Overview
In a recent article in the Observer, the Smithfield School Committee voted to participate in a new program. This program could deliver savings to SPSs energy costs and therefore, allow the savings to be diverted to other building projects.
First, kudos to the SPS Administration and School Committee to investigate this initiative as the next step to a previous article Smithfield seeking proposals for renewable energy projects in June 2021.
As with any business organization ... public or private ownership, non-profit or profit, governmental or private business ... the existance is to serve its stakeholders, including its customers, owners, or a public interest.
Whether it is implmented or not ... this initiative is positive for two reasons: 1) open to new ideas using a strategic and creative business mindset and 2) leveraging its resources (revenue, labor, infrastructure) for the best of its stakeholders. In SPSs case, the students, residents and taxpayers.
At the same time, the most creative and well-meaning intiatives must also be approached with a methodical and objective mindset.
Proposal
A initiaive that would "deliver up to $1.5m" in savings which would be redirected to "school improvement projects over time". Ultimately, to identify areas to save energy while making improvements to the school buildings which would "balance the the cost against the additional savings".
Again, great idea.
Quotes
An energy audit would identify needs and savings. According to John Bonavist, a representative from Honeywell, "That will see how much savings we have from these specifc measures that could actually pay for the things that need to be done."
Potential projects could include boiler replacements, mechanical upgrades and improved lighting. According to Superintendent Paolucci ... She has been through this process in other districts ...
The end result of the audit would be a 'menu' of potential energy savings project the district could choose from. The district would not be obligated to pursue any one option.
SPS is committed to pay $25k to Honeywell. In the event that the District decides not to move forward, Honeywell would retain this fee to cover the work for the audit.
At the same time, Honeywell would cover any lost savings that are not realized for the energy projects selected.
Suggestions to Move Forward
From the article, this sounds like an interesting, creative and reasonable initiative. However, as I have learned and taught many times in my career ... the details are always in the implementation of an idea or proposal. The details are how well the proposal is analyzed, vetted and the actual execution of a quality project plan as well as monitoring the project during execution and report any variances in the project timeframe, scope, and costs.
All companies exist to receive revenue and realize profits. No company sells its products or services at a loss. Honeywell is no different. The best situations is when an initiative is not "sold", but when both parties to a contract work to the benefit of each other. Ultimately, the value proposition.
So, some suggestions ...
Governments should objectively benefit from initiatives.
- Best Practices Investigation. Learn from the experience of other businesses for initiatives like this. Superintendent Paolucci has stated that she has implemented these in the past. SPS should report and present the experiences and outcomes of those projects.
- Objective Audit. Audits by their very nature are objective, independent and factual. Based on factual evidence and sound analysis which are guided by generally-accepted procedures. Preferably industry-based. SPS should clearly define the approach, methodologies, data, benchmarks and procedures that will be employed for the audit.
- Legal Advice. The contract for the audit should be scrutinized by a qualified attourney from both the legal and business perspective. The audit specifications needs to be evaluated from both perspectives prior to its acceptance. SPS needs to have its counsel review and evaluate the proposal including the practices noted above.
- Budget & Financial Review Board. There are long-term fiscal implications specific to SPS's capital needs which will affect budgets for several years. Therefore, this initiative to the budget evaluation, analysis and approval process, the BFRB should be an active participant in the process before and after final approval by SPSS and the School Committee.
- Public Presentation/Workshop. As stated earlier, this intiative has long-term effects on the fiscal status of both SPSs and the Town. The objective details, outcomes and expected savings should be fully disclosed to the public. SPSS should schedule a meeting/workshop for a presentation and questons prior to any final acceptance and approval.
- Progress Reporting. This initiative will be complicated and has embedded long-term fiscal implications to SPS and the Town. It will be important for progress reports at important milestones in the entire process including presentation of the final audit, "menu" list of projects (energy savings and improvement) and an analysis of expected vs. actual returns. SPS should integrate the BFRB into those milestone progress reports as well as the Town Council.
- Capital Project Updates. If savings are achieved to be deployed to building improvements, these projects should be identified from the capital projects list maintained by the Town. They should not be "wish list" or new projects, but those already identified to the Capital Committee, BFRB and Town Council. SPS should only select projects that have been documented to the Capital Committee.
Final Thoughts
Again, the SPSS Administration and the School Committee should be commended for this initiative.
The safety and comfort of our students and SPS employees are always a top concern. Always! At the same time, the primary objective is to provide a quality education to our students.
Therefore, any funds gained from this initiative will not only be realized by taxpayers, but should be used to fortify the primary purpose of the entity ... a quality education.
The outcomes of this initiative should increase the brand of Smithfield and its residents' children who are educated in our Town. It will become the springboard for their future ... college, technical schools and the careers after they graduate from Smithfield.
To build a sense of pride and thanks for the foundation to begin their new lives.
