Title
Vote on a request to approve the County to jointly apply for the North Carolina State Department of Instruction’s (DPI) Needs-Based Public School Capital Fund with Chatham County Schools for three capital projects - Namely, the replacement of school gymnasiums in Bennett, Bonlee, and Silk Hope (a total of three gymnasium replacements).
Abstract
Action Requested: Approve the County to jointly apply for the North Carolina State Department of Instruction’s Needs-Based Public School Capital Fund with Chatham County Schools for three capital projects - Namely, the replacement of school gymnasiums in Bennett, Bonlee, and Silk Hope (a total of three gymnasium replacements).
Introduction & Background: The Needs-Based Public School Capital Fund (NBPSCF) was established to assist counties with their critical public school building capital needs. Grants from NBPSCF are funded with revenue from the NC Education Lottery. Grant funds are available to eligible counties for construction of new school buildings and additions, repairs, and renovations of existing school facilities. As a Tier III County, Chatham has not historically been eligible to apply for project funding through this source. However, the eligibility standards have been amended for this latest funding cycle, which allows Chatham’s participation in this round. Additionally, in the past, counties awarded funding through NBPSCF were required to forego five years of education lottery revenue. This is no longer the case. Therefore, if awarded, Chatham will not have to forego this revenue.
In consultation with Chatham County Schools, the proposed project is to construct a new 10,000 sq ft. gymnasium in a different location on each campus (Bennett, Bonlee, and Silk Hope) with a Pre Engineered Metal Building (PEMB). This project will include a middle school sized basketball court, locker and team facilities for boys and girls, public facilities, and associated storage/mechanical space.
Each campus project represents a separate funding request application to DPI. Therefore, three applications will be submitted to DPI, if approved by the Board of Commissioners. With some assistance from the County, Chatham County Schools is presently finalizing these applications, which are due no later than March 15, 2022.
Discussion & Analysis: This is a “future project” as listed in the most recently adopted county Capital Improvement Plan (CIP). The CIP states, as a recommended solution to the undersized facilities at each of these three locations is, “replace the gymnasiums at Bennett, Silk Hope, and Bonlee schools with gyms that meet the current size, features, and standards recommended by the Department of Public Instruction”. The CIP further notes, “the same design will be used on all gyms, with adjustments for site conditions, to reduce design cost”.
Recently, Chatham County Schools commissioned a feasibility study to analyze these three sites and facilities and determine alternative solution approaches and their respective costs and the probable annual cost escalation factor for each alternative. This study was presented to county staff and Board of Commissioners during its annual budget retreat in January of 2022. During this initial discussion, all parties agreed that the feasibility study’s fourth option, which aligns with the recommended solution of the adopted CIP, is the preferred alternative to explore.
As this project is a future project and not one that is within the seven-year CIP, currently there is no funding plan in place to move this project forward. However, this project is recognized by Chatham County Schools as having particular importance and value to relating to the overall educational offerings by the School System. As stated in the draft funding application, the Schools note that replacing these gymnasiums will positively impact the quality of the learning and athletic opportunities of all students and student-athletes enrolled at these schools. The School further notes, “funding this project will impact a broad group of stakeholders and will address the educational programming, equity, and safety aspects of this situation as well”.
The NBPSCF funding, if awarded, will enable this project to move forward in a much sooner timeframe than if the three gymnasium projects remain on the given schedule of the most recently adopted CIP. Furthermore, moving this project ahead, provided the necessary funding through the NBPSCF, will drive down the capital cost for these improvements, as the estimated annual cost escalation for this project is just over $1 million.
How does this relate to the Comprehensive Plan: Plan Chatham calls for the provision of equitable access to educational opportunities and high-quality education along with providing expanded recreation opportunities and improving access to parks, community facilities, trails, and open space. These facilities are utilized by the Schools for the benefit of its students, by the Chatham County Parks and Recreation Department for programing it offers, and the community at large. While each of the subject school campuses have gymnasium space for its students and community, these facilities are quite aged, undersized, and are not adequate to continue serving the existing and growing needs.
Budgetary Impact: If awarded, the requested funding for the proposed projects will require a 15% local match. The subject feasibility study estimates the cost of all three project to be $15.069 million, assuming construction begins in fiscal year 2024. Accordingly, the 15% local match would be approximately $2.26 million. Additional funds will be required to demolish the existing gymnasiums and prepare the resulting area for other purposes. This additional work is estimated at $500,000, which would not be funded through NBPSCF award. In total, it is estimated that the one-time budgetary impact for this project will be approximately $2.76 million. As a one-time cost, staff recommends this project be funded through a General Fund Fund Balance appropriation.
The ongoing operating budget impact is anticipated to potentially improve as utility and maintenance costs are expected to decline, resulting from updated systems and materials. However, this improvement may be mitigated, to some degree, by the increased size of the new facilities.
Recommendation: Approve the County to jointly apply for the North Carolina State Department of Instruction’s Needs-Based Public School Capital Fund with Chatham County Schools for three capital projects - Namely, the replacement of school gymnasiums in Bennett, Bonlee, and Silk Hope (a total of three gymnasium replacements).