.High performance schools are cost-effective because they positively influence both sides of the financial books. When evaluating the value of high performance design, it is necessary to consider all costs and benefits. High performance schools are cost-effective because they:

  • Can bring more money to the school by increasing average daily attendance,
  • Keep more money in the school by significantly reducing the utility bill, and
  • Can take advantage of currently available incentive programs.

When the avoided societal and district costs of workers compensation and litigation are also considered, high performance schools becomes an even wiser business choice for your school district.


Life-Cycle Costing

School facilities are investments. State government and local communities spend billions of dollars per year on new facilities for current and future generations of students. Unfortunately, the institutional separation of operational and construction budgets can create schools that are economically, environmentally, and educationally poor investments.

Many high performance measures can be incorporated into a school design without increasing first-costs, but additional investments can increase the health and efficiency of the school even further. Under the standard methodology, design measures that clearly reduce the operating budget may not be included because the district may has no means to cover any additional incremental costs.
Life-cycle costing is a means to calculate and compare different designs to identify which is the best investment. Districts can use it assess the total cost of ownership for a facility over time. All of the building expenses that can be calculated are included in the analysis, including initial costs (design and construction), operating costs (energy, water, other utilities, and personnel), and maintenance, repair and replacement costs. The values are adjusted for the time-value of money to represent the true value of the investment. Predicted costs for alternative design approaches can then be compared until the approach which provides the lowest overall cost of ownership consistent with the quality level desired for the facility is selected.
The true cost of a school is much more than the price to design and build it. The long term costs of operating and maintaining the facility must also be included. Only by evaluating all three of these parameters can a community understand how much a new school really "costs."

And only by looking at all three parameters simultaneously can the impacts of specific design approaches, especially those which result in better long term performance, be evaluated. High performance classroom glazing, for example, may cost more upfront but may result in energy savings that pay for the glazing in a few years and then continue to save money for the school for years to come. Life cycle cost analysis is the key to making these kinds of comparisons and to creating new schools with the lowest long term costs of ownership.

Note, however, that life-cycle costing will only address some of the benefits of High Performance Design. Many benefits, such as improved health and test scores, are valuable, but difficult to quantify monetarily.


Reduced Operating Expenses

High performance schools cost less to operate. School districts spend less for electricity, gas, water, maintenance, and other ongoing facility operating costs, enabling more money to be spent for salaries, books, teaching supplies and other items with a more immediate link to the true mission of schools: educating students.

How much savings can be expected? School districts can save 30 to 40 percent on annual utility costs for new schools and 20 to 30 percent on renovated schools by applying high performance design and sustainability concepts. The potential for savings is greater in new schools because it is possible to "design out" inefficiencies from the outset. These savings are designed into the building and will save money year after year, for decades.

The US Department of Energy's Rebuild America K-12 Schools Program estimates that school energy costs are approximately $100 per student year, depending on region and climate conditions. Adding in the costs of water, wastewater processing and trash raises the cost to approximately $125 per student per year. High performance design solutions can yield savings of up to $50 per student per year. In addition, high performance schools are healthy, and can bring more money into the school by lowering student absenteeism. With current revenue limit rates of $4,300 to $5,200 per student directly dependent on Average Daily Attendance (ADA), even small increases in attendance can significantly affect funding.

Integrated design is the key to savings of this magnitude. From the beginning of the design process, each of the building elements (windows, walls, building materials, air-conditioning, landscaping, etc.) is considered part of an integrated system of interacting components. Choices in one area often affect other building systems; integrated design leverages these interactions to maximize the overall building performance.


Increased Funds

Investing in high performance measures that increase the health of the school can bring monetary returns to your school. District funds come from a variety of State, Federal, and local sources, and every district has a unique blend of sources. In general, a district's funding can be divided into three components:

  • General Purpose Funds are calculated by multiplying a school's Average Daily Attendance by its Revenue Limit. Current revenue limits for the 2000-2001 school year are $4306, $5175, and $4485 for elementary, high school, and unified schools, respectively.
  • Categorical Aid covers a wide array of programs from special education programs to instructional materials. The application process and funding amounts vary depending on the programs. Depending on the district, categorical aid can range from small amounts to almost one-third of their total budget.
  • Miscellaneous funds comprise the small remaining amount. Typical sources are the lottery and various local sources.

High Performance School can increase the amount of school funding by increasing your average daily attendance. Because the revenue limits range from $4,300 to $5,175, even small changes in attendance can significantly effect your schools bottom line. Recent changes in the funding mechanism that exclude excused absences from the average daily attendance calculation further increase the financial necessity of keeping as many students in class as possible.
For example, assume that a 500 student elementary school invests $4.00 per square foot on high performance lighting and air conditioning improvements that will increase the health of the indoor environment. Based on the $4,300 revenue limit, an increase in average daily attendance of 1.75% would pay back all of the investments in only two years. And this doesn't begin to take into affect any utility savings from energy efficiency improvements.

Although many studies have correlated characteristics of the indoor environment to changes in student health, behavior, and performance, estimating the degree to which absenteeism might be reduced by a given investment in high performance design is unknown. Ongoing research may eventually provide a methodology, but it is reasonable to assume that investing in high indoor environmental can decrease absenteeism.


Financial Incentive and Technical Assistance Programs

Several programs are currently available to financially and technically assist districts and designers in creating high performance schools. Complete descriptions and contact information are available on the programs page.


Avoided Costs and Litigation Risk

The considerable costs of poor school IEQ are paid by students, staff, parents, and the local community. In the school populations, the costs include poor health, reduced learning effectiveness, and increased frustration when IEQ problems become unmanageable. These costs are difficult to quantify. More easily counted are the strained budgets and staff resources expended by districts for facility repairs due to insufficient maintenance, community-relations damage control, litigation and workers compensation claims. In addressing such problems, schools must use resources that would otherwise be available for educational and other programs.

Poor school IEQ can cause both short-term (reversible) and long-term (chronic) effects in students and staff. Overcrowded, poorly ventilated classrooms contribute substantially to the spread of infectious diseases, such as colds and influenza. Poorly maintained carpets, dirty air ducts, and water-damaged materials are prime breeding grounds for a plethora of substances that can trigger asthma attacks, sensitize allergy-prone individuals, and cause sinus and respiratory infections. Asthma is one of the environmentally triggered diseases acquired during childhood which may be carried will into the adult years. Other chronic diseases include irreversible lung and respiratory illnesses that result from chronic irritation by airborne chemical and/or biological contaminants. The economic costs of these long term, possibly life-long, diseases are substantial; the costs in terms of quality of life and more profound, and certainly difficult to measure.

One of the ramifications of school building neglect and its consequent adverse effects on IEQ is the potential for litigation from students, parents, and/or staff. Crisis stage IEQ problems can be extremely costly, litigious, and detrimental to long-term relations among school administrators, staff, parents, students, and public agencies. The fiscal, political, and social costs of addressing a crisis situation are often far larger than anticipated. Schools may close temporarily when a formerly manageable problem becomes a financial, logistic, and emotional crisis. Besides the costs of conducting emergency repairs, a school closing requires alternative space and making up missed classes. Re-opening schools that have been closed is also a difficult process, due to the logistics of inspections, the uncertainties of authority, and the residual fears. Workers' compensation claims by school staff are another financial cost to districts when IEQ complaints escalate.
The threat of increasing IEQ problems, recognition of adverse health effects from indoor air exposures, and the litigious nature of societal interactions warn that poor IEQ in California schools can threaten the financial stability of local school districts.

A number of lawsuits have been filed against California school districts. For example, after complains, investigations, and legal actions spanning more than three years, a student received a cash settlement for damages from "contaminated air" in his junior high school classroom. At the same time a third of the school staff filed workers' compensation claims for respiratory and other health problems. In other states, lawsuits have been settled for millions of dollars. In a school district in Washington, D.C. leaky school roofs and other IEQ problems prompted a judge to order closed 21 school buildings due to the resultant potential fire hazard. It is clear that for each incident that makes the evening news or is adjudicated in court, there are many less publicized cases occurring in other districts.

Building a high performance school helps protect districts from IEQ problems by designing out potential problems and documenting the health of the facility.

 

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