Juneau’s City Hall Situation
Why does Juneau need a new city hall?
The City and Borough of Juneau is in need of a new City Hall to consolidate staff from leased office space into a single facility, provide more convenient access to the public, and invest in a long term and purpose-built asset for the community. CBJ is proposing to meet this need without raising resident taxes with the construction of a new facility on existing city property at 450 Whittier Street.
Why New? Why Now?
Rent – Nearly $1 million per year:
- CBJ staff and services are currently spread across five different buildings, including the aging City Hall which requires significant structural, safety and systems repairs and no longer meets the current or future needs of CBJ.
- Due to space limitations at the current 16,000 square foot City Hall, less than 40% of CBJ staff are located on site. The majority of CBJ offices are spread across four other rental spaces in Downtown Juneau, at the cost of over $820,000 per year in rent and the opportunity cost of occupying of nearly 34,000 square feet of desirable downtown real estate that could be repurposed for residential or commercial use in the private sector.
Repairs – More than just a coat of paint:
- Originally built as a fire house in 1951, and renovated in the 1970’s, the existing City Hall building at 155 South Seward requires over $14 million in known interior and exterior mechanical, electrical, and plumbing system repairs to bring the building up to code and in ADA compliance. From the roof to the restrooms, the age of the building means there is no such thing as a quick fix. Even with these significant repairs, the size and layout of the building would require CBJ to continue to rent additional off site office space for the majority of its employees.
Real Estate – Stronger market, lower inventory:
- The market for commercial office space has tightened significantly in the last year. While the trend is a boon for the Juneau economy, a recent professional analysis found that there are no existing commercial properties that could accommodate CBJ staff and necessary services without displacing other tenants and requiring cost-prohibitive renovations.
- As an example of the strengthening market and space scarcity, CBJ needs to find new office space for the more than 30 CBJ employees currently housed in the Municipal Way building to make way for new building ownership.
Return on Investment:
- The condition of City Hall requires critical near-term and costly repairs (over $14M) in addition to the over $820,000 spent annually on rent for less than functional office space for over half of CBJ employees.
- Given the potential instability of the rental market, it makes good financial sense for CBJ to own its own purpose-built and modest facility that is energy efficient, properly sized, and customer service oriented, and will provide real cost savings in 25 years.
Proposed Location: 450 Whittier Street
Following a comprehensive professional analysis of existing commercial real estate and a community preference survey, the City and Borough of Juneau have selected the construction of a new, purpose-built facility on the CBJ-owned property at 450 Whittier Street as the best option for a future City Hall.
This project would create a 46,200 square foot energy and space-efficient building in the Aak’w Village District. The building would be designed for longevity and functionality, based on class B office space and minimal square foot per employee standards. Building features would include the Assembly Chambers, new public meeting rooms as well as public restrooms and 36 underground parking spots with dedicated parking for the public.
Project Cost & Financing
Total estimated construction and development costs of the 450 Whittier Street location are $43.3 million. This estimate includes all of the components listed above with 5% escalation costs to reflect inflation.
The project would be funded through a combination of $16.3 million is previously appropriated funds and a $27 million bond, to be decided by voters during the October 3 election. The bond would not require an increase property taxes due to CBJ’s significant available debt capacity.
More details on these topics and more in the following tabs.
Latest Updates
June 26, 2023 – Assembly passes ordinance (Meeting Details)
June 12, 2023 – Assembly approves annual budget with $10 million for New City Hall (Meeting Recording and Details)
In fall 2021, the City & Borough of Juneau asked residents to participate in a survey regarding the need for a New City Hall. A total of 1,326 Juneau residents responded.
74% indicated they were supportive of a new facility with parking for public and staff as the highest ranking factor. Other factors included in the survey were the length of service life, energy efficiency, location, and access. See all the results of the survey by selecting the Community Survey tab above.
Wait… didn’t I just vote on this?
Not exactly.
In October 2022, Juneau voters were asked to decide on a ballot measure proposing a $35M bond to design and construct a new City Hall. At the time, very little information was available to voters regarding the reasoning and community need for a new city hall.
However, significant changes in the last year to both the economics and operational conditions of CBJ’s owned, rented and proposed city hall spaces have brought the organization to a crossroads. The Assembly chose to provide voters a new opportunity to decide on the future of City Hall with the latest available information. (Read the CBJ ordinance.)
How much can change in a year?
Quite a lot.
Here are some of the key differences between the 2022 bond proposition and the ballot measure to be included in the municipal election on October 3, 2023:
Lower Bond Amount: The 2023 ballot proposition proposes a lower $27M bond at an estimated 4.77% interest rate. The previous 2022 ballot proposed a $35M bond at an estimated $4.88% interest rate. The Assembly has appropriated $16.3M in general funds for the remaining cost of the $43.3M project (see Proposed Location tab for more on project costs).
Market Changes: The market for commercial office space tightened significantly in the last year with the sale of the Walmart building and other downtown properties. A recent professional analysis found that there are no existing commercial properties that could accommodate CBJ staff and necessary services without displacing other tenants and/or requiring cost-prohibitive renovations. A more competitive real estate market is also contributing to both lower interest rates and the potential for higher rent costs.
Rental Changes Coming: The current CBJ rental arrangement, with 160+ employees spread across five downtown buildings is no longer sustainable for many reasons. With the 2023 sale of the Municipal Way building, CBJ needs to find new office space for the more than 30 CBJ employees currently housed on the first and second floors to make way for new ownership when the lease expires in June 2028. The Marine Way building, which houses 50 employees, is in poor condition and suffers from leaks, plumbing shut offs, and poor heating controls.
Changing Conditions: The current City Hall building continues to degrade, creating functional challenges as well as potential health and safety concerns for CBJ employees. The building requires over $14.1M in known repairs and maintenance to extend its usable life.
More Information: Per ordinance 2023-30, CBJ will have the opportunity to better communicate the need for and benefits of a new city hall prior to the election. A comparable ordinance did not exist in 2022.
If approved, would this bond increase my property taxes?
In short, no.
The proposed bond issuance would not require an increase in property taxes from their current rate due to CBJ’s significant debt service capacity.
The CBJ property tax mill rate (which determines the annual property tax rate) is comprised of an operational mill levy and a debt service mill levy. The operational mill levy supports all aspects of local government including schools, police, fire protection, roads, libraries, parks, public transportation, etc. The debt service mill levy pays for voter-approved bonds. In FY24, the operational and debt service mill rates are 8.96 and 1.2, respectively, for a combined total of 10.16. Read more about the CBJ mill rate here.
CBJ has substantial debt capacity as many large projects are and will continue to be paid off in the coming years. This chart and corresponding memo show that there will be significant capacity in the coming years for a new city hall project and others without raising property taxes. If this bond issuance is approved, the debt service portion of the property taxation rate will not increase and a significant amount of capacity will remain for future debt issuances without exceeding the current 1.2 debt service mill rate.
Where can I get more information? (ADD CONTACT INFO)
450 Whittier Street
Following a community preference survey and a comprehensive professional analysis of existing commercial real estate, the City and Borough of Juneau have selected the construction of a new, purpose-built facility on the CBJ-owned property at 450 Whittier Street as the best option for a future City Hall.
This project would create a 46,200 square foot energy and space-efficient building in the Aak’w Village District. The building would be designed for longevity and functionality, based on class B office space and minimal square foot per employee standards (about 100 sq ft). Building features would include the Assembly Chambers, new public meeting rooms as well as public restrooms and 36 underground parking spots with dedicated parking for the public.
Project Cost & Financing
Total estimated construction and development costs of the 450 Whittier Street location are $43.3 million. This estimate includes all of the components listed above with 5% escalation costs to reflect inflation.
The project would be funded through a combination of $16.3 million in previously appropriated general funds and a potential $27 million bond, to be decided by voters during the October 3 election. The The bond would not require an increase in resident property taxes due to CBJ’s significant available debt capacity. The bond would also leave capacity available for future debt issuances should the need arise.
More details coming soon.
From the Archives: 2018-2019 City Hall Ideas
Community Survey Information
Will add more detail (charts and pull quotes) regarding community preference for downtown location, focus on a functional building, construction priorities, use of City Hall, survey demographics.
After July 27, will add community ambassadors and quotes.
Public Meetings Assembly Meeting, June 26, 2023 Assembly Meeting, June 12, 2023 Finance Committee Meeting, June XX, 2023 Public Forum, May 19, 2022 Public Forum, January 26, 2022
REPORTS ANALYSIS Ricker Report
Assembly Meeting, June 26, 2023
Site Information
2023 FAQs
Voters will be asked to decide on a $27M bond this fall to design and construct a New City Hall on city property at 450 Whittier (next door to Zach Gordon Youth Center) in the Aak’w Village District. The proposed new building will be a purpose-built facility designed to be energy efficient with a long service life and functional office space. It would include an Assembly chambers, public meeting rooms, 36 underground parking spaces and employee offices.
What has changed since we voted on this last year?
Lower Bond Amount: The 2023 ballot proposition proposes a lower $27M bond at an estimated 4.77% interest rate. The 2022 ballot proposed a $35M bond at an estimated $4.88% interest rate.
Market Changes: The market for commercial office space tightened significantly in the last year with the sale of the Walmart building and other downtown properties. A recent professional analysis found that there are no existing commercial properties that could accommodate CBJ staff and necessary services without displacing other tenants and/or requiring cost-prohibitive renovations.
A more competitive real estate market is also contributing to lower interest rates and the potential for higher rent costs.
Rental Changes: The current CBJ rental arrangement is no longer sustainable for many reasons. With the 2023 sale of the Municipal Way building, CBJ needs to find new office space for the more than 30 CBJ employees currently housed in the building to make way for new ownership when the lease expires in June 2028. The Marine Way building, which houses 50 employees, is in poor condition and suffers from leaks, plumbing shut offs, and poor heating controls.
Changing Conditions: The current City Hall building continues to degrade, creating functional challenges as well as potential health and safety concerns for CBJ employees. The building requires over $14.1M in known repairs and maintenance to extend its usable life.
More Information: Per ordinance 2023-30, CBJ will have the opportunity to better communicate the need for and benefits of a new city hall prior to the election. A comparable ordinance did not exist in 2022.
How much does the project cost?
The total project cost is $43.3M. The Assembly has appropriated $16.3M in general funds for the project and is asking the voters for the authority to bond for the remaining $27M.
What effect will it have on my property taxes if this bond is approved?
The short answer is that the 2023 bond issuance would not require an increase in resident property taxes.
The CBJ property tax mill rate (which determines the annual property tax rate) is comprised of an operational mill levy and a debt service mill levy. The operational mill levy supports all aspects of local government including schools, police, fire protection, roads, libraries, parks, public transportation, etc. The debt service mill levy pays for voter-approved bonds. In FY24, the operational and debt service mill rates are 8.96 and 1.2, respectively, for a combined total of 10.16. Read more about the CBJ mill rate here.
CBJ has substantial debt capacity as many large projects are and will continue to be paid off in the coming years. This chart (link) and corresponding memo (link) show that there will be significant capacity in the coming years for a new city hall project and others without raising property taxes. If this bond issuance is approved, the debt service portion of the property taxation rate will not increase and a significant amount of capacity will remain for future debt issuances without exceeding the current 1.2 debt service mill rate.
The total annual debt service costs (the amount CBJ will pay back each year), assuming an interest rate of 4.77%, would be approximately $1.87M. This amount of debt service would require an annual property tax levy of approximately $28.03 per $100,000 of assessed value which is less than previous years (see chart referenced above). (This example of property tax levy is provided for illustrative purposes only.
What if the project exceeds the estimated budget?
The bond proposition stipulates that the project be completed within the $43.3M total budget which factors in 5% escalation costs due to construction inflation. By using a design build procurement process, CBJ will be able to ensure that the project is cost driven and remains on budget.
Where do CBJ employees work now?
The current City Hall houses less than half of the downtown CBJ workforce. The remaining staff and services are spread out amongst four rented facilities (Marine View Building, Sealaska Plaza, Seadrome Building, and Municipal Way Building). CBJ currently spends $820,000 a year on rent at these four facilities and has rented office space for more than 30 years.
What is the condition of the current City Hall?
City Hall was originally constructed in the 1950s as the downtown fire station. Over $14M in known mechanical, structural and systems repairs are needed to support the health and safety of employees and to extend the useful life of the facility for 25 years. Needed repairs include but are not limited to: roof replacement, mechanical systems, windows, restrooms, façade work, and painting.
What does CBJ pay to rent its current office space?
CBJ currently pays a total of $820,000 per year to rent the space necessary for staff and services at four separate facilities (Marine View Building, Sealaska Plaza, Seadrome Building, and Municipal Way Building). However, due to ownership changes and unsuitable building conditions in existing facilities, as well as a decreasing inventory of large commercial office space in Juneau, several of CBJ’s lease agreements will change in the near term, with the likely potential of significant increases in the annual cost of rent.
How did you land on 450 Whittier Street as the preferred site?
Staff started with suggestions from the public gathered in a 2021 survey and eliminated existing building options based on lot or building size, the prospective owner’s willingness to sell, and public access and parking. The Assembly went through two rounds of eliminating sites based on a matrix built from the priorities the public identified in the survey as most important. These included parking, energy efficiency, cost, and long service life. The top four sites that received the most study were:
- Status quo (renovating the current facility and continuing to rent);
- Downtown Transit Center;
- Former Walmart Building (recently sold); and
- 450 Whittier Street
Copies of the matrix used for this analysis can be found here (round 1) and here (round 2).
In May 2023, a commercial real estate consultant performed an analysis of facilities available in the Juneau commercial real estate market that could be repurposed for the Juneau City Hall. The study found that there were no existing properties available with the necessary square footage that wouldn’t require significant displacement of State employees. Read the full report (link) and site analysis (link).
What about an existing Juneau school building?
Per the Juneau Board of Education, all existing Juneau School District (JSD) facilities of the square footage required to accommodate a new city hall are needed to accommodate JSD student and operational needs.
What would happen to the vacated downtown office space?
City Hall – Waterfront location; zoned Mixed Use; could be sold for private enterprise or retained for other public uses (up to the Assembly).
Marine View Building – If converted back into apartments with the same floor plan as adjacent floors, conversion would result in 24 apartments (up to the private owner).
Municipal Way – Recently purchased by the Sealaska Heritage Institute. CBJ vacated one floor in 2023 and will be required to vacate the remaining floor by 2028 to allow for the expansion of the Sealaska Heritage Arts Campus.
Seadrome – Goldbelt has plans to demolish and expand the facility for enhanced visitor amenities and mixed use.
Where would people park at New City Hall?
New City Hall would include 36 parking spaces in a garage underneath the building, including dedicated parking for the public to do business at City Hall. According to an initial parking assessment conducted in 2022, the Aak’w Village District also has approximately 1,500 surface parking spaces in the general area. Many of these spaces are leased by the State during business hours. However, an assessment of the lease holder parking needs is overdue as much has changed in recent years. A comprehensive parking study is planned. Additionally, CBJ received $10M to partner with the State on a future project to expand the North State Office Building parking garage.
Regarding employee parking, there are currently 175 parking permits issued to downtown municipal employees, mostly in the Marine Parking Garage. Moving this demand and vehicular traffic out of the downtown core would open significant parking capacity for locals.
How big will a new city hall be?
A space needs analysis determined municipal functions require 46,200 square feet based on space-efficient class B office space and minimal square feet of office space per employee standards (approximately 100 sq ft). This square footage, including an Assembly Chambers and public restrooms and meeting rooms, fits in a 3-story facility on the 450 Whittier Street site with space for a small public plaza. This is roughly 4,000 square feet less than the space downtown CBJ employees currently occupy. Space needs are based on industry standards for cubicles and open floor plans. Further refining of the space needs will include a public engagement program as part of the design process if the project is endorsed.
In the 2021 survey noted above, respondents placed a low value (15%) on architectural and visual appeal. This feedback, in addition to input from future public engagement efforts, will be incorporated in the design of a new city hall.
What is the design of the proposed new city hall?
Initial design was completed to estimate project costs and confirm that the property could effectively accommodate CBJ operations and employees within the project budget. However, further refining of the space needs and subsequent design is needed if the project is endorsed. Future design will include a public engagement process and potential adjustments to ensure that the purpose and budget for the project are met.
How has the public been involved in this project?
Given the operational and financial inefficiency of renting office space in multiple locations, a new city hall is an ongoing project CBJ has been evaluating for years. A 2019 effort was re-energized in the fall of 2021 when CBJ surveyed over 1,300 people to collect information on where residents want a city hall, how they use city hall, and their priorities for the facility. Survey results can be found here.
In summary:
- 74% of respondents were supportive or strongly supportive of a new city hall
- When asked for recommendation on location, the vacant Walmart building (no longer available) was the top choice (32%), with ‘downtown’ coming in second (27%).
- When combining “downtown” with specific locations in the downtown area, 36% support a downtown location.
- Respondents placed a high value on parking.
- The highest construction priority was that it be designed for a long service life (73%) followed by high energy efficiency (65%).
The Assembly Public Works and Facilities Committee and Committee of the Whole held multiple meetings before landing on 450 Whittier Street as the preferred alternative. There have also been two public meetings on the topic hosted over Zoom. Materials from the meetings, and recordings of the public meetings, can be found .
Subsequent Assembly and Committee meetings which included discussion of a new city hall are linked in the “Public Meetings and Reports” tab on this page.