Portsmouth City Council Work Session on Unsolicited PPEA Proposal for New City Hall – February 9, 2026
Portsmouth City Council Work Session on Unsolicited PPEA Proposal for New City Hall – February 9, 2026
City Manager Stephen Carter presented an informational review of an unsolicited proposal under the Virginia Public-Private Education and Infrastructure Act (PPEA) to build a new city hall, replacement parking garage, and public plaza on a city-owned site behind the public library between King and Court Streets. The presentation emphasized that no decisions were required at this meeting and that the council retains full control with multiple exit points throughout the statutory process. The proposed team includes Ripley Hewalp (lead developer), MEB (general contractor), and Clark Nexon (architect/engineer). A preliminary cost estimate of $86 million was cited, with an additional estimated $7 million for financing, totaling approximately $93 million (excluding furniture and moving costs). The meeting also served as a prelude to scheduling a public hearing.
Discussion Items
- Process Overview: City Manager Carter explained that the PPEA allows alternate delivery methods while preserving public control and transparency. The unsolicited proposal triggered a required 45-day competitive window, which has closed, and no other bids were received. The city is now at the stage of scheduling a public hearing before entering an interim agreement, which would produce 35% design and refined cost estimates.
- Site Rationale: The proposed site is city-owned, centrally located downtown, and would allow the current city hall property (on valuable waterfront land) to be redeveloped in the future. However, the waterfront redevelopment will not directly finance the new city hall. Renovation of the existing building was discussed but deemed infeasible due to outgrown space, security deficiencies, and deferred maintenance issues.
- Financing Options: The proposal suggests a not-for-profit model using tax-exempt bonds with a 30-year lease, but this is not the only option. The city will work with financial advisors to determine the most cost-effective approach. The preliminary $93 million estimate is not a guaranteed price and will be validated during the interim agreement phase.
- Council Questions and Concerns:
- Councilwoman Thomas questioned how the unsolicited proposal originated and whether the 45-day competitive window limited participation. She noted that the proposing team had prior knowledge of city needs through previous work.
- Vice Mayor Moody asked for clarification on the closed competitive window.
- Councilman Hugo requested that the 2019/2025 programming studies and a renovation cost comparison be made available. He also asked for a detailed timeline beyond the interim agreement, including off-ramps and expected completion milestones.
- Councilman Dodson emphasized the need to consider other options, such as incorporating the city hall move into a broader waterfront development proposal. He also asked whether the $86 million estimate includes moving costs and furniture (it does not).
- Councilman Tilly asked about independent third-party advisors for cost verification and whether outside legal counsel would be needed for negotiations. It was confirmed that the city attorney is currently engaged, but additional counsel can be brought in if necessary.
- Councilman Hughes inquired about the project manager (City Manager Carter, with plans to hire a program manager) and was advised that several interested groups did not submit competing bids due to financing challenges. He also confirmed that downtown parking needs justify a new garage.
- Mayor's Remarks: The Mayor encouraged council members to educate themselves on the PPEA process and noted that other Hampton Roads localities have used it successfully for city halls. He highlighted the city’s strong financial record and fund balance but cautioned that the city’s limited debt capacity makes this approach attractive. He also requested examples from other localities that have completed similar projects.
Key Outcomes
- Public Hearing Scheduled: The council agreed to schedule a public hearing for March 10, 2026, as required by statute before entering an interim agreement with the development team.
- Information Requests: The city manager committed to providing:
- The 2019/2025 programming studies.
- A detailed cost comparison between renovation and new construction.
- A full timeline extending beyond the interim agreement, with clear exit points.
- A total project cost including furniture, fixtures, and moving expenses.
- Examples of other localities that have used the PPEA for similar projects.
- No Formal Decision: No votes were taken; the meeting was purely informational. The council will decide on the interim agreement after the March 10 public hearing and a 30-day waiting period.
- Advisor Engagement: The city will continue to work with contracted engineers, financial advisors, and potentially outside legal counsel as needed. A program manager may also be hired to oversee the process.
Meeting Transcript
Good evening, citizens of course with everyone who is here in present. Thank you for joining us today for our public work session here on February 9th. I want to take a moment to acknowledge our city staff who's here with us. Thank you all for being here and the citizens joining us here in the work session. Also want to acknowledge Mr. Stephen Carter, City Manager, you know, city attorney, Mr. Terry Challenger, and of course it's white. Of course. Oh. And also, Mr. Edwards. My eyes didn't see you. I got it. Thank you for joining us. Mr. Evans. Thank you for reminding me, Mr. White. You're welcome. Would you please call the law? Yes, sir, Ms. Brian. Mr. Hugo. Mr. Moody. Here, Ms. Thomas. Here. Mr. Telley. Here. Mayor Claudia. Here. Thank you. Mr. Carter. Thank you, Mayor. We only have one item on the agenda this evening and that is a review of an unsolicited, unsolicited proposal for a new city hall and fucking garage. Alright. Tonight's presentation is just informational. There's no requirement or ask of any decision to be made this evening. This is just information so that you uh and our citizens be aware of what this process is. Uh what we're doing, why are they hope to make sure I uh explain tonight is what this is and what it is not. Um this is a statutory process, so we we have rules about how this goes along. And what I would be explaining is what those rules are, where we are in the process, and what is the expectation in the coming weeks. I want to be very clear that this is uh is an evaluation exercise really what we're doing today. Uh so this is not uh is not uh a foregone conclusion that anything will happen. Is that this council of the city, the leadership of the city uh remain in full control of the whole process? So we will, as we walk through this, you're seeing their decision points all along the way where you get to this determined yay and nay remove or we don't move.
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