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City justice center over budget; cost of building materials blamed

Projected price hits $265 million, an increase of 24%

Daniel J. Chacon, Rocky Mountain News

Published June 20, 2007 at midnight

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The cost to build Denver's new jail and courthouse has been a big secret at City Hall for months.

No wonder.

The price tag has increased by $51.6 million because of the rising cost of construction materials.

The projected cost of the two buildings is now $265.6 million, a 24 percent increase over the original budget of $214 million.

When RTD announced last month that FasTracks was nearly $1.5 billion over budget and Mayor John Hickenlooper said the city was "in the same position" with the justice center, imaginations ran wild.

But James Mejia, justice center policy manager, said Tuesday the city should be able to cover the increase through premiums from the sale of general obligation bonds, interest earnings and project contingencies.

"We're not having to go back to ask for more money," he said.

"We're reallocating from elsewhere in the budget to stay within our overall budget," he added.

Hickenlooper called it a "remarkable achievement" that the project is within budget "despite the incredible rise in basic commodities, like steel and concrete, which have (increased) between 60 (percent) and 150 percent since the project started."

"It really reflects on a great team," the mayor said.

Mejia will ask a City Council committee today to endorse a $265.6 million contract with Hensel Phelps Construction Co. to build the jail and courthouse as part of the nearly $400 million Denver Justice Center project, which also includes improvements to the county jail on Smith Road and a new post office on West 14th Avenue.

If it gets committee approval, the contract would go before the full council for first reading July 9.

Under the current schedule, the jail would be finished in December 2009 and the courthouse would be completed in May 2010.

The original construction budget was $115 million for the jail and $99.1 million for the courthouse.The jail and courthouse are the third and fourth phases, respectively, of the five-phase project.

The first phase, which dealt with infrastructure, such as fiber optics, wastewater and electricity, is largely complete.

The second phase, which called for building a post office and parking garage, is about 90 percent complete, said Nick Kontas, project manager for that phase.

The post office and parking garage building is expected to be finished in September, he said.

The post office and parking garage building is about 2 percent over budget, which "means belt-tightening all the way through," Mejia said.

The fifth phase involves the Smith Road facility improvements. The justice center complex is being funded by a bond that voters approved in 2005.

"When you go to the voters for a bond, it's basically like a contract," Hickenlooper said.

"You tell voters that you're going to give them a certain product for a certain amount of investment," he said. "I think it should be exceedingly rare - hopefully never during my tenure - that you are unable to deliver what you commit to."

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