Council confronts $270 million capital funding gap

Asheville historic capital spending graph
TOO LITTLE, TOO LATE?: Asheville's capital spending levels over the recent past have left the city with a significant backlog of unfunded projects and maintenance. Graphic courtesy of the city of Asheville

The situation presented to Asheville City Council at its Feb. 12 budget briefing by Barbara Whitehorn, the city’s chief financial officer, was “not really a new story,” according to Mayor Esther Manheimer. Asheville’s government, she said, has long recognized that its capital spending was not keeping pace with its needs. “We’re just putting it all on slides right now,” she explained.

But the $270 million difference between Asheville’s capital improvement plan through fiscal year 2023 — roughly $60 million — and the $330 million requested by city departments through fiscal 2024 came as a wake-up call to at least one Council member. “It’s a little bit of a new story for me, in terms of the overall numbers,” said Vijay Kapoor.

That story, Whitehorn explained, consists of multiple interwoven threads. First is Asheville’s unusually conservative approach to issuing bonds, the legacy of massive municipal debt accrued in the 1920s that wasn’t fully repaid until 1976. Many cities, she said, conduct general obligation bond referendums every two to four years, but Asheville had a 17-year gap between its most recent bond issue in 2016 and a previous, unsuccessful referendum in 1999.

The last successful bond referendum, Whitehorn added, took place in 1986 — earning a laugh from Council when she accompanied that date with the record cover to “How Will I Know” by Whitney Houston. “The impact of that on our community is that meeting services and being able to keep the infrastructure in a good place is really challenging,” she said.

The second contributor to the funding gap, Whitehorn said, is the skyrocketing cost of construction in a competitive economy. Planned projects with a $7.5 million budget are now estimated to cost $15.7 million, or more than double the original projection.

“That’s a little scary,” Whitehorn acknowledged. “When you have your finance person, who’s going to be the most conservative person in the room, saying, ‘Let’s add a million dollars to that,’ and then you’re still $3 million short — it’s a bit of a crazy environment.”

Finally, Whitehorn noted that annual maintenance spending on the city’s existing infrastructure was nearly $5 million below needed levels. Even without adding any new projects, she explained, Asheville should be spending $7.4 million per year on roofs, facilities, sidewalks, traffic signals and parks by fiscal 2024.

Council’s largest unsupported capital project is the Transit Master Plan, which calls for a new $50 million bus maintenance facility and $12 million to expand service. Answering a question by Council member Brian Haynes, Whitehorn said staff “has no current plan in place” to fund the facility but is evaluating options.

Council member Julie Mayfield, who has championed the transit plan, noted that the exact details of the maintenance facility would be worked out through a future study and that federal grant money might defray a significant portion of the cost. However, Whitehorn confirmed that the city’s proposed transportation budget for next year contains no money to conduct that initial facility study.

At the end of the meeting, Kapoor expressed his concerns about the city’s financial circumstances. “It shocks me, in terms of just looking at the lack of debt,” he said. “It’s penny-wise, pound-foolish. … I’m not trying to blame other councils before us, but that is the issue we are dealing with right now, is how to basically fund what wasn’t funded in years past.”

City Manager Debra Campbell called the briefing “food for thought” as she encouraged Council members to focus and prioritize their objectives. “This is why we’re presenting this information,” she said. “We’ve got some tough decisions that we need to make over the next several years.”


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About Daniel Walton
Daniel Walton is the former news editor of Mountain Xpress. His work has also appeared in Sierra, The Guardian, and Civil Eats, among other national and regional publications. Follow me @DanielWWalton

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18 thoughts on “Council confronts $270 million capital funding gap

  1. Lulz

    LOL maybe fake news Xpress can ask them where the money went? Of course not. Why would they hold the goons accountable. They have more pressing matters like telling us all how racist white people are and that doing yoga with a cat is the best thing ever lulz.

    • Well, for us to ask “where the money went” for capital projects, Council would have needed to raise the money in the first place. The issue under discussion here is not the misappropriation of funds, but instead the considerable imbalance between the money the city has and what it needs to spend over the next few years.

      • Lulz

        You mean after 2 decades of tax increases and fee increases, the city has no money to spend on what it is obligated to? Again, where did the money go? Maybe an art museum isn’t a wise investment.

        • luther blissett

          Maybe you can explain how $2m to the art museum would have covered $200m in deferred capital maintenance. That’s some wacky math.

          (Maybe you can stop harping on the same string.)

      • Lulz

        LOL Republicans are after Asheville lulz. They don’t need to do anything merely because the fools running the show here are now scrambling for money to make up for the YEARS of neglect. And fake news is where? Better walk around barefoot lulz. Dimwit resolutions from elitist morons? That’s breaking news right there LOL.

  2. See a dollor, spend a dollar

    Maybe they should hire another outside consultant to tell them what to do, so they don’t have to make any hard decisions. Maybe cut spending in bloated departments……. Sorry how dare I suggest such a thing.

  3. Robin

    “The second contributor to the funding gap, Whitehorn said, is the skyrocketing cost of construction in a competitive economy” I call B.S. on that statement. Over the last 6-10 years, City staff have a horrible track record of accurately estimating and then delivering projects within what they projected. Some examples are:

    -The Pack Square project was well before the current construction boom, yet the same story; constantly underestimating costs and having to ask for more funding. Asheville did what Asheville does, and rewarded the project manager’s poor performance by making him their Public Works Director (current Director Greg Shuler), despite the costs of the project doubling from $10 million to 20 MILLION Dollars under his “leadership”.

    -How about RadTip? You have to be completely inept at your job or absolutely ignorant of the real world to miss an estimate by over $20 million. Yet, that’s exactly what Planning and Multimodal Director Cathy Ball did. What did the City do about such an egregious oversight by a certified Professional Engineer and certified AICP Professional Planner? They, of course, promoted her to Assistant City Manager.

    -The Pit of Despair: Way back before the “skyrocketing costs of construction”, when City Engineer Cathy Ball pitched to City Council that she could buy a piece of Catholic Church property for a song, build a parking deck on it, with some included storefront development, and in one fell swoop (and one low price) solve Asheville’s parking issues. Asheville City Council fell for it and agreed to buy the property, close and demolish the adjacent businesses, and go with Ms. Ball’s plan. Fast forward 10-12 years, and millions of dollars later, and the City still has parking issues, they closed what few tax paying businesses that were there, and now owns a hole that it can’t get out of it’s own way to decide what to do with. Also, it’s not over yet. Unless they sell it outright, there’s still money to be spent there.

    I’m sure Ms. Whitehorn is good at her job, but she should research a little Asheville history on the topic before she makes such statements. If she did, she would see that the City’s overseers of capital projects, namely Ms. Ball, and Mr. Shuler, have a considerable history of lowballing estimates and not delivering projects within what they promised. Based on their history, I’d be almost willing to bet that the $60 million overage being reported today isn’t even accurate, and that many of those projects are brought back for even more funding later on. It’s just what they do.

    Mrs. Campbell, and the citizens of Asheville, should be concerned when the Finance Director (Ms. Whitehorn) is suggesting that she has so little confidence in staff’s projections that she just willy nilly adds a million dollars to a project here and there to “pad their numbers”. Here’s a novel idea, fire the inept managers who can’t hit a budget, and hire ones who will. It would be easy to find out; just look back through Council minutes and see who has a habit of constantly bringing projects back for more money. I’ll bet you’d find a commonality with who I’ve already mentioned.

    Sorry for such a long response. It just irks me when government officials offer to just throw a million dollars at a problem as if it were change (padding, in this case).

    • luther blissett

      “You have to be completely inept at your job or absolutely ignorant of the real world to miss an estimate by over $20 million.”

      This is a complete misrepresentation of what happened.

      The city hired Beverly Grant/Barnhill as the CMAR for pre-construction guidance, and it came back with a $56m budget in December 2016. The city then followed state law on the bidding process, and the lowest bid was $76m, from… Beverly Grant/Barnhill.

      “The winning bidder, Beverly Grant/Barnhill, was the same firm that had in December estimated the project at $56 million. The company’s final bid came in at $76 million and did not include at least one component of the project, the Livingston Street Complete Streets package. No bidders competed for that portion of the work, Ball said.

      “Asked after the meeting to confirm that Beverly Grant/Barnhill had underestimated the final construction cost by at least $20 million and still won the project, Ball said that was the case.”

      There’s an argument that the city was bait-and-switched, but that’s not the argument you’re making.

      • Robin

        In response to Luther:
        -The point I was trying to make, and the examples I shared, were that much of the ineptness (and poor project estimating) was on City staff, and not on the surge in competitive construction. My examples were to point out that the practice predated the current construction climate. Entities supposedly hire credentialed staff to serve as a professional representative of that respective field; basically, you have a staff engineer to make sure you don’t get hoodooed on engineering matters. In my example, City Engineer (Multi-modal Transportation and Public Works Director/Assistant City Manager) Cathy Ball is both a certified Professional Engineer, and a certified AICP planner; yet, her, nor her enormous staff, caught how far off the estimates were (before they put them out to bid). Ms. Ball, nor none of her staff, did any comparison calculation(like a good engineer or planner should), and merely took the contractors word. The argument of Bait and switch aside; in the private sector, Engineers are usually fired for such excessive misses, but the City chose to reward Ms. Ball instead of punishing her for basically what is professional malpractice.

        • luther blissett

          “The argument of Bait and switch aside”

          No, that’s weak. You can’t “aside” that. Are you really saying that Cathy Ball was in the wrong for hiring a local construction company as a CMAR and trusting that they weren’t trying to squeeze her? If she’d questioned Beverly Grant/Barnhill’s guidance, you’d be whining about a public sector employee trying to second-guess a private-sector company’s expertise. Spare us the faux sanctimony.

  4. TDA is corrupt and must be stopped

    With Assets of $31 million and revenues of $17 million+ per year it is time the Buncombe County Tourism Development Authority to be greatly reduced in size and the funds be used to pay for the City and County infrastructure. All occupancy taxes paid by the tourists that use the infrastructure goes straight into the coffers of the BCTDA. Would you be surprised to learn the average annual salary at the BCTDA is $67,000+, not including benefits such as incentive pay and retirement? That is over twice the median income in Buncombe County, to do what?
    Don’t believe me?
    Also it is on their website go to and click on About the BCTDA, quick before they take it down!

    It is time to put the BCTDA on blast – you are not serving the interests of your community, you are serving your own interests with taxpayer money!

    • bsummers

      I’m with ya on that, but to accomplish it you’d need a legislature in Raleigh that doesn’t enjoy treating the City of Asheville like a whipping boy, and local elected officials who aren’t afraid to stand up to the hotel lobby.

      • Lulz

        LOL why would anyone in Raleigh change anything here when the local cult leaders are in lockstep with the TDA and corporations lulz? Why would the local political hacks want to change things here? After all they have a booming tourist business financed by people who are punished for simply living here.

        Again, where did all the money go over the years? I know, I know, articles about out of touch windbags and their resolutions are much more important than actually reporting about such things as misspent money and rampant corporate cronyism. Why self identifying democrats still assume they’re for the poor and working class and anti-corporate lulz. And yet the town they’re proud of is known for its low wages and a huge swath of people who can’t afford to live here. All under the noses of the wealthy who are making millions off their backs. And you say Republicans are bad? LOL you sure?

        • Enlightened Enigma

          Brilliant synopsis Lulz! think Jennifer Pickering , Biltmore billionairess, director of LEAF, and she ‘serves’ on the Housing Authority board creating MORE ghettos…call her out!

          • luther blissett

            To Heckle and Jeckle: the budgets are public documents. Learn to read them.

            (Most of the money went to cops and firefighters.)

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