Rehoboth Beach City Hall Project is $2 Million Over Budget - WBOC-TV 16, Delmarvas News Leader, FOX 21 -

Rehoboth Beach City Hall Project is $2 Million Over Budget

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City hall is currently fenced off. On Friday, it is set to be demolished. (Photo: WBOC) City hall is currently fenced off. On Friday, it is set to be demolished. (Photo: WBOC)

REHOBOTH BEACH, Del.- In Rehoboth Beach, the city commissioners are searching for a solution, after recent bids have put their city hall project $2 million over their expected cost. Initial estimates by a company contracted by the city projected that the total cost of the projects would be about $18 million, but after the most recent bid, that projection has been raised to approximately $20 million. 

"It was pretty disappointing," said City Manager Sharon Lynn. 

The most recent bid under consideration is for the construction of the city hall building and the convention center. Currently, the lowest bidder for this project is by Whiting-Turner Construction, a nationwide firm that submitted an approximately $11.6 million bid. This amount is approximately $1.5 million above the projected amount for this section of the project. 

Lynn said that the reason for the increased cost was a major decrease in competition for the bid. 

"Unfortunately we started out with five or even six interested parties," she said. "And they dropped off to just two construction companies that bid on the project. So we didn't have the competition where we could go higher or lower." 

The city hall, which has stood for almost 50 years, is set to be demolished on Friday. With the plan underway, the commissioners are now searching for ways to pay for the increased cost. The commissioners have set a special meeting for Monday to discuss solutions. 

Mayor Sam Cooper said that both borrowing money and cutting expenses are on the table. Cooper said that one thing the city would not do is cut corners with the project. 

"Clearly we do not want to gut this project," he said. "This is very important to the city's future. Think it's a very good project. It's been put together by a dedicated group of individuals. And I think to start pulling it apart at this time would be wrong."

Voters approved the borrowing of $18 million for the project last June by a vote of 741-544. Their plan is to borrow the money from PNC Bank. The city will then use a loan from the US Department of Agriculture to repay the bank. The city will pay off the USDA loan over a 20-year period. 

Some residents like Dottie Blakely said they are worried the additional costs will be placed on the backs of residents. 

"They find a way to get you one way or another," she said. "You know - we'll be paying for it. You can be assured of that."

If the city decides to borrow more money, it would not need to go to referendum. That's because the city can borrow up to $6 million without a vote.

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