DAM EXPENSIVE

THE NEW VISITORS CENTER AT HOOVER DAM WILL COST $119 MILLION

When it finally opens early next year, the new visitors center at Hoover Dam promises to be a classy affair, a three-story marvel rising from the canyon wall with sweeping views of the dam and of Lake Mead.

All for a mere $119 million.
That staggering price tag for the building almost certainly qualifies it as the most expensive visitors center ever built at a public facility. Originally expected to cost about $32 million, the project has been plagued by cost overruns that apparently piled up without notice by Congress or federal watchdogs.

Now it has become a major embarrassment to the U.S. Bureau of Reclamation and has prompted an investigation by the U.S. Inspector General's Office.

By comparison, the new Phoenix City Hall cost $84.5 million, and the most expensive visitors center ever built by the National Park Service--at a park in West Virginia--cost a little more than $5 million.

So far, federal taxpayers have been footing the bill for the project.
But after the center actually opens, which should be in February, electric customers in Arizona, California and Nevada who use power from the dam will have to pay the money back.

"Yes. It will be showing up in the rate structure," says Bob Walsh, acting spokesman for the Bureau of Reclamation's Nevada office.

How did the federal government allow the center's cost to nearly quadruple without someone noticing? That is what the Inspector General's Office is now trying to figure out.

Basically, Walsh says, the bureau kept asking for more money, Congress kept appropriating it and no one ever objected to the increasing costs.

"We have asked the inspector general to take a look at this and find out how it got to this point and why," Walsh says.

The saga began back in 1984, when Congress authorized the bureau to spend $77 million to upgrade the dam's power generators and build a new visitors center. At that point, the bureau estimated the center would cost about $32 million, Walsh says.

But grafting a nice building--and a five-story parking garage--onto a canyon wall proved tricky, Walsh says.

First, several of the gargantuan transmission towers that carry power from the dam had to be moved to make way for the new building. Then a road had to be realigned.

Construction on the actual building did not begin until 1991, and the bureau set out to build a very nice visitors center.

The 44,000-square-foot, circular building will have three levels and an observation deck on top. It will be connected to a garage with covered parking for 400 cars and 50 buses and motor homes. The garage, Walsh says, is colored to blend in with the canyon rock.

Two new elevator shafts have been sunk through the rock--at a cost of about $16 million--so visitors can be whisked down into the dam in 50-passenger cars.

"It will be quite an imposing structure," Walsh says.
As costs mounted, Walsh says, the bureau simply went back to Congress each year, asked for more money and got it.

"We would go back to Congress and say we are requesting X amount of dollars for visitor-center construction this year," he says. "But there was no real mechanism that provided them with a total cost."
Only after the contracts had been awarded and construction was beyond the point of no return did the true cost of the project become widely known.

The first to catch on were the utilities that buy the dam's electricity, and which will ultimately be asked to pass the $119 million price tag on to their customers.

"We knew there was going to be a visitors center, but the original estimate was that it was going to be the $32 million," says Dave Onstad, director of Arizona Power Authority.

The authority buys power from Hoover Dam and resells it to Arizona utilities. Currently, Onstad says, Arizona buys about 18.5 percent of the power generated by the dam.

That means that Arizona homeowners and businesses will ultimately pay about 18.5 percent of the center's cost, says Ann Garner, chief of the Power Resource Management Branch at the bureau's Nevada office.

The money will be paid back to the federal treasury over 50 years, Garner says, so its cost should be virtually unnoticeable to most electric customers.

"It's not a real significant impact that we can see at this time," she says.
Onstad says that's generally true. Many of the state's utilities buy Hoover Dam power, he says, but it composes only a fraction of the electricity they provide.

Salt River Project, for instance, buys some Hoover Dam power, but not enough that SRP customers will see more than perhaps a few pennies' increase in their bills. Arizona Public Service Company uses virtually no Hoover Dam power, he says.

But some small, mostly rural electric companies in the state use Hoover Dam power almost exclusively, Onstad says, and customers of those companies could see sizable hikes in their electric bills.

By the time he and other Hoover Dam customers learned the full cost of the visitors center, Onstad says, it was too late to do anything about it.

"Essentially, they have spent the bulk of the money," he says. "If you were going to walk away from this, you should have walked away from it a long time ago."
Construction on the center should be done by this fall, Walsh says, and then it will take a few months to put in the displays and paraphernalia that will turn the building into an educational center on the dam and its history.

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