
DATE: Monday, October 13, 1997              TAG: 9710130060

SECTION: LOCAL                   PAGE: B1   EDITION: FINAL 

SOURCE: BY TOM HOLDEN, STAFF WRITER 

DATELINE: VIRGINIA BEACH                    LENGTH:   87 lines

BEACH SERVICES SITE: FIX IT OR SELL IT? COMMUNITY SERVICES BOARD TO STUDY OPTIONS FOR PROPERTY

The Community Services Board will meet Wednesday to begin a ``bottom up'' review of its controversial project to consolidate services at a new site on Bonney Road.

That review will include various options, from selling the property and abandoning the project to trying to convince the city to spend millions more than it already has allocated.

In the two weeks following the resignation of Executive Director Dennis I. Wool, the board has come under pressure from the City Council to more fully explain why it believes new facilities are needed for board services.

Those services cover the needs of the city's mentally ill and mentally retarded, and those with substance abuse problems.

Last month, the board announced that the costs to convert a hotel and a business on Bonney Road into a new campus for board services had swelled $3 million over budget.

Then it was learned that an architectural review that was the initial basis for the project was incomplete, leading Wool to proceed on false assumptions about how much it would cost to convert the buildings. Those assumptions became the basis last December for the City Council's buying and agreeing to renovate the property for $12 million. The price then rose to $14 million when city construction rules called for $2 million in contingency funds.

Then, when another architect evaluated the property, the cost rose to $17.2 million. The architect found that a former Days Inn hotel, the main property on the site, would need a new roof, reinforced floors to accommodate design changes, a more expensive heating and air conditioning system than originally thought, extensive plumbing reconfigurations, and a new turning lane on Bonney Road to handle increased traffic flows onto the property.

The missteps angered the City Council, and, bowing to pressure from it and the community, the board on Sept. 25 asked for Wool's resignation, which he tendered.

Board President Donald V. Jellig characterized the new review as ``a normal business process.''

``After all this, you need to take a look at the project, to review it from the bottom up,'' he said. ``We have the whole management team looking at it to come up with the best solution.''

Unlike past planning for the consolidation, which was largely directed by Wool and a few close associates that included a four-member building committee, the review, Jellig said, would involve not only board members but the city's Departments of Public Works and Engineering as well as budget and finance experts.

``This developmental phase will have more board involvement, more city involvement, and more staff involvement, but I can't predict the outcome. . . intelligent use of those resources,'' Jellig said.

Asked whether the board's building committee had not been kept informed by Wool during his planning, Jellig said: ``I'm not sure what they heard and what they're involvement was.''

Henry McCoy Jr., a dentist who also serves as chairman of the building committee, said that in considering a ``bottom up'' review, the board will look at every reasonable possibility. ``We're going to look at three scenarios: the $14.2 million option, the $17.2 million plan, or even selling the buildings,'' McCoy said. ``It only makes sense.''

But both Jellig and McCoy, interviewed at separate times, stressed that selling the buildings the city already has bought is not a strong option.

``We're going to leave everything on the table,'' Jellig said.

``(Selling) may not be the best long-term solution but it is an option we should explore, but I would not consider that to be a highly likely outcome.

``Ultimately, all the numbers have to work out,'' he added. ``If there was an opportunity to turn around and somehow get ahead financially, I guess we'd have to explore that. But I don't think the city sees itself in the real estate investment business.'' ILLUSTRATION: [Color Photo]

CSB President Donald V. Jellig sees the new review as ``a normal

business process.''

CSB: OVER BUDGET

D. KEVIN ELLIOTT/The Virginian-Pilot

Options for the property on Bonney Road include abandoning the

project or spending millions to upgrade it. The board meets

Wednesday.

D. KEVIN ELLIOTT/The Virginian-Pilot

Two options the Community Services Board will consider for fixing up

the former Days Inn hotel, the main property purchased for the

board's new home, would cost $14.2 million and $17.2 million. KEYWORDS: VIRGINIA BEACH COMMUNITY SERVICES BOARD