Press Releases & Statements

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Chancellor Harold O. Levy today announced recommendations of the Commission on the Capital Plan, which he created in December to find ways to slash school construction costs, while adding classroom space and pinpointing alternative strategies for delivering schools.

The Chancellor said he will immediately implement recommendations to control the cost of school construction and other initiatives that do not require sign-off from the State or the City, including eliminating the over 2500 pages of existing school design and material standards and mandating that schools be designed so more space is devoted to true educational purposes.

The Commission, chaired by Peter M. Lehrer, co-founder of the construction management firm of Lehrer McGovern and Opus Three Ltd., is composed of city leaders in the areas of building construction, design, business, law, and finance. For four months, it reviewed the school construction process, the Board of Education's construction standards and the contributing factors to the high cost of NYC school construction. The Commission also visited schools in New York City and Chicago and reviewed the operating structure of the SCA and the Board of Education's Division of School Facilities (DSF).

Chancellor Levy said, "In light of the severe shortfall in our capital plan and the anticipated shortfall that I announced last summer, I decided that we needed an immediate and comprehensive review of the entire school construction process. To this end, it made eminent sense to call on experts in the private and public sectors to review our processes and devise innovative ways to contain costs and reduce overcrowding.

"I thank Peter and all the members of the Commission for undertaking this Herculean task. Their methodical and sober examination of the challenges we face in school construction has culminated in a solid set of recommendations, some of which I intend to put into practice immediately."

Peter Lehrer said, "It is indisputable that schools in New York City cost too much to build. I am grateful to Chancellor Levy for asking me to lead this Commission. It has been a challenging and rewarding experience. This is a distinguished group that relished the task - finding ways to drive down the costs associated with school construction. There is no issue more important than providing all children a quality education. As the Chancellor has said often, we know that smaller class size is conducive to learning. That's why capacity projects that provide more seats are so important."

The principal findings and recommendations of the Commission are:

1. Current new school construction costs now running at $425-450 per square foot in hard costs can and should be reduced by 25%-30% to $300-325 per square foot, without sacrificing quality.
2. To meet the needs of the large scale building process there should be a new Deputy Chancellor for Facilities.
3. To promote accountability the School Construction Authority (SCA) and the newly created Deputy Chancellor for Facilities should report to one person. The Mayor also should appoint all three SCA Trustees (he now appoints only one).
4. The Board of Education's outmoded and not cost effective design and material standards should be eliminated, and new standards more consistent with the NYC Building Code and widely accepted school building practices should be adopted.
5. The amount of space allocated to educational purposes should be increased from the typical 55% in New York City to the national standard of at least 60%.
6. Current SCA and BOE procedures are overly restrictive and reduce the number of contractors willing to bid for SCA work. These procedures, including in the pre-qualification and project management areas, should be streamlined.
7. SCA's overhead should be reduced by $50 million, and independent architects and construction managers should generally be used for new construction.
8. To create more seats the Board of Education should explore using more alternatives to new construction, including leasing buildings developed by private and non-profit organizations, using, among other things, newly available federal QPEF bonds. The City should also explore transfer of air rights to developers in exchange for those developers building turnkey schools.

The Chancellor has already acted to implement the recommendations in his sole authority by:

• Declaring that the Board of Education's outdated construction standards shall be null and void in 90 days;
  
  The Deputy Chancellor for Operations has brought in one of NYC's leading construction experts, who has already begun the process of streamlining and updating the standards and SCA's design practices, with a goal of building high-functioning, attractive schools, but without unnecessary elements that drive up costs. Other individuals or firms will be added to this endeavor as it progresses.
  
  
• Directing that effective immediately, all new schools must achieve a standard of at least 60% of square footage for educational purposes and no more than 40% for technical support spaces. No exceptions without approval of Deputy Chancellor for Operations.
  
  
• Directing the Deputy Chancellor for Operations to ensure that all interested BOE groups will walk job sites together and produce a single "punch list" near the completion of a project. SCA will be asked to join, so there will be only one such list per job.
  
  
• Eliminating "program creep" by directing that effective in 90 days (or sooner, if the new standards are prepared) both the construction standards (materials, systems, etc.) and the program standards (number of hall monitoring offices, staff bathrooms, etc.) will be rigorously enforced, with no exceptions without approval of the Deputy Chancellor for Operations
  
  
• Directing the Deputy Chancellor for Operations and the BOE's Chief Financial Officer to move forward immediately to develop new schools through public/private partnerships under the new federal QPEF bond program.
  
  
• Directing the Deputy Chancellor for Operations to work with SCA to develop, within 30 days, a unified, streamlined process for consideration of all construction change order requests by appropriate high-level employees of BOE and SCA.
  
  
• Directing the Deputy Chancellor for Operations and Chief Financial Officer to work with OMB toward flexibility in the BOE's capital budget, permitting a specified percentage each year to be moved from the BOE's capital budget to its expense budget, for use exclusively to add new school seats through expansion of the BOE's leasing program, which can add seats more quickly than new construction and offers flexibility in communities with current need whose long-term need is less certain.
  
  
• Directing the Deputy Chancellor for Operations to approach the City Planning Department regarding the development of as-of-right density bonus provisions in city zoning law to create incentives for private development of schools in areas of greatest need.

The Chancellor will also work with the Governor, the Mayor, the State Legislature and the SCA to implement those recommendations requiring coordinated action. He has also asked the Commission to do a follow-up report on implementation progress in six months.

Members of the Commission on the Capital Plan are:

Peter M. Lehrer, Chairman, Opus Three Ltd., Manhattan

Richard Davis, Partner, Weil, Gotshal & Manges, Manhattan

H. Henry Elghanayan, CEO, Rockrose Development Corp., New York City

Bruce Frank, Partner, Ernst & Young LLP, Manhattan

Gary Hirsch, Chairman, Elk Homes LLC, Rye, NY

Ed Malloy, President, NY Building & Construction Trades Council, Manhattan

Joseph Monaco, Consultant, Little Neck, NY

John Morning, Trustee, City University of NY, Manhattan

Bradford Perkins, Founder and Principal, Perkins Eastman Architects PC, Manhattan

Jack Rudin, Chairman, Rudin Management, Manhattan

Kathleen Schoonmaker, Director of Finance and Operations, Riverdale Country School, Bronx

Gaston Silva, Chief Operating Officer, Vornado Realty Trust, Manhattan

Professor Lynne B. Sagalyn, Director, M.B.A. Real Estate Program, Columbia University Graduate School of Business, Manhattan

Herb Sturz, Chairman, The Afterschool Corporation, and Trustee, The Open Society Institute, Manhattan

 

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