Peter’s Take is a weekly opinion column. The views and opinions expressed in this column are those of the author and do not necessarily reflect the views of ARLnow.com.
On Tuesday (Jan. 29), the County Board approved a contract for a new A/V system for the Aquatics Center.
It first appeared from a reading of a county staff report (Item 23 at pp. 2-3) that the “soft costs” of the new A/V system were being paid for out of a total of $3.2 million in “new funding.”
Background
When the County Board approved the Aquatics Center’s design-build contract in Nov. 2017, $7.5 million was included for soft costs (at p. 12) to cover “construction administration, county staff time, permits, other consultants, FF&E, technology, and public art.”
The staff report before the Board last night said that these soft costs had escalated 42.7 percent to $10.7 million (at pp. 2-3). Of the additional $3.2 million, the only new soft cost specified was a $450,700 expenditure for new A/V system:
“soft costs include construction management, project management, County staff time, permits, other consultants, FF&E, audio-visual, and public art. The funding for the audio-visual package was funded from the $10.71 million in associated soft costs, from the following funding source and account: Pay-As-You-Go (PAYG) capital funds (313.480001.80001.LBAD.0649.0000).”
The staff report does not explain how the remaining $2,749,300 of costs are allocated among all the other items noted, such as for staff time or consultant fees.
Payment for the additional soft costs
A vote on the new A/V system was pulled from last Saturday’s consent agenda by Katie Cristol after the Board received a letter from John Vihstadt questioning the expenditure.
Last night, staff members from Arlington’s Department of Parks and Recreation (DPR) said that the $3.2 million in PayGo capital used as the source for the funding of these additional soft costs had been in last year’s CIP for the Aquatics Center all along. Therefore, they claimed, using these funds for the new soft costs did not represent any increase in the total project cost for the Aquatics Center. That total cost had been $70.7 million all along, not the $67.5 million the community had assumed.
Based on what it heard, the Board voted last night to approve the new contract for the A/V system.
The right talk, but not the right walk
The Board should not have approved the A/V contract in these fiscally austere times.
At its Jan. 2 organizational meeting, the County Board prepared the community for anticipated tough fiscal times this year: “The only responsible course is fiscal austerity, County Board Chairman Christian Dorsey said….”
Late last year, the County Manager had already warned about projected major shortfalls facing us in his proposed FY 2020 budget: “In all, the county’s combined budget deficit [including APS] could be as large as $78 million.”
Canceling the Aquatics Center project entirely still makes fiscal sense
In a June 2018 column, I explained why Arlington should cancel the Aquatics Center project entirely. The county manager’s protestations that contractors would no longer bid on Arlington contracts if we cancelled lacks credibility. So long as we meet our contractual obligations (paying the cancellation costs), contractors will continue to line up for our business.
As to the argument that cancellation would be a breach of faith with the long-time Aquatics Center advocates, we must weigh their great disappointment against the long-lasting costs to the entire Arlington community of moving forward — the opportunity cost of devoting $70.7 million in total capital funding to this project.
For the next decade, we are bumping up against our 10 percent debt service limit. Cancelling the Aquatics Center project entirely and paying off some of that debt would give us much needed wiggle room. Closing an FY 2020 budget gap of up to $78 million will preserve the priorities of the entire Arlington community far better if we cancel the Aquatics Center.
Conclusion
Canceling the Aquatics Center offers two alternatives. The Board could choose to repay the debt, giving us more flexibility in capital spending. Or it could redirect the net post-cancellation savings to other legally permissible uses.
The manager has confirmed that the County Board legally could reprogram the approved Aquatics Center bond funds for other park and recreation priorities, including these:
- land acquisition for new parkland (the current CIP contains $0 for acquisition of new parkland over the next 10 years)
- park infrastructure (including a smaller community pool) at Long Bridge or elsewhere
Peter Rousselot previously served as Chair of the Fiscal Affairs Advisory Commission (FAAC) to the Arlington County Board and as Co-Chair of the Advisory Council on Instruction (ACI) to the Arlington School Board. He is also a former Chair of the Arlington County Democratic Committee (ACDC) and a former member of the Central Committee of the Democratic Party of Virginia (DPVA). He currently serves as a board member of the Together Virginia PAC-a political action committee dedicated to identifying, helping and advising Democratic candidates in rural Virginia.