PRESENTED BY: SchoolDude

SUCCESS STRATEGIES IN SUCCESS STRATEGIES IN FACILITY CAPITAL FACILITY CAPITAL PLANNINGPLANNING

Do you have a formal capital planning process?

Source: 2004 SchoolDude Capital Planning Survey. 737 educational professional respondents from the US, Canada, and Australia

When do you do most of your capital planning?

Source: 2004 SchoolDude Capital Planning Survey. 737 educational professional respondents from the US, Canada, and Australia

How do you gather your deficiencies?

Source: 2004 SchoolDude Capital Planning Survey. 737 educational professional respondents from the US, Canada, and Australia

Why don’t you have a formal budgeting process?

Source: 2004 SchoolDude Capital Planning Survey. 737 educational professional respondents from the US, Canada, and Australia

Is your board out of touch?

Source: 2004 SchoolDude Capital Planning Survey. 737 educational professional respondents from the US, Canada, and Australia

Why is facility planning important?• All buildings age, deteriorate, and weaken - little maintenance or no All buildings age, deteriorate, and weaken - little maintenance or no

proactive maintenance speeds this processproactive maintenance speeds this process

• If no reliable preventive maintenance process is in place, sustaining a If no reliable preventive maintenance process is in place, sustaining a building encounters budgetary, personnel, administrative, and even building encounters budgetary, personnel, administrative, and even personal drains due to stress, not to mention the occasional legal burdenspersonal drains due to stress, not to mention the occasional legal burdens

• Lack of funding is often cited as an issue, yet when building components Lack of funding is often cited as an issue, yet when building components fail before their expected life expectancies are completed or cause fail before their expected life expectancies are completed or cause additional issues (e.g., mold, safety issues or violations, emergency additional issues (e.g., mold, safety issues or violations, emergency repairs) to arise, thereby multiplying cost burdensrepairs) to arise, thereby multiplying cost burdens

• At the core, Schools, Colleges, and Universities are budget businesses At the core, Schools, Colleges, and Universities are budget businesses and have to be intent upon attracting and retaining students and staffand have to be intent upon attracting and retaining students and staff

• Recent studies have shown that a building’s physical appearance and Recent studies have shown that a building’s physical appearance and function affect grade levelsfunction affect grade levels

• Additional surveys have shown that a large percentage of staff would Additional surveys have shown that a large percentage of staff would have preferred to work in a nicer environment vs. having a pay increasehave preferred to work in a nicer environment vs. having a pay increase

Common Facility Problems

Environmental ConditionsDeferred MaintenanceInadequate FundingInadequate Staff TrainingInsufficient PracticesBuilding and Equipment Deterioration/Expired WarrantiesMorale and Perception by Staff, Students, Public

“Every year we compile our list with estimates. The total is around $15,000,000.00 but we only have about $5,000,000.00 to work with so there is a huge backlog. Therefore we are forced to adjust our plan throughout the

year as systems fail that did not make the cut.”

Comment from SchoolDude capital planning survey

What questions should you be asking?

What is wrong or will be a future issue/need?Will I fix it or replace it? How much will each option cost? How will I price it?How critical is it?When will I address the issue(s)?How will I pay for it?How does it fit into a master plan?

Best Practices

Bring together facility condition assessment data, maintenance requirements, and estimated costs for capital and maintenance planningDevelop preventive and routine maintenance programs and schedulesTrack work orders/approved maintenance tasksMeasure and compare each building’s overall condition in relation to the others, using a ranking against a means or a “facility condition index”Identify and prioritize major facility upgrades/renovation requirements with cost estimates

Best Practices

Develop or obtain cost estimates for all identified future tasksIdentify and prioritize tasks/projects, including routine, major, and deferred maintenanceMaintain/update data from facility condition assessments and conditions including tasks performedDevelop life cycle costs or expected future costs based on current information of facilities and their systems/componentsAnalyze cost benefits periodically for “replace vs. renovate” decisions

Factors in a Plan

Roadmap for Capital Planning Success

Identify needsPrioritization of needsDevelop estimates and alternative resolution scenariosPresentation of needs and options for approvalFinalization of plan(s), project(s), and fundingSchedule timeframeImplementUpdate and identify future needs

Source: Source: Construction, Renovation and Long-Term Facility Planning Construction, Renovation and Long-Term Facility Planning presented at SchoolDude Universitypresented at SchoolDude University

© Copyright 2006 SchoolDude.com, Inc. All rights reserved.© Copyright 2006 SchoolDude.com, Inc. All rights reserved.

Identify NeedsWalkthroughs (internal, 3rd party, or combination)Work requestsStaff interviews and/or surveysBoard or government-required mandatesReview of previous year(s) for leftover needs or ongoing projectsSurveys to, or requests from, facility staff or occupants

Prioritization of NeedsPrimary Priority (emergency vs. low)Varying viewpoints with Priorities (e.g., identify a resolution as a low priority from an aesthetic perspective that may be a high priority in relation to a health/safety risk or litigation point of view) such as:

• ADA/Accessibility• Air Quality• Building Code• Cosmetic• Educational Impact• Environmental Impact• Litigation Potential• Safety

Determine building deficiencies in these arenas:Determine building deficiencies in these arenas:• Codes and standards Codes and standards

• Architectural/StructuralArchitectural/Structural• MechanicalMechanical

• PlumbingPlumbing• Electrical/EnergyElectrical/Energy• Site Conditions Site Conditions

• Additional NeedsAdditional Needs

Estimates and Alternative Resolution Scenarios

Patch vs. Replace scenarios and estimated costs of approachesYour previous experience, but also your neighbors!Bids and estimates for contracted workRS Means, Whitestone, or similar estimating benchmarking toolProject the future cost (add inflationary value as time progresses)

Estimates and Alternative Resolution Scenarios

Present Needs and Options for Approval

Summarize report into categories:Sites/Campuses and associated BuildingsPrioritiesProjectsMaster Plan(s)Funding SourcesYearsTypes of Work (mechanical vs. energy conservation vs. roofing)

Summaries from various viewpoints may be able to coincide with one another (one room’s needs could fold into others for one large project vs. many small ones)Have details ready for specific needs to help in plan of actionProvide graphical view for additional impact with bar graphs and pie charts

Categorize Your Projects or Needs

ADAADA AdditionsAdditions AestheticsAesthetics AnalysisAnalysis Asbestos AbatementAsbestos Abatement Codes/StandardsCodes/Standards Damage/WearDamage/Wear DesignDesign Disabled AccessDisabled Access Electrical System UpgradesElectrical System Upgrades Energy ConservationEnergy Conservation EnhancementEnhancement Environmental Environmental

ImprovementsImprovements Facility UpgradesFacility Upgrades

FunctionalityFunctionality Health and Life Safety Health and Life Safety

UpgradesUpgrades Human ErrorHuman Error Life SafetyLife Safety Loss PreventionLoss Prevention Mechanical System UpgradesMechanical System Upgrades New Site ConstructionNew Site Construction Preventive Maintenance WorkPreventive Maintenance Work RemodelingRemodeling RenovationRenovation Repairs - MajorRepairs - Major Repairs - MinorRepairs - Minor Roof ReplacementsRoof Replacements Site ServicingSite Servicing Site UpgradesSite Upgrades

Finalization of Plans, Projects, and Funding

Constantly monitor plans to shift to alternative solutions or entirely remove from plan to:

Manage available monies and resourcesAdapt to changes (facility change, legal requirements)Finalize proposed bid from multiple contractorsInclude next year’s projects into this year’s remaining funding and resources

Schedule TimeframeFor 5, 10, 15, 20 year plans, establish a fiscal or calendar year of when need will the most likely impact

“Life Cycle”A life cycle analysis is a structured approach or methodology to establish a facility’s life cycle costsLife cycle costs are anticipated expenses for each stage in the life of a facility and its componentsLife cycle costs will include capital investment costs, financing, operations and maintenance, repair and replacement, salvage costs, facility alterations and improvements, and functional use costs

SOURCE: REVIEW OF DEFERRED MAINTENANCE IN THE COMMONWEALTH [of VA], DECEMBER 2004, AUDITOR OF PUBLIC ACCOUNTS

“Life Cycle”Institutions should perform the life cycle analysis during the design of a new building in conjunction with the condition assessment of older buildingsReview the programmatic and functional use of the building to develop a life cycle analysis of the cost to operate a newly designed or previously constructed building for at least 10 yearsFor new construction, the life cycle analysis provides information on the cost to operate and maintain the building to assist in budgeting for these costsFor older buildings, the analysis includes repair or replace options

SOURCE: REVIEW OF DEFERRED MAINTENANCE IN THE COMMONWEALTH [of VA], DECEMBER 2004, AUDITOR OF PUBLIC ACCOUNTS

“Life Cycle” and Maintenance

Everything has a life span or expectancyProper preventive and timely corrective maintenance can easily extend the life span of building components and save capital

Typical Replacement Cost (US)Typical Replacement Cost (US)** – – $16,183/student$16,183/student

• Value of roof (6% of bldg. cost)Value of roof (6% of bldg. cost) $16,183 * .06 =$16,183 * .06 = $971/student$971/student• Value of HVAC (11%)Value of HVAC (11%) $16,183 * .11 =$16,183 * .11 = $1,780/student$1,780/studentTotal for just two systems:Total for just two systems: $2,751/student$2,751/student

Traditional life of component = 15 Years therefore Traditional life of component = 15 Years therefore $2751 / 15 = $2751 / 15 = $183.40$183.40If extend this by 2 years of PM = 17 Years therefore If extend this by 2 years of PM = 17 Years therefore $2751 / 17 =$2751 / 17 = $161.88$161.88

Capital Budget Relief/Difference:Capital Budget Relief/Difference: $21.58/student$21.58/student

If FTE is 2000 students:If FTE is 2000 students: 2000 * $21.58 =2000 * $21.58 = $43,154.67 $43,154.67

savings!savings!* - American School & University magazine 27TH ANNUAL OFFICIAL EDUCATION CONSTRUCTION REPORT Assuming a 15-year life cycle extended to 17 years with a PM program (very conservative estimate)

$100K

$75K

$50K

$25K

$0K

0 5 10 15 20 25

Extend the Life Cycle through PM...

$

$

Less Dollars to Fix Issues

More Dollars to Fix Issues

Opportune Time to Invest in PM

$ Benefit $

Replacement Threshold

2318

Source: MACTEC EngineeringYears

PMLittle or No PM

Sample Life Expectancies

Varies due to proper maintenanceVaries due to regionCosts vary in future due to availability of resources for maintenance and construction materials

System

Site Improvements 25 n/a n/aSite Utilities 40 n/a n/aFoundation/Substruct. 50 10.25% 5.78%Superstructure 50 13.63% 16.57%Exterior Wall System 25 9.10% 7.49%Exterior Windows 30 2.41% 2.59%Exterior Doors 20 0.48% 0.44%Roof Systems 20 4.64% 5.09%Interior Partitions 50 5.27% 5.28%Interior Doors 30 1.63% 1.72%Interior Floor Finishes 15 5.45% 5.61%Interior Wall Finishes 25 2.07% 2.17%Interior Ceiling Finishes 25 3.48% 3.23%Specialties 40 2.66% 2.94%Conveying Systems 40 0.38%Plumbing piping 30 3.50% 3.65%Plumbing Fixtures 30 1.72% 1.54%Fire Protect./Suppres. 30 2.57% 2.74%HVAC Distribution 40 5.05% 5.25%HVAC Equipment 30 11.43% 10.75%HVAC Controls 20 2.15% 2.50%Electrical Serv./Gen. 40 2.04% 2.68%Electrical Distribution 50 2.45% 2.76%Electrical Lighting 25 5.59% 6.05%Special Electrical 15 2.46% 2.80%Equip and Furnishings 25 n/a n/a

100.00% 100.00%

Life Expect

% cost 1-story

% cost 2-story

Schedule Timeframe

Prior to upcoming year, begin associating estimated start dates to work and consider:

–Workload of staffWorkload of staff–Contractor timeframes and your time Contractor timeframes and your time to manage themto manage them–Impact on facility’s operationsImpact on facility’s operations–Budget, budget, budgetBudget, budget, budget

Implement

Track statuses, keeping an eye out for new impacts and prioritizing workTracking actual time and expenditures in conjunction with milestones or achievementsRemaining time including delays and slack timeUpdate and identify future or remaining needs for all plans and projects

Summary

Summary

Contact SchoolDude for more Information:

Email – sales@schooldude.com Phone – 877-868-3833