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County Council Chair Jim Hall spoke strongly in favor of denying a $9.7 million budget increase for demolition costs at Trinity Site in Tuesday’s budget hearing. The meeting focused on review of the updated Capital Improvements Process (CIP) plan and included budget discussion.
Historical escalation of project costs due to delays drove the development of a better defined CIP plan. “Especially in the larger projects, these dollars become significant,” said County Chief Financial Officer Steven Lynne. “Do the math” he said. “On a $20 million project like the jail complex, cost increases of 2 percent a month is $200,000. That’s a million dollars in six months.”
He said most of the budget changes seen in the last five years have been due to unprecedented construction-cost inflation.
County Administrator Max Baker said the most significant change in the planning process is splitting it into two phases, a concept study phase and a real design phase.
“There will be milestones, so any deviation from plans will come before council,” Baker said.
“It is a major, major fix in the missing step of defining conceptual design,” said Council Vice Chair Robert Gibson. Yet, Gibson wants project budget variances to be zero.
“Why even 5 percent (variance)?” he asked. “What’s wrong with the idea that the project budget is the project budget? You shouldn’t be coming to council to ask for money; you should tell us how you’re going to stay within the budget.”
Gibson said he did not like the idea that budget variance was a slush fund for overruns. He requested that every project have a review step of lessons learned at the end, adding, “If we don’t learn something from each project we’re never going to improve the process.”
Councilor Nona Bowman asked for more and clearer documentation of planning. Councilor Michael Wheeler suggested clarification of how the new process dovetails with the budget process.
Lynne said that the planning process for utilities would remain separate but standardized procedures would be requested.
The council asked that a revised CIP plan be brought to a later meeting. The council moved on to discussion of the proposed fiscal year 2008 budget.
Bowman asked if the $23 million price for the new Municipal Building could be lowered.
“$575 a square foot is way out of line,” echoed Hall.
“How much can we allocate to improve the schools in the near term?” asked Councilor Ken Milder.
“The state legislature is very jealous about their fund,” Hall said. “If it looks like we are violating their funding procedures, they will take their (school capital improvements) funding away.”
“I’m looking to squeeze money out of projects we have in order to do something for White Rock, which it so badly needs,” Bowman said.
The FY 2008 budget includes $9,672,783 for demolition costs at Trinity Site that had not yet been approved.
Hall questioned whether the FY 2009 budget could be passed with this unresolved. Wheeler responded, “The CIP budget is a policy statement on where the county is going; it’s a set of priorities.”
An additional meeting is scheduled for May 5 to continue discussion of the CIP process with changes added, and to vote on adjustments of the 2008 budget.
During public commentary, Howard Cady requested that county maintenance be more effective and timely at public facilities.
The council resumes budget hearings at 7 p.m. Thursday in Council Chambers in the Los Alamos Community Building.