NEW ORLEANS -- The city of New Orleans has confirmed that plans to move City Hall to the old Charity Hospital building have been scrapped.
The building has been closed since Hurricane Katrina. The city has had its eyes on it as a site for City Hall since 2012.
Recent cost estimates put the price tag on the proposed project in the $300 million range. The city had hoped the state would pick up about a third of the cost, but Mayor Mitch Landrieu said the state hasn't been able to commit the cash to the project.
In a statement released Wednesday, Landrieu said the city can't afford the price.
“I made this decision with my eyes wide open, and with the best interest of the entire city at the forefront," he said. "Simply put, we cannot afford the project at this time, given our other critical needs.”
Landrieu added that the estimated costs of the project jumped by over $100 million to $397 million total.
Mayor Mitch Landrieu released the following statement:
“When I was elected Mayor in 2010, the City of New Orleans was still recovering from one of the worst disasters in American history. Hurricane Katrina had left us with the most blight of any city in the country. Rebuilding projects were stalled, and our city teetered on financial collapse.
“After flooded by Katrina, Charity Hospital was the largest piece of blight in the City, sprawling nine city blocks. City Hall and Civil District Court were housed in outdated buildings that had fallen into disrepair. For years, city officials and members of the Judiciary had talked about the need to move into new buildings.
“This was the backdrop when we began our due diligence on redeveloping Charity Hospital into a Civic Complex. In 2011, I put together a team of experts in public finance, real estate, architecture and engineering to analyze our options. They considered four scenarios: keep City Hall and the court in their current locations, build a new complex at Duncan Plaza, relocate to an existing building at 1515 Poydras Street or repurpose Charity Hospital.
“After extensive review and analysis, the team recommended pursuing the Charity Hospital concept. It made the most economic sense because public funding was specifically attached to the redevelopment of this building and the project was eligible for millions more in tax credits. It also served a significant public purpose. The idea was pretty simple: put a historic, blighted building in the heart of downtown back into commerce, while moving city government from inefficient buildings into an iconic space.
“While the idea was simple, we knew the execution of this project would be complex. We planned to finance the project with a mix of funding from the state, FEMA, historic tax credits, new market tax credits, recovery dollars and city issued revenue bonds and we planned to fill the facility with a mix of public tenants.
“I never formally announced the project because my commitment to the people of this city is that I will not announce a project until I can say with 100% certainty that it will get done. So we began an even deeper dive, entering into discussions with potential tenants, putting financing packages together and conducting an even more extensive, brick-by-brick inspection of the Charity site.
“After a great deal of work, it is clear that we cannot move forward with our plans to repurpose Charity Hospital at this time. First, although the Governor and his team have been good partners and have offered to commit tens of millions to support this project, the State has not been able to commit the $100 million we have requested. Second, due to increases in our construction cost estimates for the project and to properly repair the building’s foundation as well as its damaged limestone façade, our estimates for the cost of the project have grown by more than $100 million – up from $270 million to $397 million or more. Finally and most importantly, I cannot in good faith ask the people of this city to assume close to $200 million in public debt for this project, when that money could otherwise be spent on long overdue street repairs.
“With regards to City Hall and the Civil District Court, the plans do not pencil out to build a new Civic Complex or to relocate to a new building. My plan is to invest FEMA and capital funding into reasonable repairs of the buildings that will make them more efficient and safe.
“I made this decision with my eyes wide open, and with the best interest of the entire city at the forefront. Simply put, we cannot afford the project at this time, given our other critical needs.”