By Adam Swift
The City Council held off on authorizing a nearly half a billion dollar budget for a new Revere High School at its meeting Monday night, a move that could delay approval of the project by the Massachusetts School Building Authority.
The budget estimate was presented by the school department’s project manager, Leftfield, and contractor, Consigli.
According to Brian Dakin of Leftfield, the $499 million worst case scenario budget estimate needed to be sent to the MSBA this month as part of the approval process of the schematic design process of the project. The MSBA would then review the project budget and timeline over January and February before making a decision in March which would set the state reimbursement rate and clear the way for the city to put the project out for bonding for its portion of the cost.
However, several councillors stated that it was too much to ask the council to consider the budget numbers that were just arrived at before the weekend, and ask the council to vote on it without further discussion. Council President Gerry Visconti agreed, sending the issue to the council’s ways and means committee, acknowledging that it could delay the project timeline, which currently calls for students to be in the new school by the fall of 2027.
“The numbers are astounding,†said Visconti, noting that the estimates were $120 million over what was presented at the beginning of the schematic design process. “Basically, what you are telling me, to be honest, there was a notification that there was a vote needed at 12:30 this afternoon on a $499 million project. I can say for all 11 of us up here (on the council) that we all want a new high school … but we’ve had less than a weekend to review these numbers.â€
Visconti noted that the estimate includes over an $80 million cushion on soft costs and contingency costs, and that the number also did not include the land acquisition costs for the Wonderland property to build the new high school.
“That’s a big ask for this council, especially without having (the city’s) chief financial officer here, because that is a $120 million increase,†said Visconti. “I don’t feel comfortable voting this evening without know how we are going to pay for it.â€
Dakin explained how a reconciliation and estimation process helped to determine the figures for the building project, as well as the timeline needed to submit paperwork to the MSBA. The budget numbers were presented to the School Building Committee and the regular School Committee on Dec. 8, he said.
“We owe the MSBA a notification form of whether the schematic design submission is imminent on (Dec.) 14, and we owe the submission itself by the 28th,†said Dakin. “These dates are due to the fact that the MSBA process includes timelines on the completion of the feasibility study.â€
The project has already requested and received one extension of the deadline due to the eminent domain process for the Wonderland site, Dakin said.
“If we cannot make these dates, we will have to request another extension, which would essentially push it off a couple months and potentially impact the construction schedule,†said Dakin.
As for the cost estimate itself, officials from Consigli said the initial estimate for construction itself that was arrived at last week was $437 million, but several items were cut from the construction costs to bring the construction estimate down to $420 million.
In addition, another 20 items in the budget were identified that could potentially cut costs by $35 million.
Dakin said the $17 million in cuts would not affect the programming or appearance of the building, but that additional cuts could impact programming.
The soft project contingency costs added to the construction costs raised the total budget number to just under $500 million, although Dakin pointed out that number would be a worst-case scenario, and that there are still opportunities to cut that number during the ongoing design phases.
“We understand this is an immense number, and we understand it has gone up a lot in the last year, and it has gone up the last two times you have seen it,†said Dakin.
He said there are significantly higher trade costs and building costs that drive up the contingency costs, as well as environmental permitting costs.
While the cost of the project has increased, Dakin said the anticipated MSBA grant amount has stayed relatively flat at over $160 million.
“As the market costs go up, the reimbursement does not go up,†said Dakin, noting that the MSBA puts caps on square footage of the building and site costs.
With the grant in hand, Dakin said the potential cost the city would have to shell out is $338,664,809.
“That results in about a 32 percent effective reimbursement rate,†said Dakin.
Dakin assured the council that if it moved ahead with the project with the $499 million budget estimate, the project would be able to proceed on schedule and within the confines of that budget.
“It does not mean that this is the amount of money that the city, at the end of the day, should have to spend or would have to spend,†said Dakin. “We can value engineer and we can continue identifying and potentially accepting cost reductions through the next few phases of the project. If we are given a new goal to hit as we move forward, we will work to hit that new goal via the value management process and finding efficiencies in this building.â€
Dakin said the project principals would work and strive to deliver a project well under the numbers presented to the MSBA and ultimately not have the city need to borrow the full amount of money presented.
“I have to say, as a councillor, it feels likes every time you guys are before us, it feels like Chicken Little, the sky is falling, here are some numbers you have to vote on,†said Ward 6 Councillor Richard Serino. “You need to vote on this, you need to vote on the selection site. We don’t have time as a council to go through the fine details.â€
Serino said the council needs to be able to defend and justify its spending.
“We are authorizing up to a half a billion dollars with just a few days to discuss this and not have a full public discussion,†said Serino. “We hold the purse strings of the city and we are the ones who have to make these financial decisions. I want a new high school, but that’s not the point, the point is that every time you guys are here, you tell us you have to vote on it.â€
Superintendent of Schools Dr. Dianne Kelly said another way to look at it is that the council has been presented with the most up-to-date information as soon as possible. She noted that there have been a number of meetings with the council on the process, including one last week when the council was informed there was likely to be a large increase in the budget estimate for the project. Kelly added that the actual voting on bonding and the budget number would take place in March.
“We keep the information flowing so the City Council can make an educated decision when it comes time to actually vote on the money, which is around March, when the MSBA gives us that final set of numbers they agree on,†said Kelly.
Kelly said she did not oppose the budget numbers going before the ways and means committee, but said that move could delay the project off by three to six months and add inflationary costs on the back end of the project.
Councillor-At-Large Anthony Zambuto argued the request should go before ways and means because of the staggering financial impact.
“I’m tired of this gun to the head stuff,†said Zambuto. “I got an email today at noon telling me we were going to be looking at half a billion dollars to vote on tonight. You can get up and you do whatever you want, but we went through this when we were bonding the land and it was, if you don’t do this tonight we’re going to be six months out.
“Guess what, if there is going to have to be an extension, there’s going to be an extension, and I’ll sign on that, but there is no way I’m voting for this tonight.â€
Ward 4 Councillor Patrick Keefe, who sits on the building committee with Visconti, noted that the council was not being asked to vote on a bond authorization or spending.
“I don’t understand the hostility here,†said Keefe. “We should all be conscious that we are all here for the same reason, that we all care about Revere.â€
However, Keefe said he did understand the concerns that the council received information about the budget estimates four days before its meeting.
Keefe said he also believed in Kelly’s ability to fight for Revere and possibly help secure a better reimbursement rate for the project.