Study Session Meeting

No content available.

[6] Ray Rodriguez: That's not an excuse. That's just what guys do, right? So it's 536. Ready to get this meeting going. It's a regular school board meeting for the Newark Unified School District, Thursday, 21st. of March 2019. Roll call.

[37] SPEAKER_22: President Rodriguez. Present. Vice President Thomas.

[42] Ray Rodriguez: She'll be here in a little while.

[44] SPEAKER_22: Member Martinez.

[45] Ray Rodriguez: Here.

[46] SPEAKER_22: Member Gutierrez. Here. Member John.

[49] Ray Rodriguez: I'm sure he'll be here. So we have a study session.

[59] SPEAKER_22: Did you want to do the new agenda item? That's a typographical error. OK.

[66] Ray Rodriguez: We were thinking about it, but we're not. Starting in future meetings, we're going to do the accepting the agenda right after roll call so that it covers everything that's on the agenda from closed session on. Do we have anybody in the public that would like I have a comment on the board study session. Superintendent Witt, can you tell us what's going to happen during the board study session, please?

[99] SPEAKER_13: Sure. We have a presentation from Climate Tech today, just to give us some ideas on how energy conservation and price securing can happen. So they have about 15 minutes of a presentation. Then we'll leave the other 15 minutes for questions by the board. We'll just get into questions and answers there. They're ready to go.

[124] Ray Rodriguez: Tyler, Gertman, you ready? I don't know. Get up first, if you don't mind, so we can kind of check you out. Make sure we want you to do this. Anyway, can you introduce yourselves? And then if you want us to move down, we're fine with it. Yeah.

[139] SPEAKER_13: I think we probably can see better from here, Tyler. OK. Yeah, that's fine. Introduce yourself and who's with you.

[146] SPEAKER_11: Yeah, Tyler Gertman, Regional Director for Climate Tech, been with them for about 13 years. And Jeff Bartel is my associate in these projects.

[157] Ray Rodriguez: Thank you. Go ahead, it's on you. Perfect.

[163] SPEAKER_11: We were asked to discuss approaches for the district to obtain really long-term savings, long-term cost savings for the general fund. Most districts that have move forward with an approach like this, have been able to achieve good substantial savings out of the general fund which could be utilized for other educational items, salaries, et cetera. And so we're just going to share some information and some experiences from other districts. This is not about climate tech and we basically ask at the end if this is of interest, you know, we fully encourage a competitive process or an RFQ. So just full disclosure on that up front. Conceptual conversations with staff, again, alluding to one of the first current challenges, the top priority is really budget constraints. And really trying to achieve as much general fund savings as possible for other benefits for the district. Alongside of that, too, is just the aging infrastructure. Windows, and we're going to jump into that just a little bit. But aging infrastructure has been piling up and be able to handle that to improve the comfort within the classroom. and specifically temperature control management, being able to make sure that, again, it's comfortable in the space but also the units, the heating and cooling units are turned off when it's unnecessary to be running. And then, you know, the limited staff resources, you know, many staff members are wearing multiple hats, just needing some extra resources and assistance to really get over the hill on this. below the bottom two are the desire to go green and go green potentially with solar PV depending on the economics and being really a site constraint type district, you know, which is mostly in the Bay Area, it plays a role in it. And so that's obviously a current challenge as well. Not every district, not every school is suitable for solar and that's obviously would be identified at a further phase or further step.

[278] SPEAKER_14: So in our conversations that we had with staff, these are some of the needs that were uncovered that could potentially be addressed by bringing in this funding from outside of your typical traditional sources and fund for the district. One of the areas was heating and cooling. You guys have done a lot of upgrades, and I can see them when we go around on heating and cooling on your permanent buildings. But one of the things we heard was that the portable classrooms need some love, both from the standpoint of the heating and cooling units and also roofing was another area that came up in our conversations. Tyler mentioned the temperature controls and the ability to give staff the tools that they need to be able to look at all of your heating and cooling equipment and to look at all of your irrigation equipment remotely from anywhere, from a handheld, from a computer, be able to monitor, schedule, and control that equipment. Huge efficiency improvement, huge in terms of saving both resources and saving dollars. And again, same thing, you guys have done a lot of work in your classrooms, either from Prop 39 or potentially from your bond or their bond work in terms of upgrading your lighting to LED. There's areas that just didn't have sufficient funding to do that. This would be another area that could be addressed through a program like this. I mentioned the roofing. One of the specific areas that came up in conversations was at Newark Memorial High School, The permanent buildings, I think it's in the admin. We haven't been to your campus, but I think that's the way it was. It's sort of those picture windows, the large picture windows is the way I'm envisioning it from the conversation. Single pane really needed to be upgraded in terms from a comfort standpoint in those areas. And then Tyler mentioned the renewables. So renewable energy, both PVs, photovoltaic system, I'm sure you've heard the phrase before. The other thing that's happening right now in this business is that the utilities are really changing the rules on how we all buy our power. It used to be how much power we buy during a month. Now it's really about when we buy that power. And it's getting real specific and it's actually moving into the evening hours because there's been so much solar that's been brought in and put on rooftops and school districts and commercial buildings. You see it when you drive around. And what that does is it's creating a situation where power is now more expensive during the evening hours than it was during the middle of the day, which it was before. So battery storage is something that's really becoming the buzzword in our industry, and that's something else that if you decide to move forward here, whoever's fortunate enough to work with you, I'm sure they're going to want to look at that from an opportunity standpoint to see, often makes really good sense with solar. And the last one is solar thermal. specifically for a swimming pool application. Our understanding is you have a pool. It would be something to look at. I'm not saying that it would make sense, but we always look at it from the standpoint of reducing your gas usage. Untapped funding petition. This is the numbers we got from you during the fiscal year. PG&E expenditure about 1.1, between 1.1 and 1.2 million. If you think about that, instead of thinking about it from a one-year standpoint, if you think about it, what would it be over the life of this equipment that we're talking about potentially installing here? You know, solar has a 30-year life. What does that look like? Well, if you take that 1.1 million and just You put a 4% utility increase, and you can make an argument that the utility increases have been a lot more than that over the last few years. We don't know what it's gonna be, but in this specific example, it's a 4% increase for the next 30 years. You've committed to spend, if you stick with status quo, over $63 million to PG&E. It's a huge number, and you think about it, instead of just thinking about the 1 million, you think about it over the next 30 years. And so in the bar chart there, you think about current, your existing operating conditions. What would happen if you were to implement these measures that Tyler and I are thinking about here for your district? Dropping that operating cost and using a portion of that savings to fund these improvements and then the part there on the top, that net annual budget relief would be the part that could be available in your existing budget for other things, in the classroom, you know, things in the classroom, salaries, et cetera. And then really what we're talking about here is more of taking a comprehensive approach, not just a solar project, but what does it look like from an energy efficiency? What type of deferred maintenance areas could a program like this address? And then also looking at the renewable, a real comprehensive for the most part, they're really good at going after funding. If there's funding through the utility, if there's bond money at the Prop 39, they go after it and they get that funding. And what happens is you're funding constricted. You get part of the way down the road with getting those upgrades and you run out of the funding. This is about, forget about that barrier any longer. This is about bringing that funding in to take care of it in a more of a comprehensive fashion and really see the deferred maintenance backlog relief And get that general fund budget relief that I think your district and many of the others that we're talking about need.

[619] SPEAKER_11: So looking at where does the funding come from for projects like this, right? You know, outside of capital, outside of bond dollars, where does the funding come from? So obviously the first source to go towards is the utility programs. Even with PG&E and Limbo and all the negative news regarding the bankruptcy, et cetera, they still have one of the best, most lucrative programs. versus any other utility in all of California. So definitely take advantage of that. State of California programs, we listed a few here. There's also about $620 million coming available specifically for battery storage and for public entities like school districts. There's also some local funding here through the Air Quality District as well for those type of projects. So a lot of local funding from the state of California, also the governor's office has some funding for these types of programs. Districts since the 80s have used low interest municipal financing as well. Again, that's the choice of the districts. And then also solar PV power purchase agreements. And we've talked to Kai about this a little bit in terms of really what it is, is it's switching the utility provider instead of buying it from PG&E. You're buying it from a third party who has constructed the solar panels at the sites that actually make fiscal sense. And you're buying it at a lower rate, and you're hedging against inflation from PG&E as well. And it allows public entities to actually take advantage of the federal tax credits that districts can't, because you don't pay taxes, right? And so having a commercial entity own that property and install it actually provides better value to the district. The terms can be 15, 20, 25 years. Again, that's all, you know, dealt at a later time for your specific case. Bosch funding, Clematek, you know, we're a full subsidiary of Bosch and one of the largest privately held company in the world, you know, dishwashers, cell phones, etc. Last year they invested about 20, 30 million dollars into public entities and that's available as well for most school districts. here in California. And then more recently, routine maintenance accounts, districts are seeing the cost of these types of programs increase year over year, especially in the Bay Area, 12, 15%. And so what they're trying to do is try to get more bang for the buck, more done now in terms of infrastructure improvements and sustainability improvements. And they're utilizing yearly RMA funds to go towards that. So there's some really creative financial mechanisms to be able to do some of this. And then obviously, the best district capital or bonds, if available, but in most instances, they are not. So just real quick here, I wanted to give you three examples. All of these districts are local, and they also went out to a competitive process to pick their provider. This instance is San Lorenzo Unified School District. I think you're all aware of that district just up north here. Before they entered in and moved forward with a comprehensive approach and equated HVAC systems, especially in the multipurpose rooms, inadequate lighting, and limited staff to really try to accomplish this. Also a lot of turnover that they had throughout the years. And then they have a central kitchen at the district office that they really needed to modernize because it was just an energy hog, for lack of a better term. They went out for an RFQ. Clem Tech was selected. 100% of the HVAC units were replaced and upgraded. Lighting was taken care of, standardized throughout the entire district in three separate phases of work. Was able to provide the technology to the staff to be able to be more efficient. And then obviously make the central kitchen more energy efficient. All without zero bond capital contribution. and providing around roughly $9.3 million in life cycle savings. They've done three phases of work. So they did a first phase, and then they came back two years later, did a second phase, and came back again this year and did a third phase. So they've been seeing some results and going along with an approach like this.

[859] SPEAKER_14: This is another Bay Area district. I think this one's Burlingame. Interesting district, little to no air conditioning, right on the water. And their biggest problem when we initially met with them was windows. And the reason this example's up here is because that was something that was mentioned here in our conversations. But literally, aluminum frame windows falling out of the buildings just completely rusted away, corroded. And the other thing, they really wanted to do SOAR and just hadn't been able to get it off the ground. We were able to put a program together that addressed all their antiquated windows, invested over $4 million of outside funding. They didn't put up any capital to do the program. And we're able to, I think they're about 80% of the district now, 80, 85% is totally powered by solar from each of their campus. So it's a very successful project, very creative one where there's little to no air conditioning and we're still able to do this project.

[925] SPEAKER_11: And then the last, Castro Valley. Again, just here on the east side, just a little further north. Inadequate HVAC systems. One of their big drives publicly, and they recently passed a bond to do this too, is to add air conditioning to their sites. Well, what does that do? That also increases energy, right? And in addition, irrigation issues and costs. You know, we all focus on the bigger dollar amount, which is electric, but you also look at the dollars increasing on the water side, especially from the drought. You know, costs per gallon have gone up significantly. So they had a large irrigation cost that they wanted to tackle. And then really just general fund relief. They were seeing cuts in their budgets and they really needed to see that. So utilizing, they utilized a competitive approach. At one of their sites were able to add air conditioning to their classrooms, improve some of the other HVAC systems. tackle the irrigation issues by providing staff with better technology to control their irrigation systems. And then receive about 30% utility savings directly off their general fund and back into the classroom. And additional benefits as well at the bottom. So really, what's the next steps? How does this move forward is really the next question. And if the district is interested, like other districts have done, like we just explained, typically, and we are big advocates for it, there's two different, going out for an RFQ. getting different firms to respond, not just Climatec, but others as well. Other, you know, quality trusted firms have been doing this for years. Get some of their qualifications. The district also has an option to negotiate through procurement legislation, but typically 95% of the time we see RFQs. Or the third option is status quo and keep piecemeal on the infrastructure and not really affecting the general fund. So there's really three options moving forward here. And with that, that's the end of our presentation. Thank you.

[1047] Ray Rodriguez: Thank you. Let me apologize a little bit. I thought I turned the mic on. We take pride in making sure that we're courteous and respectful. So when you said going out for an RFP, that would respond to it normally?

[1075] SPEAKER_14: Yeah, a couple things there. Yes, it's your question. We'd love to have that opportunity and we'll take our chances in that competitive environment. Our biggest competitor by a factor of 10 is Status Quo. And it's not the other, we have a lot of good competitors and they'll respond to this. But we'll take our chances in that competitive environment because we look at it, we can't win unless you folks make that decision to look at that comprehensive approach.

[1109] SPEAKER_20: I guess my question might be more for the superintendent if we in the future but if we were to go on the solar route with the facilities planning that's currently going on would any of that change or this just gets added on?

[1124] SPEAKER_13: It would be folded into the part of the process so we don't have duplication. Most of the facility master planning we're looking at now is silent on energy in the initial versions when the prior board majority had looked at doing the proposal for ADIS and facility master planning. At one point we had discussed about doing a facility master plan and an energy master plan and we kind of just focused on facilities. So I don't see that as a conflict because currently that was only for facilities master planning and I think it was also for long-term maintenance. Okay. So I don't see that as a conflict.

[1165] SPEAKER_20: Okay, and I guess the reason more was that why I was asking was since the facility planning is already in process, it just seems reasonable to decide on something like this sooner than later in regards to make sure that the facility planning can coincide. But I just wanted to clear that up. Okay.

[1190] Elisa Martinez: Thank you for the presentation. My question is around obviously before moving to an RFP is the feasibility assessment. This is just a presentation, I mean, because I think that's the key is what's the size of the price for us, right, before we start to try to move anything aggressively to an RFP. So the way I would look at it is we would have to hire someone to do a true feasibility and or sizing the opportunity for us or how does that work?

[1220] SPEAKER_11: So typically in this process, in RFQ, and this is what other districts have done, they'll put out an RFQ, they'll select a firm to be their partner to put the numbers together and collaborate with staff, not only in the needs, but the savings and cost, and then they bring that back to the board to make a decision on. Typically, most firms would do that at no cost, so you're not wasting time and money hiring a consultant. So there's plenty of good RFQs out there that other districts have used to pick a design build basically general contractor like we're talking about here today to do this comprehensive approach and as you're walking through the design phase you have exit hatches to not move forward if the numbers come back and aren't appeasing to the district.

[1261] Nancy Thomas: Thank you. This is as much for staff I think is for you but my Question is, how much have we already saved? You talk about piecemeal, but we have had our bond. We've replaced a large number of our HVAC systems. We have $6 million that we're going to start spending this summer on replacing even more of our HVAC systems. We have a Fund 40, which is a capital fund, where we have set aside over $2 million is still left in there after we painted our buildings to have a drought-tolerant landscaping and replace all of our irrigation systems. We've been killed with leaks in our irrigation system. And so we've already done a lot of this stuff. And I'm just kind of wondering if staff has done an analysis of how much we have saved or could save based on the projects we already have on the drawing board.

[1324] SPEAKER_16: So based on last year's actuals for utility bills, and compared to this year, we're anticipating that the expenditures for utility will increase by about $100,000.

[1337] Nancy Thomas: OK, but I'm wondering about the usage, not the cut. You know, they increased the price. I'm wondering based on, yeah, they increased the rates, but based on our usage over the last since we started the bond, I would really be interested in seeing how much kilowatt hours we're using and how much water we're using year by year to see have we gotten any benefit from all the work we've done already. And what is that benefit? And then that would feed into whoever, when we send the RFQ out, That would be part of it, I think, would be to have them estimate how much more, given we've already done a lot of this work, how much more of a reduction in our utility bills will solar give us.

[1389] SPEAKER_14: Yeah, maybe in the early days. Sorry, I interrupted you. One of the things I was going to say, sometimes we'll see in different RFQs, they'll state that. They'll say, here's what we've done recently in the last several years. And like in Prop 39 work for that would be a great example of the work that you were able to accomplish there. And this is what we've seen in savings from that today. And then that gives the people that are responding an idea of where, what you've done and maybe where other opportunities may be going forward.

[1420] Ray Rodriguez: Okay, thank you. So four of us, did you want to, did you have anything? Right, so I have just a couple of things. three of our board members are new. We've been basically talking about this probably going back 15 years. And it's been piecemeal. And we have some success. And we've had other firms help us. So I'm just trying to understand the process, because I don't want to just continue to talk about this. I either want to move on it or just continue to do what we're doing. And you said that's your biggest competitor, the district that decides they're going to do it. So my question is. If we go out for an RFP, now you mentioned another synonym. Someone to come in and help us. Is that what you were saying?

[1473] SPEAKER_14: So typically the RFP or RFQ, whatever we want to phrase this.

[1478] Ray Rodriguez: So what is RFQ? What is that?

[1480] SPEAKER_14: Qualifications. Request for qualifications as opposed to request for proposals. Some districts call it one or the other.

[1485] Ray Rodriguez: OK, so basically we're talking about the same thing then.

[1488] SPEAKER_14: You're selecting an energy services firm that would help you in a couple areas. One, they would perform this very detailed audit. And the outcome of that audit would be a series of recommendations to the district. And those recommendations would have a cost and a savings associated with it. The district could select some of those, all of them, or none of them.

[1506] Ray Rodriguez: No, I understand.

[1508] SPEAKER_14: And then the next step from that would be to implement those measures.

[1511] Ray Rodriguez: So let me just interrupt you just quickly. So if we, I think you said there would be no cost to that. Did I hear you right?

[1521] SPEAKER_14: Just so we're clear. Because that really got me going here. You're talking to one company. If that's our approach, you'll get other approaches from different companies. That's part of this qualifications process. Some firms may charge for the honors. Some may not. So that's something you're going to learn through this process.

[1537] Ray Rodriguez: So a lot of people think about doing this at their home, whether you just put solar or I have solar for my pool. And it doesn't work at all. It's just the pool's too big. It doesn't give me very much. So I know Ohlone College did a lot. And they put up little parking structures, right? And then they put solar on it. And some people even talked about innovative about school district, because most schools have fences. And how do you use the fence to bring in solar? Is that a possibility? I know that probably sounds far-fetched, but it just It just seems that there's so many possibilities. You have your roof, and then you put in parking structures. And that's probably one of the things you would do, is look at where can we put solar in, if solar is what we pick, and save some money. And that'll be part of whoever we hire to start the whole thing and do the feasibility study. And like Member Thomas, look at what we've already done and see how we can improve on it. And is that basically what it is?

[1610] SPEAKER_11: Yes, yes. And a lot of the discussion within the last six months has been even shade structures for the children in certain areas. And so during this process, put out an RFQ, select a firm, whoever that may be, and they'll walk you through all the different places where you could potentially put it, the shade, on the ground, wherever. And all that is a collaborative process to get to a point where you can see cost savings, what does this mean to your bottom line, so you can make an informed decision at that point in time.

[1640] Ray Rodriguez: And as far as getting paid, do any companies that you know work on a percentage of what they save the district or is it just you charge a consultant fee and then does it go both ways?

[1656] SPEAKER_11: So at the end of, so the RFQ and then they do basically an investment grade audit, right, at that point in time, a more in-depth audit after you select a firm. And then after the end of that, you make a determination whether you want to move forward with some, all, or none of the measures like Jeff stated. And in that implementation agreement, they're paid by constructing the project, by actually implementing the project. We're design-build general contractors. And so then we construct the project, and we're responsible for it. We can't have any change orders on the project whatsoever, so it's got to be fixed price. And then we're also accountable for the savings. So the question about, how's our savings looking? You know, there's resources that a firm would assist with and give you all the analysis on a monthly basis in terms of the performance and the monitoring of all the savings. So that's all included in that too.

[1704] Ray Rodriguez: So like a grant writer, you would put together ways that we can come up with the funding in order to pay for it?

[1710] SPEAKER_11: Yes, yes. As you're doing this investment grade audit, there's technical engineering and there's financial engineering. The technical engineering is what heating and cooling systems are we going to replace or windows or whatever or the solar, what locations. And the financial engineering is what are the five or six different financial sources out there that the district's comfortable with, that the board's comfortable with and making those decisions and then marrying those together to actually meet your expectations.

[1734] Ray Rodriguez: OK. So we're basically, you know, even though we're a small school district as far you know, the number of children that we have, the students, but we're very blessed in having, you know, a lot of property, you know, in each one of our schools. So, there's so many possibilities and I know Member Thomas and I will attest to it that we've talked about this for a while. And so, we're hoping that, you know, we can move forward on something like this. I mean, I am, I don't know if the rest of the board is, so that we can, you know, start saving money and which helps everybody.

[1771] SPEAKER_13: If I may, so I do have a good template for one of my peer superintendents in the county that is a very good RFP starting point. And what I would suggest if there's kind of a consensus of the board to look at this more is maybe to work with one or two board members with me to shape the RFP. I'd rather say RFP, more familiar with that. And just kind of think about that structure. The example template I've been given has a lot of protections for our district. And the reason I got Climate Tech was a good firm to bring in to talk to us is they've done some work in the Bay Area, San Lorenzo, Castro Valley, Burlingame. And I think some next steps I would recommend is I'm going to ask for superintendent recommendations so I can check. And I'd like board to board to make some calls to those board members to see how they worked with this company and how they did the process so we could learn how to shape this. That would be my recommendation. As you know, they're not They are, there's nothing to vote on with them tonight. I just wanted to get a sense if the board wants to look at an RFP. I have a template that we can shape with a couple board members and then we can decide how we move forward.

[1843] Ray Rodriguez: Now if you go out with an RFP, I'm sorry go ahead Nancy.

[1845] Nancy Thomas: I was just saying that you know I've been to CSBA conventions where I've talked to other energy companies, maybe just having one or two more come in and give us a half hour presentation at future meetings. We don't It's not that we have to move on it immediately, but just to kind of begin to understand the approaches.

[1869] SPEAKER_13: That may help us with the content of the RFP. Yeah, right.

[1872] Ray Rodriguez: Now, the RFP, with your experience, there's positives and there's always negatives. Now, does the RFP restrict you to accept the lowest responsible bid? No.

[1887] SPEAKER_11: No, you're selecting a firm based mostly on qualifications and the pricing aspect of it is really how much does it cost to do this investment grade audit? And many firms will respond and give you their approaches and some of those details within, there's many good templates out there that multiple companies have responded to in order to give you all the approaches and what their benefits are versus, you know, others.

[1911] Ray Rodriguez: So recently we were approached by one of our partners and very into the labor, where they're looking any time somebody comes in and does work locally, they're looking for local to hire local people. Is that something that? Yes.

[1927] SPEAKER_14: It comes up for almost every project.

[1929] SPEAKER_11: Right. I would imagine. Some projects have a community workforce agreement that's signed for local labor use, first priority, things like that.

[1935] SPEAKER_14: And just one other thing on your question. Your question was a really good one. There's legislation in California called California Government Code 4217. It's written as an encouragement for public agencies to do energy conservation projects. And as long as it saves energy, as long as it pays for itself over the useful life of that equipment, you folks define the criteria for procurement. Could be best value, it could be references, technology, all those types of things, and you define it. It's really a neat piece of legend that's been used hundreds and hundreds of times.

[1969] Ray Rodriguez: Now, we're supposed to go to closed session. Superintendent, how long is the closed session?

[1974] SPEAKER_13: I think we need the rest of the time for closed session.

[1976] Ray Rodriguez: OK. OK. So we have to go, but thank you so much. Thank you very much. Thank you, gentlemen. Thank you. OK. So does anyone want to approach the board on any items that are in closed session? Item 3.1, Public Employee Discipline and Special Relief Complaints. 3.2, Public Employee Performance Evaluation, the superintendent. 3.3, expulsion case. 3.4, expulsion case. Anything else? That's it, right? Okay. 6.11, critical session. Thank you.

No minutes available.