District of Columbia
D.C. Public Schools' Modernization Program Faces Major Challenges Gao ID: GAO-02-628T April 25, 2002The District of Columbia school system, with help from the U.S. Army Corps of Engineers (Corps), has made considerable progress in fixing roofs, replacing windows, repairing bathrooms, and completing other maintenance work that has been neglected for years. The D.C. school system is now addressing the more complex task of modernizing--either through renovation or through new construction--virtually every public school in the city. In April 1998, the school system entered into an agreement with the Corps for engineering, procurement, and technical assistance. In December 2000, the D.C. Board of Education approved a facility master plan that would modernize 10 schools annually over 10 to 15 years at a cost of $1.3 billion. Historically significant buildings cannot be razed, however, and are costly to redesign. So far, construction costs are running significantly higher than estimated by the facility master plan. The scope of the work has been expanded to recognize community needs for some special facilities. In examining the Washington Gas Light Company's records of quality inspections for the work it managed for the school system, GAO found that 77 percent of all projects lacked evidence of quality inspections. The school system sought help from the Corps in fiscal year 1999 to comply with EPA requirements and spent $60.5 million on asbestos management and abatement activities.
GAO-02-628T, District of Columbia: D.C. Public Schools' Modernization Program Faces Major Challenges
This is the accessible text file for GAO report number GAO-02-628T
entitled 'District Of Columbia: D.C. Public Schools' Modernization
Program Faces Major Challenges' which was released on April 25, 2002.
This text file was formatted by the U.S. General Accounting Office
(GAO) to be accessible to users with visual impairments, as part of a
longer term project to improve GAO products' accessibility. Every
attempt has been made to maintain the structural and data integrity of
the original printed product. Accessibility features, such as text
descriptions of tables, consecutively numbered footnotes placed at the
end of the file, and the text of agency comment letters, are provided
but may not exactly duplicate the presentation or format of the
printed version. The portable document format (PDF) file is an exact
electronic replica of the printed version. We welcome your feedback.
Please E-mail your comments regarding the contents or accessibility
features of this document to Webmaster@gao.gov.
This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed
in its entirety without further permission from GAO. Because this work
may contain copyrighted images or other material, permission from the
copyright holder may be necessary if you wish to reproduce this
material separately.
United States General Accounting Office:
GAO:
Testimony:
Before the Subcommittee on the District of Columbia, Committee on
Appropriations, House of Representatives:
For Release on Delivery:
Expected at 10:00 a.m.
Thursday, April 25, 2002:
District Of Columbia:
D.C. Public Schools' Modernization Program Faces Major Challenges:
Statement of David E. Cooper:
Director, Acquisition and Sourcing Management:
GAO-02-628T:
Mr. Chairman and Members of the Subcommittee:
Thank you for inviting me to participate in today's hearing. At your
request, we have been evaluating the District of Columbia's plans to
modernize and renovate its public schools. In the past few years, the
school system, with the assistance of the U.S. Army Corps of Engineers
(the Corps), has made considerable progress in fixing roofs, replacing
windows, repairing bathrooms, and addressing maintenance projects that
had been neglected for years.
Now that many of the emergency repairs have been completed, the school
system is turning its attention to the more complex task of
modernizing”either through renovation or through new construction”
virtually every public school in the District of Columbia. In fact,
several new school construction projects are underway. My remarks will
focus on challenges the school system faces in this formidable task.
Specifically, I will address:
* increases in the cost of modernizing the schools,
* delays in completing the schools,
* quality inspection problems, and,
* concerns about managing asbestos hazards.
Background:
In April 1998, the school system entered into a memorandum of
agreement with the Corps for engineering, procurement, and technical
assistance to ensure that construction contracts were awarded and
managed so that the schools could open that year. Under the Fiscal
Year 1999 District of Columbia Appropriations Act, Congress expanded
the Corps' role by authorizing it to provide the school system with
engineering, construction, and related services. Through the years,
the school system has renewed its working relationship with the Corps
by signing yearly updates to the support agreement.
To modernize the schools, the school system generally plans to build a
new school and demolish the old one or to completely renovate an
entire school. The Corps and the school system each have
responsibility for managing a certain number of new school
modernization projects. Because all of the schools are not modernized
at the same time, component replacements are needed to replace major
building systems”such as boilers, chillers, roofs, and windows”that
have reached the end of their useful lives. The Corps has taken
responsibility for the majority of these projects. In the past, the
school system used an area-wide utility contract with the Washington
Gas Light Company to perform some types of repairs, such as
electrical, heating, and air conditioning work, painting, and
carpeting. We reported in September 2001 that the school system had
improperly used this contract.[Footnote 1] The school system is no
longer using Washington Gas and has taken steps to implement new
contracting mechanisms for this work.
Modernization Projects Are Costing More Than Planned:
In December 2000, the District of Columbia Board of Education approved
a facility master plan to rebuild and update the District's public
schools. It is an ambitious plan calling for the modernization of 10
schools annually over a 10- to 15-year period. Based on this plan, a
$1.3 billion capital budget to modernize the public schools was
approved in June 2001. However, in November 2001, the school system
revised its spending plan. Because the District's capital plans
require 6-year budget projections, we evaluated the fiscal year 2002
through 2007 projections in the approved budget and in the revised
plan. We found that the cost to execute the modernization effort has
increased significantly”about $848 million in the 6-year period.
Figure 1 shows how the costs have increased over the period.
Figure 1: Comparison of the School System's Approved Budget and
Revised Plan:
[Refer to PDF for image: multiple line graph]
The graph plots the following:
District of Columbia approved capital improvement plan, and;
District of Columbia Public Schools' revised estimate.
Amounts are indicated in dollars in millions for the year 2002 through
2007.
Source: GAO analysis.
[End of figure]
According to school system officials, costs increased for a number of
reasons, including the following:
* historically significant buildings cannot be razed and have to be
redesigned at higher costs,
* experience to date shows that construction costs are running
significantly higher than the estimates used in the facility master
plan, and,
* the scope has been expanded for some projects to recognize community
needs for special facilities.
As an indication of how costs are increasing, we reviewed the cost
estimates in the facility master plan and the revised estimates for
the first 22 schools to be modernized.[Footnote 2] These schools are
currently in the planning, design, or construction phase. We found
that the costs for these schools have increased by about $170 million.
Appendix I lists the original and revised estimates for the 22 schools.
These cost increases present a significant challenge. On March 22,
2002, the District's Office of the Chief Financial Officer advised the
school system that due to the District's current debt position and
limited borrowing capacity, it must meet its capital improvement needs
within its currently approved budget. School system officials are
considering options to deal with the cost increases. However, such a
huge increase will likely result in stretching out the modernization
program. If that happens, some schools will have to be maintained
longer than currently planned, which will add costs to a program that
is already over budget.
Modernization Efforts Are Taking Longer Than Planned:
The facility master plan approved by the Board of Education set
ambitious completion dates for modernizing the schools. Generally, 3
to 4 years are required to conduct feasibility studies,[Footnote 3]
design the schools, and complete construction. To meet the master
plan's construction completion dates, time frames were compressed.
However, most of the first 22 schools to be modernized will not be
completed on time. Recognizing that the schedule in the facility
master plan cannot be achieved, school system and Corps officials are
developing more realistic schedules for some of the schools. Appendix
II contains a list of the first 22 schools with facility master plan
and current completion dates. It shows that:
* 10 schools are experiencing delays ranging from 3 to 15 months,
* 1 is ahead of schedule,
* 3 are on time, and,
* the schedules for 5 schools are being revised.
In addition, three schools are ahead of the facility master plan
schedule, but they have not met accelerated schedules established by
the school system and Corps. The scheduled construction completion
dates for four elementary schools”Key, Miner, Randle Highlands, and
Barnard”were accelerated to show the community tangible results
quickly. Accelerated completion of the schools involves a high-risk
acquisition strategy. For example, in some cases, construction began
before the designs were complete. The accelerated schedule also
required at least $700,000 in additional costs. None of the 4 schools
have met the accelerated schedule. The delays in meeting the
accelerated schedules were caused by difficulties in obtaining
required permits from other District agencies, incorrect assumptions
about the time required to get materials, design changes, and a bid
protest. At Key elementary, persistent contractor performance problems
continue to delay completion of the project.
Our work also shows that delays have occurred with some repair
projects. For example, completion dates for 9 boiler replacement
projects slipped from October 2001 to March 2002 and 1 slipped to
August 2002.[Footnote 4] Also, 17 of 22 bathroom renovation projects
were delayed.[Footnote 5] Reasons for the delays in the boiler and
bathroom projects included problems in obtaining required permits,
time required for asbestos inspections and removal, and a contract
award protest.
Concerns about Quality Inspections:
In our September 2001 report to you, we raised a number of concerns
about the school system's use of a Washington Gas Light Company
contract, including concerns about quality inspections. In a follow-up
to our report, we examined the gas company's records of quality
inspections for the work it managed for the school system. From August
2000 through March 2001, the school system paid Washington Gas $25
million for 609 repair projects. Based on the results of a random
sample of projects, we estimate that 77 percent of all projects lacked
evidence that quality inspections were performed.[Footnote 6] Without
evidence of inspections, the school system has no assurance that the
work was properly completed and its money was well-spent.
School system officials advised us that they are negotiating with the
company about the fee they paid the company to manage the repair
projects.
Concerns about Managing Asbestos Hazards:
To ensure compliance with legal requirements, the school system must
be ever vigilant in dealing with asbestos problems. In September 1998,
the Environmental Protection Agency (EPA) notified the District of
Columbia of serious issues of noncompliance with federal asbestos law
at the public schools. EPA's primary concern was the lack of required
asbestos management plans and periodic updates of the plans at each
school. The plans are required to show where asbestos is located in
the schools so that it will not be accidentally disturbed. To deal
with the issues raised by EPA, the school system sought assistance
from the Corps in fiscal year 1999. The Corps helped achieve
compliance with EPA requirements and, as of February 2002, had spent
$60.5 million on asbestos management and abatement activities in the
schools.
From October 1999 through May 2001, 13 inadvertent asbestos releases
occurred in the schools. Most of these releases were caused when
contractors and school custodians failed to consult the asbestos
management plans and to follow proper procedures for dealing with
asbestos in the schools.[Footnote 7] According to District of Columbia
Department of Health officials, asbestos tests at the schools revealed
that, while some of the releases were serious, the health of District
school children was not affected.
Concerns remain about whether the school system plans to adequately
fund continued compliance with asbestos mandates and additional
asbestos management activities. In addition, the Department of Health
did not promptly pursue enforcement actions against the contractors
who were at fault for the asbestos releases.
The school system's fiscal year 2002 to 2007 capital improvement plan
includes only $1 million per year for asbestos management. Based on
past experience and ongoing requirements, this level of funding is
insufficient to meet asbestos management needs. According to Corps
officials, a much higher level of funding is needed to (1) maintain
compliance with EPA requirements to keep the asbestos management plans
updated, (2) conduct assessments of asbestos areas before starting
renovation work, and (3) manage asbestos abatements.
The school system identified an additional $12 million from other
sources to fund asbestos activities for this year. However, Corps
officials told us they need an additional $1.6 million by mid-May or
they will have to curtail some of their asbestos activities. They also
estimate that asbestos activities will require about $17 million in
fiscal year 2003.
Our review of asbestos activities also raises concerns about the
Department of Health's role in taking enforcement action against
contractors who failed to (1) follow the asbestos management plans in
the schools before starting renovation work and (2) properly deal with
asbestos-containing materials once the releases occurred. Department
of Health officials told us that they did not pursue enforcement
actions because the Department's inspectors had not collected adequate
documentation.[Footnote 8] Specifically, inspection reports had not
been prepared which would have included information on laboratory
reports, the sequence of events and key players, a technical analysis
of the information collected at the scene, and a record of witness
interviews.
After our inquiries, Department of Health attorneys began looking into
some of the 13 incidents where contractor errors caused the asbestos
releases. After gathering additional documentation from the Corps,
earlier this month the Department issued a notice of noncompliance and
fined the contractors involved in one of the release incidents. The
Department plans to issue additional notices soon. Department
officials told us that noncompliance notices will be issued for such
things as failures to:
* notify the District and receive proper approval to start a
renovation project involving asbestos materials,
* obtain and pay for an asbestos abatement license,
* show evidence of proper asbestos abatement training,
* provide protective clothing for employees engaged in asbestos
abatement,
* display caution signs, and,
* enclose work areas with airtight plastic sheeting.
The Department of Health also plans to train its inspectors on the
types of documentation they need to prepare, such as inspection
reports, to enable contractor violations to be promptly pursued.
Our work also shows that communication between the Department of
Health, the Corps, and the school system needs to be improved. In some
cases, the Department of Health was unaware of asbestos releases in
the schools. Department of Health officials told us that they are
working to improve communications with the school system and the Corps
and increase the Department's oversight of renovation work being done
in the schools.
In summary, Mr. Chairman, the school system, with the Corps of
Engineers' assistance, has accomplished much in the last few years.
However, it must now come to grips with a modernization program that
will cost significantly more and take longer to accomplish than
originally projected. We believe the school system needs to revise its
modernization plans to reflect these realities. We also believe the
school system needs to fully fund asbestos management activities this
year and ensure that sufficient funding is budgeted in future years.
Mr. Chairman, this concludes my prepared statement. I will be happy to
respond to any questions you or other Members of the Subcommittee may
have.
Contacts and Acknowledgments:
For further information about our work or the issues discussed in this
statement, please contact David E. Cooper at (202) 512-4841. We will
make copies of this statement available to other interested parties
upon request. This testimony is also available on GAO's Web site at
www.gao.gov. This effort was conducted under the direction of Michele
Mackin. Other individuals making key contributions were Charles D.
Groves, John D. Heere, Gary L. Middleton, William Petrick, Jr.,
Russell R. Reiter, Rebecca L. Shea, and Adam Vodraska.
[End of section]
Appendix I: Original and Current Cost Estimates for First 22 Schools
to be Modernized (dollars in millions):
School: Key Elementary;
Cost in facility master plan[A]: $8.7;
Current estimate[B]: $11.9;
Increase: $3.2.
School: Randle Highlands Elementary;
Cost in facility master plan[A]: $14.2;
Current estimate[B]: $20.8;
Increase: $6.6.
School: Barnard Elementary;
Cost in facility master plan[A]: $12.8;
Current estimate[B]: $23.9;
Increase: $11.1.
School: Miner Elementary;
Cost in facility master plan[A]: $15.3;
Current estimate[B]: $22.0;
Increase: $6.7.
School: Kelly-Miller Middle;
Cost in facility master plan[A]: $20.6;
Current estimate[B]: $25.2;
Increase: $4.6.
School: Patterson Elementary;
Cost in facility master plan[A]: $14.0;
Current estimate[B]: $18.3;
Increase: $4.3.
School: Noyes Elementary;
Cost in facility master plan[A]: $10.2;
Current estimate[B]: $16.5;
Increase: $6.3.
School: Cleveland Elementary;
Cost in facility master plan[A]: $9.1;
Current estimate[B]: $12.2;
Increase: $3.1.
School: McKinley Technology High;
Cost in facility master plan[A]: $44.7;
Current estimate[B]: $52.0;
Increase: $7.3.
School: Thomson Elementary;
Cost in facility master plan[A]: $10.6;
Current estimate[B]: $17.3;
Increase: $6.7.
School: Bell/Lincoln High;
Cost in facility master plan[A]: $40.0;
Current estimate[B]: $63.0;
Increase: $23.0.
School: Phelps High[C];
Cost in facility master plan[A]: $0.0;
Current estimate[B]: $26.0;
Increase: $26.0.
School: Birney Elementary;
Cost in facility master plan[A]: $11.3;
Current estimate[B]: $21.2;
Increase: $9.9.
School: Thomas Elementary;
Cost in facility master plan[A]: $10.8;
Current estimate[B]: $15.6;
Increase: $4.8.
School: Walker Jones Elementary;
Cost in facility master plan[A]: $16.4;
Current estimate[B]: $22.3;
Increase: $5.9.
School: Wheatley Elementary;
Cost in facility master plan[A]: $9.9;
Current estimate[B]: $18.0;
Increase: $8.1.
School: Luke Moore High;
Cost in facility master plan[A]: $10.9;
Current estimate[B]: $15.1;
Increase: $4.2.
School: Woodson High;
Cost in facility master plan[A]: $42.7;
Current estimate[B]: $50.2;
Increase: $7.5.
School: Brightwood Elementary;
Cost in facility master plan[A]: $10.9;
Current estimate[B]: $18.5;
Increase: $7.6.
School: Cooke Elementary;
Cost in facility master plan[A]: $14.0;
Current estimate[B]: $19.3;
Increase: $5.3.
School: Hardy Middle;
Cost in facility master plan[A]: $20.6;
Current estimate[B]: $24.9;
Increase: $4.3.
School: Sousa Middle;
Cost in facility master plan[A]: $17.1;
Current estimate[B]: $20.1;
Increase: $3.0.
School: Total;
Cost in facility master plan[A]: $364.8;
Current estimate[B]: $534.3;
Increase: $169.5.
[A] Cost reported in the facility master plan dated December 20, 2000.
[B] Estimates reported in the fiscal year 2003-2008 capital spending
plan dated November 30, 2001.
[C] Phelps High School was not listed in the December 2000 facility
master plan as a planned renovation.
[End of section]
Appendix II: Original and Current Schedules for First 22 Schools to be
Modernized:
School: Key Elementary[C];
Facility master plan completion date[A]: September 2002;
Current completion date[B]: December 2002;
Delay (months): 3.
School: Randle-Highlands Elementary[C];
Facility master plan completion date[A]: April 2003;
Current completion date[B]: August 2002;
Delay (months): 8 months early.
School: Barnard Elementary[C];
Facility master plan completion date[A]: April 2003;
Current completion date[B]: November 2002;
Delay (months): 5 months early.
School: Miner Elementary[C];
Facility master plan completion date[A]: April 2003;
Current completion date[B]: December 2002;
Delay (months): 4 months early.
School: Kelly-Miller Middle;
Facility master plan completion date[A]: April 2003;
Current completion date[B]: July 2003;
Delay (months): 3.
School: Patterson Elementary;
Facility master plan completion date[A]: July 2003;
Current completion date[B]: July 2003;
Delay (months): 0.
School: Noyes Elementary;
Facility master plan completion date[A]: July 2003;
Current completion date[B]: July 2003;
Delay (months): 0.
School: Cleveland Elementary;
Facility master plan completion date[A]: July 2003;
Current completion date[B]: July 2003;
Delay (months): 0.
School: McKinley Technology High;
Facility master plan completion date[A]: September 2003;
Current completion date[B]: May 2004;
Delay (months): 8.
School: Thomson Elementary;
Facility master plan completion date[A]: July 2003;
Current completion date[B]: December 2003;
Delay (months): 5.
School: Bell/Lincoln High;
Facility master plan completion date[A]: September 2003;
Current completion date[B]: July 2004;
Delay (months): 10.
School: Phelps High;
Facility master plan completion date[A]: [D];
Current completion date[B]: Unknown;
Delay (months): Not applicable.
School: Birney Elementary;
Facility master plan completion date[A]: September 2003;
Current completion date[B]: December 2004;
Delay (months): 15.
School: Thomas Elementary;
Facility master plan completion date[A]: September 2003;
Current completion date[B]: July 2004;
Delay (months): 10.
School: Walker Jones Elementary;
Facility master plan completion date[A]: September 2003;
Current completion date[B]: July 2004;
Delay (months): 10.
School: Wheatley Elementary;
Facility master plan completion date[A]: September 2003;
Current completion date[B]: July 2004;
Delay (months): 10.
School: Luke Moore High;
Facility master plan completion date[A]: September 2004;
Current completion date[B]: July 2004;
Delay (months): 2 months early.
School: Woodson High;
Facility master plan completion date[A]: September 2005;
Current completion date[B]: December 2005;
Delay (months): 3.
School: Brightwood Elementary[E];
Facility master plan completion date[A]: September 2003;
Current completion date[B]: Unknown;
Delay (months): Unknown.
School: Cooke Elementary[E];
Facility master plan completion date[A]: September 2003;
Current completion date[B]: Unknown;
Delay (months): Unknown.
School: Hardy Middle[E];
Facility master plan completion date[A]: September 2004;
Current completion date[B]: Unknown;
Delay (months): Unknown.
School: Sousa Middle[E];
Facility master plan completion date[A]: September 2004;
Current completion date[B]: Unknown;
Delay (months): Unknown.
[A] Completion dates reported in the facility master plan dated
December 20, 2000.
[B] Completion dates in Army Corps of Engineers status reports as of
April 11, 2002.
[C] At the request of the school system, the schedules for these
schools were fast tracked for completion by July 2002.
[D] Phelps was not included in the original facility master plan.
[E] Current completion estimates are under review.
[End of section]
Footnotes:
[1] U.S. General Accounting Office, District of Columbia: D.C. Public
Schools Inappropriately Used Gas Utility Contract for Renovations,
[hyperlink, http://www.gao.gov/products/GAO-01-96] (Washington, D.C.:
Sept. 28, 2001) and U.S. General Accounting Office, GSA's Guidance and
Oversight Concerning Areawide Utility Contracts, [hyperlink,
http://www.gao.gov/products/GAO-02-56R] (Washington, D.C.: Dec. 17,
2001).
[2] Oyster elementary school, funded through a public-private
partnership, opened in September 2001.
[3] Feasibility studies are used to develop the initial design of a
school, based on the educational specifications. These studies involve
extensive input from the community.
[4] According to Corps officials, temporary heating systems were
available in the schools in October 2001 for 7 of the projects. Three
of the projects were substantially completed in October 2001, but
additional time was needed to finish remaining work.
[5] An additional three projects did not have scheduled completion
dates due to an administrative error, so we could not assess
timeliness of these projects. The basis for our analysis was the
Corps' fiscal year 2001 project list, dated February 2001, and
subsequent updates.
[6] Estimates were made using a 95-percent confidence level. We
considered evidence of inspection to be the Washington Gas inspector's
initials or signature on subcontractor invoices or proposals.
[7] When it was discovered that many of these incidents occurred
during boiler replacement projects, the District of Columbia
Department of Health temporarily shut down 17 boiler replacement
projects throughout the school system.
[8] One enforcement action taken by the Department was to suspend a
contractor's license for 30 days.
[End of section]
