Saying cost overruns have resulted from a change whereby the Town Council is less involved in and informed of planning for major capital projects than it has been in the past, one member of the legislative body this month called for a return to stronger oversight.
In the past, the Town Council “appropriated the monies for the design” of a project and “the development of the drawings” before it goes out for bid, according to Cristina A. Ross.
“We’ve abandoned that and we’ve gone from concept to budgeting to approval,” Ross said during the Council’s April 5 meeting, held at Town Hall and via videoconference. “We don’t see anything else in the middle. We don’t know what the project is going to look like, for the most part, unless we insist. We don’t have a firm budget and I don’t think that the Town Council should be excluded from a decision-making process that is both informed and with valid numbers.”
She added, “We have gone through many projects that have gone way beyond [budget] with no explanation other than ‘Oops.’ And that cannot happen.”
Ross cited capital projects at The Playhouse on Elm Street, where it recently emerged that the project would cost $7.9 million—roughly double the original budget—as well as the commercial building at 220 Elm St., which the town acquired as the future home of the Board of Education, Waveny House and athletic fields.
“We did well when we had more control over the process, and certitude that it would be within the number that was given,” Ross said. “We have jumped into scrubbing the process and being given a budget number that doesn’t hold water. Especially on large projects, and we should not gamble with the taxpayers’ money.”
Her comments came during a general discussion of capital projects that followed the Town Council’s approval of the fiscal year 2024 budget.
Chair Steve Karl said that although he was “not happy about the [movie] theater either,” the Council also should give credit for projects that went well.
“Let’s not lose sight of that,” he said. “So if we had a batting average of 90% or 95%, it’s not bad.”
“I get your point on two or three projects,” Karl told Ross. “You’re correct. But on hundreds of other ones, you’re not. So let’s not concentrate on the ones that are terrible when we’re doing a good job on so many.”
Town CFO Anne Kelly-Lenz said she’d been asked by the Board of Finance chair to review several years’ worth of capital projects and found that since 2017, the town had closed out 145 of 260 total capital projects—many of them ranging to smaller expenditures—and that “of those we probably had 10 that you would say were ‘over budget’ but were not, because some had a donation going against it, some had a grant.”
“So what you would have originally approved for bonded was one number,” she said. “It would have increased because there was a donation or bonding against it. We had a couple that went over.” (Kelly-Lenz would provide a 15-minute review of those projects at the April 11 Board of Finance meeting.)
She added, “The big ones you are talking about are the ones now, but we haven’t seen that in the past.”
Ross said that the “outlier” projects are “big-ticket items.”
“You can go back four years to some of these projects,” she said. “And the difference is that prior to that, there was more of a control process. And now it’s just a presentation, the budgeted number. If the Board of Ed was doing this, there would be zero tolerance for it. We want a number and to be able to hold to it. Then why is the town can do the same on large projects?”
She added, “We have had contingencies of 20% on projects, and the projects go beyond, into the millions. So there’s something about the process that doesn’t work.”
Karl said that increased controls on such capital projects is “definitely going to be a conversation we will have” and that first the town must “put data together to look at this.”
Ross noted that New Canaan taxpayers are footing the bills “so I want to be conscientious and accountable for what we are approving.”
“So moving forward I would recommend that we agree on establishing a committee to talk about a process that would give us the confidence in voting for the numbers when they come in,” she said.
Karl said, “We can discuss that.”
According to Ross, who has a professional background in building, the Board of Finance does not have expertise in the area.
“And I think it should start at the Board of Finance, and start with a department when they budget a project,” Ross said. “The same as the Board of Ed has done on other buildings.”
One regular meeting where town officials used to provide regular updates on building projects was the 2019-created Selectmen’s Advisory Committee on Buildings and Infrastructure—the brainchild of First Selectman Kevin Moynihan. He dissolved it after its last meeting in October 2021. (The following month, the Board of Selectmen approved the purchase-and-sale agreement for the town to acquire 220 Elm St. for $6.1 million. At the time of the purchase, the property was assessed at $6,086,710, according to tax records.)
Good for Christina Ross to raise this question. I was under the impression that after the $1 million dollar cost overrun for fields project that safeguards were already in place. To review, in June of 2017 the fields committee of which current selectman Nick Williams was member became aware that the project was going to cost $1 millions dollars more. Committee gave approval to contractor but chose NOT to let the Town Council nor the general public know until September when it was too late to turn back. I can’t think of a better example of the need for safeguards that will protect tax payers from this type of deception. It’s great to hear that a lot of projects went well but all you need is for one or two major projects to go off the rails to offset the ones that went smoothly.