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New Civic Center Project Costs Increase; Before Vote, Councilmembers Must Make Sense Out Of The Dollars

The proposed new Long Beach Civic Center project is one that will move this city forward in a positive way. The project is needed, but it must make financial sense.

So before councilmembers cast their final vote next Tuesday, December 15, they must fully understand the project’s costs, such as the impact to the city’s general fund, the exposure to the city and to taxpayers, the effect on unfunded liabilities, etc. If councilmembers do not understand the financial obligations, they should admit it and delay the vote.

This vote is even more important now that the costs have increased by roughly 20 percent from the original proposal a year ago. These higher costs are outlined in a 137-page document released yesterday.

The original annual cost (referred to as a service fee) was pegged at $12.6 million. Now it’s $14.48 million, plus a new contingency fund, bringing the cost to $14.71 million. That’s a first year increase of nearly 16.8 percent due to what the report describes as “enhancements, escalations and reallocations.” The service fee jumps to $17.28 million in fiscal year 2020. Additionally, there are “other annual costs” of at least $3.27 million, escalating to $3.88 million in a few years. One chart indicates that the “general fund anticipated budget impact total” is more than $5 million in fiscal years 2020 to 2022.

Bottom line is that there are a lot of numbers and a lot of charts in the new report. This is one of the most important votes councilmembers make during their time on the city council. They must get it right.

The Business Journal hopes it pencils out financially. A new city hall, port headquarters, main library and other facilities encompassing the new civic center are essential to the future success of the city.

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