REINVENTING THE BUILDING OF SCHOOLS ATLANTIC INSTITUTE FOR MARKET STUDIES Policy Paper Reinventing the Building of Schools The Real Legacy of Public-Private-Partnership (P3) Schools in Nova Scotia Paul W. Bennett, Ed.D. Director, Schoolhouse Consulting, Halifax, Nova Scotia Halifax, Nova Scotia May 2017 ©2017 ATLANTIC INSTITUTE FOR MARKET STUDIES 1 REINVENTING THE BUILDING OF SCHOOLS The Atlantic Institute for Market Studies (AIMS) AIMS is a Canadian non-profit, non-partisan think tank that provides a distinctive Atlantic Canadian perspective on economic, political, and social issues. The Institute sets the benchmark on public policy by drawing together the most innovative thinking available from some of the world’s foremost experts and applying that thinking to the challenges facing Canadians. AIMS was incorporated as a non-profit corporation under Part II of the Canada Corporations Act and was granted charitable registration by Revenue Canada as of 3 October 1994. It received US charitable recognition under 501(c)(3), effective the same date. 287 Lacewood Drive, Suite 204, Halifax, Nova Scotia, Canada B3M 3Y7 Telephone: (902) 429-1143 [email protected] facebook.com/AtlanticInstituteCA @aims_ca www.AIMS.ca /company/atlantic-institute-for-market-studies Board of Directors Chairman: John Risley Former Chairman: John F. Irving President and CEO: Marco Navarro-Génie Vice-Chair: Scott McCain (New Brunswick), Vice-Chair: Don Mills (Nova Scotia) Vice-Chair: Leo Power (Newfoundland and Labrador) Secretary: Fae Shaw Treasurer: Doug Reid, FCA Directors: Paul Antle, Laura Araneda, Lee Bragg, Dr. Robert Campbell, Stephen Emmerson, Dr. Richard Florizone, Nelson Hagerman, Doug Hall, Dennice Leahey, Todd McDonald, Jonathan Meretsky, Andrew Oland, Bob Owens, Peter Woodward. Advisory Council George Bishop, Angus Bruneau, George Cooper, Ivan Duvar, Peter Godsoe, James Gogan, Frederick Hyndman, Bernard Imbeault, Phillip Knoll, Colin Latham, Norman Miller, James Moir, Jr., Gerald L. Pond, Allan C. Shaw, Joseph Shannon. Board of Research Advisors Advisors: Ian R. Brodie, Charles Colgan, J. Colin Dodds, Morley Gunderson, Doug May, Jim McNiven, Robert Mundell. The author(s) of this document worked independently, and is solely responsible for the views presented here. The opinions are not necessarily those of the Atlantic Institute for Market Studies, its directors or supporters or of other organizations with which the author(s) may be affiliated. Any errors or omissions remain the responsibility of the author(s). ©2017 ATLANTIC INSTITUTE FOR MARKET STUDIES 2 REINVENTING THE BUILDING OF SCHOOLS Reinventing the Building of Schools The Real Legacy of Public-Private-Partnership (P3) Schools in Nova Scotia By Paul W. Bennett, Ed.D. Director, Schoolhouse Consulting, Halifax, Nova Scotia Table of Contents Executive Summary 5 Introduction: Innovation Injection and Rejection 7 Background Context: Why Turn to Public-Private Partnerships (P3s) for New Schools? 10 Building Too Many, Too Fast: The P3 Schools Construction Program, 1993- 2001 13 Successes and Set-Backs: Assessing the P3 Schools Record 18 Hidden Legacy: Of Education Sector Mismanagement and the Innovation Quotient 23 Who Benefited Most from P3 Schools? Net Benefits and the Public Interest 28 Summary: Lessons Learned from Nova Scotia’s P3 Schools Initiative 33 Recommendations: Building Upon the Lessons 34 References 36 Halifax, Nova Scotia May 2017 ©2017 ATLANTIC INSTITUTE FOR MARKET STUDIES 3 REINVENTING THE BUILDING OF SCHOOLS AboutAbout the Author the Author Paul W. Bennett, Ed.D. (OISE/Toronto) is Founding Director of Schoolhouse Consulting, and Adjunct Professor of Education at Saint Mary’s University, Halifax, NS. Dr. Bennett is a Halifax author, education professor, policy researcher and news commentator. Prior to completing his doctorate at the University of Toronto, Paul earned an Hons. B.A. in History and Political Science (York), a M.A. in History (York), and a B.Ed. from the University of Toronto. Over a career spanning four decades, Paul has taught high school history, authored three national textbooks, headed two leading independent schools, produced many policy papers and written or co-authored eight books. His three most recent books are The Grammar School: Striving for Excellence in a Public School World (2009), and Vanishing Schools, Threatened Communities; The Contested Schoolhouse in Maritime Canada, 1850 -2010 (2011), and The Last Stand: Schools, Communities and the Future of Rural Nova Scotia (2013). Today Paul is primarily an education policy analyst and commentator, producing regular columns for The Chronicle Herald, The Globe and Mail, and The National Post and a variety of other publications. His most recent academic articles have appeared in The Journal of Sports History, Historical Studies in Education, Acadiensis, Canadian Issues, and the Royal Nova Scotia Historical Society Journal. Over the past seven years, he has produced major policy papers for the Atlantic Institute for Market Studies, the Northern Policy Institute, the Society for Quality Education, and the Canadian Accredited Independent Schools Association. He specializes in K-12 educational policy, education history, educational standards, school governance, teacher education, and special education services. Currently, Paul serves as Chair of the Board of the Halifax Regional Library Board, and Vice Chair of the Board at Churchill Academy, a Dartmouth school for students with learning challenges. ©2017 ATLANTIC INSTITUTE FOR MARKET STUDIES 4 REINVENTING THE BUILDING OF SCHOOLS Executive Summary The current research report, Reinventing the Building of Schools, seeks to dispel the enduring myths associated with Nova Scotia’s foray into Public-Private Partnership (P3) schools from their inception in the mid-1990s until the present. With the 20-year P3 school contracts expiring over the next few years, it seemed to be an opportune time to take stock of the successes and shortfalls, to assess the real value of the whole initiative, to identify a few public policy lessons, and to suggest a few ways to build upon the P3 schools legacy in school planning, innovation, and management. Public criticisms of the P3 school deals have been overstated and amplified by politically-driven research which makes little or no reference to the later participation of OMERS, a major Ontario union pension fund. The critical issue is not whether the province should purchase or “buy-out” the private contractors or not, but how we can sustain the innovative impulse unlocked by the first generation of P3s – nurture the innovative ideas, re-capture entrepreneurial spirit, and move ahead with a more flexible, integrated and responsive school building process. Recent public revelations about “queue jumping” in the N.S. school construction approvals process also suggest that political interference in deciding where schools are built or renovated is a public issue of considerable concern. Building upon research conducted for this policy paper and the lessons gleaned from recent Nova Scotia Auditor General reports, I suggest that the Government of Nova Scotia, the Department of Education and Early Childhood Development, regional school boards, and potential private sector partners consider and act upon the following recommendations: 1. Make school capital planning a higher priority of the government and initiate a multi-year school construction and renovation planning process. 2. Establish a Capital Asset Management Framework (CAMF) and expand the range of strategic options from public procurement to alternative service models. End the current counterproductive division of responsibilities in school planning between the department and school boards. 3. Build upon the foundation laid by public-private partnerships by establishing “Partnerships NS,” as a P3 advisory committee, tapping into entrepreneurial innovation. 4. Expand the network of school-level facilities management teams from P3 schools to regular schools, as a demonstration of community engagement. ©2017 ATLANTIC INSTITUTE FOR MARKET STUDIES 5 REINVENTING THE BUILDING OF SCHOOLS 5. Conduct a comprehensive audit of the P3 school planning and management venture assessing the hard lessons, community impact, costs and benefits to the public. 6. Develop a new set of provincial guidelines for identifying P3s, including clear performance standards and criteria for selection. 7. Establish criteria for evaluating progress in reinventing school planning and management process, drawing upon the latest research in public sector management, including value-for-money (VfM) analysis and P3 screening. ©2017 ATLANTIC INSTITUTE FOR MARKET STUDIES 6 REINVENTING THE BUILDING OF SCHOOLS Introduction: Innovation Injection and Rejection “We believe P3 models are largely misunderstood and often misrepresented in pub- lic discussion….” — Paul LaFleche, Deputy Minister of Transportation and Infrastructure Renewal, Testimony, Public Accounts Committee, Nova Scotia Legislature, January 25, 2017. Nova Scotia’s Public-Private Partnership (P3) schools have attracted more than their share of “scare stories” since their inception two decades ago. The first ventures, graphically symbolized by the new Horton High School in Wolfville, NS, tagged the “Taj Mahal,” built at a total cost of over $30-million, cemented in the public mind the image that private-public partnerships drove costs up, exemplified lavish spending, and enriched private developers (Sheppard 1998). In December 2015, the public reputation of P3 schools