The Roanoke School Board agreed to a financing plan Tuesday for a $16.8 million energy savings project school administrators said will pay for itself.
The project calls for replacing heating, ventilation and air conditioning units and retrofitting old lighting with LED fixtures, along with other energy efficiency measures. Roanoke City Public Schools hired energy services contractor Trane in January to study energy systems and implement upgrades.
Based on Trane’s analysis, Roanoke could pay for the project with guaranteed savings of $1.3 million annually over the next 15 years. Trane must pay the difference if the savings do not meet the guarantee, according to Deputy Superintendent Dan Lyons.
School board Chairman Mark Cathey said the board views the plan as a no risk method of improving efficiency and cutting longterm costs.
School officials voted 7-0 to enter a lease purchase financing agreement for new equipment, capped at $17 million with a maximum timeline of 16 years.
David Rose, managing partner for the school division’s financial adviser, Davenport & Co., told the board Roanoke received 10 responses to a request for proposal for financing last week. TD Bank presented the lowest offer, with a fixed interest rate of 2.1%, Rose said.
With the school board’s approval Tuesday, central office can choose a winning proposal and begin finalizing the financing agreement.
Trane will manage the equipment installation and monitor usage over the life of the project to ensure its annual savings guarantees are met, according to the school system.
The company completed some preliminary work this summer, such as replacing the HVAC system at the Noel C. Taylor Academy, a failed chiller and cooling tower at Lucy Addison Middle School and the HVAC units at Forest Park Academy. Additional work this fall includes replacing boilers at the Roanoke Academy for Math and Science.
Next summer, the company plans to install equipment at John P. Fishwick Middle and Roanoke’s school administration building.
The school system said it hired Trane through a cooperative procurement process by using contracts competitively bid by other public entities. Virginia law allows public bodies to use the process for certain purchases.
Roanoke used a contract created by US Communities — now part of Omnia Partners — a large national cooperative, according to the school division.
Botetourt County Public Schools launched a similar energy savings project in 2017 through a contract with Johnson Controls Inc.
Roanoke County Public Schools also conducted an energy performance project.