The Albany Convention Center Authority will move forward with plans to build a convention center, 400-room hotel and a parking garage despite an increase in the price tag to an estimated $397.5 million, nearly twice the cost announced a year ago.
The board met Friday morning to discuss the project and members were given a specific cost breakdown.
Convention center plan
To view a Powerpoint presentation on the proposed convention center in downtown Albany from Friday’s Albany Convention Center Authority meeting, click here.
It includes $192.5 million for the convention center and a pedestrian walkway to the Times Union Center, $153.2 million for the hotel and $32.3 million for the garage behind the convention center. Also factoring in is $6.9 million to purchase the land and $12.6 million for improvements.
The authority’s executive director, Duncan Stewart, said the price was released Wednesday and that this is the first detailed cost estimate the authority has done. It provides a breakdown of everything from the number of escalators, truck docks and staircases to electrical and plumbing systems.
Part of the reason the price tag is higher is escalation in costs through the midpoint of construction that could be affected by changes in the cost of fuel and other commodities, according to Stewart.
“If we start building in 2008, we believe we have anticipated cost increases in that number,” said Stewart.
If the project is not authorized by June, costs would increase by $40,000 a day.
Mayor Jerry Jennings, who has been a strong proponent of the convention center, raised concerns about the higher price tag Wednesday and said it may be time to re-examine the project at a time the city is faced with other financial priorities.
“I respect the mayor’s position about the city, but we are a state authority and we are awaiting authorization from policymakers at the state level,” Stewart said Friday.
He said the state Legislature and governor’s office decide to authorize the project, not the authority itself.
At this point, the Albany Convention Authority has a $75 million grant from Empire State Development Corp. and $2 million of this has been released for the planning process.
In addition to the $75 million, the authority will also receive a portion of the Albany County hotel occupancy tax. An increase in state aid to Albany in the next 25 years will be a guarantee for bonds that the authority will sell to finance construction.
An additional $192 million is needed over the duration of the project. The authority is expected to seek additional state funding to cover increased costs, which would have to be authorized by the Legislature and governor.
The authority will also look for other sources of funding.
A spokeswoman for Gov. Eliot Spitzer said the revised costs will be reviewed.
Stewart said he’s hopeful the authority will get authorization this legislative session.
“It’s possible we could begin construction in 2008. We need the authorization this year, but we don’t have additional money at this point in time.”
The next step is to complete the state environmental review. Stewart said that in the event construction is not authorized this year, the archaeological and environmental work will already be done to make the site “shovel ready.”
In December, the authority chose firms to operate the convention center and hotel. It entered into negotiations with Starwood Hotels to operate a 400-room Sheraton Hotel and with SMG, which operates the Times Union Center, to run the convention center.
The convention center and hotel would be built in the area bounded by South Pearl Street, Broadway, Hudson Avenue and Madison Avenue.
The next board meeting will be held at 8:30 a.m. on Feb. 29 at 112 State St., in the Cahill Room.
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