2006-11-29-SPTM2-AC-rpt - Laserfiche WebLink

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APPROPRIATION COMMITTEE PRELIMINARY REPORT TO STM2-NOVEMBER 2006 As of the writing of this report, this Committee has seen only the $30.SM cost estimate and a breakdown of the costs at a level of detail of only half a-dozen lines in a table. Some of what we have not seen includes: • The cost estimate from the professional cost estimators based on the partial design-development drawings that the Permanent Building Committee is in the process of vetting; • Any formal pros & cons, with approximate cost impacts, of alternatives considered in reaching the current project scope; • Any quantitative analysis of future operating costs (but see the online presentation referenced above for a good qualitative analysis of the advantages and disadvantages of indoor vehicle and equipment storage); • Any quantitative analysis of the effects on future needs for DPW equipment; • Any quantitative analysis of projected energy usage; and • Any cost/benefit analysis of noise and stray light control versus their effects on nearby residents. For smaller projects, these types of analyses are often desirable. For the present project, they are imperative. In summary, while the design of the new facility, the plans for its construction, and the cost estimates appear to be proceeding in an orderly way toward reasonable goals, more information and analysis are necessary before we can make a positive recommendation on the appropriation of the large amount that would cover the full costs of construction (including "soft" costs) of a facility that will affect operating budgets for decades. It should also be noted that the degree of certainty in the project costs will be significantly higher at future stages in the design and engineering (D&E), and then the bidding process, when the design will be more detailed, when additional cost analyses will be completed, and when the time until construction will be shorter. We are aware of the generally high rate of inflation of construction costs, especially for public facilities in Massachusetts, which maybe on the order of 10% per year. Thus it is not desirable to incur delays in the actual construction of the DP~1U facility if they can be prudently avoided. Likewise, we shouldn't interrupt the D&E team as there is great value in what they can provide to help answer the open questions and as there would be new start-up costs to bear to restart that team. We currently believe there is an appropriate way to provide time to proceed with the D&E work and the analyses that need to be done without materially delaying the actual construction schedule: Appropriate under this Article only those funds necessary to proceed with the D&E work to achieve formal, bid-read construction documents and require that important analyses be done on an expeditious schedule. The much larger balance of the funds needed for the project could then be appropriated at the Annual Town Meeting in the spring of 2007 (if sufficient progress has been made by then with regard to additional information, including more precise cost estimates) or at a Special Town Meeting no later than the late summer or early fall of 2007. In the event that the Town's voters do not approve adebt-exclusion referendum, funds spent on the D&E work would have to come from the General Fund's non-exempt tax levy-likely with Bond Anticipation Notes. If a debt exclusion is eventually passed for this project, the D&E costs can be included in that exempt tax levy. For these reasons, this Committee voted unanimously (9-0) to "recommend to the Board of Selectmen that at the Special Town Meeting No. 2 they seek only to appropriate the remainder of the funds for D&E work reasonably necessary for completion ofbid-ready construction drawings." Discussions on strategy among a number of boards and committees will continue until this Article is taken up by Town Meeting-which is expected to be next month on the 6th. VVe will make our final recommendation at that time. 2