Construction Conundrum

In the coming weeks, Minnechaug Regional High School in Wilbraham, Mass., hopes to be able to turn off the lights in its building. That’s something they haven’t been able to do since August 2021.

That’s when the software controlling the lighting system in school failed, and for more than a year, the 7,000 or so lights in the building have remained on 24 hours a day.

Officials in the Hampden-Wilbraham Regional School District began working immediately to unravel the complications that led to their costly and embarrassing problem. But that has proven to be a herculean task. The company that installed the system has changed hands several times, and company now in charge found it difficult to find someone familiar enough with the system to fix it.

Soon, replacement parts were ordered, and repairs were planned, but weeks turned into months as the Covid-19 pandemic caused supply chain delays in receiving the needed equipment from factories in China.

The good news is that the supply chain bottleneck has loosened, and district officials say the parts and people will be in place in February to install a properly functioning lighting system after 18 months of excess illumination.

The lighting snafu at Minnechaug High is a uniquely odd situation—not every school facility glitch catches the attention of the joke writers on Saturday Night Live—but supply chain problems for school projects are not an outlier.

Supply chain delays have become more commonplace as education institutions try to keep their construction and renovation projects on schedule and on budget. Schools and universities around the nation are postponing or altering projects as they confront those realities.

For example:

-Even though voters have approved funding, the Kearney (Mo.) district has decided to forgo construction of the district’s fifth elementary school because of unfavorable economic conditions. Kearney “needs to rethink plans for a new elementary school due to some serious challenges,” the district announced. “Supply chain shortages persist, inflation is soaring, and a recession looms.”

-Construction of the new Candlewood Lake Elementary School in Brookfield, conn., was supposed to be finished by December so students could move in after the winter break, but delays in receiving supplies such as flooring and roofing materials have prompted district officials to postpone the opening until the beginning of the 2023-24 school year.

-West Prairie (Ill.) Community School District 103 had planned to complete renovations and additions of West Prairie Junior-Senior High School in Colchester by December, but it also fell victim to supply chain problems. “There have been significant delays in material availability, ranging from various petroleum-based products to heating and ventilation equipment,” the district said. The school board has put off opening the upgraded facility until fall semester 2023.

Education facility projects always have been susceptible to delays and cost overruns when unexpected conditions blow up carefully crafted budgets and timelines, but a combination of factors—the lingering effects of the pandemic, the war in Ukraine and spiking inflation—continue to throw many school construction schedules and budgets into disarray.

“It all started with the pandemic,” says Chris Powers, vice president of Colantonio Inc., a construction firm in Holliston, Mass. “Between the pandemic, the war in Ukraine, PVC petroleum plans freezing over in the South, labor shortages—it just seemed to be one thing after the next.”

Many planned projects were put on hold and ongoing projects halted when Covid-19 brought the economy to a standstill. When it became safe to get projects back on track, there were more of them than the industry could handle.

“You had so much demand that we’re still catching up,” says Powers. “That’s why you’re continuing to see some of these lead time issues.

Little things and big delays

Construction projects have a lot of moving parts, and a problem in one area can have ripple effects that jeopardize a schedule.

“Schools....with the high level of energy efficiency they’re looking for, they need thick insulation on the roof,” Powers says. “To install this thick insulation, you need these long screws—8- to 12-inch screws. At one point, those were actually holding up projects because nobody could get the screws. That shows how granular this problem becomes.”

As of the beginning of 2023, pricing and availability fluctuations for some items have settled down. “For a long time, there seemed to be issues with insulation, rock wall, lumber—that type of pricing seems to be stabilizing,” Powers says. “There is still stuff we’re seeing increases or long lead times on—electrically related items like switchgear, transformers. Windows are stull a long lead item. We’re still wrestling with that.”

Embracing teamwork

To navigate the conditions that can throw a school construction project off course, all of the key players—school leadership, design team, contractor and subcontractors—should develop a level of trust and cooperation so that the new or renovated facility is ready for students and staff when it is needed.

“Living and dying by the contract isn’t going to get your project built,” says Powers. “You’ve got to have some level of flexibility as a team. You don’t want a subcontractor to get hurt so bad on a job that he can’t perform.

Each situation should be evaluated on a case-by-case basis.

“When you talk about supply chain delays and cost increases associated with that, who’s responsible?” Power says. “In most cases, it’s reasonable to assume that the subcontractors included some type of reasonable escalation within their original bids. But what’s unreasonable is when there’s a piece of equipment they’re providing and there’s a component of that piece of equipment that the manufacturer can’t get, so the subcontractor has to go to a different manufacturer and there’s a price increase. That’s something that the team as a whole has to look at, and the [school] has to be willing to pay that escalation cost in order to get the project built.”

Early planning

With supply chain issues cropping up more frequently, one key to anticipating potential construction snags and cost increases is to gather information early, Powers asserts.

“Our operations teams spend so much more time now worrying about lead times, getting materials on site, making sure they’re doing their due diligence with the subcontractors, then going deeper and getting backup from manufacturers on lead times,” Powers says. “You can no longer take the subcontractor or even the suppliers at face value. You have to go up one layer and hear it from the manufacturer.”

From a contractor’s perspective, the best way to accomplish this is for an education institution to use a Construction Manager at Risk project delivery method rather than a hard bid (design-bid-build).

“With CM at Risk, you’re bringing the construction manager on board early—it could be eight to 12 months before the project is getting built,” Powers says. “The construction manager can be investigating things like lead times and escalation, and mitigating them along the way, looking for alternative products or alternative procurement methods.”

Powers says that some may perceive CM at Risk as a more expensive delivery method, but he disputes that.

“It’s a misconception,” he says. “The missteps you can have with a hard bid—there’s much more risk associated with that. CM at Risk reduces the opportunity for change orders dramatically.”

The CM at Risk method also enables a contractor to put out bid packages in advance of the entire project going out for bid.

“If you know metal windows have a long lead time, the design team could put extra attention on detailing the windows early on in the design, and we can go out for bid far in advance just on the metal window package,” says Powers. “If you wait until there’s 100% construction documents, then you run the risk of not having the product on site when you need it.”

CM at Risk is especially valuable in facility renovations, which typically have a tighter schedule, Powers says. With new construction, the contractor is likely to devote several months on site work, concrete foundations and structural steel, and finished materials don’t need to be delivered for six months or more.

“But on renovations, you may have only a month of demolition before you need to start putting it all back together, so you are going need materials right away,” Powers says. “The design team and the [school] need to figure for the procurement timeframe and really dissect their schedule.”

Conditions improving

It may take a while for school construction timelines and costs to return to a sense of normalcy, even when rampant supply chain backlogs are no longer an impediment.

“We have to go through a period of time—I’d say a year—of stable pricing, because subcontractors have taken a hit on a lot of these jobs,” Powers says. “You’ve got all this escalation—some of it they’ve been able to recoup, and some it they’ve been held to whatever their contract was. So they’re extremely cautious. Until they see prices stabilizing, they’re really not going to want to take much of a risk.”