budget

When government is involved in planning, construction, or nearly anything, the projected price of a project usually goes up quite drastically. This is true now as the state government’s replacement of the century-old General Assembly building has risen in projected cost by at least $24 million.

The increased price of the Capitol Square complex overhaul is largely due to the two-year delay that stemmed from then-governor Terry McAuliffe’s tiff with the legislature’s Republican majority over Medicaid expansion. The Richmond Times-Dispatch reports that the extent of the project cost overrun is not clear, though. No surprise there – nearly anything involving government is unclear.

The two-year delay has resulted in higher estimated construction costs, which increased by approximately four percent per year, or $24 million, explained Joe Damico, director of the Virginia Department of General Services, the group responsible for state construction projects.

“Construction costs escalated more this year,” Damico said in the report. “Steel prices are going up.”

Furthermore, he explained that the skilled construction labor market has not grown since the 2008 recession, making it harder to speed up the project to outpace inflation.

State officials have yet to sign construction contracts for the new General Assembly building. As well, they have yet to finalize renovations of the Old City Hall building which is now said to be more expensive than estimated and the construction of a new parking garage that would be connected to the new General Assembly building via a tunnel beneath North Ninth Street in downtown Richmond.

Nevertheless, some lawmakers who are overseeing the projects claim they have looked to cut costs as they have decreased the square footage of the new General Assembly building and have excluded a duo of high-profile legislative agencies.

“The estimate came back higher than anticipated and that, coupled with the additional cost due to delay, required adjustments to the scope of the project,” said House Appropriations Chairman Chris Jones (R-Suffolk). Jones is a member of a joint rules subcommittee that is supervising the Capitol Square complex revitalization.

“Some changes had to be made to bring the cost back to a little closer in line,” said Senator Frank Ruff (R-Mecklenburg), a member of the subcommittee that oversees the capital outlay.

According to the lawmakers, the changes that were made on the size of the floor plan for the new building which left out the Division of Capitol Police and the Joint Legislative Audit and Review Commission offices.

The targeted price for the entirely is still unclear. Nearly eight years ago, the state adopted a policy to finance capital projects through pools so that potential bidders do not know the targeted price. Therefore, it is difficult to establish firm cost estimates for each stage of the project.

This year’s House budget includes $11.8 million for the project, entitled “Capitol Complex Infrastructure and Security.”

The General Assembly held its last session in the old building in 2017, then moving to the office and support agency center of the Pocahontas Building. As the repairs are completed, the Pocahontas Building will temporarily house the legislature and then the Virginia Supreme Court.

2021 is set to be the year of completion for the new 14-story General Assembly building as current estimates run.