with the roofer, a couple of our different subs, got with MSA and the team. We actually pulled that number down to where the roofing is below budget on the middle school, for example. We still have to do that with a lot of packages
011as they come in and because what they do is bring ideas, but what we don't want to do is go and say, let's cut out the scope. You know, it's easy to come in and say, "Hey, we can reduce scope." But for example, we talked yesterday about some areas where we have some different ceiling options. And I think just a 15minute exercise with the core team probably valued about $180,000. That process will continue. So yeah, like when we talk about buyout, that was one of the pieces with the roofing and why it's showing that we are under budget on that GMP because that's part of the buyout process that we do with the the subcontractors as we're looking through those. >> What I want to do is try and get out in front of this.
012I don't want to have to keep going back to these exercises and and going back for extra money. I want to get our arms around where we are and make sure we're crystal clear in terms of the monies we're spending. Obviously, I know what's going on with the economy and what's going on with pricing. I'm very aware of that. But again, I want to make sure we're looking at this holistically. We've got a fiduciary responsibility to the community and I want to make sure we're adhering to that knowing that we've got extra costs coming in. But again, we need to get out in front of this as soon as possible so that we can minimize these meetings and make sure we totally understand where our costs are coming in so that we've got a clear
013picture of what we're dealing with. And >> I think almost all the packages will be in for bid. May 26th is when they're accepting the bids from Scansa. There's going to be probably about a two-eek period where they work back and forth with the subcontractors at that point. So, we are only probably about a month away from really having everything um besides the potential of expanded spaces or anything like that. That was that was going to be my next question because I think when we talked at our meeting last week, one thing we we talked about and we were I think very serious about it was if these numbers continue to come up and up and up that could threaten >> Sure. >> the viability of the expanded music space and wellness center. >> Absolutely.
014>> So you think by June we'll have a pretty good sense of our final cost for middle school, primary school, elementary school? >> Yes. >> Yeah. My goal would be is, you know, we keep doing what we're doing. You know, we've actually in the last week had a really good week with some ideas. >> Walk me through that. What is when you say we saved a million dollars in the roof is that we're getting a million dollars lesser quality of a roof or is it other design? >> Understanding that, you know, there's parts that have a really expensive panel system on it. It's coming with an alternative product that gives us the same quality and look. It's maybe changing the composite of the material, you know, to where if it's an aluminum high quality finish,
015put it on the front, you know, not necessarily on the back of the pen houses that face the the the the west side of the project. >> And that's just your typical value engineering process. We call it um pre-construction cost events, you know, where we just bring ideas. >> Okay. >> And we know that, you know, we always like like Kirk's uh our conversations and meetings have always been good, better, best. You know, a lot of the best is where we start and then we see where that's at and then we start working our way down to better and then good good with good being well above what normal other K12s have for example. So, it's a matter of just prioritizing things and coming up with ideas. Uh the we're meeting with electrical this week.
016You know, a lot of jobs we've come back after we've taken the electrical number that's in this budget and we come back with, hey, bring us all the ideas you got. Sometimes changing one fixture out in a whole in a building where we have a whole lot of these produces a pretty nice savings. And it's not that the fixture is any different in quality. It's just that understanding the different options you have. >> So, let's level set here for just a minute. I understand where you're coming from. I want you to understand where we're coming from. We've got an original construction contract that we agreed to. We've also preliminarily agreed to another 11 million plus for for extra added scope value. So if we have added construction costs coming in, then we will have to
017draw a hard line in the sand and cut things back. So we've got to get out in front of that >> so that we're keeping you on track as far as the building is going. But we've also got to make sure that we're looking at from the financial side. So my ask of you is that we get out in front of this as soon as we get those other bids back. we we are clearly understanding where you're coming from so that we can all get together, sit back and look at this and then make uh whatever adjustments we may have to do on this. >> Yeah. One question on that though. I I don't think these aren't additional scope or change orders. These are just the typical contracts we need to do the project. Yes.
018>> It's just the timing for Okay. Thank you. >> Yeah. These are the base scope, >> right? But if we do have any change orders, I'm saying that's what I'm sensitive to. And I think uh Craig, to your point, that's one of the reasons that we've added the um finance committee meeting and the uh potential special board meeting for June ahead of the regular June board meeting because of the timing of when their uh the rest of their estimates on their packages should come in. Um we should be set for that week so that the board can have information ahead of time to review heading into that week. Yeah, we want to give you more more heads up more ahead of time and get the numbers set and level before um you're presented with them
019so you've got time to digest those as well. >> Great. So, thank you. >> I just have a recap question. So, in terms of the bids that we've received back, we've received back 75%. Is that correct? How much have we received back? O >> overall about 75%. So, the middle school's about 75% bid out at this point. Um the elementary is uh valuewise is probably about 50% at this point and then the um primary school is it it's the full GMP package at this point except >> controls >> minus the HVAC controls because we're going to bid that as a different solicitation for districtwide. >> So that so those are what we have out or those are what we've received back >> those are all of what we received already received back. >> Yeah. And
020then of what we've received back, we're six million over budget. Is that right >> at this point in time? Yes. >> Is that just middle school though or is that overall? >> Overall. >> That's overall. >> So we're 6 million over. We've got 100% of the primary, 50% of elementary, 75% ballpark on the middle school. >> Yeah. >> And then outside of that 6 million that were over, the contingency that's left is how much? We're about 3.2 >> million dollars overall. >> Just I just want to make sure that I understand and I appreciate. So the reality is the six million over >> if we used all the contingency which we haven't but if we use all the contingency to date we would be two in theory we'd be 2.8 over with 25% left to
021come back in the middle school 50% on the elementary. Am I understanding correctly? >> Yes. and and the value of the elementary is about $6 million for for that half >> right >> of what we still have to bid. Um middle school even though we're using percentages is a much larger >> um a bigger dollar amount of 25%. Okay. All right. Thank you. >> And then from a bidding what we're have left to bid my understanding is all the site work earth work moving that's all been bid. >> Yes. And that is generally the largest variable based on the unknown of >> those are usually your unforeseen conditions especially with a new building correct because >> yeah getting into we found a couple >> so a couple pockets a couple items >> is it I
022mean obviously nobody can guarantee anything but as a a the risk of a major spike going forward should in theory be less than what it was at the beginning of the project just because we've gotten through the earthwork we've gotten through you know 50 75% of the project depending on the Correct. A lot of >> from a bidding standpoint. >> Yeah, that's what I mean, right? I mean, of course, who >> I mean, we have the middle school pad on grade. You know, there's still risk with site work. The big, you know, a million dollars of the risk came when we took the numbers on the middle school, high school site with the with the underground attention requirements, we were as opposed to digging a hole and putting it in a pond. Um, you know,
023we still need to start all the site work on the elementary school, but you know, pretty pretty relative low risk because it's pretty >> Excuse me. Can you just repeat what you just said at a high level and summarize it because there's other people that pay attention to this meeting who have no idea about construction, the site conditions and the million dollars. Explain that again. >> Yeah. When we pulled the when we brought the early sight package on the middle school, we were required to put detention underground as opposed to digging a hole to let the water go in. That was a million dollars just on that site. So in that 6 million overage, you know, 1 million is just related to the site here because, you know, there's not a lot of property. So
024when you're saying to dig a hole, I was like, typically on most sites, we have a detention area or retention area for the water that gets taken away from the building. So there's usually some sort of ponding area or something like that. All of this goes into an underground system, >> which is expensive, >> you know. So we we have to overcome that one site number that's a million. You know, what that does is that throws off the percentages of our hard cost. It's over. In theory, uh, for what we bid to date, we're about 6%. Or no, 5% if we take that out on the early packages. And then when we're tracking with some of this work, we're around four >> on the elementary school. Have we done that analysis yet? Do we have
025room to do above ground detention? >> The elementary is actually um above ground detention. There's no tanks. The only tanks are on the mil on the middle school site here in the back. >> So, we shouldn't expect to see that delta on the elementary school. >> Correct. So a point of clarification as far as the bids and getting all the numbers back. Are you talking about the numbers back in the next three to four weeks for just the middle school or all the projects >> program resting packages? >> So we will have very clear >> June. >> Okay. So Okay. Thank you. And then I have just a clarification on the um on the three GMPS that we were reading particularly on the primary there were a lot of exclusions and some were explained excluded
026because not necessary or whatever. Are any of those exclusions are they permanent or are they things that are just being excluded from this GMP? >> Well like for example sometimes we exclude a spec section because or like controls because we haven't bid that yet in the future. you know, sometimes we put exclusions for um you know, hazardous material like in the elementary school or something. Now, I don't have those in front of me or all of them. What that means is, you know, we're just making some assumptions. We still talk through that with the core team and go through that. Just because it's in the GMP doesn't mean it's the final version. There may be some edits left or up or down a little bit yet, but because of time, we're just trying to get
027these things pulled together. And then in June, when we have these numbers in front of us and have a real clear picture of where we think we'll be, is it too late for savings other than bidding type savings? I mean, I would hate to have to change things because I think we have a great plan, but if we are significantly over, how can we manage that? we are going to bring back uh cost-saving ideas to the team, you know, and that will go well past after we get the numbers in my mind. I think we just talked yesterday about sometimes we bring back ideas that teams don't like or want, but that's not our place to make that decision. You know, typically we try not to we try to not to impact the the the
028scope or value of the project. >> Yeah. At that point, we all want to keep the project moving forward and the sooner we can get back the numbers with options will give us the best chance to be able to make some decisions on our on our side. >> Correct. >> And also at this point, what's your best guess? And I know it's a guess on future supply chain and labor issues because my big fear because we all know that delays cost money. >> Right now getting um what would I call it? Dedicate dedications from suppliers is extremely difficult. Um, you know, we're finding out every day that if you go to we we just opened up a health center up in Dayton and there was a change that had to happen at the end of
029the job and just getting breakers for a panel to go from like a 50 amp to a 100 amp was like a 16week lead time to get that breaker. Now, we work through that. we have a lot of resources but um I mean it's it's it's sort of the way the world is we're dealing with and we're trying to mitigate that as much as we can. There is risk with material deliveries in the job. >> Um >> and we have had a discussion with the team that if there are any delays, we need to know about them immediately because it not just affects us financially but also operationally. Um we've got kids in lots of different places right now and if anything changes with the date of uh completion, we're going to have to pivot
030and make other plans. So um the team is aware that that is crucial and that information is is need to know as soon as we get it. >> Um Mike, could you chime in on your perspective at all? This is this kind of where you would expect this project to be? I I know maybe just for people watching just kind of give a statement on the process of how you're involved in this reviewing the numbers on behalf of the district and I guess give us your kind of high level overview of where things stand. >> Really high level uh looking at this project and a number of projects that we're working on and just really trying to draw a comparison to where we are. Um most recently we had we had a board meeting last
031night and we just had a final GMP uh for a project uh not too far from here. Um and the overall project, you know, on on the final GMP uh ended up 12 1.5% over. Uh again, we're we're working with districts all over Ohio and we're running into the same problem and it's it's tough. Uh it's tough for the administration, it's tough for the boards, it's tough for the teams. Um, I I really feel that, you know, Pete has and his team have done, you know, uh, a very good job of trying to keep the cost down. Uh, there are a lot of factors that go into this. You talk about, you know, lead times, you talk about availability, not just of materials, but of labor. Um, it's it's it's a difficult time. We're navigating
032our way through it. Uh we we will always look out for the district's best interest. Uh and we expect that of the entire team. Uh we want you to make uh very very informed and very sound decisions and moving forward. Um I I'm not really aware of other projects that are bidding. We're doing estimating and we're seeing the same thing right now. Um, you know, the OFCC, uh, probably the largest in the state of Ohio that that does construction everywhere, um, they have, uh, updated their cost calculator, uh, to reflect a 17% and up to a 25% depending on which region you are in Ohio. Uh, so they're fully aware of of of the market. So, it's a difficult time, but, you know, we're we're going to work through it. Uh we're going to do
033the very best we can in getting the cost down. Um I you know we're we're not done. Uh again, we've got a $6 million issue. Uh but I think through some hard work where we can look at uh options that are available as far as bringing the cost down without giving up quality and the aesthetics that I know are going to be very important to Indian Hill. Uh but there there may be opportunities that you know we can not sacrifice quality, bring the cost down and we want to get that that number as low as we can. Mike, I I think first of all, I appreciate all you're doing for us and the team. I think as I'm sitting back and looking at this, you know, makes pretty well logical sense. I think one of
034the things that I know you guys are thinking about, but I think we should put extra attention on is you we're 6 million over right now. We've got a contingency of 3.2. So net we're 2.8. Right. Obviously, there's still a substantial amount left is really really locking in on protecting us against change orders >> and protecting that 3.2 because if we can protect against change orders and those kind of deltas that will chew up that 3.2 and we can save that, then we're in a position where that six doesn't sting as bad. So, I just I know in the craziness of what's going on, if we can really as a team try to make sure that we're not I mean, we're gonna have change orders and things that happen, but if we can do our
035best to really be thinking through, okay, making sure that we we don't gobble into that, then I think it'll take the sting off of what the market's putting on us. >> Yeah. And and I think one of the things that will help us uh everybody's fully aware of the contingency and our desire to hang on to that money. We've made that abundantly clear from the very beginning. Uh but I think something else that will help us is the work that you know the project team, the administration and the board uh through your work as well. uh really getting everything final as far as the design, the look you want, how you want the buildings to feel. I think everybody's done a very good job in in in in that respect. So that tells me that
036there's probably not going to be a lot of owner requested change orders, which what we typically find in, you know, in the in the co-funded arena through OFCC, it's it's a little different approach. You you try to hang on to that money, uh get out of the ground where you've mitigated most of your risk. And then the second milestone is when you get under roof. Now you've pretty much mitigated all of your risk. So even weather can't impact the project. So that's when you start releasing some of the owner contingency to do some of those things that you thought you couldn't afford or maybe you couldn't afford in the very beginning. But now when you're 50% complete, you know, you can, you know, just like, you know, floor floor tile, you know, maybe you were
037settling on one quality, you know, one level of quality. you can actually take it up. Uh certain things like that. So I think here there probably won't be that you won't be taking that approach. The owner requested change orders. So uh anything outside of maybe unforeseen field conditions. Uh I think you know I think we should do a pretty good job of hanging on to the owner contingency just for that purpose. >> Just to to review and add to to Mr. Markx's comment there. When will we have that high level review? We're going to finish design process in June. At what point will we have that discussion with the board? Um when we take a look at contingency after that first milestone, would will that be September? Will that be August? When will that be?
038again looking at the entire district. Um I think what you know what I just mentioned when you get out of the ground I think we need to take a you know a pretty good look at you know have we had to uh use any contingency funds for unforeseen field conditions. >> My understanding when we met with the project team that would probably be no later than the September board meeting. should be I think we should have a pretty good idea there. But again, I think I would also want to look, you know, downstream when are we going to when are we going to see ourselves enclosed or under roof? >> That would be the next milestone. Yes. >> Okay. So, we'll nail down those those milestone timelines so the board knows which meetings to expect
039some of that dialogue. >> And our our contingency meeting will be a little different, I think, than what what Mike's describing. Ours are just going to simply be a review and then that money is going to be used against all of the market marketing. >> Just Mike, you you made a comment just made me think you're talking about things like floor tiles and finishes. Is that's all included in these numbers, correct? That we're seeing. Okay, >> that is correct. That is correct. And again, just just so you can put it in perspective, you know, oftent times when you're going through the estimating through the design phases, you know, you find out you're over budget. So you have to value engineer things out. One of the things that we we have really worked hard on is
040not doing that here because we know how important the the look and the feel and and the the level of quality of the materials that go into this building. We just did not want to sacrifice that. We could do that and obviously we could probably get back on budget, but you're going to be giving up I I think things that are going to be very important to you. I mean, this is uh, you know, this is legacy stuff. I mean, you get this opportunity maybe once every 50 years. You want to get you want to get it right. You want you want the very best. Uh, and and I think that's our understanding is the district wants the very best and we're we're working hard to make sure you get that. >> I'm going to
041make a motion unless anybody has any other. So, I'd like to make a motion to approve item 5, A1, 2, and three. >> Second, >> Mr. Marks. >> Yes. >> Mr. Summerl. >> Yes. >> Mrs. Eicult. >> Hi. >> Yes, >> Mrs. Singh. >> Yes. >> Mr. Tullles. >> Yes. >> Thank you everybody. Um, any other else? Any other items, Kirk? >> No, no other business. Is there a motion to adjurnn? >> So moved. >> Second. >> All in favor? >> I >> thank you everybody.