So let's break even on the float. Kind Regards,
Scott Clary 617-968-5769 Sent from a mobile device - please excuse typos and errors On Wed, Jun 4, 2025, 8:05 PM Garrick Niemiec <[email protected]> wrote: > > ---------- Forwarded message --------- > From: Garrick Niemiec <[email protected]> > Date: Wed, Jun 4, 2025, 8:04 PM > Subject: Re: [LincolnTalk] Trying to make sense of the statement about CC > costs > To: Andrew Payne <[email protected]> > > > You clearly don't understand the nuances of design and building projects > and associated contract forms > > On Wed, Jun 4, 2025, 6:03 PM Andrew Payne <[email protected]> wrote: > >> David C. wrote: >> >>> “cutting $2.3M out of the project would require a complete redesign >>> (estimated cost $1.5M to $2.0M)” >>> >>> This stretches the bounds of plausibility. Anyone familiar with >>> construction projects knows that cost-cutting trade-offs are often >>> necessary, and rarely do they require paying full architectural fees all >>> over again. >>> >> There's not a smooth linear slider where we can just "uncheck boxes" and >> costs come down. >> >> Sometimes, you can't materially reduce scope or cut costs without >> triggering a redesign. For example, if you need to materially reduce >> costs, that may trigger a footprint reduction, which may trigger a room >> reduction, which triggers a layout change, which triggers a roof change, >> etc. If it's already highly constrained (as this project is), you may need >> to look at a couple of conceptual designs before committing to a new >> redesign, review with all the stakeholders, renegotiate tradeoffs, etc. >> And, because of the municipal process, we need to generate a new full set >> of design documents so that bidders have enough detail to submit new bids. >> >> The CCBC-provided redesign cost estimate may be "conservative", but it's >> not surprising if it's close to a design-from-scratch cost since a redesign >> means going back to nearly the beginning. >> >> “and a delayed timeline, resulting in further escalated costs ($1.5M to >>> $2.0M)” >>> >>> Have they never heard of the time value of money? I’d rather see my >>> taxes levied two years from now than today. Delaying the project means >>> capital remains available for more productive uses. Even if the funds are >>> already allocated, they would be earning interest—likely 4–5%. Any >>> escalation estimate should be offset by that. Moreover, our record for >>> predicting escalation is weak at best. We should avoid baseless speculation. >>> >> To clarify: the majority of funds (~$16m) would be bonded, and that >> would happen *after* we are "go flight!" with an accepted bid, etc. At >> that point, we're paying interest on those funds and MA anti-arbitrage laws >> prevent us from earning more interest/return than we're paying on float. >> Generally, if bonding is involved, we can't arbitrage away cost escalations >> in any meaningful way. >> >> Do residents prefer to pay escalated costs in ~2 years *vs* current >> costs, as you suggest? Maybe; I'd be very surprised. That's why we vote. >> >> One if-you-think-community-centers-are-expensive-try-two-weddings >> resident's view, >> >> -andy >> -- >> The LincolnTalk mailing list. >> To post, send mail to [email protected]. >> Browse the archives at >> https://pairlist9.pair.net/mailman/private/lincoln/. >> Change your subscription settings at >> https://pairlist9.pair.net/mailman/listinfo/lincoln. >> >>
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