County Votes to Spend $15 Million on Offices for Government Workers

From the Courier-Journal:

The Harrison County Council voted 4-2 last night to give final approval to a proposed $15 million renovation of the former county hospital for government offices.

The vote -- which split along party lines -- paves the way for the massive construction project and partial demolition of the old hospital. The work could start as soon as this fall.

"The majority of people I've talked with are in favor of remodeling (the former hospital)," Councilman Bill Nichols said. "I'm voting for remodeling."

Nichols, along with fellow Democrats Leslie Robertson, Gordon Pendleton and Richard Gerdon, voted for the project. Republicans Jim Heitkemper and Ralph Sherman opposed it.

The action represents the culmination of months of discussions and meetings after the commissioners' decision last year to pull the vacated hospital off the market and have an Indianapolis-based architectural firm, RQAW Corp., explore converting it and two nearby doctors' office buildings for a government complex.

The project, which involves upgrading roughly 65,000 square feet of space, would be funded with a $9 million grant from the Harrison County Community Foundation.

The foundation would be allowed to get the same amount during the next year or so from the $8 million to $12 million in annual profit-sharing money that Horseshoe Casino pays directly to the county under a development agreement.

That's about $1,500 for every family living in Harrison County.

What a deal we got, building lavish new offices for public servants at a time that the public they are serving is struggling to get by. And we're not just building offices for current public servants, or the public servants we might have in ten years.

Heck no. We're building offices for public servants that it is estimated we might have in another twenty-five years. And who did the estimate that says we might need them? Why, the company (RQAW) that will make a hefty fee off of the building contracts, that's who.

RQAW has in the past, I am told, gotten a fee of about 7% on its work for Harrison County; that means that they stand to make over a million dollars on this project. No wonder they give so much in campaign contributions to certain county commissioners that advocated so strongly for RQAW's proposal.

RQAW and the commissioners pointed to many reasons for their proposal being a good idea.

They said it would be cheaper to build it now than at any other time; that's sort of like finding an item on sale in the store and buying it just because it's on sale, not because you really need it.

They said their study indicated that we needed it; not that there might be a slight conflict of interest involved in that. RQAW's last such study for the county in the late 1990s projected 20 years into the future. Now, barely halfway through the period covered by it, their study was so wrong that they are telling us that we need to rely on a new study by them to get them to build even more buildings for us. Why should we believe them this time when the last one was so wrong? The current study is supposed to predict 25 years into the future; sometime long before that, RQAW will be back with a new study saying that we need even more government buildings.

They said that the old hospital building was just sitting there; that's true, but it's also the triumph of the "don't just sit there, do something or spend some money" mentality. It could have been demolished, turned into a community college, or any number of other projects that would have returned the land to the property tax rolls and would not have burdened Harrison County taxpayers or the county's finances.

They said that the location was ideal; the location was so ideal that the hospital wanted desperately to relocate from it because the site sits on a steep hill that is difficult to access in rough weather in the winter. Sounds like just the place you want important county government buildings to be located.

They say that they want to favor local contractors as a way of stimulating the local economy; bidding laws mean that they'll have to go with the lowest bid, which could well not come from within the county itself. There is no guarantee that any local businesses will get any work out of the project at all, and the work is expected to employ between 20 and 50 people; hardly a great economic boost. But it's safe to say at least some of those contractors will have given campaign contributions to at least one of the commissioners before the whole thing is said and done.

They say that the scheme conjured up to pay for this leaves no real cost to the taxpayer; a feat of voodoo accounting worthy of Wall Street or Washington.

They want to get a loan from the Community Foundation (which cannot legally give loans, so they are calling it a "grant" and operating on the understanding that it will be repaid, which even prominent Democrats on the County Council admit makes it a loan no matter what the verbiage used calls it). In raiding the Foundation money, they want to make it appear that there is no cost. But in repaying the Foundation, the money will have to come from somewhere eventually, and that piper will have to be paid when the time comes.

Many of the assumptions underlying the project seem deeply flawed. It's also likely that the project will run--as so many projects undertaken of late in the county have--over budget (the new hospital was supposed to cost around $30 million; it ended up costing around $45), take longer than anticipated (see the new hospital), and face more difficulties than originally expected (see the new hospital).

The site has been decaying for several years (while the commissioners had the study done and declined, stifled, or killed other opportunities for the site, especially a community college initiative back in 2006) and there are probably numerous lingering and undetected problems that are going to be discovered, were not planned for, and are going to have to be overcome (at additional project cost, no less).

I fear that we've just bought a lemon, and a very big lemon at that, important questions about the project that should have been posed by members of the council were never even asked, and we certainly aren't making an expenditure that is a wise use of taxpayer dollars and county funds in a very difficult economic time.