Credit Report
TIM HANNON wanted answers.
The freshman Carmel city councillor had just discovered that Hotel Carmichael, Carmel’s 122-room luxury hotel slated to open next month, was more than $18 million over budget. It was the latest cost overrun for a city-subsidized project that, at $58.5 million, was now 46 percent over its original estimate. As he walked into his third Carmel City Council meeting at City Hall on a Monday evening in February, another surprise awaited him. Henry Mestetsky, the executive director of the Carmel Redevelopment Commission who reports to Mayor Jim Brainard, revealed that the commission had known about the cost overrun for about a year—yet Mestetsky had continued to list the lower figure in his monthly reports to the council.
Hannon was taken aback. Is this how things work here? he thought. I have to find out about the city’s finances from reporters?
Mestetsky said the CRC hadn’t dis-closed the higher estimate, which he blamed on increased construction costs and labor shortages, because the commission wanted to wait until it was certain the increase was necessary. And its decision to fund the extra expenses without notifying the council, he said, was perfectly legal. “Yes, I should update the numbers in the packet,” he said. “[But] we wanted the update to happen when we could say with absolute certainty that there’s not going to be a dollar more spent.”
Hannon wasn’t the
