July 23, 2014 at 2:10 p.m.
A closer look at South Adams numbers (03/29/07)
Letter to the Editor
To the editor:
Based on several questions I have had from members of the community, I want to take this opportunity to present the facts regarding the South Adams School building project.
All the calculations shown here are from Umbaugh and Associates, Certified Public Accountants, LLP.
1. What the above means is that given the worse-case scenario, if you owned a home with a market value of $100,000 your estimated portion dedicated to your school property tax would be $239.87 per year. That is not on top of what you currently pay in your school property taxes but what would be the total estimated amount of property taxes. If we were able to sell the bonds today, the same $100,000 home would pay $212.75 per year in property taxes.
2. If you have commercial and other farm property, the worst case scenario estimated cost would be $0.3869/acre per year. If we sold bonds today the cost would be $ 0.3431/acre per year.
3. All of the above would vary to some degree depending upon your tax exemptions and for the farming community, the soil type.
Other factors to consider:
1. South Adams new pre-k through 8 building is being done in the most cost-effective manner, that being design-build which allows for a more competitive process and one which allows for negotiation. In the past, schools have only been allowed to take the lowest bid presented, regardless of quality of work, price, now, we can search for the best value. design-build cost savings realized across the country is between 7 percent and 12 percent when compared to similar projects under a traditional bid build.
2. Energy savings contracts are tax neutral which means that no new taxes will be used for that project. We are beginning an energy savings contract for our HVAC system (heating, ventilation, and air conditioning, some wiring, and the swimming pool renovation). The anticipated cost for the project was $4.1 million. The actual bids came in at $3.5 million which then allowed us to move the renovation of the swimming pool (to bring the pool up to Indiana Code) out of the high school renovation and into the energy savings contract.
3. As of March 26, 2007 the cost of copper increased on the COMEX trading exchange. The spot price has risen above the $3 level. Earlier this year the trading price was in the mid $2 range. (Fortunately for SA, we are doing an energy savings contract for our entire school system including the HVAC (heating, ventilation and the needed copper was already purchased at the lower price.
4. Concrete has increased in price by approximately 20 percent over the last three years and is expected to continue to increase.
5. For at least the last five years, over-all construction costs have been in double digit inflation yearly.
6. Our transportation costs, assuming a single campus, will decrease once all the students are on one campus.
7. We are not adding additional rooms or additional gyms. Despite heavy use of all three current gyms, we will only be replacing the current gyms at both the elementary and the middle school with an elementary gym and a middle school gym (which will have a regulation size basketball court).
8. We have decreased the over-all combined square footage of our elementary and middle school from approximately 187,000 square feet to 147,000 square feet.
9. We will have one kitchen instead of three kitchens.
10. We will have two dining areas instead of three. These spaces will be expected to be able to be combined to create a single large community space easily.
11. There will be an elementary music room.
12. We will have created a pre-kindergarten through 12th grade facility on one campus for which parents, grandparents, and community members can come to one location to see their kids learning within a great facility - one which includes expectations of academic excellence.
The bottom line is that we are diligently working to provide a cost-effective and great learning environment for South Adams students. If we delay the project, the financial costs will increase and we will receive no gain from such an expense.
The design-build process is different than what people are used to and it can be a little confusing. It seems basically is backwards. Indiana is the 43rd state to do this and South Adams would be the first school system in the state to use this process. I think what people need to know, even though we have brought the maximum bonding amount to $25 million, we fully expect the bids to come in lower than that. I have confidence that if bids do not come in as we expect, we will tell the architects to go sharpen their pencils until the bids do come in where we think they should be.
We are not looking for fluff - we live in a community of hard-working people, from business people to farmers to laborers and others. We all live in great harmony together and we will combine to get this important project done for our children and their children, and their children after that. It is not only the current generation we are looking to provide the best education possible for - it is future generations and we all have some stake in seeing that this can be accomplished.
Cathy Egolf
Superintendent of Schools
Tony Mellencamp
School Board President
South Adams Schools[[In-content Ad]]
Based on several questions I have had from members of the community, I want to take this opportunity to present the facts regarding the South Adams School building project.
All the calculations shown here are from Umbaugh and Associates, Certified Public Accountants, LLP.
1. What the above means is that given the worse-case scenario, if you owned a home with a market value of $100,000 your estimated portion dedicated to your school property tax would be $239.87 per year. That is not on top of what you currently pay in your school property taxes but what would be the total estimated amount of property taxes. If we were able to sell the bonds today, the same $100,000 home would pay $212.75 per year in property taxes.
2. If you have commercial and other farm property, the worst case scenario estimated cost would be $0.3869/acre per year. If we sold bonds today the cost would be $ 0.3431/acre per year.
3. All of the above would vary to some degree depending upon your tax exemptions and for the farming community, the soil type.
Other factors to consider:
1. South Adams new pre-k through 8 building is being done in the most cost-effective manner, that being design-build which allows for a more competitive process and one which allows for negotiation. In the past, schools have only been allowed to take the lowest bid presented, regardless of quality of work, price, now, we can search for the best value. design-build cost savings realized across the country is between 7 percent and 12 percent when compared to similar projects under a traditional bid build.
2. Energy savings contracts are tax neutral which means that no new taxes will be used for that project. We are beginning an energy savings contract for our HVAC system (heating, ventilation, and air conditioning, some wiring, and the swimming pool renovation). The anticipated cost for the project was $4.1 million. The actual bids came in at $3.5 million which then allowed us to move the renovation of the swimming pool (to bring the pool up to Indiana Code) out of the high school renovation and into the energy savings contract.
3. As of March 26, 2007 the cost of copper increased on the COMEX trading exchange. The spot price has risen above the $3 level. Earlier this year the trading price was in the mid $2 range. (Fortunately for SA, we are doing an energy savings contract for our entire school system including the HVAC (heating, ventilation and the needed copper was already purchased at the lower price.
4. Concrete has increased in price by approximately 20 percent over the last three years and is expected to continue to increase.
5. For at least the last five years, over-all construction costs have been in double digit inflation yearly.
6. Our transportation costs, assuming a single campus, will decrease once all the students are on one campus.
7. We are not adding additional rooms or additional gyms. Despite heavy use of all three current gyms, we will only be replacing the current gyms at both the elementary and the middle school with an elementary gym and a middle school gym (which will have a regulation size basketball court).
8. We have decreased the over-all combined square footage of our elementary and middle school from approximately 187,000 square feet to 147,000 square feet.
9. We will have one kitchen instead of three kitchens.
10. We will have two dining areas instead of three. These spaces will be expected to be able to be combined to create a single large community space easily.
11. There will be an elementary music room.
12. We will have created a pre-kindergarten through 12th grade facility on one campus for which parents, grandparents, and community members can come to one location to see their kids learning within a great facility - one which includes expectations of academic excellence.
The bottom line is that we are diligently working to provide a cost-effective and great learning environment for South Adams students. If we delay the project, the financial costs will increase and we will receive no gain from such an expense.
The design-build process is different than what people are used to and it can be a little confusing. It seems basically is backwards. Indiana is the 43rd state to do this and South Adams would be the first school system in the state to use this process. I think what people need to know, even though we have brought the maximum bonding amount to $25 million, we fully expect the bids to come in lower than that. I have confidence that if bids do not come in as we expect, we will tell the architects to go sharpen their pencils until the bids do come in where we think they should be.
We are not looking for fluff - we live in a community of hard-working people, from business people to farmers to laborers and others. We all live in great harmony together and we will combine to get this important project done for our children and their children, and their children after that. It is not only the current generation we are looking to provide the best education possible for - it is future generations and we all have some stake in seeing that this can be accomplished.
Cathy Egolf
Superintendent of Schools
Tony Mellencamp
School Board President
South Adams Schools[[In-content Ad]]
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