The San Luis Obispo City Council is expected to decide tonight whether it will spend $786,500 to improve two blocks downtown.
The projected cost of the improvements to the small area of downtown — which would include aesthetic upgrades such as Mission-style sidewalks and new tree grates, trash cans and sign posts — has risen beyond what was originally budgeted, again.
In March, the council scaled back the project to two blocks from three blocks — the area on Higuera Street from Morro Street to Garden Street — after bids for the work were $87,000 more than the $640,000 of general fund money the city had budgeted to spend.
Tonight, the council will be told that the smaller project will now cost $786,500. Staff is proposing that the council spend $121,000 of additional general fund money to fund the project. The remaining shortfall would be covered by various capital improvement funds.
The increased cost is blamed on escalating construction costs and the addition of lighting conduits to be installed at the base of trees for outdoor lighting.
The lighting conduits, something that the San Luis Obispo Downtown Association has long advocated to increase the safety and the ambiance downtown at night, would cost about $81,000 to install.
However, some people have questioned whether the timing is right to spend money on aesthetic improvements as the city grapples with budget woes.
Councilman Dan Carpenter said he is concerned about the escalating costs given the current negotiations with city employees, who are being asked to give up nearly 7 percent of their total compensation to balance the budget.
“Do we want to pull more money from the general fund to spend on the downtown?” Carpenter said. “The communication from the public has been that they don’t want us to spend any more money than was already allocated.”
Other council members also expressed concerns about the increased cost.
“I have a lot of questions about the viability of this project at this time in our financial status,” said Councilwoman Kathy Smith, referencing several other city projects that recently came in at a higher cost than anticipated.
One such project is the city’s need to replace the signs downtown to facilitate charging increased parking rates. That cost grew to $102,500 from the original estimate of $11,000. Smith voted against it.
“The question is what is getting shortchanged as we continue to put dollars into these things that we thought would cost less,” Smith said. “Maybe we have to bite the bullet and say that we can’t afford it right now.”
John Ashbaugh said the improvements are worth the investment.
“Property owners and their tenants’ downtown are continually spending money to improve the downtown area,” Ashbaugh said. “They are expecting the city to do our part, and I think we have an obligation to step up and do so.”