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Write Ahead, Wellesley

Budget challenges have Wellesley digging deep on Hardy Elementary School project

November 2, 2022 by Bob Brown Leave a Comment

Wellesley public school and town officials recently posed with shiny shovels while doing the obligatory groundbreaking for the new Hunnewell Elementary School, projected to open in February of 2024. They might need to swap shovels for backhoes when the time comes for the new Hardy Elementary School ceremony, as the town finds itself digging deeper than it hoped to pay for this project, slated for completion in fall of 2024.

Inflation and supply chain challenges are largely to blame for rising costs, as discussed at recent School Committee and Permanent Building Committee (PBC) meetings.

Higher costs are forcing the town to make tough decisions in an effort to provide relative parity between the new Hunnewell and Hardy schools and to avoid screwing up everything from construction schedules to redistricting to collective bargaining. It’s all connected.

“My discomfort exists on multiple levels,” Supt. Dr. David Lussier said during the Oct. 11 School Committee meeting. “This is a tough time to be building a new school, we know that. We also don’t get to choose…it took us more than 10 years to get here. We are where we are…”

In a similar vein, the PBC Chair Michael Tauer said at that group’s Oct. 13 meeting with the School Committee: “We’re faced with a range of unpalatable choices.”

Hardy Elementary School in Wellesley

How we got here

In 2021, Town Meeting and then town residents (via a debt exclusion) approved funding the Hardy project with an overall budget of $72.5M, inclusive of $2.5M that had previously been allocated for a feasibility study and schematic design. Some $70M is budgeted for design development and construction of the project, with up to a $13.5M reimbursement expected through the public school system’s partnership with the Massachusetts School Building Authority (MSBA).

“After the Town Meeting approval and the debt exclusion, the project moved into the design development phase during which the building design is further refined, culminating in construction documents. There are multiple checkpoints in which the construction manager and an outside firm provide estimates based on the current design which are then reconciled into one estimate,” explained School Committee member Melissa Martin in an email exchange with us on Oct. 21. “Unfortunately, this project, like many other construction projects, has been severely impacted by market conditions and inflationary pressures.”

During the spring, at the end of the design development phase, estimates came in about $3M over the construction budget of $55.6M. The PBC explored potential savings and brought the price back to where it started. Unfortunately, during the latest checkpoint, the estimate for construction was over budget by $3.2M.

The PBC devoted its Oct. 6 meeting, which lasted 3 hours, to whittling down that $3.2M via a value management or engineering process, to use project management lingo. They did it, in part by significantly shaving the hard and soft cost contingency budget, and in part by making adjustments to various line items, including interior and exterior building components, all with an eye toward not compromising the educational needs supported by the facility. While project managers try to avoid reducing contingencies, those involved in this project acknowledge these often can be lower for new construction than for renovations where you might find more surprises along the way (not that Wellesley hasn’t come across surprises with new construction, including the high school).

“It’s a very, very tight way to go into a project,” PBC’s Tom Goemaat said during that committee’s Oct. 13 meeting. “But that’s how we have to move money around in order to get through the next step with the MSBA.”

In the end, those proposed reductions for the Hardy project resulted in a collective, “Phew!”

But that’s not the end of this story.

The Hardy plan

Martin shared a brief update on the situation with the School Committee on Oct. 11, which proved to be a preview of a longer discussion at the Oct. 13 PBC meeting involving the PBC, School Committee, and school administrators. Martin reminded School Committee meeting participants and viewers before that PBC meeting that the funding process for Hardy was different than for other projects, such as Hunnewell and the Town Hall renovation, in that Town Meeting and the town needed to be approached about Hardy earlier than usual because of the MSBA partnership. Doing so at the schematic design phase of the project made cost calculations more difficult. (The School Committee has been keeping the Select Board in the loop as well, though this aspect of the Hardy project has not been on any recent Select Board agendas.)

What has everyone on pins and needles is that the project timeline calls for securing some contracts in January through early bids, as there’s a desire to get elements such as roofing addressed early on due to lead-time realities. The town could wind up committing $20M to the project early in the new year and digging a hole in the ground, only to find that costs are again escalating. That could force School Committee to go back to Town Meeting to ask for more funding even if money turned back from Middle School and other projects can cover some of the Hardy costs. Town Meeting could vote “yes” or “no.”

“There is a very real sense, though the likelihood might be small, that essentially you’re rolling the dice with $20 million dollars of taxpayer money,” said PBC Chair Tauer. “That makes me very nervous.”

An alternative would be holding off on bidding until the Guaranteed Maximum Price is available in April. But delaying the project’s start by months would make it impossible to catch up and open Hardy on time. As currently planned, next summer would be the sweet spot for getting a lot done on the project while school is out of session.

“Based on the current timeline, the new Hardy school building will open in the fall of 2024, at which point the redistricting plan will go into effect, with the seven elementary schools consolidating into six,” Martin said. “The two committees discussed the fact that a delay to the timeline would result in a series of challenging programmatic decisions and would incur additional costs, both in terms of educational operations and in terms of construction. Recognizing that the fall 2024 opening date for the Hardy school has important implications programmatically that affect the entire Wellesley district and also would result in additional costs, the PBC decided to continue on the current timeline.That said, there will be additional opportunities to review updated cost estimates with the next being the 90% design estimate expected in mid-November.”

PBC and project team members said hearing from the School Committee and school officials directly on Oct. 13 helped them appreciate just how critical sticking to the current timeline will be. Lussier raised questions around what would happen if Hardy didn’t open as planned in fall of 2024. Would Upham Elementary School, slated to be shuttered as the town consolidates from 7 to 6 elementary schools, need to be left open longer? Would Wellesley Public Schools close Upham as planned and squeeze more kids into the existing Hardy school, creating fresh challenges for students, including for those with autism in the WPS Skills Program?

“There’s a series of very tough choices there that we’d have to investigate,” Lussier said. “An important element that the School Committee identified early on in contemplating sequencing of all of these things was to try to minimize disruptions for kids…”

The School Committee’s Martin said she was in favor of moving ahead and gathering information from bidders that can be useful regardless of how the project goes from there. Her colleagues at the Oct. 13 meeting agreed, and so did PMC members.

“Hearing that there’s definitely additional costs to pushing it out, and there’s definitely additional costs to the school budget, and there’s definitely impacts to a lot of things in town, let’s keep going,” Goematt said. “If we have to, we’ll value engineer some things out we don’t want to value engineer.”

Not that this provides Wellesley school officials with much comfort, but the town is not alone among municipalities dealing with such issues.

“You’re one of many towns having this identical conversation…” said Jeff D’Amico of Compass, the Hardy school’s project management firm. “Towns are having to find creative ways to get additional money, whether it’s through the use of [American Rescue Plan Act] funding, through the redeployment of surplus funds, or going back for a new ask. We’ve seen all those happen.”


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