New London — Years of deferred maintenance and a leaky roof have led to mushrooming costs for the ongoing renovations at the Gam building at city-owned Ocean Beach Park.

The City Council on Monday authorized borrowing $600,000 to cover work in both the Port 'N Starboard banquet hall and the Nautilus section of the Gam building. The council also authorized spending $22,500 to cover emergency asbestos removal completed in early January in the banquet hall that was not covered in a previous $10,000 contract with LHI Environmental.

The city last year hired contractors to replace the roof of the Gam in the wake of a December 2017 storm that exacerbated water infiltration problems that have been ongoing for years. The poor condition of the Gam roof was not a secret, though funding for the repairs had been deferred through the years.

Councilors waxed nostalgic about the park on Monday but also bemoaned the lack of capital improvements at buildings at Ocean Beach and elsewhere in the city.

“The city owns the buildings at Ocean Beach Park. This is our responsibility,” said councilor Martin Olsen. “Quite frankly this work should have been done years ago. We really shouldn’t be delaying this at all. All it’s going to do is get worse.”

A portion of the 2018 Gam roof replacement cost was covered by the city’s insurance carrier, said City Risk Manager Paul Gills. The city paid a $100,000 deductible but must now spend an estimated $200,000 more to correct problems that resulted from years of neglect and issues not fully covered by insurance.

“After a full evaluation of the mold and asbestos, they found water and mold extended far beyond what we thought the damage was,” Gills said. “We kept ripping into walls and found more problems.”

The banquet hall is a popular venue for special events and a money maker for the park. Delay in removal of the asbestos would have shifted the timeline for completion of the entire project, which is slated to be done by March 1.

The banquet hall is being completely overhauled — with work to replace walls, ceiling, carpets and electrical work while HVAC units are cleaned and air quality testing performed. The demolition and remediation work are mostly completed, but additional problems were discovered in the Nautilus wing — an estimated $400,000 worth.

“It’s mushroomed into a huge project,” Gills said.

It turns out the Nautilus wing roof continues to leak and has created mold issues and damage to ceiling fixtures stored there during banquet hall work. There were also electrical issues such as rusted conduit, improper grounding of wiring and non-code-compliant electrical fixtures.

Gills said the entire roof and portions of the walls and ceiling of the Nautilus section need replacement, along with rooftop HVAC units. The fire alarm control panel was also damaged by the water, and the fire protection system is inoperative. Water continues to seep into the electrical panels, and bathroom plumbing fixtures were not installed to code.

Councilor John Satti agreed repairs were needed and credited park manager Centerplate for a turnaround at the park. But he also questioned why Centerplate could not share in the expenses. He was the lone vote against the measure to borrow $600,000 and said the city's debt payments continue to grow.

Centerplate earns 10 percent of gross revenue from the park and a portion of a net profit as part of the agreement with the city that runs through 2024. The agreement also calls for Centerplate to invest 2 percent of gross revenue into a maintenance reserve.

The park, according to a 2015 audit, had $2.005 million in revenue. While the park has returned more than $100,000, sometimes close to $200,000, to the city in past years, it lost money last year. The city paid Centerplate $17,000, said Finance Director Don Gray.

Park Manager Dave Sugrue called it “the worst summer we’ve had in a long time,” mostly because of the weather.

g.smith@theday.com