The escalating
cost of construction, an active construction market and pricing
uncertainties are straining local governments across Volusia County.
Dozens of planned and much-needed projects are being delayed due to
budget shortfalls at a time when the county’s growing population is
straining existing infrastructure – from roads to schools.
“We are moving
forward with the most essential elements of the project – roofing
and
siding work at the gymnasium, but the additional space for
pre-school and PAL programs is under review,” said Parker.
The impact of
rising construction costs was foreshadowed in Port Orange when a
2005
proposed bond issue of $14 million to build a new police station,
two fire stations and other projects came up short, and the city
allocated $17 million for the work, only to have estimated pricing
come in at $21 million. The city had planned public meeting spaces
in the fire stations hoping to fill a need for public meeting space
and returning fire stations to a time when they are a center of
community life. “We are now in discussions with architects over just
what $17 million actually will buy,” said Parker.
Escalating
costs also have taken a toll on essential road construction. South
Williamson
Boulevard in Port Orange has become more heavily traveled and was a
priority in Volusia County’s five-year road program. Construction
was expected to occur in 2009. Now, the project could be delayed
until 2015.
DeLand also
has had a similar experience. “Inflationary costs have had a
significant impact on our construction projects,” said DeLand City
Manager Mike Abels. For example, the city’s street resurfacing and
sidewalk construction program required an additional appropriation
of $200,000.
DeLand’s new
city hall, scheduled for occupancy next month, with a grand opening
slated for March, will have cost $10 million, or nearly $2 million
more than budgeted when the project went to bid in 2003.
The
inflationary costs for projects including construction of DeLand’s
new city hall, a new fire station and renovation of the central fire
station approached 25 percent from
the time costs were estimated to the time bids were received and
contracts were secured. This represents $2.5 million in increased
costs between 2003 - 2005.
The challenges
are similar at the Volusia County School District, which is striving
to
build and renovate schools to accommodate its growing student
population. There are 75 public schools in Volusia County that serve
a student population of 65,400. There are three elementary schools
under construction or about to begin construction, as well as one
middle school, one high school and a combined middle/high
replacement school.
Jack Dunlop,
Director of New Construction and Inspections for Volusia County
Schools,
said that while costs always are relative to supply and demand, the
past five years have been particularly busy worldwide, putting
pressure on the supply of materials and driving prices skyward.
The building
of a new school typically is a cooperative venture. Volusia County
Schools
builds the school plant, while Volusia County Government handles
road construction. “The county people are incredibly cooperative and
go out of their way to do what has to be done in road construction
to help us keep up with our school construction program,” said
Dunlop. Just the same, when a road project along Clyde Morris
Boulevard had to be postponed by the county, school district
officials had to authorize
and fund the construction of turn lanes and other road work to
ensure Hinson Middle
School in Daytona Beach could commence operations.
The school
system’s highest profile and most expensive project is the planned
new high school in Orange City, currently called high school DDD.
When bids were solicited for DDD, only one bid was submitted. A
second request for proposals was issued which yielded only two bids.
The school will be a major addition to the lineup of high schools
and will serve 2,500 students. Its $95 million price tag includes $5
million for site work and $1 million for a mechanical plant that
will serve DDD and middle school DD. By comparison, the new high
school in New Smyrna Beach serves 2,100 students and was constructed
at a cost of about $40 million.
High school
DDD also is larger than the new Mainland High School, which was
built at
a cost of about $49 million including $1.5 million for a temporary
campus so classes could continue through the construction, and $2.5
million for the Vince Carter Athletic Center, funded by Carter, a
National Basketball Association star and Mainland alumnus.
Pat Drago,
Executive Director of Facilities Services for Volusia County
Schools, said the cost of building elementary schools three years
ago was about $11 million each, compared to $17 million today. All
of this illustrates the challenges of keeping up with school
construction in an environment of high prices.
Of critical
importance is the impact of escalating costs on Volusia County’s
road construction program. Cost increases are striking. Materials
costs are up significantly.
The cost of
pouring concrete sidewalks is up 45 percent; curbing is up 60
percent; and liquid asphalt is up a stunning 120 percent.
Translating some of these statistics into dollars, the cost of
resurfacing a mile of road is up from $40,114 to $93,622. This
represents millions of dollars in increased expenditures.
“We had been
accustomed to yearly increases in construction costs of 3 - 5
percent
and budgeted accordingly,” said Jerry Brinton, County Engineer. “The
huge spike in costs for land for right-of-way use and construction
have had a dramatic effect on our five-year road program, which is
more like a 10-year program as a result.” He added that priorities
have to be reviewed frequently.
The road
building funding shortage is so critical and so important to the
community that County Manager Jim Dinneen recently convened a
meeting of county and city officials.
And when
Brinton was interviewed for this article, he was on his way to a
similar summit being hosted by the Florida Department of
Transportation for city and county officials in the region.
In spite of
the difficult market conditions, Volusia County remains active in
road
construction because the Volusia County Council previously bonded
gas tax revenues,
taking advantage of low interest rates and advancing $65 million
available to fund projects.
These funds
will have been spent by the end of next year, according to Brinton.
It’s a challenging time for Brinton, his counterparts in the cities
and construction
managers. While construction costs are well above estimates, there
may be a bit of relief on the horizon. “We have seen signs the
market is becoming more competitive,” said Volusia County Schools’
Drago. “While the cost of materials has not come down, the cost of
labor has.”
Abels and
Parker concur and said they have seen some stabilization of
construction prices recently. According to Brinton, another factor
causing increased competition among contractors is the fact that the
Florida Department of Transportation has fewer
projects going out to bid at this time, resulting in the
availability of more bidders for county and city work. Bids for the
Clyde Morris Boulevard project that was to have served Hinson Middle
School and had been delayed recently was put out to bid and
attracted several bids, signaling at least the hint of a return to a
more balanced market.
