Parking garage will pay for itself

Wednesday, February 07, 2018

Given the questions raised by the Town Council two weeks ago, it seems worthwhile to explain in more detail the status of the Greenfield garage now under construction on Olive Street, and why the mayor has requested the transfer of half a million dollars of unexpended FEMA money to fund its completion.

We have been working on this project with Desman Associates for nine years. Over the course of that time, the cost of construction has increased. The garage’s $10 million budget was established in 2014 — $8 million for construction, and $2 million for “soft costs” (contingency, project manager, engineers, etc.). Inflation is the main reason construction costs now stand at $8.7 million — an increase of less than 10 percent overall, or 2.5 percent per year. Our professional cost estimators say that building costs typically go up 4 percent per year. That the increase has been held to 2.5 percent per year is due in large part to the competitive bidding carried out by the Construction Manager, Daniel O’Connell & Sons, and diligent oversight of the project by the owner’s project manager.

The $529,000 transfer the mayor requested will cover the shortfall and ensure the project’s completion. The most important point that needs to be made is that the garage — unlike most other municipal building projects — will pay for itself.

Parking fees paid by garage users — people who want to take the train, employees and users of the Justice Center, and folks who want to go to downtown stores, restaurants and bars — will not only cover the cost of borrowing the original $2.5 million and this additional funding, but will, over time, become a money generator.

The Northampton parking garage generates over $500,000 a year, even with the first hour free.

Proceeds pay for police cruisers, city staff and other municipal expenses. While our garage will not be as large or as busy as Northampton’s, it should be a welcome source of funds to the city of Greenfield. This is a sound, forward-looking project. We ask the Council for a favorable vote to support its completion

Margo Jones