Thanks to high bids, courthouse overhaul already over budget

EVERETT — Snohomish County’s courthouse renovation is over budget before the first construction fence has gone up.

The County Council received a briefing Monday on the latest bids for the five-story addition and overhaul of the existing building, work that’s scheduled to break ground next month.

The bids came in nearly $4.7 million above budget. That’s about 6.5 percent more than the $72 million the council authorized last year.

“In this hot construction market we’re actually feeling quite good about that number,” said Ken Klein, an executive director for the county. “From what our consultants are telling us, they’re seeing overages in the Seattle market of 20 to 30 percent.”

The new total includes more than $4 million in contingency money, so it’s possible the project could wind up close to the original budget, he said.

No action was taken Monday. The council is set to vote July 25 on approving the construction bids. Fencing could go up along Wall Street and Wetmore Avenue as early as Aug. 1.

At Monday’s meeting, County Councilman Terry Ryan said he was disappointed to learn about the cost increase after hearing for more than a year that the project was on time and on budget.

“And we haven’t even put a shovel in the dirt yet,” Ryan said.

He asked a pointed question: Why hadn’t the council learned of the issue before last week, when Klein met individually to update each member? Had he known, Ryan said, he might have voted differently on a recent request that approved filling three executive office positions.

Klein said the last of the 30 bids arrived June 25. He said contractors provided widely varying estimates. The general contractor earlier this year estimated the project at $2.9 million over budget, while a third party pegged it at $6 million under.

“Until you test the market, you really don’t know,” he said.

Annual debt payments on the extra amount would cost roughly $300,000 per year.

Klein outlined three ways the county could make up the difference without raising taxes: selling county-owned property across the street, using a real estate excise tax or dipping into a savings fund intended to maintain or replace other buildings.

Council Chairwoman Stephanie Wright said she was surprised the project came in as low as it did, noting that bids for steel were under the estimates.

Councilmen Nate Nehring and Sam Low pledged to help find savings.

There’s no apparent appetite on the council for raising taxes to pay for courthouse construction.

“I’m not going to vote for anything going forward that’s going to increase taxes or fees,” Low said.

The renovation is intended to fix shortcomings with the 1967 justice building, including the presence of asbestos. The elevators are prone to breaking down and also are used to move jail detainees who are appearing in court. Few of the bathrooms are fully accessible to people with disabilities.

A planned new wing on the north side of the building would provide a safer security screening area, as well as modern elevators and bathrooms. That’s only a partial list of upgrades.

Dave Jobs, a senior associate with construction-management consultant OAC, listed other projects contributing to the bustling construction market in the greater Seattle area. They include work for tech giants such as Amazon, Google and Microsoft, plus an array of huge government works. The latter group includes numerous public school buildings and Sound Transit light-rail lines.

The latest wrinkle in the courthouse project invites uncomfortable comparisons with a previous incarnation.

Three years ago, the county was on the verge of breaking ground on a new courthouse across the street. The eight-story building was budgeted at $162 million.

Citing concerns over the costs and lack of parking, a majority of the council abruptly voted to pull the plug. At the time, Klein and his boss, now-Executive Dave Somers, were on the council. John Lovick was the county executive.

After winning election in the fall of 2015, Somers recommended a major overhaul of the old courthouse as a cheaper alternative.

A majority of the council agreed. By that point, the county had already spent more than $12 million on the canceled project, including the condemnation of five buildings through eminent domain. Selling those properties is now among the options for cost savings.

Noah Haglund: 425-339-3465; nhaglund@herald net.com. Twitter: @NWhaglund.