CCSD braces for effects of Trump tariffs in repair, construction of school facilities

Tariffs on imported goods are the known unknown in the Clark County School District’s offices of construction and facilities management.

Those are the offices responsible for the upkeep, repair, remodeling and construction of CCSD’s hundreds of buildings. They expect the cost of structural steel, aluminum and some electrical components needed to do their work to go up if President Donald Trump institutes the tariffs that he threatened — then delayed — earlier this month on Mexico and Canada, or expands his existing tariffs on China, said Brandon McLaughlin, CCSD’s assistant superintendent of construction and development.

Heating, air conditioning and ventilation systems — critical in Southern Nevada’s extreme climate — especially rely on components containing aluminum and steel.

McLaughlin doesn’t know what those impacts will be, but he expects they will happen. He said vendors and contractors are still trying to get a handle on them.

“With the threat of these things, we’re just going to see additional contingencies and some what-ifs,” he said. “We do take a hard line on our contracting practices, (in) that we agree to lump-sum pricing. We don’t compensate for escalation.”

In other words, quotes are locked in, so contractors either eat increased costs or set them high at the start to protect their interests.

CCSD has access to billions of dollars in bond funds for capital needs for its 374 schools.

Despite that, McLaughlin said he could see a few projects become unachievable given the threat of tariffs, as CCSD only has half the money it needs to fix and build everything it would like to.

Point blank, tariffs make everything more expensive, said Nicholas Irwin, a UNLV economist.

“The people who pay that cost, it’s not a homebuilder or a developer in this case. It’s you and I. It’s the taxpayers,” he said. “Big picture, depending on how big the tariffs are, you could see potentially fewer new schools, maybe more schools being remodeled.”

That goes for other public works projects too.

Repaving a road, for example, requires specialized heavy equipment that operates on parts from Mexico, Canada or China. This could lead local governments to decide between rehabbing a road or a park, Irwin said.

“There’s trade-offs that we’re going to have to make when it comes to scarce public dollars,” he said. “I don’t think people quite understand how it’s going to have these unanticipated knock-on effects that may not be felt until months or years down the road.”

Neil Opfer, an associate professor of construction management at UNLV, said the Chinese government has subsidized the United States’ existing tariffs, which neutralizes the effect on American consumers.

It’s not known whether the Chinese government will continue the subsidies under Trump’s increased tariffs on exports from that country.

Opfer, who has also worked as a carpenter, general foreman and project engineer, said that on a school construction project, costs are one-third labor, one-third materials and one-third overhead and profit for contractors and subcontractors.

In determining project costs, it’s hard to say which materials and what quantities of them will come from tariffed countries.

“The big thing right now is the uncertainty. This is a chess board. What does China do in view of the tariffs? And then, what are the manufacturers that may be getting components from China (doing)?” Opfer said. “Do they instead say, hey, there’s a manufacturer in Thailand who makes electric motors or makes compressors, and they’re just as good, and we go to them? And maybe there’s no increase in cost. Or maybe instead of a 10% increase in cost, there’s a 5% increase in cost.”

In June 2024, even before Trump won a second term, McLaughlin and colleagues told CCSD’s Bond Oversight Committee that 18 aging schools the district planned to replace between 2027 and 2034 would be delayed by a year, pending school board approval.

CCSD’s bond-funded construction plan calls for six new replacement schools to open this fall around the valley: Bracken, Dearing and Hancock elementary; Garside Junior High; and Brinley and Woodbury middle schools. Those six alone are estimated to cost about $514.9 million, according to district documents. Additionally, the district plans to launch the South Career and Technical Academy just off St. Rose Parkway, at a cost of more than $200 million, and complete a $9.1 million cafeteria addition at Eldorado High School.

Inflation had added tens of millions of dollars to the recent projects, meaning that if the district doesn’t tap the brakes on its current construction campaign, it could run out of money before completing every project it has mapped out in its plan — a $7 billion-plus bond program launched in 2015 and plotted out through 2035.

Additionally, a thriving construction market in Las Vegas has given contractors here an advantage, and with internal factors such as a new school board, a new superintendent soon and dropping enrollment, CCSD may have to recalibrate its building priorities.

CCSD had about $15 billion in capital improvement needs, about twice what it has the money for, McLaughlin said.

“I’d venture to guess that $15 billion-need number likely became 16 or 17 just in the year that we’ve held this process, and given the threat of tariffs, it only exacerbates it,” he said.

McLaughlin said the producer price index, which the institutional construction field follows more than the consumer price index, had been stable over the past several months — at least, it’s been predictably high.

On the repairs and maintenance side of CCSD’s operations, Tom Nizetich, assistant superintendent of facilities management and maintenance, said getting parts would be a problem. He likes to keep a selection of parts handy — like pieces to quickly repair busted air conditioners.

Because parts ready to be plugged in already exist as inventory, shortages might not come immediately for his division, but he will continue to be proactive in stocking up.

He’s also worried about long supply chain lead times, a pandemic-related challenge that hasn’t gone away.

Irwin said that recently, tariffs have been used like a bargaining chip. Eventually, he said, he imagines someone is going to call the bluff.

“I don’t know what that looks like. We can build models to tell you what it’s probably going to look like, but it’s just going to make everything more expensive,” he said. “If we thought inflation was bad, add on still-sustained high inflation with tariffs. It’s not going to be pretty for consumer spending or government expenditures.”