New Public Service Building in Minneapolis consolidates city offices

Earlier this year, the new Public Service Building in Minneapolis quietly opened to the public, its striking design intended to project a welcoming face for people interacting with city government.

It also comes with a steadily rising cost to the public that topped out at about $195 million, or roughly $37 million more than projected.

Over the past three years, the City Council and Mayor Jacob Frey have approved more than 200 contract amendments adjusting the costs associated with the Public Service Building, according to a Star Tribune review of city records.

Sometimes, such as when furniture came in cheaper than expected, they lowered the costs of contracts. Often, they increased them or authorized new ones. At one point, they decided to move the crime lab into the new building, based on a recommendation from police staff, according to City Coordinator Mark Ruff. They also added solar panels to reduce the building's electric bill and carbon footprint.

As they reviewed each contract adjustment, city leaders said they looked not only at the financial costs but also at whether the vendors could fulfill the city's goals of reducing its carbon footprint and meet city rules designed to support businesses owned by women and people of color.

Ruff said residents will not see a tax increase or service cuts to accommodate the increased costs.

"Among the financial variables and uncertainty that our city is facing, this is a small one," City Council President Lisa Bender said in an interview this week.

Bender said she believes the new building was a "necessary and beneficial investment for the city."

"I think that this building itself is a piece of creating a government that's more accessible and services the public better," she said.

In a statement, Frey said the city has "an obligation to Minneapolis taxpayers to carefully weigh every financial decision while responsibly investing in our city's future 100 years down the line."

The city's elected leaders in 2016 signed off on the concept of creating a new Public Service Building to consolidate city offices scattered across various buildings downtown.

The idea was to make it easier for city residents and entrepreneurs to get most of their business done with the city in one location, and to reduce the amount of time city staff spent traveling from one building to the next when they needed to collaborate.

The city initially estimated it would cost $210 million to construct the new building at 505 S. 4th Av. and perform renovations at City Hall. That total is now closer to $215 million.

While it didn't release a precise breakdown of the cost for each building, the city estimated the Public Service Building would account for roughly 75% of the initial estimated expenses, or about $158 million. The latest cost tally for the Public Service Building is just shy of $195 million.

The city expects it will eventually be able to sell other buildings, such as the old Public Service Center and the City of Lakes Building, which housed offices now included in the new facility.

The city estimates that could bring in an additional $2 million in property tax revenue for the city, though Ruff said they aren't counting on that money to cover construction costs.

The 10-story building sits kitty-corner from City Hall. A 26-foot wide limestone version of the city seal, pulled out of storage and restored, greets people who walk in the street-level main entrance.

Terrazzo and wood stairs, lined by planters, lead up to the skyway level that holds the service center that serves as the building's centerpiece.

There, agents can connect people with city staff who perform up to 250 different functions, ranging from creating payment plans for utility bills, to reviewing construction plans or accessing police reports, among other things.

"The city had five customer service locations in different buildings in downtown, and each of those locations was doing something different," said Mwende Nzimbi, interim director of the city's service center. "One of the things that we heard from customers and from the public was it's really hard, super hard to navigate the city business."

The new Public Service Building is now open to the public.

City leaders said they expect a more formal opening later this year, with the precise date depending upon the coronavirus pandemic and reactions to the first trial in George Floyd's death.

Liz Navratil • 612-673-4994