The Morning Report
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- I was on Editor’s Roundtable today with the U-T‘s Ruben Navarrette Jr. and NPR’s Alisa Joyce Barba, talking about, among other things, the library issue. If you were racing to the radio but just didn’t make it in time, give it a listen here.
- A few readers had some good responses to my column. Reader Jeffrey Davis wrote this:
Scott, I couldn’t tell from your reporting if you contacted anyone in construction for a sense of where construction costs are now versus 2005. Can anyone here comment?
I did as much of this work as I could fit in on this back in July in this post. Give it a look.
Here was the key passage from that piece:
And nobody’s denying that any estimate of the cost of construction it now would be higher.
“I’m reasonably certain that it’s gone up,” said Darren Greenhalgh, the engineer for the city of San Diego who, until recently, was the project manager for the new main library.
Ron Rudolph had a more interesting way of putting it. Rudolph is the affable official at Turner Construction who is overseeing the project’s implementation.
He said he’s been seeing an escalation in construction costs of about 10 percent to 15 percent for this year, which is good.
“It’s not going up at the rate of 35 percent a year like we were seeing,” he said. “The percentage of the increase in construction costs has gone down significantly.”
Based on all the trends I discussed in that piece, I estimated that the cost of the library had gone up $30 million — and this assumed that construction would begin today.
- Reader David Miller, presumably the former deputy city attorney, wrote in with another point:
First, you indicate that the City could “tomorrow have CCDC funds redirected…” Where are these funds that are to be redirected? Do you know of an audit showing a pool of money, which currently exists that could be “redirected.” And, more importantly, if such pool of funds does exist, are there contractual (bond) or legal restrictions on the use of such funds? Please research this. Next, why wouldn’t the City take advantage of donations to purchase a helicopter after the devastation caused by the fires? Surely, you aren’t saying not to accept money or that such a use is inappropriate or unwise.”
Well, let’s start with the first point: Does CCDC have a pool of funds available. Yes. As the U-T editorialized several months ago, it’s “brimming with cash.”
The paper listed all of the planned expenditures of that cash:
Accordingly, the agency is lavishing improvements on downtown, saving the city hundreds of millions of dollars it otherwise would have to spend itself.
Among the big-ticket items: $315 million for new neighborhood parks and open space; $45 million for two new fire stations and one overhaul; $80 million for the new central library; $11 million for the first phase of the North Embarcadero Visionary Plan; $2 million to develop a master plan for revitalizing the C Street trolley corridor; $18 million to install automatic crossing arms at 12 downtown railroad crossings, eliminating the jarring nighttime noise of train whistles. On top of all of this, CCDC is committed to spending $347 million for low-cost housing.
The city’s redevelopment funds can only be used for so-called bricks-and-mortar projects. You can build a fire station with that money, for example, but you can’t pay for the operating costs (the firefighters). Our idea (several people share it) is that this money, which is set aside for downtown development, should be paying for the lingering cost of the ballpark construction. After all, the ballpark is downtown. If the money were used to pay that legitimate downtown expense, many millions would be freed up in the city’s general fund, which could support things like public safety.
As we talked about on the radio today, the mayor’s contention that that money is somehow CCDC’s and not “the city’s” is just plain wrong. When you choose to use it to pay for a new library instead of directing it to pay for the stadium, you are choosing a library over public safety needs.
This may be a valid choice for the mayor and City Council to make — they have to just admit that they’re making it. And they most definitely are making it. As the overseers of the city’s redevelopment agency, the City Council and mayor have decided that those funds need to support the new library and not the city’s public safety.
Now, how could that change? How could you redirect the priorities of downtown redevelopment monies toward paying off the ballpark obligations the city’s general fund absorbs now. Months ago, an expert in municipal law gave me his take. He pointed out that city voters knew that the city’s general fund would have to pay off the ballpark when they approved the stadium’s construction years ago.
A significant portion of the bond payments (for the ballpark) would come from TOT generated by the new hotel rooms the Padres were responsible for. In other words, a significant portion of the bond payments would be made from new revenues generated solely as a result of the project. Thus, only a portion of the funds used to make the bond payments would come from funds that the City would otherwise have today. Thus perhaps it would be fair to have CCDC pick up that difference, and continue to have a portion of the payments come from the new revenues (it would be a canard to claim that those revenues would have come into effect anyway, without the ballpark).
In other words, maybe there’s a compromise.
But for now, we still have to push for just the discussion.