The goal of many educators is to become a superintendent. You go to school to obtain the right degree, certification, and knowledge to lead a school district. The problem is that most of the education and training we receive does not fully prepare us to do the job that we are expected to do by staff, parents, and our community. When I became a superintendent, I thought I had a pretty good grasp of how to do the educational side of the job. I was not as prepared or educated on how to deal with the maintenance and upkeep of the district and everything that goes with it. Ultimately, I turned to an Energy Service Company (ESCO) to help meet the needs of my district. From my personal experience, here are some of the things you should consider if you feel an Energy Performance Contract (EPC) is in your school district’s best interest.
District Concerns
What is your pain? Meaning, what is your biggest issue you are facing in your district? Is it finances, deferred maintenance, or salaries, etc.? Who is the driving force behind these issues, the BOE, community, staff, or matters that you are concerned about? How can you address these issues in a way that will satisfy the needs of all parties involved? There are many avenues that a superintendent may go down to accomplish this, the goal is to figure out what best fits your district. Understanding the driving force behind hiring an ESCO is essential to starting the process of hiring one.
Energy Service Company (ESCO)
Understand how an ESCO can help your district can be accomplished in a few ways:
- Through funding mechanisms. Using an EPC allows you to be more flexible with the districts money in how you approach your district’s needs.
- Through guaranteed energy savings. An ESCO can evaluate your district and find cost saving measures through replacement or upgrades of current mechanical or electrical systems or items. There are considerable savings in LED Lighting, Building Automation and HVAC. For instance, when I used an EPC, I was guaranteed $30,000 dollars of energy savings every year, which I validated and saw a reduction of over $30,000 annually on my electric bills. This was a substantial savings for our small school district.
Deferred Maintenance
As I mentioned earlier, deferred maintenance was something I was not as prepared for. My district had so many needs. We needed a new roof and tuck pointing. We had HVAC issues (building automation), gym wall issues, building weatherization issues, and a few other minor issues. Trying to figure out how I was going to accomplish all these needs was a little overwhelming until I had my first conversation with an ESCO. As we had further conversations, it made complete sense for our district to hire an ESCO, as most of our district’s deferred maintenance needs could be met in one project. The next issue that arose was how the district would pay for all of this. If some of your projects fall under Missouri Statue 8.231, then looking into an EPC may be very beneficial to your district.
Funding the Project
Funding in public schools is always a concern. There seems to never be enough money to meet the needs of a school district. This is where you really need to have a good working relationship with your financial group. Learn how they can help you financially to meet your district’s needs. It could be through a no-tax bond, a tax levy increase, or maybe a lease purchase. I know there is a lot that goes into this from what your status of reserves to bonding capacity to AV growth, etc. Your financial group will help you determine what is the best fit financially for your district or even if it is possible for you to tackle these issues. I was fortunate that we had healthy reserves and a good bonding capacity that we were able to do a million-dollar lease purchase to address most of our deferred maintenance. The following year I rolled that lease purchase into a no-tax bond, which freed up money to put into teacher salaries. The teachers loved that!
Right Fit
You need to determine if hiring an ESCO is the right fit for your district or if going through an architect is a better path. It really depends on the needs of your district. Both are good avenues, and at times it may make sense to hire both! From my experience, hiring an ESCO was the right thing for the needs I had in my buildings, and it gave me guaranteed savings that I could then use for teacher salaries. It became a win for me with having lots of deferred maintenance and needing to bolster teacher salaries to be competitive. Educate yourself as much as possible about this process to make the best decision for your school district.
This information is to provide some direction as you consider moving forward with your construction and deferred maintenance needs. I know it can be scary and a little overwhelming at times but, it wasn’t as bad as I thought it would be. Find a company you trust that will have the best interests of district in mind and ask as many questions as you can through the process.
About the author – Scott Archibald is an Education Consultant with Navitas. His background as a school administrator and 28 years of experience in the education sector help him bring a practical approach to developing strategies for school districts wanting guidance on how to initiate an energy conservation program in their facilities. He can be reached at sarchibald@navitas.us.com.