For the second time in two weeks, the Greensboro City Council gave its stamp of approval to a public-private partnership for a major downtown project.
The Greensboro City Council voted 8 to 1 on three motions to ensure that the work on the Steven Tanger Center for the Performing Arts goes forward at a special meeting on Tuesday, April 25.
Before the meeting, some prognosticators had the split going 5 to 4, and others 6 to 3, but in the end only Councilmember Marikay Abuzuaiter voted against the motions on The Tanger.
The groundbreaking for the project with Gov. Roy Cooper was Wednesday, April 26 at noon, so there was some pressure to get the $2.5 million contract for the grading and infrastructure portion of the project approved before the governor arrived to start shoveling dirt.
The idea was that, with City Council approval, the city would enter into a contract for the site work; but as Coliseum Manager Matt Brown, who is in charge of this project for the city, revealed on Tuesday, the negotiations on the contract were not completed in time for the council meeting.
Instead of approving a contract, the motion passed by the City Council set the maximum price for the site work at $2.5 million, but also had an ominous clause stating that if a contract with Skanska Retenbach, the construction manager at risk for the entire project, were not successfully negotiated, the site work would be done by other means for the same amount.
After the meeting, Brown said that there were parts of the site work contract that could legally be put out for bid separately. Brown said he hoped it didn’t come to that, but he wanted Skanska Retenbach to know that option was on the table.
Brown said that the holdup in coming to an agreement on the contract was not “unusual,” but that he was very disappointed in the attitude of Skanska Retenbach in the contract discussions. Brown said that he saw the relationship between Skanska Retenbach and the city as a kind of partnership to get The Tanger built, but he said that’s not how Skanska Retenbach views it, and that he has been surprised at their intransigence on some issues.
It was reported earlier that, following the action of the City Council, the site work would actually start on May 2. Brown said that he didn’t know when the work would start but it wouldn’t be May 2.
Brown also said that he was surprised the North Carolina Department of Environmental Quality was requiring the contractor to create a storm water retention pond for the construction phase and that it would slow down the site work, since the equipment for the retention pond would have to be ordered. He said once the construction was nearing completion the retention pond would be filled in and paved over for a parking lot, but that it is simply another unforeseen delay in getting the project going.
At the special meeting, Greensboro city councilmembers had a lot of concerns and complaints, mainly about the fact that they had been kept in the dark about what would be on the agenda for Tuesday’s meeting until Monday afternoon, and were then told that the figures they received weren’t final.
Councilmembers Jamal Fox, Sharon Hightower, Yvonne Johnson, Tony Wilkins and Mayor Nancy Vaughan all voiced concerns about getting the information Monday evening.
Brown said, “I take responsibility.”
Brown said that he was surprised by the way the negotiations had gone and hadn’t allowed enough time to negotiate the contract.
There were a number of questions about the financing, which is complicated since the city is paying $39.6 million and the Community Foundation of Greater Greensboro is putting in about $38.5 million.
Greensboro Finance Director Rick Lusk told the City Council that the Community Foundation had been billed $3.2 million of the $5 million it had agreed to pay for the design work and was paid up.
He also said that the Community Foundation has a loan for $25 million and had already collected $18 million in pledges, which puts them well above the total of $38.5 million the foundation had agreed to pay.
At the groundbreaking Wednesday, Community Foundation President Walker Sanders said his organization had now passed the $40 million mark in donations and pledges.
As with just about every meeting the City Council has, Councilmember Hightower had the most questions, and most of them were about the Minority and Women’s Business Enterprise (MWBE) goals for the project.
Brown explained that the goal was 20 percent MWBE contractors, and that was divided into 10 percent for minority contractors and 10 percent for women contractors. Brown noted that they had exceeded those goals on every aspect of the construction bid so far.
Hightower said, “That’s not enough.”
She also made a classic Hightower statement. She said about the site work contract: “$2.5 million – that’s a lot of money; 20 percent of that is nothing.”
In fact, 20 percent of $2.5 million is $500,000, and most people consider $500,000 a good bit of money. Also, 20 percent is higher than the goals set by the state.
Once councilmembers got through complaining about the lack of information, Councilmember Mike Barber kicked off a round of thanking the benefactors who were putting up half the money and talked about what a great project this was for downtown Greensboro.
Councilmember Johnson compared The Tanger to the Greensboro Aquatic Center, which had some controversy over its funding. She said, “Look at the Aquatic Center now. I shudder to think what the city would be like without it today.”
Vaughan said, “We are going to get a phenomenal first class building at half the price, and I will take that deal all day long.”
It was also noted that the city’s portion is being funded with a hotel-motel tax, parking and ticket fee revenue, not with property tax dollars.
The City Council also, by an 8-to-1 vote with Abuzuaiter voting no, agreed to purchase the specialty equipment for The Tanger at a cost of $7.1 million. Brown said that the estimated price was $7.5 million, so the city was saving $400,000, and that the purchase needed to be approved so that the drawings could be included in the construction plans for the building.
Brown said that the equipment – which includes state-of-the-art sound systems, lighting and seating – wouldn’t be paid for until they were delivered, but the order needed to be placed now so the construction documents could be completed.
The City Council also voted to appropriate the remaining $18.5 million of the $30 million loan by the same 8-to-1 vote. Lusk said the additional $8.8 million needed to be appropriated so the money could be spent when the construction started.
Lusk also explained to the City Council that the memorandum of understanding (MOA) with the Community Foundation called for the city to put in $30 million first and then the Community Foundation would put in $25 million, in addition to the $5 million already spent on design.
It seemed like a lot of the questions from councilmembers should have been answered at a council work session well ahead of the vote, but, the way this was done, the City Council came into the room without much information. One of the problems is that the MOA was signed in 2014, which is a long time to remember details like who puts how much money in when.
Once all the questions, including the multitude about the MWBE percentages, were answered, all the councilmembers except Abuzuaiter voted to move the project forward.
The groundbreaking on Wednesday was remarkable in part because of the weather. After days of steady rain, the sun was out and the temperature was in the 70s – just about perfect for an outdoor ceremony.
The other public-private partnership recently approved by the City Council took place at last week’s meeting. Without discussion, the council unanimously approved spending $30 million to buy the land and build a parking garage that will stretch from East Market Street along Davie Street over February One Place and will have a 180-room Westin Hotel built on top of it. The total project cost for the parking garage built by the city and the hotel built by private investors is estimated to be about $70 million.
And, according to city councilmembers, another downtown public-private partnership involving a city parking deck is under discussion.