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Derby Public Schools has set a guaranteed maximum price of $12,359,595 for a new 42,000-square-foot administrative center and improvements at Tanglewood Elementary School.

School board members approved the amount at their Aug. 5 meeting.

The guaranteed maximum price is the most McCownGordon Construction, the company overseeing all of the district’s bond projects, can bill the district without a change order.

Staff from the current administrative center, the educational support center and Carlton Learning Center will work in the new administrative center.

The guaranteed maximum price for the administrative center is $10,542,898.

Crews will build an enclosed connecting hall to Tanglewood, operations and finance director Joe Dessenberger said. The meeting rooms of the administrative center will serve as the storm shelter for both sites.

The Tanglewood project will include 2,212 square feet of new classroom space and interior remodeling of about 5,336 square feet.

The guaranteed maximum price for Tanglewood is $1,569,178, just more than $55,000 above an original design development estimate.

“The estimate is based on industry professional estimates based on 65 percent design plans,” Dessenberger said. “The actual cost is based on hard bids from trades. The slight upward fluctuation is not a surprising amount based on costs of materials and labor increasing in many sectors due to the strong economy.”

An owner’s contingency of $247,519 also has been included in the overall guaranteed maximum price for both projects.

“It is important to understand that owner contingency is bond funding that was held in [a] separate line of accounting outside of the construction budget,” Dessenberger said. “Without it being moved over by project and placed into the GMP, staff are not able to make decisions that often need to be made on the job site same day about a situation that arises that would cost the owner more money. This would be an adjustment to the GMP, which takes a board action. With the contingency funds being moved inside the GMP, the owner rep can make an immediate call to expend contingency dollars to rectify an issue and keep the project moving.”

Examples of such situations include “replacing an unforeseen bad water line or additional electrical needs that are not in the construction document but make sense once construction is underway,” Dessenberger said.