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Council moves forward with $23M lecture hall, Library Foundation reaffirms 50-50 funding

By SARA HALL

On Tuesday (Nov. 14), City Council reviewed the project and discussed the recent construction bids for the proposed Library Lecture Hall. The final plans call for a 9,814-square-foot building with 299 seats.

The city received three bids on October 12 and the lowest qualified bid was from AMG & Associates for a base bid of about $19.07 million. The updated total all-in project cost is projected at approximately $23.44 million. The current memorandum of understanding with the Newport Beach Public Library Foundation commits the city to a 50-50 split on funding the project.

Councilmembers voted 4-3 on a motion to move forward with the lowest bid and direct the Library Foundation to reach out to the community to find pathways to incorporate the different elements of arts, business and culture as additional uses for the facility. In a straw vote, Mayor Noah Blom, and Councilmembers Robyn Grant, Brad Avery and Erik Weigand raised their hands in support.

In the long run, they would all like to see the project happen, Grant said, although maybe some more so than others, who were primarily concerned about the high cost of the project.

“I do believe, truly believe, that the approval of this project is good shepherding of our money. We’re going to get a state-of-the-art facility for half the cost,” thanks to the private funding, Grant said, and the donations from residents represent “the true commitment of the community to this type of a project.”

Grant and other project proponents were worried that rejecting the bids and waiting would likely ultimately result in even higher costs or the idea being abandoned altogether.

Delays have already increased the costs, she noted, if the council were to reject the bids and prolong the project even longer for a redesign, they could spend a lot more money than what they’re already expecting. That move also risks losing the private funds that have already been committed to the project.

“I don’t have any doubt that we can afford this project and I believe that it is a project that we should be investing,” Grant said.

Most of the discussion on Tuesday centered around the total estimated cost of the project, which has significantly increased from the approximate $8 million when it was first proposed in 2019.

“I’ve been a fan of this project for a long time, but also very aware over this period of time – and certainly in the last few years – this period of runaway building costs,” Avery said.

That’s something nobody could have predicted when the project kicked off several years ago, he noted. The library lecture hall started with a lot of goodwill and an extraordinary effort of fundraising, he added.

The efforts of the residents and businesses drive the success of the town and the council just tries to pave the way, he commented, and, despite the current building costs, projects are still getting done.

“Do we take the risk to build something exceptional? Are we bullish on Newport Beach? That’s the question,” he said.

His key concern is ensuring that the facility is heavily programmed and serving as many residents as possible. It needs to be consistently utilized with robust programming so that the project is worth the cost.

“When it opens its doors, it’s full all the time,” he said. “I don’t think it should ever be empty.”

There’s always a little risk in terms of the financial side of it, Avery added, but they consistently see Newport Beach do very well in terms of revenue streams to the city and waiting could result in even higher bids.

Council moves forward with $23M lecture hall exterior

Click on photo for a larger image

Art courtesy of RCA/City of Newport Beach

The exterior of conceptual design for the planned library lecture hall

While the 50-50 funding MOU with the Library Foundation is still in place, the foundation already has $8.2 million in hard commitments available now: $7 million to be placed in the escrow account prior to contract award and $1.2 million to be collected over next three years.

They also identified that they already have another approximately $1 million in soft pledges that should be available after contract award.

The foundation has also committed to taking on further fundraising campaign efforts to raise the remaining contributions, up to 50% of the total project cost, or approximately $11.72 million.

Kevin Barlow, chair of the board of directors for the Newport Beach Library Foundation, confirmed that on Monday (Nov. 13), the board voted to approve leadership to negotiate an updated MOU, by increasing the foundation commitment for the library lecture hall as proposed to reflect 50% of the new expected project cost, or $11.72 million, whichever is less.

The MOU will have to re-negotiated because of the new total cost estimate, but the city will have to commit to funding the other 50% following this week’s direction from council.

Although Mayor Pro Tem Will O’Neill cautioned that it wouldn’t just be the $11.7 million, but about $17 million that the city would need to commit to since they can’t guarantee that the additional $5 million would come in from the foundation.

“There’s no scenario where the city of Newport Beach would sue for breach of contract on that. And so, I think, that when we’re up here and we’re trying to decide what we’re going to do, we have to assume that it’s $17 (million),” he said.

Councilmember Lauren Kleiman was also concerned about the ability for the foundation to collect on the current or future fundraising pledges, given current economic uncertainties.

Grant emphasized that they are a proven organization with their fundraising abilities and repeated contributions to cultural arts programming in the city.

“I do not doubt that they will continue that Sisyphean effort and come up with the money. I have no doubt. I have full faith in the people that are involved in this project,” Grant said.

But the overall project price tag is too much of a concern for others.

When the project first came before the previous council in 2019, it wasn’t a unanimous decision to move forward, O’Neill recalled, and there was a lot of concern (both on the dais and from the public) about the price tag, approximately $8 million at the time. If they had been told that it would be nearly $24 million there would be been zero votes for it, he commented.

At about $2,388 per square foot, it’s the most expensive project the city has ever built, O’Neill pointed out. Compare that rate to a recent fire station, which is a nice facility, which cost approximately $755 per square foot, he added.

“If we’re talking the ‘need to have, nice to have’ context, that is a ‘need to have’ project that is one-third the cost of a ‘nice to have’ project,” O’Neill said, “and that is a problem.”

There are also a number of important capital improvement projects anticipated for the coming years, he added, as well as the regular use surplus funds for community enhancement projects. This is the challenge that they, as a council, have to ask themselves to consider the “want” of a lecture hall project, while keeping in mind how these other plans factor in.

“This is not an easy ask, it’s actually an enormous ask, and it’s one that we need to look at within the context of everything else,” O’Neill said.

They also haven’t conducted a city survey regarding resident desire for the project, O’Neill noted, which would be important for them to know that a majority of people would prefer to do this project versus spending the money on something else.

They also haven’t discussed scaling the project back, O’Neill said. The opportunity to do so would have been earlier this year when the city first received the higher-than-expected bids.

“At the end of the day, the goal is to find a path forward that is for the best interest of the whole city. I know that a lot of you believe that this is in the best interest of the city, even at this price tag,” O’Neill said. “I just struggle to get to the point where I can support this.”

Councilmember Joe Stapleton recognized the importance of a project like this and he appreciated the public-private partnership. Although he wasn’t on the council when the project was first introduced, it’s not a discussion he’s taking lightly. He suggested they consider expanding its potential community uses, possibly to develop it more as a civic auditorium, as others mentioned.

“I believe we need to re-imagine the original intent, the original use of this building,” Stapleton said.

He recently toured the Newport Theatre Arts Center on Cliff Drive, which is slated to be replaced within the next decade. It’s not in the best interest of the city to build two auditoriums within such a short time period. He suggested possibly combining the projects.

“I’m not saying to punt the project for the library 10 years, I’m saying is there a world where we can marry these projects together?” he asked.

Although the current design of the lecture hall does not work for a community theater/performing arts center (there’s not enough back of the house space), Stapleton asked what it would take to quickly make some changes to the design.

Expanding the use would also help with fundraising, he added, and it would free up some land on Cliff Drive. There are plenty of examples of community theaters that include a lecture hall.

“I believe Newport Beach would be very well suited to have a cultural arts center,” alongside the lecture hall and the sculpture garden in the Civic Center Park, Stapleton said. “If there is a will, there is a way.”

Grant also liked the idea of merging uses like dance and theater with the lecture hall, but thought it could be done with the way it is currently designed. There’s a path forward for that, she said.

“I’m in favor of expanding the library and making it even a greater cultural hub than it already is for our community,” Grant said. “We all know in this city how valuable our library system is to every single resident.”

They get more visitors to the library than anything else in the city, other than the public beaches, she pointed out.

Merging these two concepts won’t be easy, she said, and everyone will have to come together to accommodate each other.

“I do believe that given the innovation and technology in the arts and the creative thinking and the big minds that are on this, we can bring this all together in the existing footprint,” Grant said.

Stapleton suggested rejecting the current bids and re-forming the ad hoc committee to expeditiously look into merging the lecture hall and the theater projects into one, creating a cultural arts center. In a straw vote, the idea failed to find a majority with only Stapleton, O’Neill, and Kleiman supporting the idea.

Combining the theater into the lecture hall would be complex, but doable, said Public Works Director Dave Webb. It wouldn’t be a complete redesign, he added. Although the city would have to re-bid it back on the open market, he added, which inherently brings potential risk of higher costs.

Within the last nine months, the bids have notably increased. On February 28, the city received five bids for the project ranging between $17 million and $20 million. All were significantly higher than the latest engineer’s estimate of $14 million. On April 25, council unanimously rejected all construction bids due to the high cost.

However, when the project was re-bid recently, all submissions were even higher and were above the engineer’s newest estimate of approximately $18.5 million.

This is a high-end building and the site is constrained, Webb explained. There are also still issues with the supply chain and a tight labor market that were exacerbated during the pandemic, he added. Builders have told them they have two years of backlogs, Webb noted, so there’s a lot of work out there and competing costs for contractors.

All of this factors into the price tag for the project and drives the cost up, he explained. After checking around and asking other companies that have developed large projects for the city, Webb found that “that’s the right number for this project in this environment.”

“It’s expensive, but that’s where it’s at,” Webb said.

The project was first introduced in 2018, when council approved $70,000 to initiate an exploratory effort. At the March 12, 2019, study session, a majority of council supported the item and agreed to add $500,000 to the next fiscal year’s budget to fund development of a concept plan and analyze the project cost estimate. Later that year, council formed a design committee, which reviewed proposals on Aug. 19, 2019, and later selected Robert R. Coffee Architect + Associates. At this time, the estimated cost was $8 million with a 50-50 split with the foundation.

Over the last few years, the committee was tasked with developing the facility concept. They pored over design ideas, considered seating, indoor/outdoor activity, sight lines and orientation of the entrance. The group worked on parking issues and the building’s connection to the library, compared various sizes, configurations, and blueprints and discussed how to incorporate the bamboo courtyard. They also reflected on current and future programming.

On April 30, 2021, staff and the project architect presented the concept to the Irvine Company. Following some changes and the committee’s approval, the revised concept plan was approved by TIC on August 18 of that year. Council reviewed and tentatively approved a concept plan during a study session on Sept. 28, 2021. At that time, staff also presented a $12.78 million cost estimate along with tentative funding terms for the MOU with the Library Foundation.

On Nov. 30, 2021, council approved the conceptual design for the planned library lecture hall. Councilmembers voted 6-1, with then Councilmember Kevin Muldoon dissenting, in support of the design, including the floor plan and the exterior architectural style. The November 2021 action also approved the overall cost estimate of $12.81 million and an MOU with the foundation, which commits the city to a 50-50 funding match or $6.5 million, whichever is less.

The building plans were completed by RCA and approved by city staff in the fall of 2022. The engineer’s estimate for the project at this time was approximately $14 million.

Jill Johnson-Tucker, speaking as chair of the Beyond Books campaign and chair of the Library Lecture Hall Design Committee, said that the process started even earlier for longtime library supporters. The site was studied as early as 2014, she pointed out.

“So here we are. It’s been a 10-year journey and we’re at the end of the line,” Johnson-Tucker said. “This has been a long journey and the outcome depends on you.”

A number of people have since enthusiastically embraced the dream of a lecture hall on the civic center grounds, she noted.

Although the pandemic interrupted the ongoing calculations, library programming had increased 160% in 2019 over the previous 10 years, Johnson-Tucker said. After a couple of years of Zoom/remote presentations, they are now back to in-person meetings and growth has continued to soar. They’ve introduced new series, secured world-renowned speakers and routinely have sold-out crowds.

The current space does not provide enough capacity to meet the demand, she explained. For those lucky enough to get a seat, they deal with a subpar audio-visual system and issues with the poor sightlines.

“It is a challenge to see the speaker and if the presentation involves a slideshow, it’s not possible to see the screen for much of the audience, and yet people continue to show up. They’ll sit packed in – cheek to jowl – in stackable chairs, in less-than-ideal conditions, because they want to learn and be entertained, and be part of the community,” Johnson-Tucker said.

There are a number of various programs already being discussed, Johnson-Tucker noted, including some that donors are interested to sponsor. Weekend-long conferences, a think tank series, and film programming with local movie makers are just a few of the ideas being considered.

“The possibilities are endless, if we have the right space,” Johnson-Tucker said.

The space will also help fulfill the needs of the greater community, like local organizations and business groups, she added.

The fees to use Witte Hall would offset the expenses of maintenance, Johnson-Tucker pointed out. Bowers Museum in Santa Ana, a similarly sized facility (292 seats), charges a base fee between $1,800-$2,250 to use the auditorium. She would expect Newport’s fees to be higher, Johnson-Tucker said.

Larry Tucker, who sat on the city’s Finance Committee for six years, said Newport Beach always has a surplus.

“The city has, and is expected to continue to have, large surpluses,” he said.

He discussed a key topic of the meeting: Spending money on “wants” versus “needs.”

There are several facilities that the city built even though the projects were more of a want than a need, like the Junior Guard headquarters or the OASIS Senior Center, Tucker pointed out. These were highly desirable quality of life assets and the city could afford to build them, he said.

“It’s entirely rational to prioritize spending of limited resources based upon whether an expenditure is for a want or for a need, with one exception: If a buyer can afford to buy an asset, then that changes the calculus because the asset can be bought regardless of whether it is a want or a need,” he said. “That calculus might change even further if someone else is willing to pay half the cost of that asset.”

In this case, the city has enough money to come up with its $11.7 million towards the facility without sacrificing anything else, he said.

“City Council has historically spent money on quality-of-life assets and that is what has helped keep Newport Newport,” Tucker concluded.

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Sara Hall covers City Hall and is a regular contributor to Stu News Newport.

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