‘Unusual times’: Bids for geothermal projects come in much higher than expected

Jefferson and W-K Elementary Schools

Skyrocketing costs of labor and materials have thrown a wrench into the Winona Area Public School board’s plans to improve air quality at its two historic elementary schools. 

In November 2021, the board approved to sell health and safety bonds in the amount of $16 million to fund the design and construction of geothermal dehumidification systems at Jefferson Elementary and Washington-Kosciusko Elementary. 

However, the bids received last month came in nearly 60 percent higher than anticipated, Wold Architects and Engineers partner Paul Aplkowski told the board at Thursday night’s meeting

“I’m at a loss for how to figure it out right now, which is not my favorite way to come and talk to you,” Aplikowski said. “The past two weeks, we’ve had several bids all across the state rolling in, and it all puts a similar pressure on budgets. Some are right in line with these bids, while some are exceeding what we see here.”. 

Three companies submitted a bid to complete both projects — Market and Johnson ($21.53 million), Fowler and Hammer ($21.65 million) and Wieser Brothers ($23.47 million). Brennan Construction submitted a bid for the Jefferson project only, coming in at $12.24 million. 

Several board members acknowledged that this is a problem that is happening all across the country in all areas, and is not limited to construction projects. 

“These are unusual times everywhere,” board member Karl Sonneman said. “This is not what you’ve done, this is not what we’ve done.”

The board approved a motion to reject the bids, which was recommended by Wold. It will now have to decide what happens next. 

The geothermal projects could be modified somewhat to reduce the cost, but Aplikowski warned that it would not get the board below its original budget. There is also an option to go out for bids by explicitly separating the projects to see if bids come in lower for one project instead of two. 

The board also expects to hear from Jeff Seeley from Ehlers, the school’s consultant when it comes to bonding projects, who can explain more about the financial options available.

The board will also want more advice on how to proceed with a proposed referendum set to go before the voters in April 2023. The board was planning on a two-question referendum totalling $86 million, although ballot language has not been finalized. 

While it certainly was not the news the board wanted to hear, board members were thankful for the due diligence on the part of Wold and the work the company will continue to do on the behalf of the district and local taxpayers. 

“We really appreciate your attention to this and the urgency you are showing,” board chair Nancy Denzer said. “I really appreciate that kind of attending and care for the school district.”