While we understand no one likes to lose money on a deal, it takes a lot of gall to ask someone to pony up the difference between the price you “guaranteed” and the actual cost of a project… even if the money has been found to pay for that difference.
That’s just what the Ameresco company has asked the Oroville School Board after going $180,000 over their guaranteed cost of installing a new geothermal heating and cooling system at high school. They say the more “robust” equipment they installed and the unexpectedly high cost of well drilling and trenching led to increase. They stand by their guarantee but still asked the board to consider paying them the $180,000 in potential incentives the district would realize for installing such an energy efficient system. They say the district could turn that money over to them and still get a HVAC system that returns considerable energy savings – enough to pay for itself in 10 years. The $180,000 in incentives, based on a BPA formula, would not have happened without the more “robust” equipment they say. So, why not consider giving them that money?
It’s pretty nervy to ask the school district to “gift” their company money that should remain in the district to fund other projects, especially when the feds and the state continue to cut back on what they’re willing to fund within the school district — passing it on to the district’s taxpayers. The money could be used to make further energy improvements to both school buildings or to fund putting devices like iPads in each student’s hands – a goal the board reaffirmed at their last meeting.
Ameresco representatives said they based their guaranteed price on the cost to build the HVAC system at elementary school. They said they took into account the fact that system was now six-years-old and costs would be more. They also said that there wasn’t enough time to adequately design the system. It seems like before a company bids on a project they should have their numbers more firmly in place, especially if they are going to make a guarantee on the final price.
At the last board meeting they also didn’t seem to be able to show just how the company’s mistakes added up to an extra $180,000. Even if they could, that doesn’t give the board the right to turn over what is essentially taxpayer money to make up for the company’s losses – or to use their words to make them “whole.”
They said they’d stand by their guarantee no matter what the board’s decision. That’s admirable, that’s the kind of statement that will ensure their continued good reputation. It’s too bad they sound like they’re going to lose money on the deal, but if you can’t do it for what you say and expect to get paid the difference, then the guarantee is worthless. If you stand by what you say then that will bring you future business.
When the original remodel of the high school was done somewhere along the line the district was only paying about half of the actual price of the electricity being used. This went on for years until the mistake was found. Did the PUD say they’d forget about the money that was owed the utility? No, they said they were not legally able to “gift” the district the cost of that extra power that hadn’t been paid for, even though it was one public facility to another. We’re still paying back the PUD each month and will continue to do so until that debt is retired. If the PUD can’t gift money to the school district, a public entity, how could our school district gift money to a private corporation? They couldn’t and they shouldn’t.
The money should be used for the education of our students and nothing else.