Sioux Falls City Hall: $20.6M not enough to finish downtown parking ramp

The city of Sioux Falls needs another $1.5 million to finish its 500 space ramp in the heart of downtown.

According to a resolution to be considered by the City Council next week, City Hall has exhausted its $20.6 million construction budget for the seven-story ramp that was supposed to anchor an additional eight stories of commercial building space.

The need for the additional dollars comes after the city borrowed more than $18.5 million in early 2018 to finance its portion of the project, referred to as Village on the River. The remaining project budget was to be paid for using available cash in the city's parking fund.

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Mayor Paul TenHaken, Chief of Staff Erica Beck and finance director Shawn Pritchett did not respond to emails Friday seeking comment on the reason for the request for additional dollars.

Deputy Chief of Staff T.J. Nelson said more information will be shared during the City Council meeting next week.

According to city finance reports, this wouldn't be the first time the city has had to add dollars to the project budget. In April 2018, another $1.2 million was dedicated to the parking ramp construction fund.

It's unclear how much has been spent on the project.

Multiple requests by both the Argus Leader and city councilors to get an update on the status of its budget have gone unanswered.

However, the finance department's most recent monthly finance report shows $137,500 remains in the project budget.

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City officials have remained tight-lipped about the status of the ramp since it cut ties in May with the private developer it had previously partnered with on the project. Village River Group, LLC, had promised to build private hotels, restaurant and commercial space around and on top of the city's parking ramp estimated at about $50 million.

But the city terminated the agreement with Village River Group after the developer sought to scale back its portion of the work.

Since then, the city has been given separate notices by Village River Group, the individuals that created that limited liability, Sioux Falls developer Legacy Developments and neighboring property owners that the failure of the private portion of Village on the River could lead to lawsuits.

While the City Council has been getting backroom briefings on the state of the project, the only public update it's received since the deal with Village River Group came in August of this year. Even then, Sioux Falls Parking Manager Matt Nelson did not provide answers to questions from councilors about how much had been spent on the project or how the absence of a private partner is impacting its bottom line.

He did say, however, portions of the project were being re-engineered, including stairwells and elevator openings created with the expectation that the ramp would have been attached to hotels and commercial space no longer being necessary.

"These aren't major changes but obviously when you take something off the top, now you need roofs on your stairwells and we have doors that lead to nowhere that needed to be infilled with concrete blocks," Nelson told the council in August.

As of Thursday, the city had not issued any change orders related to the parking ramp project, according to the Sioux Falls purchasing office.