The Cost of a Second High School (March 2023)
We receive many questions from parents, teachers, local leaders, and community members about the need for a second high school. Below are some of the commonly-asked questions about the funding of the second high school and steps the District is taking to serve current residents and a growing student population. Click here to download the FAQ PDF in English. Descarga las preguntas frecuentes en español.
How much will a new local high school cost?
The District is estimating a cost of $206 million for a high school that can serve 1,200-1,400 students and be expanded to serve 1,800 students. The cost estimate includes 45 classrooms, science, art, and music classrooms as well as a gymnasium, library, cafeteria/kitchen, performing arts building, and practice fields. It does not include a full stadium, pool, or Career Technical Education Building.
Why is school construction so expensive?
Over the last two years, school construction costs have dramatically increased due to labor shortages, supply chain issues, construction materials (e.g., aluminum, steel, lumber, fuel, and concrete), and inflation. Construction is also expensive due to the extensive State approval process combined with prevailing wage and labor requirements.
How much have school construction costs increased?
School construction costs are best gauged by the RS Means Cost Construction Index. This index is used by the State Allocation Board for determining increases in school facility grants. The index jumped by 15.80% from January 2021 to January 2022. Based on recent economic conditions, the District anticipates continued inflation will cause further increases in school construction costs. Many school districts are experiencing cost increases of 35% over the last 18 months. The longer we put off building a second high school, the more expensive it will be.
Does our District have enough school facility funds to construct a second high school?
No. Under California law, the District is authorized to collect statutory developer fees from homebuilders at the time a building permit is issued. The District collects “Level II” developer fees by meeting certain requirements including the adoption of our School Facilities Needs Analysis (“SFNA”) prepared by School Facility Consultants. Pursuant to the SFNA, the District collects $2.98 per square foot on residential development. Based on estimates in today’s dollars, those fees could generate $23 million over time for a second high school.
Are developer fees enough to pay for a second high school?
No, it is generally accepted that developer fees fall far short. Under the State School Facilities Program, developer fees are intended to make up 50% of the cost of a new school. The State School Facilities Program is intended to provide the remaining 50%. The law considers this to represent full payment of the developer’s obligation to mitigate the impact of new development even though the estimated cost of school facilities greatly exceeds the cap.
Will developers voluntarily contribute more than their required share?
Yes. The development community recognizes that Hollister High School is overcapacity, and that additional funding is necessary to maintain a healthy housing market. The District recently signed a term sheet for
additional funding with Bill Lee for the Land of Lee residential project. The term sheet provides funding beginning at $5.00 per square foot, and increasing over time. If the Land of Lee project is approved, the District will have its first voluntary mitigation agreement, which could serve as a catalyst for future agreements with developers and homebuilders.
What can the City and County do to support the District in its regional approach?
In planning for the second high school, the District is taking a regional approach toward planning a second high school. We are monitoring all residential development proposals and projects and regularly attending City and County Planning Commission meetings as well as meetings held by the Hollister City Council and Board of Supervisors.
The City of Hollister and County of San Benito can actively support the District by asking applicants of proposed developments about the number of new students generated by their project and inquiring if they have met with the District about identifying funding options for a second high school.