Council approves $236,000 change order for 725 Lake Avenue demolition amid questions over oversight and funding

The Racine Common Council on June 3 approved change order No. 1 adding roughly $236,000 to an existing demolition contract for 725 Lake Avenue, a project the council had earlier funded with a mix of CDBG and TID dollars.

Aldermen pressed staff about why the additional costs were not identified before bidding. Council members said contractors had conducted multi-hour site walkthroughs before bidding; Public Works and city development staff said undiscovered conditions were revealed as demolition exposed building materials and the Wisconsin Department of Natural Resources conducted additional samplings.

Council discussed funding sources. Staff said the original project used multiple funding buckets, including Community Development Block Grant (CDBG) and Tax Increment District (TID) funds, and that the change order would be paid using available TID accounts (TIP 9 and TIP 17 cited in committee remarks). Alder members asked whether grant funding from DNR or other state sources could cover added costs; staff said the project had used as much CDBG as legally allowed and that the change order was necessary to complete demolition safely and lawfully.

On a roll call, the council approved the change order 12–3. The item will proceed; staff said they would continue to pursue grant options where eligible but the change order funds are authorized to close the gap so demolition can finish.

The vote authorizes the change order; no additional public hearing was required. The council did not identify a separate appropriation at the meeting beyond the authorization to use the cited TID/CDBG fund mix for this contract.