It’s not every day you save more than $2 million.

That’s what the Austin Public School board did Monday night when it approved bids to build a new fifth- and sixth-grade intermediate building. The board awarded bids for various aspects of the new school which total $16.2 million, about $2.5 million lower than the estimated $18.7 million district officials had anticipated.

“We were amazed the bids came in the way they did,” finance and operations director Mark Stotts said.

The general building work will be done by The Joseph Company of Austin for $8.5 million, with subcontracting work possibly done by other local companies.

This is the latest project to be awarded under budget by the district, which has now saved millions of dollars on the new school and Woodson Kindergarten Center. Bids for the new school’s site work and four new tennis courts west of Neveln Elementary School came in so low that the board authorized building six courts instead, and still saved $39,000 on original estimates.

In addition, the Woodson expansion project came in at about $243,000 under budget when the board awarded that contact to Wagner Construction of Austin in January.

Stotts said the new school’s excess money will go to unexpected costs and increased technology applications for the project. Under state law, the $28.9 million referendum passed by voters last year must be used on the capital projects submitted by district officials for Minnesota Department of Education review. Once those projects are completely finished, excess money can be used to pay down the levy, according to Stotts.

Budget battles

The new school wasn’t the only fiscal matter the board dealt with Monday. The board passed a preliminary budget for next year that included a planned deficit to keep the general fund within board-set parameters.

The district planned to run a deficit of $1.8 to $1.9 million in 2012 and 2013 to draw down the district’s general unreserved balance fund. After the upcoming year, district officials project the general unreserved balance to end up at about $4.2 million, which is a little more than the $3.6 million required in the general fund to pay off a month’s worth of expenses at any one time, which is board policy.

Though the district usually fares a bit better than preliminary estimates once the board finalizes the yearly budget every December, Stotts cautioned against planning another deficit in the future.

“We cannot continue to run deficits indefinitely,” he told board members.

One of the reasons is the district’s health insurance. The board voted to allot an extra $1.7 million to the district health insurance fund. The district is self-insured, which benefits the budget when employees don’t put in many claims in a given year. However, school employees have submitted more claims over the past three years than district officials accounted for, according to Stotts.

“The past three years have been horrible in terms of claims,” he said.

That’s why the board approved the additional $1.7 million to cover the maximum amount of claims that could be submitted, so general unreserved funding wouldn’t have to be used to cover health insurance deficits, as district officials have done in the past three years.

In other news:

—The board approved an August 14 primary election for the nine school board candidates who filed for election this November. Three seats are up for grabs this year, as board members Aaron Keenan, Jeff Kritzer and Dick Lees face expiring terms. Keenan and Kritzer signaled in May they wouldn’t run for election, while Lees hopes to keep his term.

The nine candidates, Carol McAlister, Lees, Kathy Glowac, Mary Jane Kestner, Bud Johnson, Bruce Quitmeyer, Don Leathers, David Price and Matthew Tabor, are more than twice the amount of candidates for each available seat, which automatically triggers a primary election under state law.

—The board heard an update about district anti-bullying efforts. Neveln Principal Dewey Schara said instances of elementary-level bullying drastically reduced thanks to structured recess initiatives introduced last fall.

—The board approved the new Ellis Middle School handbook for this fall. The new handbook requires Health classes for eighth-graders, aligns the school’s Grading for Learning practices and includes information on how visitors must notify the school before meeting with a student during the school day, per newly initiated district guidelines.

Austin’s new school by the bid:

General Building Construction — Joseph Company — $8,556,500

Structural Steel (supply) — Construction Systems — $876,263

Hollow Metal, Hardware, Doors — Kendell Doors — $257,195

Kitchen Equipment — Held, as district officials have yet to meet with lowest bidder.

Mechanical work — DMC — $4,469,800

Electrical — McMartin — $2,065,400

Total: $16,225,158

District projection: $18,730,000

Source: Austin Public Schools