The City of San Diego will present voters with a choice in November of whether to build a new city hall or renovate the existing building. At a public hearing last night, very few people opposed the plan to build a new city hall, but the city council has agreed to ask the voters whether or not to go ahead.
Only three people at this first public hearing spoke out against building a new city hall; over a dozen mostly downtown businesspeople spoke out in favor.
Consultants suggested the city consider the option of buying another existing building or moving city employees to less expensive locations. At the hearing, real estate representative Craig Christopherson told the council about an offer to sell the city the high rise office building across the civic concourse from city hall -- the so called Civic Center Plaza building.
"This purchase opportunity is at a price of $200 per square foot. The acquisition of Civic Center Plaza would provide an economic alternative at a time when the city’s budget is being scrutinized and the voting public is sensitive to new expenditures," said Christopherson.
The Civic Center Plaza does not have the same significant problems as City Hall, which needs asbestos removed, a sprinkler system installed and earthquake retrofitting.
However, staff in the mayor’s office concluded the purchase would not be as cost effective as building a brand new city hall in the long run, partly because they estimate it has a useful life of only 30 years.
The city’s analysis suggests building a new city hall would be almost $40 million cheaper, over the next 10 years, than doing the renovation and maintenance needed on the current building.
But City Councilwoman Donna Frye questioned Chief Financial Officer Jay Goldstone about how changing interest rates could affect the analysis. She cited consultants’ estimates that, if interest rates rise above 6.25 percent, the whole equation changes.
“You’re saying we’re not going to exceed $295 million for the construction costs, but the cost could be $700 or $800 million if you don’t have some sort of a cap on what you’re going to be spending on interest," said Frye.
Frye tried unsuccessfully to get a guaranteed cap on the project's cost if interest rates rise.
Councilman Todd Gloria was one of four council members who fully support the plan.
“From the speakers today, and the testimony that we heard, the business decision is clear," Gloria said. “From the standpoint of good government and efficiency and saving taxpayer dollars, you proceed with this project.”
Gloria and Councilwoman Marti Emerald were so convinced by the arguments that a new city hall would save the city money that they questioned the need to spend $250,000 to put the measure on the ballot.
However, a majority of the council wants to get voter approval.
There was a motion to start design work immediately, but Emerald supported Councilwoman Sherri Lightner, who wanted to delay authorizing any spending until after November.
"If we're going to put this on the ballot,” Emerald said, “it would send the wrong message to the voters if we are already allocating $2 million to start early design work, before the voters have had a chance to vote on this.”
Councilman Carl DeMaio remains adamantly opposed to the plan, but the council would not give him authority to write a counter-ballot argument.
By law, the city cannot campaign for the measure so it remains unclear who will raise the money to support and oppose the initiative.
