Thursday August 23, 2018
The SoBu Spaces project for a new civic center on Market Street could be the potential heart of City Center, but how much will it cost to start beating, and can the city convince taxpayers to vote on the investment?
The proposed half-acre site sits east of the Allard Square senior housing building and south of the Rick Marcotte Central School. The building will abut a new road which will be built to lead to the school.
The building has undergone several iterations over the course of the year through community workshops, stakeholder meetings, and presentations with council. In July, councilors were presented with a $21 million preliminary price tag and asked the team to return with a list of possible reductions.
Special meetings were arranged on Aug. 13 and 15 with South Burlington Project Director Ilona Blanchard, Steve Roy of Wiemann Lamphere Architects, and John Stetson of Engelberth Construction to flesh out the financials.
On Monday, Aug. 13, the team revealed a cost increase, with the total cost at $23.5 million. Increases were attributed to enlarging the concrete foundation as well as details with sitework and design.
To alleviate the cost, councilors worked with the project team to whittle the total down to an estimated $21,800,000. The new city street was initially listed in the total cost estimate but was later lumped into the impact fee category, which is the source that will fund that project.
That value includes everything — even items not included in the bond that will be pitched to residents. “All in” items include structure, fees, furniture fixtures and equipment, some contingency, land acquisition and sitework, and the solar array.
Currently, the estimate for total debt authorization request is about $20,400,000. This is after subtracting the $418,000 in the Blanchette Fund — an endowment managed by the Board of Trustees — from the city share amount; the tax rate impact would also be reduced by capital campaign and a facilities impact fee. Additionally, donations and fundraising from the Library Board of Trustees could offset what is needed from the city’s reserve funds.
This also takes into account $600,000 of funds trimmed from the estimate with council approval, such as eliminating two of three proposed fireplaces, removing a generator, and skipping out on a rooftop terrace.
The estimated part of the $20,400,000 debt to be funded by the Capital Improvement Program (CIP) reserve would be $16,000,000. To service this, an estimated transfer from the General fund (which is taxpayer-funded) to the CIP reserve fund would need to be $770,000, Blanchard confirmed.
The city share bond excludes Tax Increment Financing (TIF) debt, which is an economic development tool used to leverage new property taxes generated by public projects in a specified district. This also protects the value of the original assessed value for the General Fund.
Under TIF financing, the library and senior center would be approved at 30 percent, and city offices would qualify for 10 percent. The proposed TIF bond payment is $4.6 million.
Cut Costs, Not Corners
Blanchard reiterated that they are still in schematic design and more opportunities for cutting costs will present themselves over time.
“As we know more about the building, we’ll have more options for ways to cut costs,” she said.
After reviewing several types of value management, the team said there could be an estimated $800,000 worth of reductions from the $20,400,000 estimate. This “represents a reasonable amount that could be designed out of the program in the future when we have more information on the project,” Blanchard clarified.
Sources could come from the furniture, fixtures, and equipment budget, from the design process, or through fundraising by the Library Foundation.
The library applied for a grant and was denied, but Library Trustee Mark Coel told the council that this is just the start. They have not yet sought money from private foundations.
“We have not even cracked the surface of this yet,” Coel said. “Part of the reason that we haven’t been able to proceed with this is because we haven’t had a design to provide to whoever it is that we would be asking to make grants.”
He shared a chart of national library organizations that have identified grants made to several sources totaling $3.7 billion.
“We can’t make any promises in terms of what we’d be able to raise from these sources, but we have yet to even broach this,” Coel added. “I thought it was important for you all to understand that we’re just getting started with this.”
Furthermore, councilors contemplated whether removing the city hall and/or senior center features would drastically reduce the price and make it an easier sell to the taxpayers. If a use were eliminated, they asked if the parking needs would also be reduced enough to drop the need for a Memorandum of Understanding (MOU) that was made with the school district. The MOU would grant the transfer of two pieces of the Rick Marcotte Central School property to the city to accommodate parking for the civic building and create an easement for the future of Garden Street. In exchange, the school district would have the option to lease the current city hall property with a minimum initial term of three years, which may be renewed for at least two consecutive renewal terms. These conveyances are subject to voter approval.
“I’m not endorsing this, I’m just trying to reason with those that are questioning the cost,” Councilor Tom Chittenden asked. “If there was just a library, would parking fit on this current lot acquired in the purchase and sale agreement with South Burlington Realty?”
“I don’t think so,” Blanchard answered.
Off-site parking would still be needed, and underground parking would be an added expense and yield no more than an estimated 40 spaces, she said.
On the council’s first warned item on the Aug. 15 agenda, council invited the school board to discuss how essential a land swap would be for the district and asked how strong the need was for the school to lease the city hall building.
“We put a fair amount of work and have had significant conversations about what a benefit this would be,” said Superintendent David Young. “I think it is articulated in the MOU and has not been something the board has entered into without due diligence. For us, we wouldn’t be here tonight with the way it warned if the board was not in favor. We also have a very active master planning and visioning process… this was a lot of work done by the board to get to where we are.”
The project team later revealed that the savings would not be dramatic; removing city hall from the plans would result in a complete project in the ballpark of $19,000. This was enough to convince some councilors that going for all three functionalities is worth it.
“I see that as a leg I can stand on for the voters to explain why I would put forward the three [uses] because we are maximizing the use of a very expensive piece of land,” said Councilor Meaghan Emery.
Not all councilors were convinced, however. Councilor Tim Barritt questioned if this expensive parcel of land was the city’s best option.
“There has got to be other land in this city that’s less expensive that we maybe own ourselves that would present a much nicer, cheaper opportunity and fill our needs,” he said. “I think there’s too much complexity with the school board MOU and then having to swap this place out and duplicate space you already have. I can’t sell that to a voter.”
Councilor Chittenden expressed his wish to discuss a matter with the land swap in an executive session before fully endorsing the project.
Council Chair Helen Riehle and Councilors David Kaufman and Emery said they were in favor of moving forward with presenting a city center/library/senior center building to the public.
“I think it’s a big number and will require a lot of work to make that sale,” Riehle said. She cited the Penny for Paths voter approval as an example of a project that involved advocacy for community awareness. “That tells me if you can make the case clearly, I think we can make the case to the public and that they will support this,” she said.
“We can either settle for mediocrity and make South Burlington a perfectly great community to live in, but not as good as we can be,” Councilor Kaufman said. “I think this takes us to be as good as we can be… and I think we owe it to the people who live here and who will live here in the future to do the best we can. I’m relatively confident we can convince the voters that that’s what we should do.”
Up to a Vote
City Council hosted a public hearing about placing the SoBu Spaces Project on the Nov. 7 ballot. The project team will also provide the council with an update at the Tuesday, Sept. 4 meeting.
The Council will weigh whether to have the item remain on the Nov. 7 ballot or whether to have the proposal for the building as a separate ballot from the state in March 2019, which would provide more time to make decisions.
SOURCE: Miranda Jonswold, Correspondent