LAKE Macquarie council is planning to spend at least $17.8 million refurbishing its Speers Point headquarters but is yet to discuss the plans in an open council meeting.
The council has called for tenders to reconfigure and refit 4458 square metres of workspace, which it says does not meet the needs of staff "in terms of space and modern workplace amenity".
The tender advertisement shows the council wants to gut all three floors of the 1970s-era building and upgrade to a modern fit-out with enhanced technology.
"The project will create spaces that are flexible to the needs of council employees, support creativity and innovation, and allow staff to work together more effectively as an organisation," it says in the tender ad.
"The building is operating at close to capacity and the current layout does not make effective use of the space.
"This project will ensure staff have the space they need to thrive, and the building remains a functional council asset for years to come."
The tender also calls for the design and construction of temporary offices on an adjacent site where the council plans to shift staff while the work is undertaken.
The Newcastle Herald understands councillors were briefed last year and are all in support of the upgrades to what they consider a tired facility.
But despite the significance and hefty cost of the project, councillors the Herald spoke to yesterday said it had not been discussed in an open meeting this term.
The project was also not mentioned by the mayor or CEO in their preambles to the 2020/21 budget adopted earlier this month.
When asked why ratepayers had not been made aware of the planned refurbishment, a council spokesperson pointed to the budget's exhibition earlier this year - but the project is mentioned in only one line on page 87 of the 122-page document.
The council refused to provide an overall figure in response to the Herald last night, saying "publishing detailed information about the project's budget at this time could compromise the competitive tender process".
A council spokesperson said the project, dubbed the Administrative Centre Workspace Refit, would be paid for "through a combination of funds from the Asset Replacement Reserve and external loans".
The council's 2020/21 budget shows it is planning to spend $17.8 million on what is titled "administration building future space planning" over the next three years, including $7.5m in 2020/21, $7.2m in 2021/22 and $3.1m in 2022/23.
More than $12 million will be spent on "IT infrastructure" over the next four years, including $3.8m in 2020/21, $3.4m in 21/22, $2.3m in 22/23 and $2.5m in 23/24. Another $2.7m will be spent on "computer workstations" over the same period.
While the IT costs are not attributed to the project, they are a dramatic increase on the council's historical annual spend. The council does also not usually invest in computer workstations.
The budget shows the council is planning to draw on more than $20 million in loans over the next four years to help fund the project.
Design work has already been completed with EJE Architecture awarded a $239,000 contract to undertake "future space planning" in 2018/19, according to the council's annual report.
Asked to provide a copy of the project's business case, the council spokesperson said an internal analysis had shown a refurbishment was the "most cost-effective option over a 20-year period".
The spokesperson said the analysis had shown leasing a new admin centre would have costs of more than $100 million over a 20-year period, while building a new centre had costs of more than $60 million over the same time.
The council considered a similar $31 million refurbishment in 2008 when it weighed up moving to a new site in Glendale or renovating the Speers Point building.
At that time, council staff estimated the Speers Point site could be sold for about $18 million, reducing the cost of a move to Glendale to $40 million, but neither a move or refurbishment ultimately went ahead.
The latest renovation plan comes hot on the heels of Newcastle and Maitland councils completing multimillion-dollar upgrades to their administration facilities.
Lake Macquarie council's project will likely be staged to minimise the disruption to staff housed in the building, but having some staff work from home in that period is an option believed to be under consideration given the success of those arrangements during COVID-19.
The council is conducting a pre-tender meeting and site inspection today. Tenders close on July 28.