Renovation of a Roswell International Air Center building for a start-up business is costing twice as much as anticipated, but some city leaders are saying the investment will pay off.
Following unanimous votes by the Roswell City Council Thursday night to increase the renovation project budget and revise the project services agreement, the repair and refinishing project for Building 60 leased by Red Mountain Arsenal LLC will receive another $368,000 from airport operating and reserve funds.
The city’s total financial commitment for the project is now $675,000.
Councilor Barry Foster said the agreement is good for the city and the company, a weapons manufacturer headed by Pete Charnisky, a Navy veteran with 20 years of experience in the ammunition and propellant device manufacturing industry, and his business partner, Alfred Alvarado Jr. of Alexandria, Virginia.
“We are getting jobs, we are getting business and we are paying to improve our own property,” Foster said. “The airport fund may take a hit right now, but they are going to get it back from the years that the building is going to get actual market rate rents for us.”
Red Mountain is putting in $13,000 for painting the building, with Charnisky telling Finance Committee members at a Feb. 7 meeting that the company will spend a total of about $300,000 for equipment and work inside and outside the building. The Roswell-Chaves County Economic Development Corp., which for the first time is serving as a project manager for facility improvements, also expects to pay $50,000 for renovations.
The Economic Development Corp.’s executive committee has recommended the allocation, according to President John Mulcahy, with the entire board scheduled to vote Feb. 27.
Charnisky has said in prior interviews that the company will make custom ammunition for military and government clients, with a possible expansion in future years to commercial customers. He said he expects to hire three to four people when the company opens, but projects that 20 employees would be on board within a five-year period.
Since 2010, Building 60 had been used to store airplane furnishings and was rented for below-market rates, about four times lower than the rent Red Mountain will pay, according to EDC officials. Red Mountain Arsenal has agreed to pay about $2,923 a month for the first year of the five-year lease.
Charnisky has said that the building is the reason why he relocated here with his family from Arizona.
“I chose Roswell primarily because it had facilities that met the minimum requirements for government regulations for setting up a business such as this,” he said. “Finding a building that meets the ATF (Alcohol, Tobacco and Firearms) regulations and international building codes and international safety codes is not an easy thing.”
City Project Manager Kevin Dillon told city councilors that the renovation costs increased over preliminary projections for three reasons. Crews discovered that the building needed major reconstruction of the roof system rather than minor repairs, the fire suppression upgrade needed for the type of work occurring at the building requires larger and more expensive lines than originally thought, and the electrical transformers on the property have to be updated, which cost more than $100,000 than previously budgeted.
Other work involves upgrades to bathrooms and improvements to the heating, air conditioning and ventilation system.
Councilor Juan Oropesa asked whether decisions should be delayed until the city decides how to proceed with establishing a regional air authority to manage airfield assets, but City Manager Joe Neeb said that the decisions regarding the renovation needed to occur now. The city is not expected to discuss formally the formation of an air authority until after June, after a “separation” analysis by city staff has been prepared.
Senior Writer Lisa Dunlap can be reached at 575-622-7710, ext. 311, or at firstname.lastname@example.org.