Sanitation district plans to build $20M headquarters

Amid the scores of construction projects financed by the Hampton Roads Sanitation District, the regional sewer agency is building itself a new headquarters, expected to cost $20 million.

Officials defend their decision to construct a new central office, now taking shape next to the old building on Air Rail Avenue in Virginia Beach, saying it will consolidate departments, provide meeting space, protect valuable computer systems to withstand a Category 4 hurricane, and serve the public agency for the next 30 years.

It will be a green headquarters, designed to meet environment-friendly building standards, and its open-air layout will require more than $1 million in office furnishings.

"Look, it's never a good time to build an administration building; you're always going to be second-guessed," said Ted Henifin, general manager of the district. "But we're taking advantage of some market conditions and investing in our future."

The existing headquarters opened in 1977. It lacks sufficient heating and cooling, is not compliant with the Americans with Disabilities Act, and forces the agency to rent space elsewhere for some functions, according to district records.

However, a few agency employees, speaking anonymously for fear of retribution, counter that the district should have put off the project. They point out that the existing structure was renovated in 2007 and now will be torn down, and that ratepayers face a tripling of their monthly sewer bills to pay for $1.2 billion in anticipated infrastructure work over the next 10 years.

"In this economy, how can this wasteful spending be justified?" asked one employee in an e-mail.

As part of the project, the district flew nine staffers, including two interns, to Michigan to personally preview office furniture at two manufacturing sites.

The cost of the two-day trip, including a stay at the Hilton Grand Rapids Airport: $5,826, according to district figures.

The critical employees said the trip symbolizes a "tone deaf" administration that has cut personnel benefits in recent years but spends unwisely on questionable projects.

One member of the district's governing board of commissioners defended Henifin's decision to arrange the Grand Rapids trip, saying department heads needed to have a say in how their offices would be assembled.

"He probably could have cut a few department reps and the interns," Gerald Johnson, a commissioner who represents Chesapeake, said in an email. "But I don't see this as a problem. Vegas, Miami, San Francisco, maybe. Michigan, no."

Asked about internal critics of his five-year tenure at the district, Henifin said he knows some longtime employees resent some of his decisions to reduce personnel benefits, describing that group as "malcontents."

During his time, Henifin has eliminated a paid 30-minute lunch break, changed overtime calculations, adopted an insurance plan with higher deductibles, frozen pay in 2010 and 2011, outsourced printing and mailing services, and instructed employees to contribute to their state retirement fund.

"We live in a hugely different time," he said. "I've had to make some decisions to tighten our spending that I know some people have concerns with. I get that."

About half of the $1.2 billion infrastructure program, approved this past summer, is targeted to comply with two government requirements: to upgrade sewage pipes that leak during rainstorms, and to curtail nutrient pollution from sewage treatment plants.

Much of the rest of the money is geared toward modernizing other hardware and facilities that Henifin says were allowed to deteriorate for lack of a maintenance plan. That way, he says, sewer rates were kept artificially low.

But there also is more than $9 million for a new operations center on the Peninsula, $20 million for the new headquarters in Virginia Beach, and more than $200 million set aside for "future improvements" that have yet to be determined in full.

Henifin described the future funds as "best guesses" of what the agency believes will be needed in the future to upgrade its facilities.

"Unfortunately, we have not made aging infrastructure replacement a big deal," he said. "If we were to argue that we should defer, it probably would get us in trouble again."

Scott Harper, (757) 446-2340, scott.harper@pilotonline.com