Otter shuts down Capitol expansion project project

Lawmakers will meet with governor about whether to continue plan

January 13, 2007 

Gov. Butch Otter stopped work on the Statehouse expansion project Friday, leaving a just-constructed metal-link fence standing in the snow outside the Capitol.

The order should force the first face-to-face meeting on the subject between the legislative leaders who passed the $130 million project last year and the new governor who opposes it.

"For the time being we anticipate this will be a cooling-off period for the governor and the Legislature to decide the direction they want to go," said Otter's new Department of Administration Director Keith Johnson. "If they want to make a material change or major modification, we'll deal with that down the road."

Otter's spokesman Mark Warbis said the governor told Johnson to stop the contractors.

"His intention is to keep the process from getting too far along while his negotiations with the Legislature are continuing," Warbis said.

Otter wants to renovate the existing Statehouse for about $80 million but hold off on the $40 million expansion. The additional $10 million in the project was budgeted to cover unforeseen problems.

Lawmakers still hope to convince Otter to change his mind. Senate Assistant Majority Leader Joe Stegner said a short work-stoppage shouldn't throw off the tight schedule of the renovation.

"I'm not going to consider at this very early stage that this is anything too significant," he said.

top leaders had to find outby telephone

But Otter didn't notify lawmakers of his plan to stop the work until the day he did it — when the two top legislative leaders were out of town. Senate President Pro Tem Bob Geddes is in Florida for a conference of nationwide senate leaders, and Speaker Lawerence Denney is in Virginia for a similar get-together of other statehouse speakers from around the country.

That could mean Otter and Republican leaders won't meet to talk about the Statehouse until at least Tuesday, when Denney is scheduled to resume his post.

"We won't meet with the governor without our speaker," said GOP Caucus Chairman Scott Bedke.

The Statesman could not reach Denney or Geddes on Friday evening.

state could lose some money,but not bond rating

Torry McAlvain, president of McAlvain Construction Inc., which is working on the wings, said the contract with the state calls for payment for work already performed should the state halt the work for any reason.

Putting the project on hold will affect other businesses as he starts "pulling the plug" on orders for materials and services, he said.

"It's going to have a huge trickle-down effect on sub-contractors and suppliers," McAlvain said. "Everybody has staffed up for this project. I wish they had figured this out better before it affected so many people."

Jeff Shneider, president of CSHQA, the architectural and engineering firm working on the renovation of the central Capitol building, said it was not immediately clear what impact Otter's decision would have on the company, which was handling the design on links between the main Capitol building and the underground wings.

"But right now, you know more than we do," Shneider said.

The third company asked to suspend work is Lemley/3DI, which has been consulting the state throughout the renovation process.

Work doesn't have to stop until next week, but the Statehouse lawn already was quiet Friday, after several days of activity.

Test wells that would double as water drainage have been drilled already, and workers spent the end of this week building a protective fence around the east and west lawns of the building.

The state has already spent $1.3 million on Capitol expansion and renovation, said Gary Daniel, the renovation project spokesman. He didn't know how much of that had been spent on just the underground wings.

Idaho has already borrowed the $130 million in bonds, but Otter's plan is to just pay the money back faster, Otter's budget director Brad Foltman said.

If the state just spends the money on the $80 million renovation, it can use the rest to pay the bonds back in five years instead of eight. Since they were sold to investors already, though, the costs of interest will be the same either way.

Johnson said the state won't have to pay a penalty to the contractors if work resumes soon.

If the project is canceled outright, the state could owe the contractors for work and some damages, but Johnson didn't know the extent of the potential cost.

He said the biggest problems — and costs — could come if the delay backs up the whole project and the state leaders can't move back into the Capitol in time for the 2010 legislative session, as planned.

a battle brewingfor several months

This fall, Otter campaigned with television ads criticizing the Legislature's plan to add two underground wings with 100,000 square feet of hearing rooms and offices.

If the Legislature needs more room, he said, the lawmakers should take space in the Borah Post Office and the old Ada County Courthouse. Both are state-owned buildings just across the street from the Statehouse.

"Government needs to make the best use of what it already has," he said in the ad.

But legislative leaders pointed out that they had explored these other options. The most powerful legislators in the Statehouse formed a task force that spent the summer of 2005 exploring what to do about the aging building and the always overflowing meeting rooms.

The plan to expand underground — in a much smaller version of an expansion in Austin, Texas — was the best and cheapest way, they said.

Otter didn't mention his opposition in the State of the State address on Monday, though, which caused many lawmakers to speculate he would drop it.

Friday's action, however, showed he has yet to be convinced.

That may be because he's never sat down with the people who came up with the plan in the first place.

Legislative leaders were startled when the work was stopped Friday, but they weren't surprised that Otter wanted to force a meeting.

"I've never doubted his position, and I don't think this is inconsistent with what he's talked about," Stegner said. "I welcome the opportunity to discuss this with the governor. I'm very encouraged we will probably have some dialogue now."

To offer story ideas or comments, contact reporter Gregory Hahn at ghahn@idahostatesman.com or 377-6425.1998: Lawmakers create the Idaho Capitol Commission, a citizens panel to direct a renovation project of the Statehouse and develop a plan for the Capitol Mall in Downtown Boise. The panel estimates it will cost up to $50 million to restore the Capitol, and set a goal of finishing by 2005 — the 100th anniversary of the start of construction.

1999: While fighting to keep the water oak planted by President Benjamin Harrison (it survived), the commission creates a plan to restore the Statehouse to its 1920s glory but keep it functioning as a working Capitol. Meanwhile, lawmakers agree to purchase the old Ada Courthouse for $2.5 million.

2000: As the commission travels the state to show the plan to Idahoans, the costs go up — renovation is now expected to cost $64 million.

2001: Gov. Dirk Kempthorne and the Legislature approve the project, to spend $64 million from the state surplus and to authorize another $32 million in bonds.

2002: Tax cuts and an economic slump force a budget crisis, and Kempthorne halts the project before construction starts. Lawmakers agree to hold off the renovation of the Capitol and upgrades to the old Ada Courthouse, which sits empty since the county moved out this year.

2004: The state buys the Borah Post Office from the federal government for $1. Lawmakers kill bills to both renovate the Ada Courthouse and to tear it down.

2005: Outside of about $5 million in emergency repairs spent on the Statehouse, nothing has been done and the cost keeps creeping up. Kempthorne once again asks the lawmakers to use the recently increased cigarette tax and borrowed money to pay for it. The building's 100th birthday passes with cake and about 200 people at a small ceremony. Over the summer, though, legislative leaders formed their own task force to decide what to do. They decided the Legislature needed more hearing rooms and office space. After rejecting plans to restore the Borah Post Office and the old Ada Courthouse or to build a new office building next door, they eventually agree on the plan to build underground wings.

2006: Lawmakers vote to borrow $114 million to renovate and expand the Statehouse, using the cigarette tax money to pay off the bonds. Later, inflation and the desire for a $10 million cushion leads the state to borrow $130 million. Lawmakers agree to move into the old courthouse for the 2008 and 2009 sessions.

2007: The old Ada Courthouse is expected to be ready for staffers to move into in April, when the work is slated to begin on the wings and the renovation, planned to be done by 2010.

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