Wednesday, 2/26/97
Price tag for Ackerman Union split three ways
Responsibility for construction overruns assigned
By Frances Lee
Daily Bruin Contributor
It was swift, but hardly painless.
With the possibility of an additional $2.5 million debt hanging
over their heads, the student’s association (ASUCLA) met with
Chancellor Young and Capital Programs to assign responsibility for
the Ackerman Union construction overruns.
At their brief but crucial Feb. 6 meeting, it was determined
ASUCLA will be held accountable for $1.5 million, Capital Programs
will make up $300,000 and Chancellor Young will put in $1 million
from his discretionary fund to pay the cost of accelerating the
completion of Ackerman Union and the UCLA Store.
"I think it was a wise and interesting choice on (Chancellor
Young’s) part," said Duke Oakley, design and construction director
for Capital Programs.
"It’s reasonable that the university would pay for (a portion
of) it," he said, adding that the completion of the store and the
student’s union has "advantages for the campus" by bringing in
revenue and minimizing construction disruptions on campus.
For ASUCLA, the added costs to the $18.9 million price tag for
the Ackerman expansion and store remodeling were unexpected and
unplanned.
However, "we’ve come to understand that we did get value for the
$1.5 million," said Patricia Eastman, executive director of ASUCLA.
"That’s in part how we ended up coming to this resolution."
The "added value" was in getting the store completed in time to
open it in January, whereas the original plan had called for the
store’s opening to occur July 1997.
Store interiors, additional seismic work and code requirements
were some of the other categories in which construction went over
budget.
"Most of what ASUCLA hadn’t planned for (was a result of)
communication problems between us and Capital Programs," said
Eastman.
"There was a real desire to meet the accelerated schedule, and
many other items," such as fulfilling code requirements, had to be
done. "We wouldn’t have not done them," she added.
Capital Programs and ASUCLA "could have argued for the next five
years over whose responsibility (the additional expense) was," said
Rich Delia, finance director for ASUCLA.
But, he added, the chancellor’s decision "was a fair and
reasonable compromise. We need to get this behind us and move
forward."
In order to finance this additional debt, ASUCLA restructured
their five-year plan to accommodate the $1.5 million. The original
plan had called for financing $4.4 million as long-term debt and
$900,000 in short-term loans that would be repaid in five
years.
With the new debt, the entire amount – $6.8 million – will be
financed as long-term debt, which will allow the student’s
association to spread out their loan payments over a longer
period.
"By financing it over 27 years, it gets us to where our five
year plan’s integrity is preserved," Delia said.
Through all these negotiations, however, Eastman stressed that
"when all of this additional debt came to surface, we never
considered raising the student union fee above $51."
For Capital Programs, the $300,000 will "have to be made up over
several years," said Oakley. "What I will do is essentially take it
out of overhead."
Capital Programs "doesn’t make a profit. The time was spent and
people did the work, so there’s no flexibility" in this, he
continued.