WY SCHOOL CONSTRUCTION COSTS LOWER THAN SURROUNDING STATES

Despite some news that some recent schools projects are going over budget, a recent Wyoming School Facilities Department Study presented to the Wyoming Legislature’s Select Committee Shows that Wyoming’s school construction costs are not only very competitive with the costs of surrounding states, but slightly lower than most of them.

The Department utilized RSMeans, RSMeans Square Foot Costs, 34th Annual Edition 2013 to make their determinations that Wyoming’s school construction costs, coming in at an average of $141.88 are lower than all surrounding states, other than South Dakota’s, which came in at $133.44. Colorado came in the highest at $154.60. Wyoming’s square footage costs were very close to most other surrounding states.

Of course, anyone involved in construction knows that it costs almost twice as much to actually build schools, however, the RSMeans average does not include other costs that we take for granted, like furniture, fixtures and equipment, gyms, playgrounds, auditoriums, etc.

“I have yet to hear from anyone who bases project cost estimations on RSMeans data,” says WCC President Josh Carnahan, “However, at a minimum, the data is useful to show market trends and to compare and contrast. Frankly, this data shows what we already knew, construction markets and costs are largely dependent on regional factors, and that Wyoming construction is very competitive with construction in surrounding states.”

Wyoming School Facilities Department Director, Bill Panos explained that while roughly 50% of recent school construction have come in on budget or even slightly lower, most of the the other 50% of bids are coming in way over budget, each project having a different, non-repeatable set of factors leading to the overruns.

Upon request of the Select Committee, the Department also took a look at Wyoming’s contractor preference laws and costs, namely the 5% preference for prime contractors. Panos said the Department looked into recent projects and no red flags were raised regarding contractor preference laws. Current data shows that preference played no role in the vast majority of projects, and in the few projects preference did play a role, the state saved more money than it spent. The Select Committee has requested that the Department review costs regarding the 70/30 law that requires no more than 30% of a project be subcontracted to non-residents.

“Again, this data shows what we already know, and we believe that we need to be focused on the factors that play a much larger role in costs of construction, such as project timing and labor costs,” said Carnahan.

“Last year, and for the three proceeding years, school related construction was averaging around $10 million per month in Wyoming, this year, we have seen that go up as much as 150%, that kind of fluctuation is going to impact the market,” continued Carnahan, “”We have seen increasingly stronger housing, commercial and industrial construction markets, not only in Wyoming, but even more so regionally. We are looking at a construction market that is nearing the highs of the booming 2008 market, thousands of construction employees left the state after the bust in 2009, they have not returned, they are unlikely to return to Wyoming when their local markets are strong.”

Carnahan said that Wyoming’s construction industry must work for stability, especially in the state’s boom and bust economy. A big factor in that equation is stabilizing school construction.

“We are hearing from a lot of folks saying that they need to slow school construction down. The School Facilities Department has a pretty big backlog of projects that has been building for years, school districts want their projects yesterday and the SFD is only beginning to chip away at the backlog. So right now we are looking at the big, long-term picture. In working with Mr. Panos, the Select Committee on School Facilities, and numerous staff and legislators we see that once we get through this current backlog, the long-term outlook is certainly looking more stable for school construction.”

Contact WCC to request a copy of the Wyoming School Facilities Department’s analysis of region school construction costs and contractor preference.