A LOCAL SNAPSHOTSchool Construction

S U M M E R B U L L E T I N • J U N E 2 0 1 2

2006 2007 2008 2009 2010 2011 2012

135 Elections

165 Elections

131 Elections

107 Elections • $3,228,447,000

79 Elections • $3,149,603,033

School Bonds that Have Carried in Texas

$6,164,297,085

2012 – TURNING POINT?�� Growth�in�the�Houston�MSA�job�market�has�resulted�in�more�jobs�in�the�area�than�ever�before.

�� Real�estate�inventories�are�going�down.

�� Housing�is�picking�up.

�� Employment�forecast�shows�Construction�Industry�with�an�8%�increase�in�hiring�for�2013�compared�to�2012.

�� Money�supply�is�up.

With�the�tide�starting�to�swing�with�a�growing�Houston�economy,�many�School�Districts�will� have� to� start� talking� and�planning� for� their� next�School�Bond�Program.�This�may�be�a�scary�thought,�but�the�alternative�could�be�worse.�In�these�uncertain�times�districts�are�facing�some�big�unknowns�which�make�the�decision-making�process�even�more�difficult.

�� Outcome�of�School�finance�reform?

�� Fall�Elections?

�� Is�the�growing�Houston�economy�sustainable?

�� Is�the�housing�bubble�really�over?

�� Will�Global�issues�affect�Houston?�Euro�Crisis

�� How�reliable�are�the�Demographic�Projections?

�� What�legislative�changes�are�still�to�come?

�� Can�we�accurately�predict�future�Construction�Cost?

Everything�is�circling�around�one�word�-�“Confidence”�-�in�the�direction�of� our� economy� and� government.� It� is� evident� that� businesses� and�people�are�becoming�more�confident�with�the�Houston�MSA�based�on�the�recent�indicators�illustrated�in�this�Bulletin.�

With�the�turning�of�the�page�to�a�more�vibrant�Houston�MSA,�it�will�take�time�for�School�Districts�to�benefit�from�this�growth.�Businesses�have�to�grow�and�people�have�to�spend�money�for�the�tax�revenues�to�increase�and�filter�to�our�Schools.�

Be�patient�and�start�planning.

TRENDS�� Demographics�are�changing.�(See�PASA�report�page�3)

�� CONSTRUCTION�COSTS�STARTING�TO�INCREASE�with�material�and�fuel�costs�being�the�biggest�drivers.�The�price�increase�ranges�from�a�few�percent�to�double�digits�depending�on�the�trade.

�� Schools�are�still�feeling�the�budget�cuts�to�compound�the�issue.

�� Over�half�the�school�districts�in�Texas�are�involved�in�lawsuits�against�the�State�on�School�Financing.

�� Energy�Efficiency�in�Schools�becoming�a�big�target�for�battling�budget�cuts.�

HOUSTON HOUSING ON THE RISEINDICATORS:

�� Sales�volume�is�up�7.8%�compared�to�last�year,��10th�consecutive�monthly�increase

�� Total�property�sales�are�up�7.4%�from�a�year�ago

�� Foreclosure�sales�are�down�12.8%�year�over�year�

�� 5.6�months�inventory�of�single-family�homes�is�the�lowest�level�since�December�2008�and�compares�favorably�to�the�national�average�of�6.4�months

Source: Houston Area Realtors

Mar 2011 Mar 2012 % Change

West Texas Intermediate Spot Market Price

$93.43 $103.00 10.2%

Henry Hub Natural Gas Price

$4.12 $2.36 -42.7%

Source: Baker Hughes; Energy Information Administration

OIL & NATURAL GAS INDICATORS

$11,148,510,479

79 Elections • $1,599,164,995

May - 44 Elections • $634,810,000

$8,686,683,101

2012 Elementary School Cost DataSquare Foot Size Average Cost/SF

92,000 - 114,000 SF $135.00/SF

$ 2 4 6 7 8 9 1 0 1 1 2 (Billion)

S U M M E R B U L L E T I N • J U N E 2 0 1 2

HOUSTON’S ECONOMY IS GROWING

Houston MSA Mar 2011 YTD Mar 2012 YTD % ChangeConstruction Contracts Source: McGraw-Hill Construction

Residential $1.15 B $1.58 B 37%Non-Residential $944 M $811 M -14%YTD Total $2.01 B $2.4 B 14%

City of Houston Construction PermitsSource: GHP

March YTD 2011 2012 % Change

Residential $230.3 M $354.6 M 54.0%Non-Residential $457.2 M $823.8 M 80.2%YTD Total $687.5 M $1.18 B 71.4%

PMI - Houston Indicators Index Source: Purchasing Managers Index Monthly

Mar 2011 Mar 2012 % Change

Monthly 59.9 59.1 -1.3%YTD Average 58.4 59.4 1.7%The�PMI�is�a�leading�indicator�of�economic�conditions�for�Houston.�An� index� number� below� 50� represents� a� contracting� economy;�readings� above�50� indicate� an� expanding� economy.� The� PMI� has�been�above�50� since�October,�2009�which� indicates� a� continued�expansion�in�Houston’s�economy.

Source: Texas Workforce Commission, March 2012

10

5

0

Houston8.4%

Texas 8.2%

National9.0%

Unemployment RateU.S. Employment Houston MSA Jobs

March

Houston-Baytown-Sugar Land Jobs

Houston Employment ForecastNext 12 Months (April ‘12-March ‘13) vs. Prior 12 Months

Houston MSA Population ForecastsScenario 2000-2007 Migration

S U M M E R B U L L E T I N • J U N E 2 0 1 2

Suburban growth marches forward. For the last five years (which represents the duration of the economic downturn), the Houston area school districts benefiting the most from population growth are all to the west and north (see map bottom right).

Growth Epicenters in the Next 12 MonthsThe� slump� in� the� housing� market� has� already� bottomed� out� in� the�Houston�area,�with�foreclosures�declining�by�19%�since�March�of�last�year,�and�MLS�home�sales�up�8%�from�a�year�ago.�New�home�starts�are�up�26%�this�1st�quarter,�relative�to�the�1st�quarter�last�year.

From� a� demographic� perspective,� the� coming� year� will� see� an�acceleration� of� housing� and� population� growth� in� similar� locations�as� the� past� five� years.� For� example,� to� the� west,� Katy,� Cy-Fair,� and�Lamar�school�districts�will�see�a�slight�rise�in�their�current�housing�and�population�growth� rates.� To� the�north,� the�Klein�and�Conroe� school�districts�should�have�accelerated�growth�this�year�due�to�new�office�hubs�in�The�Woodlands,�and�as�auxiliary�firms�relocate�due�to�ExxonMobil’s�future�office�complex�on�IH-45.��

Baytown’s New Industrial FacilitiesIndustrial� sites� west� of� the� Houston�Ship�Channel�are�built-out�–�allowing�the� massive� industrial� parks� and�other� targeted� locations� nearby� in�West� Chambers� County� to� be� the�sites� for� a� new� ethylene� production�facility� (to� be� completed� by� Conoco�Phillips� in� 2017),� and� for� the� new�ExxonMobil� and� Bayer� Material�Science�expansions,�and�other�added�facilities.��

Impacts of Transportation ImprovementsThe� rapid� construction� of� the� Grand�Parkway� between� IH-10� and� US�290� will� open� up� a� large� number�of� already-planned� residential�developments,� along� with� the� need�for�new�commercial�enterprises.��And,�the� recently� available� TXDOT� funds�for�the�Houston�area�(~$450�million)�will� be� oriented� to� widening�US� 290�(and� other� US� 290� improvements),�and� also� oriented� to� SH� 288� –� the�latter� spawning� further� housing� and�population� growth� outward� --� in�Pearland,�Alvin,�and�perhaps�Angleton.

SCHOOL FINANCE UPDATEMore�than�half�of�the�school�districts�in�Texas,�representing�roughly�3.5�million�students�–�or�75%�of�the�overall�total�–�have�signed�on�to�sue�the�state�over�the�way�it�funds�public�schools.

But�fewer�than�500�districts�haven’t.�Many�of�those�districts,�already�facing�budget�cuts,�say�they�just�don’t�have�the�resources.

Four� of� the� lawsuits� challenge� the� state� on� whether� it� has� given�enough�money� to� schools.�A� fifth� lawsuit�has�also�been� filed,�not�by� school�districts�but�by�a�group�of�parents�who� support� charter�schools.�It�questions�how�the�money�that�the�state�gives�to�schools�is�spent.

Last�week,�a�judge�indicated�that�a�trial�would�probably�begin�in�early�October�and�allowed�the�first� four� lawsuits� filed�by�school�districts�to� be� consolidated� into� one,� according� to� the� Austin� American�Statesman.�Source: Texas Tribune, April 2012

La Marque

ISD

-740

Devers

ISD

37

Dickinson ISD

1,580

Goose

Creek CISD

1,382

Sweeny

ISD

-115

Hardin

ISD

-64

Liberty

ISD

-123

Dayton

ISD

-11

Stafford

MSD

141

Santa Fe

ISD

40

Hempstead

ISD

105

Hull-

Daisetta

ISD

-63

West

Hardin

County CISD

-5

Damon

ISD

32

Texas

City ISD

97

Humble

ISD

4,749

Bay

City ISD

-232

Big Sandy ISD

16

Boling

ISD

71

Aldine

ISD

5,469

Spring ISD

4,258

Brazos ISD

27

Splendora

ISD

109

Katy ISD

11,213

Van

Vleck ISD

-38

Shepherd ISD

91

East

Bernard

ISD

23

Tomball

ISD

2,001

Houston

ISD

130

Galena

Park ISD

586

Klein ISD

4,390

Deer

Park ISD

420

El Campo

ISD

105

Sealy

ISD

89

New

Caney ISD

2,522

La Porte

ISD

-43

Coldspring-

Oakhurst CISD

-17

Wharton

ISD

-198

Cypress-

Fairbanks ISD

15,825

New Waverly ISD

75

Pearland

ISD

2,961

Pasadena

ISD

3,091

Willis

ISD

809

Alief ISD

-286

Spring

Branch ISD

1,527

Conroe ISD

8,204

Brazosport ISD

-624

Barbers

Hill

ISD

871

Crosby

ISD

334

Cleveland

ISD

232

Tarkington

ISD

-77

Huffman

ISD

210

Anahuac

ISD

-224

Royal ISD

200

Huntsville

ISD

23

Friendswood

ISD

75

Sheldon

ISD

1,490

Channelview

ISD

416

North

Forest ISD

-2,019

Richards ISD

0

Clear

Creek ISD

3,681

Livingston ISD

-5

Montgomery

ISD

1,202

Waller

ISD

547

Magnolia

ISD

1,485

Anderson-Shiro

CISD

113

Hitchcock

ISD

310

Fort Bend

ISD

2,435

Columbia-

Brazoria ISD

-104

Danbury

ISD

-50

Alvin

ISD

3,955

Angleton

ISD

-37

Needville ISD

49

Galveston

ISD

-2,008

Lamar

CISD

4,461

Brenham

ISD

-14

Navasota ISD

15

Grimes

San Jacinto

Montgomery

Liberty

WallerHarris

Austin

Chambers

Fort Bend

Wharton

Brazoria

Matagorda

Hardin

5-Year Change: 2006-07 to 2011-12

A b s o l u t e C h a n g e i n S c h o o l D i s t r i c t E n r o l l m e n t

HOUSTON

Source: Texas Education Agency, Public Education Information Management System Division0 10 205 Miles[

CountiesWater Bodies

School Districts<-100-99 - 01 - 500501 - 2,0002,001 - 4,000>4,000

La Marque

ISD

-740

Devers

ISD

37

Dickinson ISD

1,580

Goose

Creek CISD

1,382

Sweeny

ISD

-115

Hardin

ISD

-64

Liberty

ISD

-123

Dayton

ISD

-11

Stafford

MSD

141

Santa Fe

ISD

40

Hempstead

ISD

105

Hull-

Daisetta

ISD

-63

West

Hardin

County CISD

-5

Damon

ISD

32

Texas

City ISD

97

Humble

ISD

4,749

Bay

City ISD

-232

Big Sandy ISD

16

Boling

ISD

71

Aldine

ISD

5,469

Spring ISD

4,258

Brazos ISD

27

Splendora

ISD

109

Katy ISD

11,213

Van

Vleck ISD

-38

Shepherd ISD

91

East

Bernard

ISD

23

Tomball

ISD

2,001

Houston

ISD

130

Galena

Park ISD

586

Klein ISD

4,390

Deer

Park ISD

420

El Campo

ISD

105

Sealy

ISD

89

New

Caney ISD

2,522

La Porte

ISD

-43

Coldspring-

Oakhurst CISD

-17

Wharton

ISD

-198

Cypress-

Fairbanks ISD

15,825

New Waverly ISD

75

Pearland

ISD

2,961

Pasadena

ISD

3,091

Willis

ISD

809

Alief ISD

-286

Spring

Branch ISD

1,527

Conroe ISD

8,204

Brazosport ISD

-624

Barbers

Hill

ISD

871

Crosby

ISD

334

Cleveland

ISD

232

Tarkington

ISD

-77

Huffman

ISD

210

Anahuac

ISD

-224

Royal ISD

200

Huntsville

ISD

23

Friendswood

ISD

75

Sheldon

ISD

1,490

Channelview

ISD

416

North

Forest ISD

-2,019

Richards ISD

0

Clear

Creek ISD

3,681

Livingston ISD

-5

Montgomery

ISD

1,202

Waller

ISD

547

Magnolia

ISD

1,485

Anderson-Shiro

CISD

113

Hitchcock

ISD

310

Fort Bend

ISD

2,435

Columbia-

Brazoria ISD

-104

Danbury

ISD

-50

Alvin

ISD

3,955

Angleton

ISD

-37

Needville ISD

49

Galveston

ISD

-2,008

Lamar

CISD

4,461

Brenham

ISD

-14

Navasota ISD

15

Grimes

San Jacinto

Montgomery

Liberty

WallerHarris

Austin

Chambers

Fort Bend

Wharton

Brazoria

Matagorda

Hardin

5-Year Change: 2006-07 to 2011-12

A b s o l u t e C h a n g e i n S c h o o l D i s t r i c t E n r o l l m e n t

HOUSTON

Source: Texas Education Agency, Public Education Information Management System Division0 10 205 Miles[

CountiesWater Bodies

School Districts<-100-99 - 01 - 500501 - 2,0002,001 - 4,000>4,000

POPULATION AND HOUSING GROWTH GAME CHANGERS – AND GROWTH EPICENTERS IN THE HOUSTON METRO AREABY: DR. PAT GUSEMAN, POPULATION AND SURVEY ANALYSTS

S U M M E R B U L L E T I N • J U N E 2 0 1 2

LightingOne�of�the�biggest�trends�in�new�construction�is�LED�lighting.��LED�has�made�big�advances�over� the�past� few� years� to� the�point�where� LED�site�lighting�and�LED�can�lights�are�a�smart�investment.��Switching�out�lamps�to�high�efficient�florescent�lamps�are�another�low-cost�method�of�saving�energy�that�many�schools�are�employing.

Also,�schools�are�looking�to�bring�more�natural�light�into�the�classroom.��Tubular�daylighting�devices�can�be�used�in�both�new�construction�and�renovation�to�introduce�natural�light.��These�tubular�daylighting�devices�can�be�controlled�and�even�shut�off�when�the�classroom�needs�to�be�darkened�for�presentation.

Geothermal Heating and CoolingAnother� popular� trend� that� can� be� used� for� both� new� schools� and�renovations� is� geothermal� heating� and� cooling.� � This� method� of�“geoexchange”�uses�the�constant�temperature�of�the�Earth�to�heat�and�cool�a�building.� �While�geothermal� requires�an�up-front� investment,�the�system�can�pay�for�itself�via�energy�savings�in�three�to�five�years.��Geothermal�systems�are�simple�and�easy�to�operate.

SummaryKnowing�a�building’s�energy�benchmark�is�the�first�step�to�instituting�an�energy�savings�program.��This�allows�school�personnel�to�set�goals�and�determine�which�changes�in�either�behavior�or�equipment�need�to�be�made�to�meet�the�goals.��Also,�demonstrating�to�staff�that�had�to�give�up�their�personal�coffee�pot�or�wear�a�sweater� in� the�classroom�that�these�actions�are�having�a�positive�affect�is�a�great�way�to�reinforce�and�obtain�‘buy-in’�for�the�low-hanging�fruit�behaviors.

1�American Society of Heating, Refrigeration and Air-Conditioning Engineers, Advanced Energy Design Guide, 2008.2www.energystar.gov

As� schools� are� squeezed� by� operational� cost-cutting,� many� schools�are� looking� to� save�money�by� reducing�energy�use.� �Not�only� does�reducing�energy�use�save�money�for�school�districts,�it�can�provide�an�opportunity�to�integrate�energy�savings�into�classroom�curriculum.�

BenchmarkingKnowing�how�much�energy�your�school�is�using�(measured�in�kBtu/sf�yr)� is� the�first�step�in�an�energy�savings�program.��The�“average”�for�Houston’s�climate�zone�in�a�school�designed�to�meet�code�is�62�kBtu/sf�yr.��While�there�are�consulting�engineering�firms�that�can�provide�this�analysis,�school�staff�can�utilize�the�Environmental�Protection�Agency’s�ENERGY�STAR��program�and�enter�data�into�the�“Target�Finder.”��This�will�provide�a�snapshot�of�the�school’s�Energy�Use�Index�(EUI)�expressed�in�kBtu/sf�yr.

The�62�kBtu/sf�yr�is�an�“average”�and�new�and�renovated�schools�are�demonstrating�energy�saving�of�50�to�75�percent�less�than�the�average,�which�translates�to�lower�energy�bills.

Low-hanging FruitInstituting�systems�and�controls�to�reduce�energy�use�doesn’t�necessarily�mean�an�investment�in�lots�of�expensive�equipment.��Many�local�school�boards�are�considering�formal�policies�to�reduce�the�use�of�personal�refrigerators,�coffee�pots�and�space�heaters�in�the�classrooms.��While�these�appliances�seem�innocuous�as�far�as�energy�use,�when�multiplied�by�several�classrooms�in�several�schools,�they�can�produce�a�noticeable�increase�in�energy�use.��

Setting�up�computers�on�power�strips�that�can�be�switched�off�at�the�end�of�the�day�is�another�simple�method�of�saving�energy.��Some�schools�are� involving� students� in� “energy”� teams�where� students� ensure� that�classroom�lights�and�computers�are�turned�off�at�the�end�of�the�day.

Controls and Occupancy SensorsMore�districts�are�taking�away�user�space�temperature�adjustments�and�maintaining� complete� control� at� a� central� level.� � The� schools’� have�specific�set�points�for�heating�and�cooling.��Building�occupants�can’t�switch�to�cooling�in�the�winter�or�heating�in�the�summer�to�adjust�room�temperature.

Room�occupancy�sensors�are�being�tied�into�the�building�automation�system�(BAS).��When�a�room�goes�unoccupied�(for�lunch�or�other�school�activity)�during�a�normally�occupied�period,�the�classroom�occupancy�sensor� is� used� to� detect� the� condition� and� the� room� temperature� is�automatically� set�up� two� to� four�degrees.� �When�motion� is�detected�in�the�room,�the�space�temperature�is�set�back�to�its�normal�occupied�temperature.

In�the�past,�IT�departments�have�discouraged�shutting�down�computers�because� they� lose� the� ability� to� remotely� update� software.� � Now,�new� software�exists� that� allows� the�district� to�manage�updates�when�computers�are�being�operated.

TRENDS IN ENERGY SAVINGS IN HOUSTON-AREA SCHOOLSBY: MARK SEIBERT, CMTA CONSULTING ENGINEERS

S U M M E R B U L L E T I N • J U N E 2 0 1 2

KLEIN ISD FACILITIES DEPT. – MAKING A DIFFERENCE IN REDUCING M&O COSTBY: ROBERT ROBERTSON, KLEIN ISDNone�of�us�have�a�crystal�ball�to�predict�the�future,�but�we�are�charged�with�being�good�stewards�of�the�taxpayer�dollars�allocated�to�us�that�carries�with�it�the�responsibility�of�ensuring�that�we�build�new�schools�economically�and�that�we�operate�them�efficiently.�Contrary�to�popular�convention�construction�and�operation�are�not�diametrically�opposed.�The�departments�tasked�with�operating�the�school�once�it�is�completed�must�be�involved�in�the�construction�process�throughout�the�design�and�construction�of�the�school.�That�way�when�the�building�is�turned�over�they�have�an�understanding�of�how�it�should�operate�most�efficiently.�If�the�school�was�constructed�following�CHPS�(Collaborative�for�High�Performing� Schools)� or� LEED� for� Schools� (Leadership� in� Energy� and�Environmental�Design)� there�are�specific�requirements� in� the�types�of�products� to�be�used�to�maintain� the�building.�Knowing�that�going� in�makes�it�much�easier�and�more�likely�that�the�building�is�operated�as�intended.

Klein� ISD� has� built� its� latest� elementary� school� following� CHPS�Guidelines.�Results�from�the�first�four�(4)�months�of�operations�reflect�a�30%�reduction�in�electricity�usage�when�compared�to�its�sister�school�of� the�same�architectural�design.�By�using�condensate�and�rainwater�collection� for� the� irrigation� system� and� low-flow� fixtures� the� school�is� using� half� as�much�water� as� other� elementaries.� All� of� this� has� a�favorable� impact� on� the�General� Fund.� It� should� be� noted� that� this�design�was�a�prototype�that�had�been�built� three�previous�times�and�that�the�mechanical�systems�were�re-designed�for�CHPS�compliance.�The�elementary�school�currently�under�construction�was�designed�from�the�beginning�following�CHPS.

Not�all�efficiencies�are�found�in�construction.�A�valuable�tool�employed�by�KISD�in�the�last�three�(3)�years�has�been�the�Benchmark4Excellence�Study� that� compares� operations� in�maintenance,� custodial,� grounds�and� energy� for� KISD� to� other� districts� in� Texas.� The� data� presented�is� used� to� identify� areas� using� excessive� resources� that� can� then� be�reallocated�to�areas�that�are�in�need�or�returned�to�the�General�Fund.�Through� the�use�of� this�data�KISD�has� reduced�custodial� staffing�by�78� positions� over� the� last� three� years� while� increasing� productivity�through�the�use�of�automatic�floor�machines�and�hands-free�restroom�cleaning� systems.� The� study�has�also�been�used� to� support� requests�for�additional�staffing�and�funds�in�areas�where�needed.�And,�perhaps�most�importantly,�it�is�used�to�recognize�outstanding�performance.

Handbook of Best Practices for Project Close-out to be released Soon!The�success�of�the�previous�three�AGC/CEFPI�joint�task�forces�on�developing�best�practices�handbooks�for�CSP,�CM�at�Risk�and�Hiring�an�Architect,�have�led�to�the�charge�of�the�joint�task�force�to�produce�a�recommended�practices�handbook�focusing�on�successful�project�close-out.�

The�purpose�of�this�handbook�is�to�provide�an�overview�of�best�practices,�provide�tools�and�strategies�for�managing�an�effective�project�close-out�effort.�The�goal�is�to�keep�the�close-out�process�collaborative�and�efficient�to�minimize�the�stress�normally�associated�with�project�close-out,�and�to�reduce�the�amount�of�time�required�to�achieve�final�project�completion.

The�Close-Out�Handbook�is�in�its�final�technical�draft,�and�is�in�the�process�of�being�reviewed�by�the�AGC�and�CEFPI�boards.�Due�to�the�various�local,�regional�and�national�board�schedules,�it�is�anticipated�that�final�board�approval�will�be�reached�sometime�mid-summer.�Once�approved�by�both�boards�for�release,�look�to�either�organizations’�website�for�the�publication�of�the�final�document�this�summer.

u p c o m i n g e v e n t s

CEFPI

AGC

Unit 1 BIM 101: An Introduction to Building Information Modeling (Section III)

Sept. 20

Unit 2 BIM Technology (Section II) June 12/13

Unit 2 BIM Technology (Section III) Oct. 16/17

Unit 3 BIM Contract Negotiation and Allocation (Section II)

July 24

Unit 3 BIM Contract Negotiation and Allocation (Section III)

Nov. 6

Unit 4 BIM Process, Adoption and Integration (Section II)

Aug. 7

Unit 4 BIM Process, Adoption and Integration (Section III)

Dec. 11

CM-BIM Credentialing Exam (Section VI)

June 15

CM-BIM Credentialing Exam (Section IV)

Aug. 24

CM-BIM Credentialing Exam (Section V)

Dec. 14

Board Meeting July 19

Best Practices Meeting Sept. 7

Board Meeting and Chapter Meeting/Facility Tour

Sept. 27