APPA Institute for Facilities ManagementBoth exteriors and interiors APPA Institute for Facilities Management 8 Quality is in the Details Prominent entrances Hidden downspouts Buried

APPA Institute for Facilities Management

1

Institute for Facilities Management

Project Costs & Investments

Why does it cost so much??

High Compared to What?

Frame of reference


2


Compared to residential construction


Compared to commercial construction

Comparisons Are Not Valid

• Residential – Designed and built for light traffic and medium life, high importance placed on aesthetics

• Commercial – Designed and built for medium traffic and short life, high importance placed on function

• Institutional – Designed and built for heavy traffic and long life, high importance placed on aesthetics and function


3

Bottom Line…

Costs for campus projects rank among the highest in the market…

Bottom Line…

Costs for campus projects rank among the highest in the market…

…and would we want it any other way?

Bottom Line…

These higher costs are by and large a reflection of sound total-cost-of-ownership decisions being made.


4

Total-Cost-of-Ownership

What do we mean by total-cost-of-ownership?

Total-Cost-of-Ownership

What do we mean by total-cost-of-ownership?

TOC = Total Project Cost (D+C+F) + Operating Costs + Capital Renewal or Deferred Maintenance + Decomissioning

Cost vs. Investment

Higher capital investments can lower the total-cost-of-ownership.

Many incremental investments we make in a capital project yield attractive savings.

Therefore a higher project investment may be in the best interest of the institution’s bottom line.


5

Why the High Cost?

How do you fit these marbles into this jar without increasing the size of the jar, reducing the number of marbles, or breaking the marbles.

Why the High Cost?

Sense of PlaceCodes, Regulations & StandardsComplexityInstitutional and Statutory RequirementsTime PressuresMaintainability, Sustainability & Longevity

Sense of Place


6

Institutional Vision

Our institutions choose to build above the baseline


The physical environment creates the visual and tangible image of our institutions


In short, the facilities we construct reflect the vision and aspirations of the institution


7

Image Comes at a Price

Institutions are competing for national and international recognition

Noel-Levitz and Carnegie Foundation studies reveal the impact the physical environment has on prospective students

Marketing

As students increasingly select colleges based on what they can see, colleges will spend more money on that which can be seen.

Rigor in the classroom and intellect in the faculty cannot easily be seen – certainly not as easily as a fitness center or a three story granite fireplace.

Architectural Character

Building designs make statements

Both exteriors and interiors


8

Quality is in the Details

Prominent entrancesHidden downspoutsBuried utilitiesScreened trash receptaclesUnderground/screened cooling towersDiscrete service accessSite amenities/ArtExtensive and intensive landscaping

Preservation of Land

Importance of green space

Optimizing building footprints

Cost of building upward

Quality Comes at a Price

We are not just building structures… …we are creating a “sense of place”


9

Codes, Regulations & Standards

Gathering Places

Large assemblies drive our facilities into a higher level of life safety design

Code requires rated corridors, stair towers, fireproofing, fire alarm systems, sprinklers and smoke evacuation systems

Legislative Mandates

Federal, state and local regulations add cost burdens to our facilities• Asbestos abatement• Hazardous waste removal• Storm water runoff• Air quality control• Dust, noise & vibration controls


10

Universal Design

Universities facilities must not only be compliant with ADA, but are increasingly expected to go well beyond the minimum requirements.

HVAC Standards

Labs are intensive energy consumers

Classroom and assemblies are also intensive

Ventilation requirements drive up the sizeand cost of mechanical systems.

Complexity


11

Complex Facilities

Sophisticated research facilities

High occupancy and specialized venues

Intensive technological environments

Designed for extreme conditionsHottest and coldest temperaturesHumidity extremesStrictest controlsHighest occupancyFault detectionMeasurement and verification

Complex Mechanical Systems

Structural Loading

Heavy floor loadings

Column-free spans


12

Access & Security

Mixed Use Facilities

Combine classrooms, laboratories, meeting rooms and offices under one roof

Institutional & Statutory Requirements


13

Statutory Requirements

Procurement StatutesPrevailing WagesProject Labor AgreementsMBE/DBE/TSB ProgramsInsuranceBonding

Institutional Constraints

“Protected environment” of the campus

Minimize campus disruptions

Restricted building sites

Limited access & staging space

Restricted construction traffic

Complex phasing schemes

And…

Challenging Logistics


14

Additional Requirements

Noise restrictionsFencing and protectionNo ParkingNo SmokingLitter-free, weed-free work siteFull time supervisionElevated safety expectations

Time Pressures

Time Constraints

Immovable completion dates

Compressed construction windows


15

Maintainability, Sustainability & Longevity

Stewardship

Designing for low life cycle cost requires higher initial investments:

Energy efficiencyMaintainabilityLong lifeAdaptability

Adaptability

Overbuilt utilities and utilities pathways necessary for flexibility and growth


16

Adaptability

Increased floor to ceiling heights lower future renovations costs

Durability

Campus facilities subjected to frequent cycles of use

Durability

Durability important component of doors, hardware, carpeting, restrooms, furniture, etc.


17

Durability

Much of our deferred maintenance backlog is due to short-sighted life cycle decisions

Reliability

Reliable electrical and mechanical systems are essential to our institutional missions

Reliability

Higher cost for providing emergency power, redundancy, generators, UPS systems, and centralized utility systems


18

Sustainability

Higher education is “LEED”ing sustainable design efforts

Managing construction waste Renewable-sourced building productsPorous pavementsGreen roofsGray water systemsOther

A Postscript

What About Renovations?

Renovations

Often modifying existing conditions is more expensive than starting new


19

Buildings built just a generation ago may not have the infrastructure for today’s renovations

Renovations

Investments in renovations must often be made to correct the “sins of the past”

Renovations

Renovations magnify the perception of high cost because they commonly fall in the realm of personal expenditures… thus heightening the “sticker shock” experience

Renovations


20

Inevitably, comparing institutional renovation costs to residential housing investments…

Renovations

Classroom

Your House

Your Houseon Campus

Elevator ForAccessibility

MasonryConstruction

Metal WindowWith Low-e glass

Modified FloorStructure

Emergency ShowerAnd Eye Wash

Lab

Variable VolumeFume Hood

Institutional Grade Casework

Chilled Water Connection For Lower Life Cycle Cooling Cost

Code CompliantEmergency Egress

Institutional GradeDoor Hardware

Institutional GradePlumbing Fixtures

ADA CompliantFixtures

Pressure Flush With AutomaticFlush Valves

Increased Ventilation

Electronic Access

Classroom

Commercial GradeCarpet and Tile

Larger Hot WaterStorage System forCirculating Water

Steamline for LowerLife Cycle Heating Costs

Fire AlarmPanel

Continuous CirculatingHot Water Loop

Heat ExchangerCoils

Office

Energy ManagementControl System

Screen Wall forAesthetics

Strobic Air Fan toExhaust Fume Hood

Fresh AirIntake

Wider StaircaseAnd Corridor

Longer Life Slate Or Metal Roofing

Variable Air VolumeAir Handling Unit

Sprinkler System


21

Why the High Cost?

Why the high cost?

Why the High Cost?

Why the high cost?Sense of PlaceCodes, Regulations & StandardsComplexityInstitutional and Statutory RequirementsTime PressuresMaintainability, Sustainability & Longevity

In Summary…

• Stewardship demands a long term view of project investment decisions

• Investments are made with total-cost-of-ownership as our compass

• Excellence is in the details - thousands of cost additive details

• Construction costs mirror institutional values, demands and aspirations

Planningfor Higher Education

For an online version

of the journal, visit

www.scup.org/phe.

5 This study finds a need for new capital projects to include continuing, dedicated revenue streams for the project lifetime in order to avoid continuation of the current state of underfunded maintenance, especially in light of growing needs for upgraded research equipment and space.

12 A health professions building project at CentralMichigan University provides focus for a theoretical and practical discussion of effective planning to optimize human, spatial, and digital connections for learner-centered environments.

24 Higher education facilities seem to come at premium cost, even taking into account that educational facilities tend to cost more. The authors argue that this is due to appropriate and strategic high aspirations.

30 Indiana’s Twenty-First Century Scholars program effectively meets the needs of high-risk and low-income students byunderstanding the student’s mind-set, providing mentoringrelationships, being flexible with credit load minimums, and utilizing alumni for student recruitment.

37 A study at the University of Washington called “Listening to the Learner,” asked students about their desire for using technology in coursework, and facult about current approaches/barriers. Curricula were developed that intergrate education technology in a learner-centered way.

Planning for Higher Education 1

Volume 32, Number 2

December 2003–February 2004

Articles

An Assessment of CapitalBudgeting Practices in Public

Higher Educationby Derrick Manns

Creating Adaptive Learning Environments

by Stephen J. Kopp, Linda Seestedt Stanford, Kenneth Rohlfing, and Jonathan P. Kendall

The High Cost of Building aBetter University

by Donald J. Guckert and Jeri Ripley King

Indiana’s Twenty-First CenturyScholars Program

by Tamara L. Wandel

The Impact of Technologies on Learning

by Kimberly Gustafson

Book Reviews

Shattering the Myths: Women in Academe

Reviewed by Susan R. Griffith

Gender Equity or Bust! On the Roadto Campus Leadership with Women

in Higher Education®

Reviewed by Alice L. Hoersch

Women Administrators in HigherEducation: Historical and

Contemporary PerspectivesReviewed by Kim S. Phipps

Gendered Futures in Higher Education: Critical

Perspectives for ChangeReviewed by Helen Giles-Gee

Noteworthy Articles

Compiled by Laurie Baker

44

47

49

50

53

2 December 2003–February 2004

Planning for Higher Education (ISSN 0736-0983) is a quarterly production of the Societyfor College and University Planning, an association of professionals devoted to planning at academic institutions. This journal seeks to transmit the knowledge,ideas, research, and experience most likelyto advance the practice of higher educationplanning and policy making. SCUP membersreceive a complimentary subscription. The Society offers both individual and institutional memberships.

For contributor guidelines and subscriptioninformation, visit www.scup.org/phe.

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Copyright ©2003 by the Society for Collegeand University Planning. All rightsreserved. Printed in the UnitedStates. Indexed in the Current Index

to Journals in Education (ERIC), HigherEducation Abstracts, and Contents Pages inEducation. Also available from ProQuestInformation and Learning, 300 North ZeebRoad, Ann Arbor, Michigan 48106 USA.


Peter BalbertTrinity University

Sr. Paula Marie BuleyMount St. Mary’s College & Seminary

Gerald GaitherPrairie View A&M University

Mernoy HarrisonArizona State University

Trudis HeineckeUniversity of California System

Gary KrahenbuhlArizona State University

Thomas LonginAssociation of Governing Boards ofUniversities and Colleges

G. Gregory LozierIBM Business Consulting Services

Andrew LunaState University of West Georgia

Marilyn McCoyNorthwestern University

Anthony MorganUniversity of Utah

David NeumanStanford University

Roland ProulxUniversité de Montréal

Persis RickesRickes Associates

Richard RigterinkThe Campus Studio

Laura SaundersHighline Community College

Robert ShirleyUniversity of Southern Colorado

Joseph SzutzGeorgia Board of Regents Central Office

Carole WhartonMcManis-Monsalve Associates

Lori YamauchiUniversity of California, San Francisco

Editorial Review Board

Executive Editor

Rod RoseSTRATUS

Associate Editors

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Carol Everly FloydEducation Consultant

Sandra GleasonPennsylvania State University

Frank SchmidtleinUniversity of Maryland College Park

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Book Review Editor

David L. ParkynMessiah College

Noteworthy Articles

Laurie BakerThe Richard Stockton College of New Jersey

Director of Communications and Publications

Terry CalhounSCUP

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Society for College andUniversity PlanningJolene Knapp, Executive Director

Planningfor Higher Education

Higher education design and construction projectmanagers perform their work on the forward-edgeof an ever-changing world. We face increasingly

complex facilities, shortening time lines, proliferating codeand regulatory requirements, emerging technologies, andgrowing concerns for indoor air quality and environmentalsustainability. As we strive to keep abreast of these changes,we continue to hear one question from governing boards,administrators, and customers: Why does it cost so much?

We cannot deny that educational facilities cost more tobuild than many other types of construction. Even in therealm of education, there is a hierarchy ranging fromsophisticated research facilities to parking structures. Yet,all our facilities seem to come at a premium cost. Lowercost alternatives are always available, but our institutionschoose, instead, to build to a quality level that is above thebaseline. These choices flow from the institution's visionand strategic plan. The facilities we construct reflect thevalues and aspirations of our institutions.

A Sense of Place

Many universities are vying for national and internationalrecognition. To do this, they compete for students, faculty, andresearch funding. More than ever before, university buildingdesigns are viewed as enhancing and preserving our institutional heritage while creating an attractive environmentin which to learn, discover, and live. We do not just build orrenovate structures; we create a “sense of place.”


The High Cost of Buildinga Better UniversityHigher education facilities seem to come at premium cost, even taking into account that educational facilities tend to cost more. The authors argue that this is due to appropriate and strategic high aspirations.

by Donald J. Guckert and Jeri Ripley King

This article is reprinted from Facilities Manager, May/June2003, pp. 18–21, published by APPA: The Association ofHigher Education Facilities Officers.

Don Guckert recently joined The University of Iowa as the associate vice president for facilities. Previously, he was thedirector of planning, design, and construction at the Universityof Missouri-Columbia. He serves as dean of planning, design,and construction for The Association of Higher EducationFacilities’ (APPA’s) Institute for Facilities Management and sits onthe Construction Specifications Institute (CSI) editorial advisoryboard for The Construction Specifier. He has authored severalarticles for APPA’s Facilities Manager and CSI’s The ConstructionSpecifier and served as editor for APPA’s publication FromConcept to Commissioning: Planning, Design, and Constructionof Campus Facilities (2002). He has been a member of SCUPsince 1993.

Jeri King is assistant to the associate vice president for facilitiesat The University of Iowa. Previously, she served as the assistantdirector for the Center for the Study of Organizational Changeand senior management analyst for planning, design, and construction at the University of Missouri-Columbia. She hasauthored and coauthored several articles that have appeared inthe Journal of Management Inquiry, APPA’s Facilities Manager,and the National Association of College and University BusinessOfficers’ Business Officer. She is currently working on aresearch project through APPA’s Center for Facilities Research.

Coauthors Don Guckert and Jeri King received APPA’s 2003 RexDillow Award for Outstanding Article for “The High Cost ofBuilding a Better University.”

Clearly, this sense of place plays an important role inmarketing the institution. In a 2001 study of college-boundhigh school seniors by Noel-Levitz, a market research firm,the most notable experiences seniors encountered on theirbest college visit had to do with the appearance of thecampus and its facilities (Noel-Levitz 2002). This study confirmed the 1986 report by the Carnegie Foundation forthe Advancement of Teaching that found that for 62 percentof prospective students, the most influential factor during a campus visit was the appearance of the buildings andgrounds (Carnegie Foundation for the Advancement ofTeaching 1986).

The attractive appearance of the grounds and buildingscomes at a cost. In constructing a new building for a campus environment, we seek elaborate designs that convey emotions and reactions that range from stimulatingdebates over architecture to communicating notions of continuity and timelessness. Often the little extras add a lotto the quality of the built campus environment: prominentbuilding entrances, buried utilities in tunnels and chases,hidden downspouts in interior walls, screened waste receptacles, underground cooling towers, discrete access forservice vehicles, and extensive landscaping and courtyards.

Land must be used carefully, with attention to gatheringplaces and circulation. The need for green space must balance the need for building space. This drives us to optimize building footprints by building skyward and belowgrade to conserve precious campus real estate. Multiplestories require more costly foundations and structuresdesigned to withstand seismic and wind loading standards.Stair towers and elevators consume project resources anddecrease the percentage of assignable space. All these factors lead to a higher cost per square foot.

Codes, Regulations, and Standards

The type of occupancy determines the applicable buildingcode requirements. The large assemblies found in mostuniversity facilities dictate the highest level of life safetydesign. These code requirements have a tremendousimpact on cost by requiring stair towers, fire-rated corridors, fireproofing on structural members, fire alarmsystems, sprinklers, and smoke evacuation systems. Even

the grade of carpeting in a university facility is selected tominimize concerns about flame spread.

In addition to codes, building design and constructionmust meet a myriad of legislative mandates and regulations.The list reads like alphabet soup: ADA, EPA, OSHA, andmore. These laws and agencies govern building accessibility,removal of hazardous waste, asbestos, light ballasts, leadpaint, storm water runoff, construction dust control, noisecontrol, and more. Then, there are the state permits, localpermits, contracts, agreements, and requirements bydonors and funding agencies that must be managed.

The type of facility and occupancy also drives ventilation requirements. Labs require more ventilation than classrooms; classrooms require more ventilation thanoffices. Increased ventilation leads to upsizing HVAC systems, because outside air must be heated or cooledbefore it is delivered to the finished space. In a trendtoward thwarting indoor air quality problems, buildingmechanical codes have increased ventilation requirementsfar beyond the infrastructure capacities in many buildingsbuilt before the 1990s. The impact is profound on renovationprojects where HVAC costs alone can consume the majorityof the project budget.

Institutional and Statutory Requirements

Institutional and statutory requirements can drive up coststoo. Contractors must provide the highest industry coveragefor insurance and bonding and construct in accordance withthe highest industry standards. Architects may be requiredto furnish professional liability insurance. Public ownersmust follow state procurement statutes, which increasedesign and bidding costs and constrain the use of morecost-effective delivery approaches. Many institutionsrequire contractors to pay prevailing wages to their workers, equating to union-scale.

An often overlooked impact on cost is the expectationthat construction activities will be conducted with minimaldisruption to campus life. The campus is a protected environment that accommodates learning, social interaction,discovery, living, dining, recreation, and public service. Asinvited guests into this haven, contractors are required toconduct their activities in a manner that minimizes theimpact on the institution’s primary missions. This is not atypical construction site. Project costs go up dramaticallywhen universities restrict access to building sites; limitspace for staging; require off-campus parking; enforce

The High Cost of Building a Better University


We do not just build or renovate

structures; we create a ‘sense of place.’

Donald J. Guckert and Jeri Ripley King


jobsite cleanliness; add fencing and protection; route construction vehicles around, rather than through, the campus; limit noise and hours of operation; and imposecomplex phasing schemes to accommodate academic calendars.

Time Is Money

Demanding schedules are an inherent part of higher education design and construction efforts. In general, shortening the time line will drive up costs, lengthening the schedule will drive them down. An aggressive three-month renovation will be unaffordable if we only allow sixweeks for completion of the work. Conversely, easing the schedule to six months will yield savings.

Contractors, when bidding a shortened schedule, willincrease their bids to reflect overtime payments to workers,incentive payments to vendors, reduced worker productivity,and contingencies to cover the risks of falling behindschedule or completing late. On the other hand, extra timein the schedule reduces the contractor's risk, facilitateseffective coordination among subcontractors, and providessufficient time for fabrication and delivery of materials andequipment and other accommodations that result in a morecost-effective project delivery.

More often than not, we aggressively work towardinflexible milestones, such as semester starts and athleticevent schedules. In research environments, the need to beup-and-running is paramount. When the higher educationenvironment demands design and construction projectsdelivered on increasingly shorter time lines, this drives upthe cost of university projects.

Complexity

The facilities we build are among the most challenging in thebuilding construction industry. We build state-of-the-art researchfacilities, high-occupancy performance and athletic venues,heavily trafficked and technological learning environments,and living and social environments that must appeal to anew generation. In short, we are constructing complexcommunities.

Program activities often dictate the need for a combination of classrooms, laboratories, meeting rooms,and offices. Although grouping one type of activity in afacility would reduce costs, our buildings rarely house only one type of activity. In addition, they must meet the functional requirements of the campus environment.

For example, classrooms and auditoriums are usuallyon the lower levels of a building and demand larger, column-free spans. The lower levels may then have to support upper floors designed to accommodate floor loadings for bookshelves and lab equipment. Invertingthese spaces, by placing the column-free classrooms onthe upper floors and the heavy load-bearing spaces on the lower floors, would be more cost-effective but lessfunctional in a campus setting.

Our facilities must accommodate a mix of functionsand heavy traffic. To manage this, we install complex building systems. Mechanical systems are designed forextreme conditions: hottest and coldest temperatures,humidity extremes, strictest climate control, and highestoccupancy. We recognize that the design of a mechanicalsystem represents the greatest opportunity for energy conservation in the future. Investments in energy-efficientmechanical systems will yield a lower stream of future utility costs.

Maintainability, Sustainability,and Longevity

Good stewardship involves constructing buildings that willlast, buildings that can be easily maintained, and buildingsthat can be converted to other programmatic or technologicuses in the future.

With many people using university facilities in frequentcycles throughout the course of a day, not only do thestructures need to be able to handle this, but also the components of these facilities must be of a quality to withstand constant heavy use and abuse. Because of thecampus building boom in the 1960s, we know all too wellthe consequences of cheaper designed and constructed

facilities that were not built to survive the test of time. Ourrequirement for durability raises the price of doors, doorhardware, carpeting, entrance mats, floor tile, and restroomfixtures, but it lowers the future costs of maintaining andreplacing the lower quality products. We are resolved not

Environmental sustainability is

another factor having an increasing

impact on construction costs within

higher education.

“You've got to be kidding! I could build a nice housefor that amount!”

How many times have we heard that the cost of a “simple” renovation would buy a high-end home in a nice neighborhood? Customers typically react withsticker shock over the cost of a campus renovationwhen they receive the initial project estimate. This isthe point at which worlds collide; where the institutionalconstruction world of the project manager meets thecustomer’s residential construction frame of reference.

Trying to justify the costs of institutional constructionwithin a residential frame of reference is not easy. These



two types of construction are a world apart. However,just for the fun of it, we wondered, what would it taketo renovate your house into a campus facility? Supposeyou request that we renovate the living room into aclassroom, the kitchen into a lab, and the bedroom intoan office. In addition, you request that this facility islocated on campus. Let’s take a walk through yourhouse (figure 1) to see what we will need to do.

To begin with, we’ll need to make the facility safeand accessible. We’ll add an elevator to the secondfloor, and an exit stair tower connecting all floors to the outside. To make this building look like it belongs

Figure 1 Your House on Campus

Your House on Campus by Donald J. Guckert and Jeri Ripley King

CCOORRRRIIDDOORR

VVAALLVVEESS

Donald J. Guckert and Jeri Ripley King


on our campus, we’ll arrange for matching towers andgive the building an identifiable look. Unfortunately, thiswill add considerable cost and space to the buildingwhile not adding any space for program needs. Afterwe widen the interior hallways and stairways forincreased traffic and install a utility chase from thebasement to the attic, we will actually reduce theamount of assignable space.

As a university facility, the house will fall under a different classification as far as building codes areconcerned. This means we’ll need to replace the $15battery-operated smoke detectors with a $15,000 fireprotection system. This system, which includes a firealarm panel, wired sensors, and sprinkler system,meets all of the requirements of the local fire marshal.To inhibit the spread of flames and smoke from oneroom to another, we will have to reconstruct the wallsthat separate the rooms from the hallway and makethem “fire-rated walls.” This is not cheap! The soliddoors mounted to the metal doorframes that we’ll use to replace the house’s hollow doors and woodenframes are also not cheap.

We know the budget for this renovation is limited.Before the money runs out, we need to look at themechanical systems. By code, our lab, classroom,office, and restroom require outside ventilation thatyour house doesn’t have. The small air-conditioning unit and gas furnace will have to go. With the bigincrease in airflow, it wouldn’t keep up after the firstfive minutes. We’ll connect to chilled water and steamfrom our central plant. Our campus building will needredundant, dependable, code-compliant, and cost-effective mechanical systems.

Finally, we move to the kitchen. To convert it to a lab, we’ll take out the $600 kitchen stove and hood and replace it with a $25,000 variable flow fumehood. Let’s hope we won’t need a strobic air fan forthat hood; you don’t even want to think about thatcost. Those kitchen cabinets will come out to allow forthe built-in lab casework. The refrigerator will have togo, too. In its place will be a $10,000 environmental

chamber. We’ll open up the walls when we install thelab gases, electrical conduits, and corrosion-resistantplumbing. While we are in the walls, let’s replace thewooden studs with metal studs. Then, to complete this“kitchen remodeling,” we’ll replace the linoleum withan $8,000 epoxy floor, and the Formica counters withepoxy resin.

We’re going to need to remove the ceiling abovethe kitchen to increase the structural support necessaryto handle the small library in the office above. Theanticipated weight of books will stress the existingfloor joists. While the ceiling is open, we’ll install the circulating hot water system, designed to serve the laband restroom, and we’ll upsize the mechanical ductworkto meet the new airflow requirements. Speaking of airflow, that “whooshing” sound will be distracting inthe classroom next door, so we will need to put insound attenuation devices.

To meet institutional standards, the wooden windowswill need to be replaced with metal, commercial-gradewindows that have energy-efficient glazing. Similarly,the roof shingles will need to be replaced with slate,due to concerns about life-cycle maintenance and architectural consistency. While we’re on the roof, let’sscreen the unsightly mechanical systems. Oh yeah, we can’t forget to do something about the pigeons.

Let’s look at the outside again, just for a minute.Only the front facade was bricked when your housewas originally constructed, so we’ll need to install brickson three sides. After all, our university is trying to projecta certain image, and your house is now on campus.

At this point, we have more scope than budget.Money is running out, and there are more things weneed to do to bring your house into compliance withour institutional standards.

What happened here? In trying to meet the morestringent codes, efforts to reduce future operating costs,aesthetic requirements, and programmatic needs, weexceeded the funds available for this renovation. Forthe money this renovation will cost, you really couldbuild a nice house. But not on our campus!

to repeat the shortsighted mistakes that were made by aprevious generation of campus administrators and facilitiesmanagers.

The way we use our facilities demands that we constructutility systems within the building to high reliability standards.This often results in paying for system redundancies, generators, uninterruptible power supply systems, harmonicsreduction, and central utility systems. In addition, tele-communication/computer wiring and pathways are oftenoverbuilt to enable user flexibility and save the expense of rewiring and reconstructing walls or ceilings in the nearfuture. We have learned that planning for tomorrow can cut down on the costs of retrofitting existing buildings.

Environmental sustainability is another factor having an increasing impact on construction costs within highereducation. Facilities are being constructed with recyclablematerials, materials that are certified as manufactured fromrenewable sources, and building and system designs thatuse progressive methods and technologies to conserveenergy and reduce the waste stream. Pursuing Leadershipin Energy and Environmental Design (LEED™) certification,developed by the U.S. Green Building Council, brings theprestige and positive publicity sought by many institutionsseeking a progressive and environmentally sensitive image.However, this comes at a higher cost.

Making these long-term, sound, investment choices iswhat separates higher education from the vast array ofother building environments. Higher education, more thanany other built community and commercial environment,

constructs buildings to last beyond our lifetimes. Everyinstitution with an active building program envisions itselfin existence into perpetuity. We make the choice to investin higher quality construction of our campus, in part,because we have so many years ahead of us to reap the benefits on these initial investments.

Why Does It Cost So Much?

It is said that excellence is in the details. Thousands ofdetails go into the construction of a university building.Rarely can we point to one item as driving the high projectcost. The high cost of university construction is caused bythe accumulation of investments in all of the details that gointo building a quality facility. If we are to compete with thebest institutions, we must meet the demands for higherquality facilities.

Construction costs mirror the values and aspirationsof the institution. Our universities choose to provide stimulating, enriching environments that will serve our students, faculty, and researchers well into the future. We are building a better university, one that is built on the traditions of the past and constructed to compete forfaculty and students into the next century.

References

Carnegie Foundation for the Advancement of Teaching. 1986. How Do Students Choose a College? Change(January/February): 29–32.

Noel-Levitz. 2002. After 9/11: Campus Visit Expectations,Experiences, and Impact on Enrollment. Retrieved October 2,2003, from the World Wide Web: www.noellevitz.com/library/research/campus_visit/index.asp.



Higher education constructs buildings

to last beyond our lifetimes.

less, all are learning that the decisions they make about proj-ects have long-term implications for future budgets.

Project budgets have long been the responsibility of facili-ties project managers, who balance the scope of the projectand the time it demands against the budget for the project.However, institutional budgets include costs required for op-erating and capital renewal for the completed project, andthese budgets have been the responsibilities of others. Thus,administrators now recognize the impact that early decisionshave on the operation and renewal of a building and aretherefore starting to hold project managers accountable forensuring that the decisions that are made and the scope ofthe project that has been determined take into account theoptimal return on the institution’s investment in the project.To meet this requirement, project managers will need to aligntheir craft—creating physical assets—with the long-termstewardship of the facilities for which they are responsible.

A stewardship approach to the planning, design, and con-struction of campus facilities is based on a comprehensiveperspective of the total financial and operational impacts thata facility will have on the institution. Moreover, the planninghorizon for a facility that is yet to be built is extendedthrough its complete life cycle and into the far reaches of theuniversity’s resources—both financial and human—that willbe affected. Because of the long-term impact that project de-

A s the dust begins to settle after the building boom ofthe past decade, campus administrators and govern-ing boards have developed a heightened sensitivity

and awareness of the commitment necessary to support theirexpanded facilities portfolios. Many are discovering that theirfacilities require financial obligations of an unexpected mag-nitude. Others, however, are celebrating the completion ofprojects that employed commissioning and sustainable designand are therefore touting the institutional successes attainedby serving as good stewards of limited resources. Neverthe-

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Aligning Project Decisions with the Total Cost of Ownership

Designing for Stewardship:

Don Guckert is associate vice president for facilitiesmanagement, at the University of Iowa, Iowa City, Iowa.He is editor and coauthor of the APPA book, Stewardship& Accountability in Campus Planning, Design &Construction (from which this article is adapted), anddean of the planning, design, and construction track ofAPPA’s Institute for Facilities Management; he can bereached at [email protected]. Jeri King is assistantto the associate vice president, facilities management,at the University of Iowa and is a member of APPA’sInformation and Research Committee. She can be reached at [email protected].

By Donald J. Guckert, P.E. and Jeri Ripley King

cisions will have on the institution, decision making needs tobe increasingly institution-based rather than customer-based.Meeting this demand is particularly challenging because ofthe forces that push against making the best long-term financial decision.

Competing PerspectivesProject managers have long been expected to serve a myri-

ad of often competing needs and interests in order to servemultiple institutional customers and stakeholders. There isundeniable tension in negotiating the scope of trade-offs,which must be made to fit the needs and desires of the customers within a project budget that never seems quitelarge enough. Predictable clashes occur at points when thecustomer-driven program and architectural design meet theinstitutionally driven concerns for cost-effective operationsand maintainability. A classic example of this problem is thecase of a customer who wants to move dollars earmarked forthe mechanical room to the atrium at the same time that afacilities manager wants to move dollars from the atrium tothe mechanical room. Compounding the issue is the disjoint-ed higher education financial model created by separatefunding sources for capital costs and the long-term operationand eventual capital renewal of the facility. This creates a disjointed financial model that logically leads to competingperspectives.

After successfully raising funds for the planning, design,and construction of a building, deans, department chairs, faculty members, and development officers frequently turn tothe campus administration to ante up the finances needed tosupport the operational demands of the facility. Over theyears, faced with rising costs and budget constraints, institu-tions have tended to either underfund or fail to fund theoperating costs of new facilities. Even when adequate opera-tional monies are dedicated initially, in future budget cyclesthe funding is at risk of being reduced when budgets are tight.This situation has a tremendous impact on operational staff’sability to serve users’ needs. Project managers can help bymaking decisions that assume that the operating money willnever be proportionately more than the amount that has beenallocated the day the building opens.

Similarly, campus administrators and budget officers, facedwith the challenge of funding the operation of the new build-ing, have not been focused on annually investing 1 to 2percent of the building’s replacement value in order to addresscapital renewal needs that will occur 20 or 30 years down the road. To plan, design, and construct facilities that will mitigate these costs, project managers should have an under-standing of how operations staff care for the facility, whatresources the facility will consume over its life cycle, how andwhen building systems and components will be renewed, andhow and when the building will be decommissioned when itreaches the end of its useful life. By looking at the total lifecycle of the asset, rather than at the life of the project, theproject manager can guide the planning and decision making

involved in the project according to the total cost of ownership.

Total Cost of OwnershipThe total cost of ownership is a composite of building

costs from concept for the original design through decommis-sioning or demolition. The amount includes design andconstruction costs, operating costs, and the costs associatedwith plant renewal. Thus,

From the perspective of total cost of ownership, the capitalcost for a new building represents less than half of the totalcost of ownership during the life of the facility. The costs as-sociated with renewal and operations (maintenance, custodialcare, and utilities) are just as important as the cost of design-ing and constructing a building.

Project managers are well aware of the “first costs”—theproject costs related to the design and construction of bothnew buildings and renewal or renovation costs. But to under-stand the total cost of ownership of a building, projectmanagers also need to understand operating costs: the annu-ally budgeted expenses for all activities necessary for theroutine, day-to-day use, support, and maintenance of a build-ing or physical asset. This budget item includes the costsrequired for routine maintenance, minor repairs, preventivemaintenance, custodial services, snow removal, groundskeep-ing, waste management, energy, and utilities. Within themyriad of operating costs, energy consumption is generallythe highest and often commands the most attention in thedesign of the facility. However, the cumulative effect of all theother operational needs can also have a profound impact onannual operating budgets.

Decisions made in the design phase of a project frequentlypit programmatic needs and desires against institutional financial interests. Project managers generally are not in a position to make this decision unilaterally. Instead, campuspolicies and standards can set minimum institutional require-ments for the decision making involved in the project.

Standards Having an institutional baseline for standards of design and

construction can help to ensure a total cost of ownership ap-proach to decision making. Just as state and local buildingcodes, fire and life safety codes, and the Americans with Dis-abilities Act (ADA) establish minimum standards that protectthe public interest while using a facility, campus design stan-dards should be developed, implemented, and enforced toprotect the institutional operational and financial interests inthe project. No one would debate whether a building’s designshould comply with fire and life safety codes; similarly, thereshould be no debate about whether to invest in money-saving

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Total Cost of Ownership = Total Project Cost + Operating Costs + Capital Renewal or DeferredMaintenance + Decommissioning

energy-conserving systems, or whether equipment thatrequires servicing should be designed for safe access by main-tenance workers.

Over the last two decades, an increasing number of campuses have developed institutional design standards. Recognizing the value of such standards, the project manage-ment staff usually has taken the initiative to develop andrevise the institution’s design standards manual. These designstandards generally apply to materials, equipment, buildingcomponents, design guidelines, and design details that cam-pus stakeholders and service providers have found to facilitatethe facility’s serviceability and cost effectiveness. However, theinitial standards were often based more on preferences thanon sound life cycle cost principles. In these cases, there maybe a perception that the standard has been “gold plated,” leading project managers and customers to become critical of design standards that were determined primarily by stake-holders. To avoid this perception, standards should seek to be based on the best life-cycle value.

Standards should take into account that the best life-cyclevalue does not mean always specifying the building compo-nent that has the lowest cost of maintenance. Instead, the bestlife-cycle value should be a balance between the initial costand the operating cost of a component. Generally the higher

quality, higher cost item will yield a longer service life—butoften only to a certain point. Sometimes, the total cost ofownership can be lower when a component that has a lowercost and lower quality is used.

Design standards should also incorporate qualitative deci-sions that are not based solely on the total cost of ownership.A prime example is the debate between users and custodiansabout classrooms that have a hard surface versus carpeting.When viewed from the total cost of ownership only, hard surfaces will win every time. However, the quality of theacoustics in the classroom, which cannot be measured in dollars, generally points toward carpeting for the better class-room learning experience. Project managers should stillfacilitate this discussion with users and custodians, and allshould recognize that decisions involve more than just thebottom line.

Developing campus design standards that reflect both insti-tutional qualitative and quantitative priorities demands hardwork and commitment. Effective standards are those that involve all invested parties in a collaborative effort.

CollaborationThe most successful project managers in educational facili-

ties are those who have discovered the richness of the body of institutional knowledge that lies within the operations,

maintenance, and utilities staffs. Insti-tutions achieving the highest level ofsuccess with a total cost of ownershipapproach are those that havedeveloped enabling procedures andprocesses that tap into operating staffsas resources for reviewing plans, devel-oping standards, and commissioningbuildings.

Commissioning, in particular, hasserved the needs of users and operat-ing staff by ensuring that facilities arebuilt systematically to comply withstandards of quality and serviceability.The days of “working the bugs out” ofnew facilities for the first four seasonsof operation are quickly disappearing,as operations staff members work side-by-side with project managers todesign, inspect, test, and accept build-ing components and systems prior tooccupancy. Customers are now enjoy-ing their new and renovated facilitieswith fewer needs to call back facilitiesmanagement staff or contractors tocorrect deficiencies. The integration ofthe skills and knowledge of the projectmanager and the operating staff—cou-pled with the enormous benefit this

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collaboration provides to users and operating budgets—is thereason why the concept of commissioning is changing fromthat of a best practice to a standard practice.

Another example of the power of collaboration is found inthe increasing popularity of sustainable design. The interestsof customers, project managers, and operations staff are con-verging through efforts to reduce energy costs and resourceconsumption involved in new and renovated facilities. Sus-tainable design generally is a customer-based initiative thatbuilds on the tools of commissioning and design standardsand drives better institutional decision making that is alignedwith total cost of ownership principles.

The reason why collaboration is so effective for sustainabledesign projects is that the customer, project manager, and facilities operator align their various perspectives to reach acommon goal. The customer wants the image and reputationthat sustainable design brings; the project manager enjoys thechallenge of thinking creatively about meeting the goals forsustainable design; and the facilities manager achieves an out-come that requires fewer resources to be consumed. As aresult, the institution gets a physical asset that is designed foreffective stewardship and for the lowest cost of ownership.

If the goal of good stewardship represents the destinationfor project managers, understanding expectations is the roadmap that gets them there. The challenge for the project man-ager is to understand the expectations of the customer, the institution, andstakeholders before making the trade-offs and sacrifices that will accomplishthe goal of facilities stewardship.

Whether the project manager isfaced with competing perspectives, the need to develop standards, or the requirement to take into account thedemands of many stakeholders whoseinterests are represented by the totalcost of ownership, the key to effectiveproject management is alignment with facilities stewardship. By usingthe compilation of institutional understanding of building systems,operations, and construction, the proj-ect manager can produce a life-cycleapproach to facilities operations thatgoes well beyond the design and con-struction of a building. Collaboratingwith others enables project managersto solve complex problems and formu-late a comprehensive facilities strategyfor long-term stewardship.

Conclusion As project managers accept responsibility for decisions that

will affect long-term institutional needs, they are transformingtheir accountability to capital projects from first cost to totalcost. This transformation needs to be built on a solid founda-tion that takes into account competing perspectives, developsdefensible standards, and provides collaborative compilationof knowledge that can help align decisions to facilities stew-ardship. Overall, the decisions made today will have animpact on creating, providing, and caring for the physical facilities that provide a place for current and future genera-tions of individuals involved in academic pursuits.

Adopting a long-term stewardship approach accepts thefact that individuals come and go, but our institutions live on.For generations to come, the institution will live with consequences of the decisions made during a relatively brief design period. As project managers wrestle with the day-to-day challenges posed by new projects, using facilitiesstewardship as their compass will guide them toward the rightchoices and decisions to make when considering the designand construction of a facility.

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Documents

APPA Institute for Facilities ManagementBoth exteriors and interiors APPA Institute for Facilities Management 8 Quality is in the Details Prominent entrances Hidden downspouts Buried