A contractor dispute, sponsorship shortfalls and site upgrades have pushed the $45 million Grand Park project over budget.
The Westfield City Council this month voted 5-1 to lend the project $6 million from a city infrastructure fund, money that the administration said would be repaid through future sponsorship revenue and possible litigation windfalls.
The vote came two months after the official grand opening of the 400-acre park, which boasts more soccer and baseball fields than any other multi-use sports complex in the country. Billed as an economic development driver for the far-north suburb, Grand Park has recorded 655,000 visits since its March soft opening, according to city officials, while helping Hamilton County hotel business rise significantly since its opening.
Of the new expenses, about $3 million will pay off the aftermath of a contractor dispute.
Westfield Mayor Andy Cook said that a contractor, which he declined to name, couldn't finish its portion of the work in time for the fields to open in the spring. With the fields already reserved for use, the city had to hire a replacement, running up additional costs. Cook told The Indianapolis Star the city would try to recover as much as possible through the contractor's bonding company and litigation, though, so far, no lawsuit has been filed.
About $1 million will pay for site work and to move roads and utility lines to make room for a $20 million indoor sports arena, announced in June, that will be built by a private developer. Grand Park's initial plans included a site for a smaller, publicly funded facility.
The remaining $2 million will cover a shortfall in sponsorships. But Cook insists sponsorship revenue will pick up soon, saying "it's a completely different ballgame" now that the park is operational.
"We sold about half of the sponsorships looking at plans and pretty pictures," he said. "Now ... we have a product which is a unique sell."
Council members said the vote was the best of a series of bad options, preferring to spend cash on hand to pay the city's bills instead of taking out a bond and spending more on interest. But some criticized the way the resolution was written, characterizing the loan as a shaky promise with no established timetable for repayment.
"When it comes right down to it, I guess my bigger concern (is) I don't know exactly what this money is going for, nor do I have 100-percent assurance that it's going to get replaced," said Councilwoman Cindy Spoljarik, the lone "no" vote at the meeting. "Weren't those sponsorship monies supposed to be dedicated to other operational endeavors down the road? In taking those operational dollars once they do become available and putting them back into the fund we're still going to be in a negative somewhere."
Councilman Rob Stokes abstained, citing similar concerns. Ultimately, though, the council decided it had little choice but to follow the administration's lead. The work already has been done, and the bills are coming due.
"What do we do? Should I go out and sell another bond and (incur) more debt?" Cook said. "Well, no."
Instead, the city will take the $6 million from the city's proverbial piggy bank—the proceeds of the city's utility sale in March. Once a $44 million fund, the city so far has set aside $25 million for infrastructure projects and $2.5 million for a new high school stadium. Adding an expected $6 million in federal grant money and subtracting the Grand Park expenses would leave the city about $19 million to spend.
Cook said the withdrawal won't affect any infrastructure projects underway. But some council members remained reluctant to dip into the fund any more than the city already had, reflecting growing concerns among some Westfield residents about the rate its government has been spending money in recent years.
Because the sponsorships were included in the original $45 million budget, only $4 million are true additions, bringing the total budget for Grand Park to $49 million to date. Looking ahead, the 8 percent cost overrun—even if it's mostly repaid—could provide fuel to project critics who questioned whether tax-increment financing alone will be able to support the largest complex of its kind in the country.
"The community was told that the utility proceeds were not going to be used to pay for Grand Park," Spoljarik said. "But this is pretty much doing that."