Deep Dive: In face of budget gap, Boise library could shrink, see components delayed or removed

During Tuesday’s Boise City Council meeting, Mayor Dave Bieter told the crowd that work to bring the cost of a Boise Public Library rebuild under control was progressing.

“We’ve been doing a good job getting the costs under control,” he said.

An examination of extensive public records received by BoiseDev and interviews with city officials show progress has been slow, and big decisions to get the price under budget are still ahead.

See all 310 public documents released by the City of Boise

“Potentially drastic” changes could be made

In recent months, representatives for the contractors the City of Boise hired to design and build the project have been grappling with how to deliver the project the city wants for the price the city has budgeted.

But project cost estimates have remained far above the $85 million the city has stated as its cost goal for the project.

A January 8th project status document showed the construction estimate at $104 million, nearly 30% above the budget goal.

The budget misalignment prompted urgent notes from both Safdie Architects which is designing the project, and Okland construction, which will build it.

In a December email plotting out scheduling issues, Nick Stoutt with Safdie Associates pressed to accelerate a discussion on project costs.

“Due to the potentially drastic nature of the cost issue and potential (value engineering)/Scope reduction alternatives, could we move this discussion up to next week…?,” he wrote.

Later that month, in an internal email forwarded to city officials and thus subject to public disclosure, Ben Petzinger with Okland Construction expressed concern about the process to get costs in line.

“The advisor part in me is just trying to give them a good faith roadmap to move forward because past is prolog and they really haven’t done much since May in really tackling this budget v design misalignment problem. We can only VE and cut so much until the job is no longer the job City wants but cannot afford……….”

In an email addressed to City of Boise officials, Petzinger outlined a detailed roadmap to aid the process of aligning cost with vision.

Boise Public Library Executive Director Kevin Booe said the cost exercise is old hat.

“We go through that process with every project,” he said. “With (the Bown branch library) we did some strong value engineering. We changed some lighting, we did with that some flooring. That’s a process that we are very comfortable with.”

City of Boise Communications Director Mike Journee said the current environment for construction costs is factoring in the process to get costs in line.

“One of the challenges as we are going through (this process), construction and labor markets change either up or down that’s a big part of that,” he said.

[Library project to adapt after questions raised about Anne Frank tree, garden]

What could change

To get the project cost in line with the city’s stated cost goal, officials will make a series of choices. City of Boise officials already said they will pull out a component to build a performing arts venue and build it at a later time. This could save $9 million.

Another series of adjustments or changes could be made to meet the budget.

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“Everything is on the table but no decisions have been made,” Booe said.

Petzinger at Okland outlined them for city team members in a pre-Christmas email. He noted several features could become optional – to be added back in of case of increased funding through donations or lowered construction costs.

Some of the features are cosmetic or ancilary, like rooftop garden features, pavers, a terazzo floor or features of the lens wall.

Another option could be to push back construction of the arts & history center, much like the performing arts venue. This could save more than $6 million in first phase project costs, according to a cost savings worksheet.

Holding off on the event center and arts & history facility would not remove the cost in the long run, but would instead push them out to future funding if built in later phases.

An overall redesign of the project is also mentioned.

Safdie Associates provided an “area reduction diagram” to members of the library project team. It shows how the project would look if crews built it ten percent smaller.

Such a move would decrease the library and arts & history center square footage to 121,124 square feet versus the currently proposed 134,432 square feet.

The current library building measures about 75,000 square feet, according to City of Boise records.

Now that the project has moved beyond concept and into the nitty-gritty, Rob Bousfield with Boise’s public works department said they have to get the project in line with the budget.

“It’s an interactive process,” he said. “‘What if we did this,’ and run some numbers. ‘How much do we need to buy for that?'”

He said the cost estimate can change – but the budget cannot.

“We have to make sure we reign these things back in to the 80-85 million figure,” he said.

“Part of that process is we are re-scoping the different parts to bring them into our budget,” Booe said. “Before we move forward with schematic design, we are looking at some of the options to bring this into line with cost. We are just exploring everything we possibly can to keep it $80 to 85 million.”

How much will it cost?

At a project estimate of $80 million-$85 million, money is expected to come from four buckets.

The first is philanthropy. Fundraising is already underway, and Journee said dollars donated have been “strong,” but did not elaborate on figures. The City hopes to put $18 million from donations toward the project.

The next component is from the Capital City Development Corporation. As BoiseDev reported, the urban renewal agency for Boise has planned the $15 million in its capital improvement plan:

• $5.2 million is designated for “South 8th Street Sitework… Streetscapes” according to the Capital Improvement Plan. It also notes $2.59M will come from a bond.
• Another $6.8 million is set aside this year for “South 8th Street Parking and Mobility.”
• A final $3 million in 2019 is earmarked for “South 8th Street Public Plaza”

CCDC or another agency could be called on for so-called “lease financing.” This piece is expected to bring in $32 million to $37 million.

Lease financing, or conduit financing, involves another agency that can take on long-term public debt without a public vote.

As we reported last week, municipalities in the State of Idaho cannot take on debt without an affirmative vote of 2/3rds of its voters. Idaho law does, however, allow for urban renewal agencies to take on debt. So-called conduit financing uses CCDC’s bonding authority to take on debt for a project.

City of Boise spokesperson Mike Journee acknowledged that conduit financing could be used for a portion of the library project.

“That model has been used for bigger projects before,” Journee said. “That’s a potential.”

CCDC Executive Director John Brunelle said his agency has talked about ways it could serve in that role. It currently uses the arrangement to provide financing to the Greater Boise Auditorium District’s Boise Centre East project.

Ultimately the bonds would be paid for from public funds, as would the dollars allocated in the urban renewal agency’s capital improvement plan.

The City of Boise plans to make a direct contribution of $15 million.

Altogether, the project as budgeted would take $62 million in public money.

Booe thinks the investment is worth the end result.

“It’s a project worth doing, and a project that is going to make generations of Idahoans very very proud. A library more than a building. It is what’s inside the library, including the people.”