Do You Know or Are You Guessing? Budgeting in 2025

Good afternoon, everyone. Thanks for joining in. We're going to get started momentarily. I see a lot of people signing in, so we're just gonna give them about thirty seconds, and then we'll get started. Alright. Good afternoon, and welcome, everyone. Welcome to do you know or are you guessing budgeting in twenty twenty five? Thank you so much for joining us today. We're happy to have you. Before we get started, though, here are some housekeeping items we wanted to quickly go through. You will be muted today, during the session, but please do submit your questions using the q and a feature on this platform. This session also is being recorded, and you will receive the recording after the fact. There are a few resources that we have attached as well here for you to have a look at. So please do click through them and download the the content that you see that's available here. And with now, I will pass the floor off to Katie. Katie, please go ahead. Hello, and welcome. So we're gonna keep this one moving. It's only thirty minutes, so hopefully it won't be too boring and tedious for you. My name is Katie Gramajo. I work for Brightly in marketing for education, but prior to this, I was one of you. I was the director of operations at the Windward School in New York, which has three campuses in White Plains at Manhattan, and I was the director of sustainability scheduling and operations. The schools like interesting titles, and that was at Campbell Hall School in Los Angeles. So, I've been here for a little over a year now, and I would love to talk to you about what I've learned. So the first thing, and it's kind of a scary topic, but we're gonna dive right in, is the current state of educational facilities. There are a lot of studies that have come out with various facts. I put together a little slide of some of those facts for both k twelve and higher ed, and I linked all the sources here. None of this is gonna be surprising to you. A lot of these have been recently updated, so it may be slightly different from what you've heard before, but basically similar. We have a combined maintenance and upgrade backlog of over a hundred and ninety seven billion dollars if you add that up for both education sectors, which combined with staffing challenges and vacancies for our maintenance staff especially creates workforce gaps that we're all facing. All that means is that we have to be more efficient with what we have both financially and with people. Our facilities conditions are deteriorating based on age and just the age of our country and our buildings. And because of that, there is a huge deferred maintenance backlog that we all know about. Another thing that I'm sure we all know is that the facilities conditions actually impact academic performance and testing. There's a seventeen percent improvement on test scores if schools have more acceptable facilities for the students and it definitely affects enrollment. So that's for higher ed and any private school that has enrollment, which is where I used to be. Obviously, if you're going to be spending a lot of money on a tuition, you want the facilities to look a certain way or you're not going to go there. So it affects thirty eight percent of enrollment decisions in higher ed. Both sectors emphasize the importance of having centralized maze maintenance and asset data so that we can prioritize our budget, and we're gonna talk about that as we move through the rest of the slides. I won't read all these statistics to you. You know where we stand, but in general, buildings are old, budgets are budgets are low, and we need to fix the facilities as best we can. So something that's come up a lot recently in our current state of the United States is what is the future of educational facilities? As we have an unknown future for the Department of Education and we have an unknown future for some of our federal education programs, there may be some significant budget cuts. Something that I find will be a huge problem would be a lot of financial aid programs will potentially be cut, such as the Pell grants or work study programs, and that would infect that will infect your enrollment and therefore your budget. And in terms of k twelve or public schools in general, a lot of title one grants may be cut down. And special education grants, a lot of those types of grants could potentially be cut, which would cause less funding, less budget, less scholarship, lower enrollment. And we need to keep the facilities as best we can. Well, while potentially having less staff, and therefore the facilities will be failing faster. So it sounds scary, but all we can do is worry about what we can what we can change, what we can fix, and how we can help our schools as facilities leaders. So on the positive note, that's what I'm I'm gonna help you with today. Before we keep going, I do wanna ask a quick poll question. Question. If anyone is able to quickly answer this, please just click and submit your answer to which aspect of facilities plans concern you the most. Is it limited budget to cover your expenses, a growing backlog of maintenance repairs, difficulty getting the financial decision makers to support what you're asking for, or of overwhelming number of sustainability requirements being put upon you or something else. Take a minute to fill out the poll question, and then we'll see the results. Alright. Let's see what we've got. Seems like we have a split for budget, backlog, and getting people to give us the budget that we need. So that's makes sense. So I picked those answers because I knew that's what most people were thinking about. So let's go from there. In order to secure as much funding as possible, whether it's to convince your financial leaders to agree or to get it from federal funding or something of that nature or your board of education, we need transparency. Financial transparency will justify your budget request to make sure we get as much funding as possible rather than just be given the same amount or less than we were last year. So where do we start? There's this fancy foresight framework that I like to think about when trying to think about budget and strategic decision making. It's pretty it's obvious. It's just a visual representation to help you really think about where you begin when you feel overwhelmed about this. The first thing we have to think about is obviously hindsight, reflect and learn from the past. What have we done and what's worked? In facilities that would be looking at your historical facility use, your maintenance records, past renovation projects, educational performance data, and think about how physical infrastructure has impacted that. Then we're gonna go to four sorry, foresight, and that will be predict and prepare for the future. So how do we do that? Well, we can project our demographic changes if there's real estate development in our area or everyone's leaving for another community where there's a new factory with jobs, trying to figure out our enrollment trends, trying to figure out what technological advancements are coming and try to anticipate what requirements might come down the pipeline in terms of facilities and ensure our infrastructure is ready to grow or shrink with our students and our enrollment. In order to best do that, we can use our insight, which is interpreting our data to make those choices. So you would take your data from your facilities condition assessment, we'll get to that in a minute, from your student performance, from potentially community surveys or educational programmatic needs, and make your decisions about your capital improvements, your space utilization, and where you're going to invest. You could also consider asset investment planning software to help you with this, and we'll get to that at the end of this presentation. And then finally, you've made your decisions and oversight. You're monitoring your results. You're providing real time feedback of your facility's performance and the community feedback to validate what capital planning decisions you made. So this is just a nice way to help you think about that as we move forward. So what are the key steps when we're trying to plan our budget? First, the obvious one, assess your facilities. Oops. It seems like it jumped ahead. Let me go back. There we go. Assess your facilities for risk and priority and what needs to be done. So the first thing would be update your facility's condition assessment. Again, coming up in a second. The facilities team usually doesn't know everyone in the school's priorities, and lots of times your educational leaders have ideas for academic priorities that you may not be privy to. So involving yourself with collaborators and stakeholders in terms of what plans they're thinking of for the school will help you plan for the facilities needs as early as possible. Using your historical data to see what potentially is at risk, what's the risk factor for certain components in your buildings, and potentially where you've been overspending based upon repair costs. Then choose and prioritize what needs to be done first and get ready to justify why that is. And then you will be bidding out your projects, keeping your vendors on your toes. Don't let Bradley hear me say that, but you gotta keep vendors on their toes to make sure you're estimating your costs properly and getting the most information you can. And then you're gonna consider your long term financial planning and expenses after you talk about your normal repairs and replacements. So the poll that you might have seen, spoiler alert, where are you in your budgeting process right now? You're done. You're approved. You're you finished your part, but now you're waiting for the rest of your team. You're still working on it, or you don't even track your budget. You're just hoping for the best. Take a second to answer this poll. Alright. Let's see. Drafting. That sounds about right. It's only February. We're pretty early into the year. Those of you that are done, wow. You are on top of things. But I I would believe most people are still drafting as we go through this. Okay. So we're starting with our assess our current facilities. Obviously, you have your day to day maintenance and repairs and upgrade needs, but where you can start is a facilities condition assessment or an FCA. Most schools are required to do them every five years or so, and if you don't have a requirement, lucky you, but you should still do one every few years, whether you do it internally or externally to make sure you know everything that's going on in your facilities. So an official facilities condition assessment is conducted by an engineer an engineering professional to evaluate your infrastructure, including everything from HVAC plumbing, electrical systems, and more. Question, you will be getting a copy of these slides. Don't worry. So one of the best practices is to do your FCA. But as we know, when you do an FCA, it is usually a PDF or a binder of details that are only as current as the day they were written. As soon as you're doing repairs, as soon as someone is upgrading something or something is failing, it is no longer up to date. So the thing that people like to do is track it manually in a spreadsheet or a document where they update this. But you can use a CMMS software, which we'll talk about in a second, to also take care of that and keep it up to date rather than have to manually do this as you move forward. Once you have your condition assessment, all of us can usually prioritize what we need. Facilities managers know what they need, but how can you start that process of priorities? I always like to start with my team. What is your team's goal? Where do they need to improve safety compliance and anywhere that is not working efficiently for them because that would be where I would push most. Once you know what your priorities are, it's important that you have the data to back up what you're going to propose to your administrative meetings, whether that's board of ed, head of school, whomever is asking you for this information. The more data you have, the better to be able to not only justify the spend cost, which is potentially an ROI case where if we replace all of these filters now, we won't have to repair them in the future, but it could also be something that's aligned with instructional goals. Like, our theater is falling apart and theater seems to be a big enrollment piece for our schools. So that is something that needs to be updated before the gym because that's what's helping our enrollment numbers. Obviously, I'm a theater person, not an athlete, so you can change that however you will. But you need to also think about what other initiatives there are. Are there legislative changes we talked about that could potentially affect your budget negatively or positively? Are there grants, compliance requirements, all of those things? I find that those are most easily found from either local groups, like your local ASBO ASBO or APA group, or from groups like Facilities Dive. They do a newsletter, or even Brightly and myself. Yeah. But you'll have all my contact info at the end, and I post a lot of those updates too. So once you figure out what you might have to do, you can also add that to your list and engage with your stakeholders to present your list of wish lists. In order to back up what you have, we talked about this already, you need to have your past budget, your expenses, and detailed maintenance records to actually analyze where were you over budget last year, where were you under budget, were you spending too much on one particular component, one boiler, and then make sure you include not only the cost of the repair, but the overtime you've been spending having your staff constantly repair something after hours. If it affects school, you can't shut down the school, so it's a weekend at night job that costs more. Including all of those expenses is really key to make sure you have the best the best plan to explain just how expensive something is and that replacing it would be more efficient both financially and logistically. The other thing you'll wanna do is assess your current operational expenses. So that's your staff, your supplies, and your utilities. That leads into something we talked about a little bit before, which is sustainability. If that's a goal of your school or your community, knowing your utility costs and how you can minimize those or lower those is very important, especially your energy management. And you could be able to do that by potentially replacing things that are more energy efficient. So that's another way to get something new that you might not have been able to get before. So finally, expect your plan preventive maintenance as well. So do you have a preventive maintenance plan? Hopefully, you do, which is doing your inspections and your regular maintenance, both in house or outsourced. But you need to have those assumptions made every year as well. So once you start your prioritization we talked about, how do you decide what to prioritize? Obviously, the first thing would be based on risk and safety. What's the impact on day to day? What could close a school? What has to happen over the summer because it will actually close part of the building for you to fix that air conditioning unit? What's urgent? Like I just said in the previous slide, what has someone have to fix every weekend for an overtime? Because that adds up. The prioritization process could also involve assessing how crucial something is to the mission, which leads back to what I said about the theater in my in my school in my mind. But you wanna be able to subjectively or objectively evaluate what is priority to your school. If your school's priority is science and stem focused, then those facilities are the priority, and that's something that you can use in terms of what you're doing. I also suggest a priority matrix, which is something you could do in Excel if you want, if you don't have a CMMS or a software, which would allow you to put your building types and what requirements budget and the scale that that comes that that would entail in order to fix something. That would also help you think of your risks for certain things that are more high risk if they fail. I actually learned in my APA course that the important thing you could think about is your facility's condition index. That's that final bullet point, that FCI, which is the total cost of needed building repairs and renewal divided by the cost of replacing the building. So each building's FCI score is showing the current condition of the building as good, fair, poor, or critical. And the goal would be that a FCI score is point one eight, which would reflect it's time to start considering if you're going to replace that or repair that. And in order to do it, you need the data to back it up. So this is more data to help you justify your costs. When you're researching and estimating your costs, how do you do it while you price things out? I found that even with smaller projects that are not necessarily a full RFP process, certain districts and schools have levels in which would require you to do that. You could still do a simple one pager RFP for your own staff to do these projects. I find that that will make sure you're getting apples to apples bits. So I actually just made a literally a word doc that has the project, the campus, the location, the contact info, where you could put the project overview, the scope of work, the roadblocks, which means challenges such as a summer camp that'll be in the way of where you need to get work done or limits on time to complete things. And that would help you, one, make sure if you're asking your staff to get prices on certain things that you're getting exactly the same quote from every vendor, but it'll also help you keep a record and evaluate your yearly contracts as you move forward to make sure that you're reevaluating and getting competitive pricing on everything, not just checking in on bids that you've had in the past. So, again, I say this as someone who used to be in your shoes, not as someone that works for a corporation that sells something. It's really important to reassess your vendors because you wanna make sure you're getting the best price you can for some of these repairs, especially as your budget is potentially lower in the future. So then we get to the harder part, which is the capital planning, the long term planning. How do you use proactive facilities maintenance to contribute to preventing unexpected issues and potentially ruining the budget you created. Well, you have to factor in long term planning and renovations. In order to do that, the better way is to have all of this budgeted in a three to five year or even longer plan already knowing the expected life expectancy of that component, knowing the failure rate and a risk score for those items, you would be able to say this one is the one that needs to be repaired this year or replaced this year prior to it breaking down and costing more. Obviously, you cannot always you cannot always predict things like floods or anything like that that might cause a problem to your budget. But if you plan ahead of time and if you have data, you can at least have extra budget allotted for emergency plans and potentially be better prepared if you do have an emergency to get the insurance money that you need to cover it because you know all your assets in your facilities condition assessment or your CMMS. We all have been there where you have to a lot for everything that insurance needs to cover. And if you already have that data, it'll make your life a lot easier. In twenty twenty one, I was in hurricane Ida in New York, which no one expected, and our whole school flooded. And we had to get mold remediation, and it ended up being a very long project to repair that damage. But on top of that, the insurance claim and making sure we accounted for everything was very challenging if you don't have the data before. And the next thing we're gonna move to is the next thing you need, you have your budget, you have your requests, you need community support. If you're public, especially k twelve, but also in private schools and higher ed, there's a community that is either voting for your budget, voting for your bond referendums and things you're asking for, but also it's important to have positive support from your neighboring communities if you're planning any construction projects or changes to your school. Every school I've worked at has had a lot of neighborhood feedback based on the projects we're doing, the parking situation, the events we're holding. So community support is key no matter what you're doing. The best way to get your budget passed or approved, whether by a board of ed, a board of trustees, board of regents, whomever you work for, is to print to actually provide that transparent data driven financial reports that shows your budget based on real results and will help you build trust with your stakeholders. As the facilities leader, if that's who you are, you're going to be asked for that information. And the more you have, the better you can support your own case for what you and your team needs. And you'll it'll be best for you to obviously prove your facilities upgrades can affect student achievement because that is very near and dear to the heart of those voting for those budgets, but also to use fact based analysis like your FCA's or risk scores from something like an asset investment planning software to help you. So you can do this all on your own, which is something I'm sure most of you do using the steps we talked about before, but you can also use asset investment planning software. So here is your last poll of the day. Have you heard of asset investment planning software? Yes. We have it. Yes. But I don't know what it does. Or nope. But tell me more. I'll give you one second because I have, like, five minutes to get through the rest. Alright. No. But tell me more. And if you said yes, great. So asset investment planning software is something that there are many options. I am not a salesperson, but I would say if you already have a CMMS in place, it is something that you could use to take that data from your CMMS, which Brightlysis is called asset essentials or one of our classic products, and you can pull it directly into asset investment planning software. AIP, as it's also known, takes your facilities management and enables investment prioritization. So essentially, it takes the facilities information and adds the finance information on top of that to help prepare your budget. It automates your comprehensive asset tracking. It creates predictive analytics to show you what they believe will fail and when you should pay for it, And it can allow you to plan for up to thirty years of capital planning budgets based on the data in your CMMS. So all that mumbo jumbo, what does it mean? How does it work? Straightforward, no nonsense. It takes all your asset information and centralizes it from your CMMS into an asset directory that keeps track of your work and your repairs as you're doing them. It as I just said, it's connected with your CMMS data. It doesn't have to be ours. It can be a different CMMS. Obviously, you know, which one we prefer, but it links your asset inventory to all preventive and work order maintenance activities. Then, this is the best part about it, it leverages insights and benchmarks. So unlike a CFMS, it takes detailed insights into your assets. It uses industry benchmarks, future cost projections, and end of life estimate estimates, and even risk scores to help you see what it believes it's going to what it believes is going to fail that you need to replace and how much it thinks it's going to cost. So it will help you support your budget requests with actual capital plans, like I said, up to thirty years and ensure that your data and your requests are as accurate as possible using technology other than us just using our own guess and our own intuition to determine what we believe is going to fail. Fail. And finally, it gives you clear projections with this data to confidently present those needs to the board of ed, to your CFO, to whomever is asking you for it. So the goal is that you will be able to take your data from your daily work orders and your preventive maintenance and actually get insight and predictive analytics as to what will fail when rather than just trusting your instinct or a vendor. And what I mean by a vendor is when you go to the car mechanic, if you see me speak before, I use this metaphor a lot, but it's one close to my heart. And you don't know anything about cars and they tell you, you need this, this, and this fixed. And you're if you don't have data and you don't have information, you say, okay, and you pay for it. And if you had something that could tell you, no. That's not actually needed for another year or two, you would actually have something to help you save that money and know you're doing it correctly. So that being said, we have three minutes. Does anyone have any questions about any of this? I know I talked fast and it was only thirty minutes. And then I'll wrap it up. It looks like we have one question. What challenges can come up when implementing something like this? So when you're implementing asset investment planning software, I think the trickiest part is that you have to have your CMMS software accurate and being utilized. So we all buy software and then sometimes it is not used properly or our staff is struggling to constantly update tickets on their phone or their tablet, and then poor data entry habits give us incomplete information. And if the information in the CMMS is incomplete, then it is being pulled directly to your AIP, and therefore, that will be incomplete. And your potential proposed budgets will not be correct if you're not getting the information that you need from your CMMS. So really training your staff, really making sure your staff is using it and doing it as often as possible. Anytime they're doing a repair, anytime they're working on something is really important. And then I would say making sure that once you have your CMMS and everyone's using it and it's going well and you start integrating it into your asset investment planning software, you need to make sure that your finance leaders truly understand that software because really it's for the leader of facilities, but also the leader of finance because they're the one that needs that information. And the best thing I thought about it was that it will create charts and documents and everything you need to present your budget so that you're not constantly updating a manual spreadsheet of millions of tiny numbers to try to guess what your budget is and what's coming next. Any other questions? Very quickly, how can you incorporate sustainability goals into your budgets? If you the first thing you would do is analyze your expenses. That's the easiest thing. Analyze your utility bills and your expenses. If you have a product, there are many energy products out there. Ours is called Energy Manager. It can do that for you so you don't have to do it yourself, but you can do it manually. But once you can decide where energy is being wasted and where it's being overused or potentially misused, then you can use that data to determine what the return on investment would be to repair or replace those things. So you would be able to say, well, this building has all, poorly insulated windows and old light bulbs. So if we replace the light bulbs with LED and we reinsulate all the windows, we are predicting an energy savings cost of this much. Like I said, you can do it manually or there are technological products that can help you with that. So it looks like we are just about out of time. So I'm gonna wrap up with in this slide deck, you will get this. There are many resources for you. We created quite a few documents about the state of budgeting and finance for schools, and we did a survey and infrastructure and capital planning study that has a lot of great information for you. So we have all those linked here, and you will get this, I believe, in an email after this webinar is over. And that's it. I hope everyone has a nice Wednesday, and I'll see you soon. I hope.