Nelson County supervisors voted to approve a resolution (R2025-51) supporting a revised scope and financing plan for the Charlottesville-Albemarle Regional Jail renovation and expansion after the project’s construction bids significantly exceeded earlier cost estimates.

Colonel Carl Coomer, presenting the project update for the jail authority, told the board bids for the work came in “significantly over what we expected.” Staff had previously estimated hard-construction costs around $39.9 million; the low bid received was about $53 million and the highest about $76 million. In response, the authority re-scoped the project to prioritize the planned expansion over a broader renovation of the older 1974 portion of the facility so the overall project could fit the previously anticipated total budget of roughly $49.3 million (hard and soft costs combined).

Under the revised scope, the project focuses on demolishing a 16,000-square-foot section and replacing it with 32,000 square feet of two-story expansion. The expansion will include a new dedicated public entrance, 12 individual visitation rooms, 65 single beds rebuilt to meet 2018 Board of Corrections standards (the authority emphasized these are replacements rather than added beds), three outdoor recreation areas attached to each new housing unit, video court holding space, two mental-health offices with group therapy rooms, two community-provider rooms, two purpose-built mental-health housing areas totaling 14 beds, one large inmate classroom and 14 additional staff offices. Coomer said the authority will preserve the renovation of the other older section for a later time and will focus on HVAC work in that portion during the current phase.

Finance adviser Roland C. Davenport briefed the board on the two-part finance plan: (1) a grant-anticipation note to front the Commonwealth’s anticipated 25 percent reimbursement for eligible capital costs and (2) permanent bonds issued through the Virginia Resources Authority (VRA) for the remainder. Davenport said the Commonwealth has set aside roughly $11.79 million for the 25 percent reimbursement and that the grant-anticipation note is expected to be approximately $12.1 million (including interest carry). The remaining project cost—roughly $37 million—would be financed through VRA bonds. The authority previously closed a 2023 bond-anticipation note of up to $4.5 million and has drawn about $3.3 million to date; Davenport said that interim borrowing was always intended to roll into the permanent financing.

Davenport described the financing structure as interest-only during the construction period (FY2026–FY2028 estimated) with a 25-year amortization once the project is placed in service. For planning purposes the authority used conservative interest-rate assumptions (planning rates around 5 percent for the grant note and just under 5 percent for the bonds in the presentation), but Davenport said actual market rates and bank proposals were trending somewhat lower at the time of the presentation. He also noted the allocation of recurring debt service among participating jurisdictions for planning purposes: Albemarle County about 44 percent, City of Charlottesville about 39.5 percent and Nelson County about 16.3 percent of the local share.

Board discussion noted the unfortunate price escalation but expressed support for moving forward with the scaled scope. Coomer and Davenport told the board the project is expected to begin construction in 2025 and take approximately 28 months to complete under the revised plan. The board moved, seconded and approved the resolution supporting the authority’s financing approach and scope changes.

The board’s approval is a local jurisdictional support step; detailed financing documents, bank proposals for the grant anticipation note, and the VRA bond sale are proceeding separately with the jail authority and financing advisers. Davenport said the authority planned to present bank proposals to its board in the coming days, close the grant anticipation note in late July and close the VRA bonds in early August so construction funding will be available to start the project.