Favorable bidding climate implodes

by Jim Boyle

The bidding climate for school remodeling projects has taken a nosedive since the Elk River Area School District renovated and remodeled Zimmerman Elementary School.

After some of the most competitive and generous bidding with the Zimmerman project, the Parker Elementary School renovation project came in over the estimated cost this week for the second time — even after  school district administrators working alongside Wold Architects took steps to tweak the initial project and break it into phases after the first set of bids came in high by nearly  $1 million.

Two factors that drove bids up past initial projections were rising material costs — up 8 percent since the beginning of the year — and the short summer-long window district officials had hoped to complete the project.

District officials were surprised and went out for another round of bids with the same result.

“The bidding climate right now is really weird,” said Randy Anderson, the executive director of business services.

The Zimmerman project had 18 contractors submit bids. Parker has only had eight bidders. Some of the companies in the larger pack have since merged. Others have gone out of business. The differences in their bid packages comparatively are staggering.

They came in 23 percent under an initial $9 million projected budget in Zimmerman. Those renovations were completed for about $7 million. The overage budgeted was spread around the school to advance the district’s deferred maintenance and upkeep.

The lowest bid on what was initially viewed as a $5.35 million construction project came in at $6.45 million from a St. Paul firm, Anderson reported to the School Board on March 26. (Note: The two lowest bidders withdrew because of a bid error.)

Contractors said the short time needed to complete the project would force them to rely on added work shifts to deal with phasing challenges.

District administrators and architects adjusted the scope of the project — eliminating such things as a bathroom near the physical education offices and the mechanics for new backboards in the gym, as well changes in the HVAC system.

“We took away things we were hoping we could afford with the bid climate,” Anderson said.

School officials were hoping bids would come in at or below budget for the newly drawn up construction project, estimated to cost $6 million, on April 3. That didn’t happen.

The district is continuing to work with Wold to determine the next steps and will discuss the bid results with the board at the April 11 work session.

Anderson told board members they have been careful to adhere to minimum equity standards the district has forged throughout its elementary schools (i.e. sinks in the classrooms).

“Reducing additional scope of work at this time to lower the cost of the project could possibly put us in an ‘all the other schools have it, how come we don’t have it’ type situation,” Anderson said.

Higher-than-expected bids have also resulted in conversations about how to move forward with planned work at the Handke Family Center and other deferred maintenance projects.

“We thought we’d have $1 million for district projects,” Anderson said.

Instead, a levy or other sources are being considered to press on with the work. Anderson is looking ahead at bonding projects that are scheduled to come offline in the future.

Meanwhile, the first phase of the renovation project began during spring break with the removal of floor tile in the west end of the building which includes the main lobby areas and locker bay areas.
That work was done to save valuable time during the summer renovation.

This summer the project will consist of the office area upgrade, locker areas, cafeteria and the gymnasium. The summer of 2013 project will consist of the academic classrooms and the media center.

Splitting the rest of the project into two phases reduces the scope to be completed in one summer and eliminates premium time charges from the contractors.

School administrators are examining their options at this point before the April 11 board meeting.