Gov. Peter Shumlin announced Wednesday that his administration has received verbal permission from the Federal Emergency Management Agency to begin demolition work on the Waterbury State Office Complex.
This news comes as a $173 million bonding and construction bill for fiscal years 2014 and 2015 is en route to the governor’s desk.
The bill contains close to $70 million in construction projects related to Tropical Storm Irene. Almost $60 million of that total will go toward replacing the state office complex, which was inundated by the August 2011 flood.
But what about FEMA payments and insurance funds for the new $125 million facility?
In the next month, the Shumlin administration is hoping to receive news from FEMA and Lexington Insurance that they will reimburse the state a combined $50 million for the Waterbury facility.
“Our target has not changed,” said Jeb Spaulding, secretary of administration. “Whether we’ll hit a bull’s-eye or not, I don’t know.”
The state is waiting for the federal government to finish drafting language that was in a congressional bill meant to aid states hit by Hurricane Sandy. The pilot program this legislation created will allow Vermont to use FEMA dollars more flexibly, Spaulding said. It will allow the state to use the money without taking a 10 percent deduction, which the state would have otherwise incurred for reallocating the dollars to another structure that was not deemed destroyed.
The administration is also waiting for FEMA and Lexington to finalize their combined estimates. If the state receives the full $50 million Spaulding is hoping for, the two-year capital bill — combined with $63 million in other state revenues — would still leave the state with a $6 million gap in fiscal year 2016 for Irene-related projects.
Shumlin says that even if the state receives as little as $40 million in reimbursements, the capital bill would still allow the state to advance the project.
Spaulding has maintained for months that the state would move forward with the office facility regardless of the exact amount FEMA pays. The administration has already received the go-ahead to remove asbestos, and Spaulding expects written approval to demolish the facility in the next week.
Spaulding said the demolition work would begin this summer.
