Missoula City Council stuck with $175K bill for Art Park overruns, fundraising shortfall
Members of the City Council on Wednesday approved a $3.6 million bond to pay for a new police evidence building and lingering costs related to the Missoula Art Park, though it was the latter that rankled several council members.
The limited tax general obligation bond, to be issued by First Security Bank at 3.9 percent interest over 20 years, includes $400,000 for the Art Park – including $175,000 for project overruns and a shortfall in fundraising.
“That was the unanticipated shortage of revenues and some expenditures in excess of what was previously budgeted,” Dale Bickell, the city's chief administrative officer, told the City Council's Administration and Finance Committee.
The Art Park celebrated its ribbon cutting outside the Missoula Art Museum on April 22 last year. The project was initially approved by the City Council in 2016 at a cost of $668,000, though the project's costs increased to around $900,000, which the council also approved.
As part of those costs, Bickell said, the council increased its general fund participation and the fundraising committee increased its amount, both intended to cover the anticipated $900,000 cost.
“What happened at the end of the day, the project ended up overspending about $50,000 that didn't have initial City Council approval, and the fundraising side fell short,” Bickell said. “Those two things compounded and created this issue.”
While most of today's City Council members didn't have a hand in the project, they still expressed dismay that fundraising efforts have stopped and that taxpayers will cover the bill.
“We're stuck with a bill we never anticipated, and now we're financing it for 20 years, and that bill will be even more as a result of the financing,” said council member John DiBari. “This doesn't sit very well with me. I want to support the police station and the legitimate part of the Art Park, but not the chunk of money the city bore no responsibility for originally then got stuck with.”
DiBari joined Michelle Cares in voting against the bond, and DiBari unsuccessfully lobbied to pay the unexpected bill using cash from the city's general fund. But that approach wasn't widely supported, as the city is working to build its reserves.
“You can pay it directly from the General Fund, but that isn't a good option to me with where we are with our goals,” said council member Bryan von Lossberg. “We learned something about the way that effort was managed. There were deficiencies in the way the project was managed from a single-point entity.”
The project was managed by a committee, not a project manager.
“For every city project we have, we have a specific project manager that's designated to make sure the project meets all the criteria and stays on budget," Bickell said. "That really didn't happen on this Art Park. It was a failure on us to establish that correctly.”
The city will be asked to support another public project on Thursday as the Missoula Redevelopment Agency considers a $500,000 request from the Missoula Public Library Foundation for tax increment financing.
Missoula County voters approved a $30 million bond in 2016 to build a new library. Increased costs in construction and building materials prompted the request, according to the Missoula Public Library Foundation.