Goleta Passes on New City Hall

Since its incorporation in 2002, the City of Goleta has made its home in rented office space in a business park off Hollister Avenue. While the city’s staff and elected officials seem ready to move on from the odd labyrinth of offices that makes up their current City Hall, finances provided the engine for bringing the matter before City Council recently.

Having come up with a suitable property and a $14 million financing proposal that he said will work, City Manager Dan Singer said that the long-term cost savings realized from owning a city hall as opposed to renting one would be significant. Renting costs taxpayers $445,000 per year currently, plus a roughly 3 percent annual increase. While it would take nearly 20 years to overcome the overall cost of buying, Singer said, the city would be ahead by 2012 in terms of annual cash flow.

Two councilmembers – Eric Onnen and Michael Bennett – tended to agree with him, but the rest of the City Council, citing today’s economic uncertainty and a number of other factors, indicated by its 4-1 vote (Bennett went along with the majority) that it would be better to wait.

The proposal to establish a new city hall in Cabrillo Business Park – an expanse of commercial property located in the Santa Barbara Airport flight path, near the intersection of Hollister Avenue and Los Carneros Road – included plans to build a 40,000-square-foot office building shell, to be customized by the city later. While Goleta has a city hall floor plan formula of 600 square feet per 1,000 residents – which, based upon Goleta’s roughly 30,000 residents, would require an 18,000-square-foot building – the city’s staff reasoned that the 20,000 or so extra square feet in the building could be leased out, keeping the space in reserve for future expansion.

However, citing constituents who said they were seeing a lot of “for lease” signs on commercial buildings around town, Councilmember Ed Easton expressed concern that the city could be left with a sizeable financial burden if it were unable to find a suitable lessee. Mayor Roger Aceves questioned the reliability of the bond market, as a municipal bond issue is one of the key financial tools included in the financing proposal. “Is this the right time? I don’t think so. Is this the right deal? I don’t think so,” he said. “The risks outweigh the benefits.”

Another major concern raised by councilmembers opposing the deal was what they said is a lack of options. “We’re the customer here. We have the right to shop around and find the best deal for construction,” said Aceves. On the other hand, citing a market with low interest rates and construction costs, as well as a significant amount of city money spent on staff analysis of the proposal, Bennett and Onnen seemed eager to jump at what they said was a sweet deal. “It’s the right time; it’s the right place. It may not be the ideal building, but it is more than acceptable for our enterprise,” said Onnen

Easton considered the abstract facets of obtaining a new city hall, saying a permanent city hall should go beyond merely meeting the business needs of the fledgling city, and wondering aloud whether this project would. “It should look and feel like a public facility. This will be a flexible commercial office space with our logo attached to the cornice,” he said. Along with their non-prejudicial denial of the project before them, the councilmembers directed their staff to enhance city hall savings funds and look at other options, although no concrete timeline has been set.