Courtesy of Portland Public Schools

Proposed plan for Lincoln High School.

By Bethany Barnes

Portland Public Schools promised to remake four schools and address serious safety hazards if voters passed the largest bond in Oregon history. And in May 2017, voters did.

Now district officials estimate the record-breaking $790 million bond won’t be nearly enough to get the job done. The district says it must pony up an additional $100 million or more or scale back its plans.

An expert panel advising the board cautions that the district lacks fiscal discipline. The problem, the committee contends, is a desire for remodels that are too extensive and high-end or new buildings with features that cost too much. Compounding the problem, the committee says, is the fact that the board diverted bond money to cover expenses not included in the original scope of bond projects.

The district counters that it owes the three high schools covered by this bond buildings that are comparable in size and quality to what it has given Franklin, Roosevelt and Grant high school communities using a 2012 bond. And it says it can't do that without the costs running over.

Here are factors driving the conversation around how Portland Public Schools will ensure it meets its obligation to modernize Madison, Lincoln and Benson high schools, fully rebuild Kellogg Middle School, and put $150 million toward safety needs.

Hot construction market

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Jamie Francis/Oregonian|OregonLive

District staffers have spent considerable time attempting to explain why projected costs to remake the four schools are now so much higher than anticipated.

Some blame goes to a hot construction market. But there is disagreement about just how much that explains the current predicament.

School board members have demanded answers and speculated about how voters were asked to consider the $790 million pricetag rather than a larger one. The innuendo is that fears around a higher number drove district officials to downplay the true costs. While documents show the district ultimately went with a lower-end estimate despite concern that it would be more prudent to leave more wiggle room, the district insists there is no “smoking gun” that shows anyone intentionally low-balled the figures.

“The Portland area construction market has experienced growth that has far outpaced the rest of the U.S. and has sustained that growth beyond expectations,” wrote Dan Jung, director of the school modernization in a March memo to the superintendent. “This factor alone accounts for $15-20 million across both” Lincoln and Madison rebuilds.

Ken Fisher, hired from outside to help manage the bond, was one of the primary people who suggested cost estimates be set higher to allow for unanticipated developments. Fisher told The Oregonian/OregonLive earlier this summer he doesn’t see himself as a prophet whose warning should have been heeded. Had the district asked for way more money than needed, he said, the public would have been outraged about that, too.

The committee advising the board made clear in its memo it’s less interested in that question than how the best possible buildings get completed with available dollars. Its report states: “There (h)as been much discussion at the board level about how the budgets were set for the bond referral. Our emphasis has instead been on the actual designs.”

One thing the committee does think warrants intense scrutiny: The decision to spend money earmarked for four specific schools on other schools.

$11.4 million to other projects

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Courtesy of Portland Public Schools

A group tours Tubman middle school over the summer as construction wraps up.

The board has already diverted $11.4 million from the bond to pay for unanticipated safety needs at two new middle schools, primarily air quality mitigation and slope stabilization at Tubman Middle School, perched just feet from congestion ridden Interstate 5.

The committee wrote it “opposes the use of bond funds for this purpose that we consider to be outside the scope approved by the voters. In our judgment, funding this work by reducing the already inadequate budgets for approved high school work simply underscores the error.”

$5 million to $10 million seismic mistake

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Courtesy of Portland Public Schools

Rendering of what Madison High could look like.

The Madison High design team misunderstood Portland Public Schools’standard for seismic upgrades and created a scheme that met code but didn’t adhere to the district’s definite of a safe school, according to Jung’s March memo. Making the building safe enough is expected to cost somewhere between $5 million to $10 million.

Last-minute $29 million decrease in proposed costs for Madison, Lincoln

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Courtesy of Portland Public Schools

Proposed plan for Lincoln High School.

As district officials planning the bond prepared their final presentation for the school board, they lopped $25 million off the projected costs to renovate Madison and $4 million off the costs of building a new Lincoln High. They did so, Jung wrote, “without identifying scope reduction or validating the revised budgets.” In other words, they lowered planned spending but not the scope of work or the detailed cost savings.

-- Bethany Barnes

Email Bethany: bbarnes@oregonian.com

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