The Hyde Park Central School District board voted June 12 to authorize an energy performance contract (EPC) with Honeywell, following presentations from Energia (technical reviewer) and Honeywell representatives and review by the district’s construction manager and legal counsel.

The contract, described in the presentation as a $12,950,000 fixed-price EPC, bundles energy-related facility upgrades — LED conversions, replacement of remaining pneumatic controls with digital controls, HVAC upgrades and a solar installation — into a single, guaranteed-savings contract. Honeywell will guarantee energy savings and the contract includes measurement and verification (M&V) procedures to validate annual savings.

Justin Benoit, director of project delivery with Energia, told the board that the governing New York energy performance law (article 9) and State Education Department review apply and explained that EPCs are funded from the energy savings the upgrades produce. “Those energy savings are guaranteed,” he said. The district’s technical review firm, Energia, conducted a comprehensive audit and advised the board throughout the procurement and evaluation process.

Financial structure and one-time funds: district presenters and the Honeywell team said the project will rely on multiple revenue streams. The EPC contract price is $12.95 million; staff identified $2.9 million in rebates and federal/utility monies tied to the solar component, plus an approximately $950,000 NYSERDA grant for design and engineering support. The district expects state building aid on aidable components (presenters used a 58.1% aid ratio in illustrations). The presentation showed an indicative total project cost of roughly $16.09 million after financing costs; Terry Geary, a Honeywell presenter, summarized the outlook: “You’ve got a very significant annual positive cash flow every year.”

Guarantee, M&V and risk: Energia and Honeywell emphasized that EPCs are fixed-price and include a formal energy-savings guarantee; the guaranteed savings were presented conservatively. The district’s cash-flow exhibit shows annual guaranteed energy savings in the first guaranteed year of about $560,000 (staff described this as a conservative, guaranteed amount). Measurement and verification will be performed annually and Honeywell’s guarantee depends on the M&V process. District staff said the M&V service can be retained long term to protect the guarantee; if the district chooses not to retain M&V support, Honeywell’s annual guarantee would not remain in force.

Procurement and approvals: Energia described the RFP process, technical review and the district’s coordination with Palumbo (construction manager) to ensure no overlap with current or recent capital work. The work and the comprehensive audit will be submitted to the State Education Department for approval under the EPC rules. Presenters said EPCs are not subject to voter approval or low-bid requirements because the statute allows procurement and funding based on guaranteed savings.

Board actions and next steps: at the June 12 meeting the board approved a negative declaration under SEQRA (no significant environmental impact), a resolution to proceed with the EPC (listed on the agenda as a SIGRA resolution), and the vendor contract with Honeywell by voice vote. The board also approved municipal advisory services for financing and will engage the district’s fiscal adviser to complete financing once SED approvals are secured. Staff said financing will be pursued through a municipal lease/loan RFP and that one-time rebates and grants will be applied in early years to reduce interest costs and principal.

Less-critical details: the district will replace select unit ventilators (noted at several schools) and install a ground-mount solar array; presenters said solar panels include 25-year power warranties and inverter warranties consistent with bankable equipment. Detailed cash-flow tables were provided to the board and will be incorporated into formal financing documents.