Boards of trustees' role in school property projects

If you are managing the project yourself (those projects that don’t need building consent) you will need to complete some  project management forms and  procurement forms .

• Providing governance for professionally managed projects
• Developing a project brief for your project
• Setting up a project file for your project
• Engaging your project manager
• Appointing a school representative
• Appointing a project control group
• Engaging parents to work on your project
• Engaging a full-time builder for your project
• Managing conflicts of interest on your project
• Delegating project management functions for your project
• Giving board approval
• Keeping people safe while the project is underway
• Getting local council sign-off before using a new building
• Updating PMIS at the end of the project
• Accounting for project funds
• Returning unspent funds to the Ministry
• Discharging the project manager
• Meeting maintenance requirements for the building
• Fixing defects found after the end of your project

Providing governance for professionally managed projects

For any property project at your school, there are a number of steps that you, as a board of trustees, must follow.

In the early stages, you will need to:

1. develop a project brief
2. set up a project file
3. engage your project manager
4. appoint a school representative
5. appoint the project control group
6. decide whether to delegate any of your board functions for the project.

As soon as you have a project manager on board, they can help with some of these steps.

During the project, you will need to:

1. keep people at the school safe during the building work
2. give board approval at various stages of the project , including:
   1. the project brief
   2. the designs
   3. any variations
   4. all payments
3. manage any potential conflicts of interest , such as board members with a financial interest in the project
4. manage any issues with the project manager’s performance
5. account for project funds in your accounting system
6. return any unspent project funds to us
7. discharge the project manager once the project is completed.

Your project manager should provide all documentation and recommendations to the school representative for board approval.

Developing a project brief for your project

The project brief is a summary of the project, including the objectives, time frame and budget.

As a board of trustees, you define your requirements for the project in the project brief. You prepare the first draft of the project brief, which you use to tender for the project manager. It should have enough information to:

• tell people who are bidding for the project manager contract what the role involves
• confirm that all board members are agreed on the work to be done.

Consult with interested parties who will use the buildings and facilities, such as staff, students and parents, when you are developing your brief.

If your school already has a project manager, such as under a long-term contract, they can develop and manage the brief from the start, with your input.

During the project, the project manager develops the brief into a more detailed document. Find out what information the brief will contain .

Development plan

Your school may have a development plan that:

• takes a long-term view of your school property as a whole
• plans how the property can best help your school to work towards its vision, goals and desired educational outcomes.

If your school has a development plan, it will contain some of the information you need for the project brief.

Sign off the project brief

The project manager will send you the project brief, as it is updated, to check that the project objectives are still being met and for approval from the board. Your delegate or the full board will need to sign it off each time.

Setting up a project file for your project

You will need to set up a project file to store information about your project. This file includes the project brief and all other information such as:

• correspondence
• emails
• contracts
• variations.

Your project manager will add to the project file as documentation is developed. Use the project management checklists to make sure all relevant documentation is included.

Closing the project file

At the end of the project, you will close the project file. You must:

• include all the final paperwork in the project file
• store the file securely – you will need the guarantees it contains if a building defect becomes apparent
• keep all procurement process records, including unsuccessful tenders, for 7 years under the Public Records Act 2005 (New Zealand Legislation website)
• keep the project file for the life of the building.

Obligations under the Official Information Act 1982

As a board of trustees, you are an agent of the Crown and bound by the Official Information Act 1982 (New Zealand Legislation website) . If a request is made under the Act, such as by a tenderer who did not get selected wanting to view your tender files, you must provide access to or copies of the information in the project file.

Engaging your project manager

You must engage a professional project manager to manage any property project at your school that requires building consent.

Find out what to look for in a good project manager and how to engage one using the Ministry’s procurement processes .

Using a non-professional project manager

If you use a non-professional project manager, such a board member or your caretaker, to manage a project (that does not need building consent), your project manager must still follow all the Ministry’s project management requirements.

You will still have to manage all the board functions covered above, depending on the scope of the project. For example, a project to replace carpets probably won’t need a project control group or design brief, but you should still have a project file, and will need to approve payments.

Appointing a school representative

You need to appoint a school representative to represent the school’s interests. They will be a member of the project control group with an oversight of the project. They will make sure that, as the project progresses, it continues to meet your school’s expectations for learning and achievement.

Your school representative must have a role or relationship with the school so that they can effectively represent the school’s interests. They may be:

• a member of the board of trustees, such as the principal
• a teaching staff member
• another school employee
• a school community member who is actively involved in the school.

You should select a candidate who has:

• an affinity with or knowledge of the school and the project
• excellent relationship management skills
• effective leadership skills
• excellent communication and networking skills
• good problem-solving skills
• sound judgement
• the ability to provide continuity and effective handover and delegation.

Appointing a project control group

You will need to appoint a project control group to oversee your building project. The project control group is likely to include the:

• school principal
• project manager
• board chair or board representative
• school representative (who can be the same person as the board representative).

The project manager will include others as they are engaged, such as the designer, engineer, quantity surveyor and contractors.

Role of the project control group

The project manager chairs the group. The group meets at regular, pre-arranged times to:

• discuss project progress
• give you financial updates
• monitor whether the project objectives are being met
• discuss and resolve problems
• make recommendations to you for approval.

For small or less complex projects, the process is likely to be less formal. However, you can still use a project control group in this supervising role.

Communication lines for the project

The project control group decides on the communication lines for your building project. The following diagram shows the typical communication lines.

Property management roles and functional relationships in a school building project

Schools, project management and consultants contribute to project management and relate to each other as members of the project control group. The Ministry and contractors each have lines of communication through members of the project control group.

Engaging parents to work on your project

If a parent of a child at your school tenders for a contract, the relationship must be entirely professional. You should make sure:

• no one pressures the parent to give a good deal
• the parent is qualified for the job and supplies warranties that the work meets trade practice.

If you engage the parent to work on the project, you:

• should expect their work to be to a professional standard
• will need a process in place to deal with any situation where the contractor does not perform or performs poorly.

Having working bees for your project

You can hold working bees to get work done on your building project. However, if the project needs a building consent, you will have to engage a professional project manager to:

• confirm the scope of work
• sign off the completed construction.

Engaging a full-time builder for your project

Your school can employ a full-time builder to do your building work. You can engage them as either a board employee or a contractor.

Builder engaged as a board employee

If you engage the builder as a board employee, the scope of work must be:

• fully covered in their employment agreement
• in line with their collective or individual agreement.

You pay for their labour (as a board employee) from your operational funding. You cannot charge these costs to the project.

Builder engaged as a contractor

If you engage the builder as a contractor, you must follow full project management processes for:

• procurement
• qualifications
• insurance
• design certification.

You must follow Ministry procurement rules when a builder engaged or employed by the school buys materials for building projects.

To find out if the builder needs to be licensed, go to licensed building practitioners (business.govt.nz website) .

Managing conflicts of interest on your project

A conflict of interest is when someone involved in a project has a financial or other interest in the project from which they can benefit or which will prevent them from acting impartially. For example, there is a conflict of interest if:

• an architect on the board of trustees wants to tender for the design work
• a board member has a brother-in-law who is tendering for the construction work
• people involved in the project have a financial interest in a company or related company that is tendering for the work.

A conflict of interest can arise during procurement or at any time in the project.

Generally, the project manager will arrange for everyone involved in the project to sign conflict of interest forms and a confidentiality agreement. If you are self managing the project, you will have to do this. See conflict of interest management on school property procurements . See also:

• chapter 3.3.5 of the Financial Information for Schools Handbook
• circular 2006/07 Conflicts of Interest for School Trustees , which deals with managing conflicts of interest with board members in particular.

Board members with financial interests in the project

A board member may have a financial interest in a contract you are entering into. If the value of this interest is over $25,000 a year, that member must apply for Ministry consent before:

• submitting a tender for the contract directly
• another party that member is associated with tenders for the contract.

Before giving consent, we need to be satisfied there is no risk of that member receiving preferential treatment.

If we give consent:

• the board member must be excluded during any board meeting when you discuss the project, as required in clause 8(8) of the sixth schedule to the Education Act 1989 (New Zealand Legislation website)
• you must record their exclusion and the reason for it in the project file.

Delegating project management functions for your project

To keep the project moving, you can delegate some of your board’s functions and powers for the project so that approvals can be done quickly, without having to wait for a full board meeting.

You can delegate board functions to:

• one or more trustees on the board
• the principal or any other employee(s) or board office holder(s) at the school
• a committee of at least 2 people, at least one of whom is a board member.

To delegate powers, you will need to make a formal board resolution agreeing to the:

• decision-making level to be delegated
• delegation level and scope.

You will need to give each delegate written notice of their delegation(s).

Section 66 of the Education Act 1989 (New Zealand Legislation website) gives you the power to delegate in this way.

Points to remember when delegating powers and functions

• You must record all delegations in the project file .
• You cannot delegate your board’s general power of delegation. This means you can’t ask anyone other than the board to make the delegations.
• As a board, you remain responsible for the actions and decisions of the delegate(s) acting under the delegation.
• You can revoke the delegation at any time.
• A person with a financial interest in the project cannot be a delegate. See conflict of interest management on school property procurements .

Financial delegation

You can only delegate financial functions to the school representative. Project managers:

• must not have any financial delegation for using school funds
• must have all project costs and expenses signed off by the school representative with financial delegation or the full board.

You can only give financial delegations through a board resolution. You must:

• set out the nature and conditions of the delegation in writing
• provide the delegation by notice to the delegated person(s), as required in section 66 of the Education Act 1989.

For more information about financial delegations, see chapter 3.3.18 of the Financial Information for Schools Handbook .

Giving board approval

As a board of trustees, you will need to give approval at various stages of the project. This may involve a full board meeting or approval by your delegate .

Approval stages include:

• approving the project brief
• approving the procurement plan and tender documents
• signing contracts for consultant engagement
• signing off on the designs
• approving any variations , for example in the material used or design changes
• approving payments.

Working with the design team

Your school representative will need to work with the design team at each stage of plan development to make sure they understand your vision for the project and the design meets your educational goals.

Find out more about the design stages .

Keeping people safe while the project is underway

As a board of trustees, you have a duty to keep your staff and students safe at all times. This is your legal responsibility under the Health and Safety in Employment Act 1992 (New Zealand Legislation website) .

Your project manager will help you meet your responsibilities by managing the day-to-day health and safety hazards during a project, including:

• keeping the construction site isolated from students and staff
• managing safe access of vehicles and materials
• using safe building materials
• managing contractors.

The project manager should meet regularly with you to report on and discuss safety issues.

Find out more about your health and safety responsibilities on WorkSafe’s website .

Getting local council sign-off before using a new building

If your project required building consent, you cannot start using the new building until the local council has issued a code compliance certificate, or your project manager has already arranged a certificate for public use. Find out more about council requirements for building projects .

Be aware that you could be fined up to $200,000 a day for each day you allow anyone to use the building without a code compliance certificate.

Updating K2PMIS at the end of the project

Check that your project manager completes the Asset Update form at the end of the project. We use this form to update physical records and project items within K2 in preparation for capitalisation. the Property Management Information System (PMIS) .

If K2PMIS is not updated, you won’t get your full Property Maintenance Grant funding , which is based on the school’s buildings area.

Accounting for project funds

In your accounting system, you must separately account for money you receive for property projects. Treat these funds as income. You hold the money on the Ministry’s behalf until you spend it.

To meet accounting requirements, you must:

• credit funds to a liability account when received
• keep a separate account for each capital works project – for financial management and control
• include a disclosure note, in the financial statements, on the amounts received and spent during the year for each project – you must do this even if there is no year-end liability.

For more about school accounting see the Financial Information for Schools Handbook .

Returning unspent funds to the Ministry

If your project comes in under budget, you must return the savings to us. In this way, K2 hasPMIS has an accurate record of the actual project cost.

Any unspent 5 Year Agreement (5YA) project funding will be available to you for other 5YA projects. For projects funded from other funding programmes, like new teaching space, we will return unspent funds to the national programme budget.

Discharging the project manager

Your project manager will close the project . This includes:

• doing a final inspection and post-occupancy evaluation
• sending documentation to the Ministry
• getting local council sign-off .

Your final task will be to discharge your project manager, disestablish the project control group and close the project file.

Review the project manager’s performance and discuss any non-performance issues. If the project manager has a long-term contract with you, their performance will help you decide whether to continue the contract or not.

Meeting maintenance requirements for the building

Typically, a product manufacturer guarantees its product will perform in a certain way for a set time. For example, a roofing manufacturer may guarantee that the roofing will be leak-free for 10 years. A warranty is the same thing as a guarantee.

Many guarantees are only valid if you maintain the building product in a certain way. For example, you may need to arrange for:

• annual cleaning of exterior cladding to prevent damage from moss and mould
• a qualified technician to carry out an annual inspection and maintenance of a heating system.

The project manager collects all the guarantee and maintenance care documents from the contractors and building suppliers for the school. You must include maintenance requirements for building products in the school maintenance programme.

Fixing defects found after the end of your project

If anyone finds defects after the project has been completed, check your maintenance programme. If the defect results from a lack of or inappropriate maintenance, you must pay for repairs from your Property Maintenance Grant .

If you believe the defects are caused by faulty products, workmanship or design, you must seek recovery from the designer and/or contractor.

Minor defects

For a relatively minor defect, such as a crack in the plaster coating on exterior cladding, you may simply ask the contractor to fix it. In this case:

• check the contract to see who is responsible for the repairs
• write to the contractor outlining the issue and requesting a meeting to discuss it.

Complex problems or issues that cannot be resolved directly

You may need to follow through with the dispute steps in the contract if:

• the contractor does not respond to your attempts at contact
• the issue cannot be resolved
• the problem is complex.

Funding when you can’t get remediation

You may be unable to get remediation. For example, this may be because:

• the contractor refuses to pay, but
• you cannot justify the need for third-party intervention or court action.

In these situations, the school representative can discuss with the Ministry how to fund the remediation work. You must use the procurement and project management process for the remedial work.