After months of trying to obtain answers to costs involved in the massive construction project at Ocean City’s Public Works complex known as the “Campus Plan,” I am now making progress.
While not all of my questions have been answered, I have a better understanding of this very complicated undertaking.
First, I want to thank our city manager, Doug Miller, for inviting me to City Hall to meet with him along with key department directors to obtain answers to my questions.
In December, I met with Doug, Jennie Knapp, director of budget & management, Hal Adkins, public works director, and Chuck Bireley, finance director. I also want to thank Jennie, Hal and Chuck for their help in providing answers.
They were helpful at the meeting and with follow-up inquiries. I appreciate their time and assistance.
Early on I knew that the campus plan was a complex financial project involving many millions of dollars.
Initially, we were told that it would cost $25 million with the town paying $11 million from a bond sale and the Maryland Transit Administration (MTA) with Federal Transit Administration (FTA) grants paying $14 million. When one delves deeper into the project, they will find that it is much more costly.
Initial Needs Assessment studies, Design and Engineering cost the town over $1.75 million, and the MTA funded an additional $1.75 million.
Construction and construction management oversight cost the town nearly $11.1 million, and the MTA funded an additional $18.5 million.
Land at 64th Street, originally purchased for wastewater treatment plant expansion, but now developed as a ground level parking lot as part of the campus plan, along with early land improvements and interest paid on the 2010 bond to fund the acquisition cost the town nearly $2.28 million.
Interest over the next several years on the 2018 bond to fund the campus plan construction is over $4.9 million. These totals will cost the town over $20 million.
The MTA has funded a total of $20.3 million. Thanks to a bond premium of almost $950,000, which is cash applied to the construction, along with almost $376,000 in interest on bond proceeds, the town is able to reduce their costs by over $1.32 million. With this reduction, the cost to the town drops to $18.7 million.
What was presented as a $25 million project will now cost at least $39 million .
However, that is not all. There is already consideration to revisit the construction of an employee parking garage and helipad which was initially scrapped due to exorbitant bids.
If the mayor and City Council proceed, it is to be built on the ground-level parking lot on the land acquired with the 2010 bond.
That alone could cost $8 to $10 million based on earlier estimates and actual bids. If MTA shares part of the financing as previously planned, it could cost the town $4 to $5 million in additional funds.
I have recently learned that in 2016, the town stated plans to swap a portion of the 64th Street land purchased in 2010 with land under the existing Public Works administration building.
That swap would allow for future wastewater treatment plant expansion to be built where the admin building sits, thus allowing the 64th Street land to be used for the campus plan.
This will require the demolition of the admin building which was built in 2002. No one at the meeting could tell me the estimated added cost of the demolition of that building.
To facilitate the replacement of the admin building, an unfinished area or shell has been built on the second floor of the new purchasing building.
It is to be finished to house the future administrative offices after the demolition of the existing building, if and when the wastewater treatment plant is expanded. No timeline has been provided; but more important, I have no idea of what the added cost is to complete the unfinished office space.
To date, no one has provided any cost estimate on the eventual relocation of the impound lot which is earmarked to be relocated somewhere other than the campus plan complex. This could involve land acquisition costs, as well as construction costs.
By the time the campus plan is finally completed, the combined costs to the town and the MTA/FTA could potentially exceed $50 million, quite a bit higher than the stated cost of $25 million.
During the meeting, I had many questions. However, one question was posed to me, which was essentially, what was I trying to accomplish by my pursuit of this inquiry.
My answer then, now and has always been that I am concerned about the town’s excessive overspending and debt. I am also concerned about the excessive overspending and debt at all government levels, especially at the federal level.
Likewise, I am concerned for our children, grandchildren, great-grandchildren and generations yet to come.
Vincent dePaul Gisriel Jr.