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Procedures for the Joint Funding of Capital Works in Schools

April 2013

TABLE OF CONTENTS

1 INTRODUCTION 4

1.1 Purpose 4

1.2 Objectives 4

1.3 Types of School and Community Capital Funding Initiatives 4

2 SALE OF ASSETS (INCENTIVES) PROGRAM & CODE FACILITIES 5

3 DELEGATIONS 5

4 JOINT FUNDING OF FACILITIES BY SCHOOLS AND THE DEPARTMENT OF EDUCATION AND COMMUNITIES TO PROVIDE FACILITIES THAT COMPLY WITH THE SCHOOL FACILITIES STANDARDS

6

4.1 Purpose of Initiative 6

4.2 Assessment of Application for Funding 6

4.3 Process for Obtaining Approval 6

4.4 Remittance of Funds 7

4.5 Monitoring Through PMM 7

5 CONTRIBUTIONS BY SCHOOL COMMUNITIES AND OTHER PROVIDERS TOWARDS THE ENHANCEMENT OF CAPITAL PROJECTS IN SCHOOLS DURING PLANNED CAPITAL WORKS

8


5.2 Management of the Work 8


6 SCHOOL AND/OR COMMUNITY FUNDING OF FACILITIES THAT ARE ABOVE THOSE REQUIRED UNDER THE SCHOOL FACILITIES STANDARDS

9


6.2 Ministerial Approval Required 9


TABLE OF CONTENTS

7 THE APPLICATION PROCESS 10

7.1 How to Apply 10

7.2 Updating of Existing Applications 11

8 MANAGEMENT OF SCHOOL AND COMMUNITY FUNDED PROJECTS 11

8.1 Major Capital Works 11

8.2 Minor Capital Works 11

8.3 Use of Specialist Project Managers 12

8.4 Use of Contract Documents 12

8.5 Developing a Budget 12

8.6 Managing Project Costs and Delivery Schedules 13

9 RESPONSIBILITIES AND DELEGATIONS 14

9.1 School Principals 14

9.2 School and/or Other Contributor 14

9.3 Asset Management Unit 14

9.4 Asset Management Directorate 15

10 FURTHER INFORMATION 15

APPENDIX A – APPLICATION FOR SCHOOL AND COMMUNITY INITIATIVE FUNDED CAPITAL WORKS

16

SCHOOL AND COMMUNITY INITIATIVES FOR THE FUNDING OF CAPITAL WORKS IN SCHOOLS

1 Introduction

1.1 Purpose

Schools and their communities have a need for a range of facilities to enhance their educational and social objectives. Many of these facilities are similar in nature and it therefore makes good sense to share such facilities wherever possible.

Schools and their communities compete against other state-wide priorities to secure capital funding for new and upgraded facilities. School and Community Initiatives for the Funding of Capital Works in Schools encourages schools and their communities to participate in the provision of facilities through cost sharing. For schools this may mean getting facilities sooner. For communities this may mean an increase in the standard of facilities provided in schools for use by the wider community.

1.2 Objectives

The major objectives of School and Community Initiatives for the Funding of CapitalWorks in Schools are to:

Facilitate schools achieving facilities compliant with the School Facilities Standards earlier than if they had to wait for full government funding.

Allow schools and communities to add to facilities that comply with the School Facilities Standards, if their funds permit, during government funded capital works projects.

Share the high cost of capital facilities with other service providers and increase the utilisation rate of school facilities.

Promote goodwill, independence and a sense of ownership in school communities.

1.3 Types of School and Community Capital Funding Initiatives

There are three types of School and Community Initiatives for the Funding of Capital Works in Schools. Each is discussed in detail in the ensuing sections:

Joint funding by schools and DEC to enable schools to achieve their code facilities ahead of others (Section 4).

School communities and other providers contribute to the enhancement of capital projects in schools during planned capital works (Section 5).

School or community funding of code or above code facilities (Section 6).

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2 Sale of Assets (Incentives) Program & Code Facilities

Under the Sale of Assets (Incentives) Program schools may apply to dispose of surplus land and use a portion of the net proceeds to fund the provision of Code facilities. Schools often use these funds to contribute towards the provision of capital works on the site.

Code facilities refer to DEC’s current School Facilities Standards for the provision of facilities in schools. New schools are built to the latest building standards.

These standards have changed over time and many older schools do not have all the facilities or the size of facilities that new schools have.

Incentive funding cannot be used by schools to finance above code facilities.

Further information on the Sale of Assets (Incentives) program can be obtained from the Asset Management Unit.

3 Delegations

Schools should ensure that officers have the appropriate authority to approve works and incur expenditure as outlined in the School Manual on Financial Management.

The following maximum delegations apply:

Principal, High, Central 1, Primary 1 & 2 $150,000Principal, Primary 3 & 4 and Central 2 &

3$75,000

Principal, Primary 5 and Central 4 $75,000Principal, Primary 6 $75,000

Where the cost of the goods is greater than the Principal’s delegation to incur expenditure, approval to proceed with the purchase must be obtained from the Director or the Executive Director as appropriate.

Schools should also be aware that:

No capital works are to be undertaken on the site without the approval of the Asset Management Unit Manager;

The approval of the Asset Management Unit Manager is required to enable the school to manage an approved capital project locally. In such cases the school must use a specialist project manager to manage the work unless the Asset Management Unit Manager gives an exemption;

The Asset Management Unit Manager must approve the preliminary plans and scope of works before any detailed design work commences; and

All Joint Use and Development Agreements must be reviewed by the Asset Management Unit which will arrange for the approval by the appropriate officer within the Asset Management Directorate.

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4 The joint funding of facilities by schools and the Department of Education and Communities to provide facilities that comply with the School Facilities Standards

4.1 Purpose of Initiative

Joint Funding is an annual program which is approved by the Minister for Education for inclusion in the DEC Capital Works Program.

The joint funding of capital works in schools encourages schools and their communities to contribute to the provision of facilities through cost sharing, allowing schools to upgrade or get new facilities faster and increase the standard of facilities provided in schools for use by the wider community. The total value of the project must be $10,000 or more and the upper limit of the Department’s contribution on any one project is $300,000.

4.2 Assessment of Application for Funding

The level of DEC funding available each year for Joint Funded projects is limited. All applications for Joint Funding are assessed and prioritised locally by the Asset Reference Groups; and then on a statewide basis by the Asset Management Directorate. The factors considered in determining priority may include:

Educational need Date of application Whether the application is for code facilities Long term viability of the school The level of Joint Funding previously provided to the school Whether the school is in a rural/remote area Whether the school is in a socio-economically disadvantaged area The environmental sustainability of the proposed works

4.3 Process for Obtaining Approval

The following requirements apply to Joint Funded projects:

A formal application must be submitted to the Asset Management Unit (refer Appendix A);

The project must be approved by the Minister for Education; Approval is subject to DEC funds being available; The maximum DEC contribution will only be up to 50% of the value of the

standard code entitlement for the facility and will not exceed $300,000 on any one project;

The total value of the project must be $10,000 or more. The school must be able to demonstrate its long term viability with respect to

enrolments; The school must provide evidence that its portion of the funds required to

undertake the works are available; The proposed facilities must be fit for purpose and comply with all relevant

standards and legislation;

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Projects with a value of $500,000 or more must be managed by the DEC Capital Program Delivery Unit;

Management of projects with a value of less than $500,000 lies with the Asset Management Unit which may delegate responsibility to the school in certain circumstances;

Where the school manages the capital project it must comply with DEC’s Procedures for Locally (School) Managed Capital Projects;

The completed facility is owned by the Minister for Education; and, Joint funding is not available for projects which commenced and/or were

completed prior to the submission of an application by the school.

4.4 Remittance of Funds

Where DEC is contributing funds to the provision of Joint Funded capital projects there are a number of ways that funds can be made available to the school.

The most common method is that, once the project is approved, DEC’s agreed contribution will be deposited into the school’s bank account. This money is a tied grant and must only be used for the approved works.

In some instances the school may have already completed the work pending the availability of DEC joint funding monies. In these circumstances DEC will reimburse the school for the value of its agreed contribution after the application has been approved for funding. It should be noted that DEC will only consider funding projects in this manner where the school has submitted an application for joint funding prior to commencing work.

Where the school intends to use NSW Public Works for project management services, NSW Public Works has made it a condition that they deal through the Asset Management Unit rather than directly with the school. In such cases, the school will be required to remit its component of the funds by forwarding a cheque to the Asset Management Unit. These monies will be deposited into the trust account and will enable the Asset Management Unit to make payments as and when required.

4.5 Monitoring Through PMM

All joint funded projects are included on the Programs Management Module (PMM) or the Department’s Asset Management System. The Asset Management Unit should liaise with schools regarding the progress of these projects and include notes in PMM on the key milestones and issues including (where applicable):

Approval of the design by the Asset Management Unit Manager; How the work is being procured; When the development goes to tender; When work commences; and When the project is completed.

5 Contributions by school communities and other providers towards the enhancement of capital projects in schools during planned capital works

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Under this initiative local government, school communities and other providers are encouraged to contribute to the enhancement of capital projects in schools during planned capital works. This is an excellent way for schools to achieve code facilities or to obtain facilities above the code provisions. Any above code facilities requested by the school must be fully funded by the community partner as DEC does not contribute to above code facilities in schools. DEC will include the additional works in its capital works project during the planning and design phase. Examples include increasing the size of a hall, gym, multi-purpose centre or performance workshop; including a space for a community meeting room or community library; or adding a stage to a gymnasium facility.

Where DEC’s capital project has already been approved by the Minister and Treasury before the community contribution was negotiated, DEC may have to seek additional approvals to enable the enhancement in the scope of works and the cost of the project.

5.2 Management of the Work

The school or community funded work will be incorporated into the design and construction process of the main capital project and will be managed by either the Asset Management Unit (for projects with a total value of under $500,000) or the DEC Capital Program Delivery Unit.


In order to obtain approval for enhanced facilities funded by community contributions during planned capital works the following criteria apply:


The capital project must have Ministerial approval for planning; The community, local council or school must provide written advice to either

the Asset Management Unit Manager or the Capital Program Delivery Unit (depending on who is responsible for delivering the project) of its intention to contribute to the facility within 4 weeks of the first meeting with the school to discuss the approved project;

The process for obtaining approval for this type of project is detailed below:

At the completion of the concept phase of the planning process the community, local council or the school must indicate, in writing, to either the Asset Management Unit Manager or the Manager, Capital Program Delivery Unit, the extent of work sought and the financial commitment being offered;

The financial contribution must allow for management, design and construction fees associated with the additional work. The additional work must not involve any additional costs for DEC. Further information on the appropriate allowances to make for such items can be found in the Procedures for Locally (School) Managed Capital Works ;

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The work will be managed by either the DEC Major Works Unit or the Asset Management Unit as part of the existing capital works project;

Where the facility is to be jointly used by the school and the other community contributors, the community partner must be prepared to enter into a Joint Use and Development Agreement with the Department, including sharing of running and maintenance costs of the facility, and understand that the ownership of the facility rests with the Minister for Education. Further information is available in the Community Use of School F a cilities Implementation P rocedures; and

Prior to the calli n g of tenders the school/community must forward a cheque for its full contribution to the Asset Management Unit or the Capital Program Delivery Unit (depending on who is delivering the project) for deposit into a Trust Account. No interest is earned on this account.

6 School and/or community funding of facilities that are above those required under the School Facilities Standards


To facilitate the provision of facilities on school sites from which the school gains a benefit. These facilities would be above those the school would be entitled to under the School Facilities Standards and be funded by the school; school and community; or community. There is no limit to the level of school and/or community investment as the Department will only provide a site. The completed facility automatically becomes the property of the Minister for Education.

Examples of this type of funding include the provision of a performing arts theatre, a fitness training track or an additional gymnasium or sports hall; or the construction of a swimming pool.

6.2 Ministerial Approval Required

The approval of the Minister or their delegate is required for all capital works projects undertaken on DEC sites. This applies regardless of whether the work is to be funded by DEC, the school, the community or some other source. Before undertaking any work at the school details should be provided to the Asset Management Unit which will arrange for the necessary approvals.

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The project must be approved by the Minister for Education or their delegate; The facility may be above code entitlement but must not require any funding

from the Department. There is no limit to the school or community investment;

The school must clearly demonstrate there is widespread school community support for the proposed facility;

The community contribution can be made up from other state, federal or local government contributions. Special purpose grants may be dealt with under other arrangements. Further information can be provided by the Asset Management Unit;

The school must be able to demonstrate its long term viability with respect to enrolments;

The proposed facilities must be fit for purpose and comply with all relevant standards and legislation;

Where the facility is to be jointly used by the school and the other community contributors, the community partner must be prepared to enter into a Joint Use and Development Agreement with the Department, including sharing the running and maintenance costs of the facility, and understand that the ownership of the facility rests with the Minister for Education. Further information is available in the Community Use of School F a cilities Implementation P rocedures; and

Where projects have been built above current school facilities standards, the school or other contributor to the project must be prepared to pay for the running and maintenance costs for the facility or the above code portion of the facility.

7 The Application Process

7.1 How to Apply

Schools must submit applications for Joint Funding on the appropriate Form (provided at Appendix A) to their Asset Management Unit by the end of Term 1 each year, or by the due date as notified by the Asset Management Directorate.

Application for other types of School and Community Initiatives for the Funding of Capital Works in Schools projects can be submitted at any time.

Generally the Principal is required to sign the application form even where the contribution is being made by an external source. However in some circumstances, such as when a new school is being built, it may not be possible for the Principal to sign the form in which case the community partner can submit the application directly to the Asset Management Unit.

When preparing the application it is recommended that the school work closely with the Asset Management Unit to ensure that all issues have been considered and costed into the project.

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7.2 Updating of Existing Applications

The Asset Planning Unit will initiate an annual review of applications to ensure that they remain current. Asset Management Units will be asked to liaise with schools to determine whether applications which are more than two years old are still required and whether the details on the application are still current.

Any changes to the scope of the project or cost of the work should be notified to the Asset Management Unit by submitting a new application. The new application should clearly show that it is intended to supersede an existing application and a copy of the existing application should be attached to the form.

8 Management of School and Community Funded Projects

The way that a School and Community Initiatives for the Funding of Capital Works in Schools project is managed depends on the value and associated risk of the building works.

8.1 Major Capital Works

All projects which have a total budget of $500,000 or more are considered by the NSW Government to be Major Capital Works. There are strict procurement requirements for projects of this size which DEC must comply with and therefore such projects are managed by the Asset Management Directorate.

Once the project has been approved by the Minister for inclusion in the Capital Works program a Project Director from the Asset Management Directorate will contact the school to discuss the procurement process, confirm the scope of works and commence work on the delivery of the project. A representative from the school is part of the Project Control Group responsible for the successful delivery of the project and will be included in all major decisions.

8.2 Minor Capital Works

Projects with a total value of less than $500,000 are usually managed by the Asset Management Unit. However, in some circumstances, schools may be given approval by the Asset Management Unit to manage the project locally, provided all Commonwealth, State, Local Government and Departmental requirements are met. Where the works are straightforward, have a low risk, or are available under Government Contract the school will generally be given approval to manage the works locally.

DEC has developed comprehensive Procedures for Locally (School) Managed Capital Work s . It is important that the school obtains a copy of these procedures and ensures that the work is designed, constructed and managed in accordance with these requirements.

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8.3 Use of Specialist Project Managers

Unless an exemption is given by the Asset Management Unit Manager, all locally managed projects which have a total cost which is above the Principal’s financial delegation must be managed by a specialist Project Manager. One of the main benefits of engaging a specialist Project Manager is their expertise in minimising project risks including compliance with Work, Health and Safety requirements.

The main specialist Project Manager used by DEC is NSW Public Works. If the School wishes to engage them to provide these services NSW Public Works has requested that, in order to ensure DEC priorities are met and all parties are aware of their responsibilities, the engagement is through the Asset Management Unit and not directly with the school. Further details can be obtained from your Asset Management Unit on telephone 132 779.

Where NSW Public Works or another prequalified specialist Project Manager is not used it is important that competitive tenders are called for these services and that this is supported by appropriate contract documentation.

For consultancies valued at under $30,000 the NSW Government requires that one written proposal is obtained. Consultancies over this value require written bids from at least three service providers.

8.4 Use of Contract Documents

Whenever capital works are undertaken on school sites there should be proper contract documentation to ensure that prospective tenderers and the successful contractor are fully aware of the scope of works and their rights and responsibilities under the contract. Proper scoping of the works is important because any omissions, ambiguities or inconsistencies could result in cost increases, or the work being inferior in quality or not meeting requirements.

Where NSW Public Works or the Asset Management Unit is not undertaking the work, the school or its specialist Project Manager is required to use the DEC Minor Works contrac t .

Further information on the calling and awarding of tenders and the management of capital projects is available in the Procedures for Locally (School) Managed Capital Works.

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8.5 Developing a Budget

It is important that the school accurately assesses the cost of the works before submitting the application form as DEC will not contribute additional funds should cost overruns eventuate. Some of the major issues which should be considered include:

whether a specialist Project Manager is required (10-12%); whether an allowance for project variations has been included in the budget

(10%); whether development consent is required; whether there is lead based paint, asbestos, termite infestation or

contaminated soil (fibro, lead, chemicals etc); the location of in-ground and hidden services and the capacity of existing

services (power, stormwater etc); and whether the facilities have heritage significance.

There will be a cost to address these issues if identified and this should be factored into the project budget. Advice may be required from the Asset Management Unit as to an appropriate allowance for such issues. In some instances, specialist advice may also need to be sought to fully determine the extent and cost of the additional works.

Further information is available in the Procedures for Locally (School) Managed Capital Work s .

8.6 Managing Project Costs and Delivery Schedules

Schools will need to ensure that expenditure on locally managed projects meets the cash flow and school operating requirements. To achieve this, a delivery program should be developed which lists the key milestones and activities which need to be completed within the required timeframe. The school should then regularly review this program to ensure that the work remains on schedule. Once the preliminary concept work has been finalised information on the scope and cost of the project, and a copy of any plans or drawings developed, should be submitted to the Asset Management Unit for approval prior to any detailed design work commencing.

The estimated final cost of the project should also be regularly reviewed. Any additional costs arising during design and construction must be met in the first instance from the project contingency. Where there is no contingency remaining any cost overrun must be met by the school or community contributor as DEC will not provide any additional monies. To minimise the chance of cost overruns non-essential variations, such as a change to the scope of works, should only be approved at the end of the project when the school is confident that there will be adequate funds available to pay for the works.

Further information is available in the Procedures for Locally (School) Managed Capital Work s .

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9 Responsibilities and Delegations

9.1 School Principals

School Principals in consultation with the school community, local council, local community or other contributors are responsible for advising DEC, in writing, of intentions to contribute to the enhancement of capital projects during planned capital works.

School Principals in consultation with the school community, local council, local community or other contributors are responsible for preparing the application seeking approval for any projects to be funded under School and Community Initiatives for the Funding of Capital Works in Schools.

School Principals are required to seek advice from their Asset Management Unit when considering capital works options, preparing applications or developing Joint Use and Development agreements.

School Principals must provide the Asset Management Unit with detailed plans of any capital works which are being managed locally before calling tenders or commencing construction.

School Principals must advise the Asset Management Unit of any change to the scope or cost of an approved project.

School Principals must ensure that there is proper contract documentation for the work; and that all work above their delegation is managed by a specialist Project Manager.

9.2 School and/or other contributor

The school or other contributor/s are responsible for raising the funding for the school’s share of any School and Community Initiatives for the Funding of Capital Works in Schools funding proposal and for ensuring that the money is available prior to the submission of an application to the Asset Management Unit.

9.3 Asset Management Unit

Asset Management Units are responsible for providing assistance and advice to schools regarding applications for School and Community Initiatives for the Funding of Capital Works in Schools capital projects, advice for best option selection and the development of Joint Use and Development Agreements.

Asset Management Units will undertake a risk assessment of all approved School and Community Initiatives for the Funding of Capital Works in Schools projects to determine if they should be managed by the Capital Program Delivery Unit, Asset Management Unit or school.

Asset Management Units will annually review the currency of all unfunded Joint Funding applications which are more than two years old.

Asset Management Units will organise for approved funds to be placed in the school’s bank account.

Asset Management Units will liaise with the school on the progress of the project and make the appropriate notation in the Project Management Module.

9.4 Asset Management Directorate

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The Asset Planning Unit will review and prioritise all applications for Joint Funding and develop a program for the consideration of the Minister for Education.

The Asset Planning Unit will initiate an annual review of unfunded Joint Funding Applications by Asset Management Units.

The Executive Director, Asset Management must approve all Joint Use and Development Agreements.

10 Further Information

If the school has any queries on the process for applying for or managing School and Community Initiatives for the Funding of Capital Works in Schools projects they should contact their Asset Management Unit on 132 779.

Where the work is to be managed by the school reference should be made to theProcedures for Locally (School) Managed Capital Works .

Where the work involves community contributions the school should refer to the Community Use of School F a cilities Implementation P rocedures

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Appendix A – Application for School and Community InitiativeFunded Capital Works

Note: Please read from the Asset Management Intranet site the Procedures for School and Community Initiatives for the Funding of Capital Works in Schools and the Procedures for Locally Managed Capital Works before completing this form.

1. APPLICANT STATUSDOES THIS APPLICATION REPLACE / UPDATE A PREVOUSLY SUBMITTED FORM Yes / No

If yes, please attach a copy of the existing application for the project

2. APPLICANT INFORMATIONSCHOOL CODENAME OF SCHOOLADDRESS OF SCHOOL

Postcode:

PROJECT CONTACT PERSONName: Position:Telephone: Email:

3. TYPE OF APPROVAL SOUGHT (Please tick one box only) %Funding

Joint Funding

Contribution During Planned Capital Works

School and Community Funding for a Facility on a School Site

4. PROJECT SCOPE AND COST (refer s.6 of the Procedures for Locally Managed Projects)

WORK TO BE UNDERTAKEN? (Please provide as much information as possible):

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WAS A SITE INVESTIGATION UNDERTAKEN BEFORE FINALISING THE SCOPE AND COST OF THE WORKS? IF YES, WERE THE FOLLOWING FACTORS CONSIDERED:

Yes / No

Health and Safety – e.g. does the project involve lead based paint, asbestos, termite infestation, contaminated soil, etc

Location of in-ground services

The capacity of existing services

Other (specify):

LOCATION OF WORK? (Location on Site, Building ID etc):

Construction Costs

Building Works

Allowance for Variations (10%)

Total Construction Costs (A)

$

$

$Fees

Project Management Fees (10%)

Application Fees

Other Fees (Provide Details)

Total Fees (B)

$

$

$

$Total Project Cost (A+B) $

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5. PROJECT JUSIFICATIONHOW WILL THE PROJECT BENEFIT THE SCHOOL / COMMUNITY?

6. FUNDING OF PROJECTContribution of SchoolOther Community Contributions (Please specify)Funds Sought from DEC (Joint Funding projects only)

$$$

Total Funds (Must equal the project cost in Section 4) $Are the funds available now (Yes / No).If not how will the funds be raised and when will they become available?

7. PROCUREMENT STRATEGYHOW WILL THE WORK BE PROCURED?Government Contract Limited Tendering Open Tendering

NSW Public Works Asset Management Unit Asset Management Unit

Specialist Project Manager

Name:

Contact:

Qualifications / Experience:

School / Community Rep

Name:

Contact:


School / Community Rep

Name:

Contact:


WHO WILL MANAGE THE PROJECT?

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8. CERTIFICATION

I _________________________________ certify that:

The information in this application is accurate and comprehensive;

The proposed works are fully supported by the community;

I will use the services of a specialist Project Manager who has the experience outlined in the Procedures for Locally School Managed Capital Works section 4.2.3 for all projects which are above my financial delegation; and

All projects managed by the Asset Management Unit, NSW Public Works or procured using a Government contract will be covered by using the Minor Works contract.

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