Projected FUSE stadium cost jumps past $26.2 million

Another series of benchmarks in the evolution of Gastonia’s FUSE District on Tuesday came with another hike in the projected cost of building the stadium that will serve as its centerpiece.

The most recent estimate of constructing the multipurpose events complex just west of downtown, based on partially completed architectural work last spring, was roughly $21.5 million. But the new figure placed before City Council puts the tab of building the stadium at more than $26.2 million.

City Council members heard from City Manager Michael Peoples as he explained that increase Tuesday, then asked questions and offered their opinions about the project. They then opted to move ahead and commit to the investment, setting the table for an official groundbreaking ceremony on Oct. 3.

Here’s a wrap-up of FUSE-related actions that the council acted on during its regular meeting:

Contract in place

The most substantial development Tuesday was City Council’s decision to approve a contract with Rodgers Builders of Charlotte for a total of $26,219,797.

Almost two years ago, the city enlisted Rodgers Builders to serve as ‘construction manager at risk’ for the FUSE stadium project. In that role, the firm has provided professional services such as site logistics planning, prequalification of subcontractors, and other preconstruction tasks, ultimately striving to get the complex built at the best price possible.

Tuesday’s approval served as a formal extension of that, ensuring Rodgers will oversee the construction through until the stadium’s anticipated opening in the spring of 2022.

The $26.2 million figure represents the “guaranteed maximum price” that the city will pay. It now serves as the firm amount Gastonia can count on spending for the work, barring something unforeseen occurring.

“It is a guaranteed price, but there could be circumstances beyond the contractor’s control in which that price could be increased,” said Peoples. “An example might be some major, unknown subsurface condition (at the stadium site) that no one knows about now. Another example would be a (city-initiated) change.”

Any change in the guaranteed maximum price would also have to be approved by City Council, Peoples said.

Reasons for the increase

When the city first proposed the Franklin Urban Sports and Entertainment District in September 2016, then-City Manager Ed Munn said a new stadium to host athletic competitions, music concerts and other events could cost $15 million. City officials have since said that projection was purely conceptual and had no basis.

The projected cost of building the facility has steadily climbed since then. Peoples said the most recent increase is largely due to the booming economy and the limited availability of steel and other materials.

“It’s a premium marketplace now, not only in the Charlotte area, but nationwide,” he said. “The economy’s booming, unemployment is at a record low, and materials and labor are in demand. If you’re constructing in an up economy, usually it will cost more because there’s so much demand for work.”

Another reason is that in the city’s review of the final design of the stadium, several things had to be added after the plans were submitted to the North Carolina Department of Insurance. Various entry and exit features, fire suppression systems and other features were deemed necessary for health and safety purposes, Peoples said.

“We didn’t know in our design of the facility that those things would be required until that final review,” he said. “That added scope to it as well.”

When the city opened the bidding process, the total bid package for the stadium construction was actually in excess of $30 million, Peoples said. Over the past month and a half, city staff worked with architects and Rodgers Builders to shave that cost down, by defining what materials will be used and having direct conversations with subcontractors, he said.

“We feel like we’ve done our due diligence and put a lot of hours into working with these subs,” Peoples said.

Issuing bonds

The city plans to pay for the bulk of the stadium construction by selling and yielding revenue from limited obligation bonds. Unlike general obligation bonds, that financing mechanism does not require a public referendum for approval.

City Council members took the next step Tuesday by approving and authorizing the sale and issuance of those bonds, not to exceed $24 million.

The city will now have to gain clearance from the Local Government Commission, an agency of the state Treasury Department that exists to keep cities and counties from wading into fiscal waters that are too deep. The LGC approves the issuance of debt for all local governments and assists with financial management.

Gastonia leaders will meet with the LGC and seek approval to issue the $24 million in bonds during a Sept. 10 hearing in Raleigh, after which it anticipates issuing the debt.

As for the rest of the tab, the city anticipates softening the blow of the stadium debt with philanthropic donations from private business and individual donors, naming rights, and other smaller revenue sources. No such contributions have been received to date, but the city expects it can count on between $2.5 million and $5 million in donations based on a consultant’s feasibility study.

Trenton Mill redevelopment

The FUSE District consists of a total of 16 acres, but the stadium will only take up a little more than half of that. The city is setting up the surrounding land as separate development pads to host a hotel, and other commercial, retail and residential ventures.

One of those pads involves the historic Trenton Mill on West Main Avenue. Last year, Florida-based Lansing Melbourne Group was picked by the city from among a handful of competitors to handle the redevelopment of the mill. The firm has spent the last few months investigating the site and preparing a more comprehensive redevelopment proposal.

City Council members have now scheduled a public hearing on that redevelopment agreement. Residents who want to weigh in on the proposal can do so during the council’s regular meeting at 6 p.m. Tuesday, Aug. 20.

Lansing Melbourne Group’s final vision is to create 84 apartment units in the Trenton Mill, with 115 parking spaces and at least $15 million in total private investment. The mill consists of almost 82,000 square feet of space, with an outbuilding that could host a restaurant or retail venue.

You can reach Michael Barrett at 704-869-1826 or on Twitter @GazetteMike.