In public finance, cost-saving measures often rely on the ”cheese slicer” method, where budget cuts are made uniformly across the board. It would be surprising if this approach led to logical savings. A better method is to review all operations and identify actual savings opportunities.
For example, budget cuts in schools and daycare centers often involve small sums, but the technical sector burns millions. Over the years, Espoo has made decisions that resulted in significant additional costs. Here are a few examples:
- Covering Kehä I highway in Keilaniemi Initially, the project was supposed to be self-sustaining. However, officials convinced decision-makers to abandon this principle. The expected revenue was to come from four tall, round residential towers, which look impressive in nighttime illustrations. These towers, however, would be 30 meters thick, too hard to design, and too tall to sell. Decision-makers weren’t informed that additional ramps would also be needed for Länsiväylä, which now have to be funded.
- Mestarintunneli in Leppävaara (Highway tunnel) The plan was to place residential plots on top of the tunnel. Now, a decade later, the northernmost block remains undeveloped, leaving 10,000 square meters of unused building rights. The value exceeds 10 million euros.
- City Hall Espoo’s City Hall had reached the age for major renovations, but it was decided to demolish it instead. The intention was to generate revenue from selling the plot for residential development. Renovation would have been cheaper than new construction; the comparison showed a loss from demolition of approximately 3,000 square meters of usable area, valued at over 10 million euros. The plot remains empty.
- Sammalvuori The city has an area development agreement that entitles it to receive planned parks and public building plots in Sammalvuori for free. However, the city board hastily purchased part of the green area for 700,000 euros, and over 3 million euros more will be spent if the rest is acquired. Why?
- Tapiola Swimming Hall The previous renovation of the hall was botched, but the contractor wasn’t accountable. Officials decided to try a new solution, which failed. The cost? 17 million euros.
- Theatre
Initially, it was decided that the City Theatre would be built in Tapiola as a joint project with a hotel, either as a tenant or a co-owner. It would already be in use by now. However, officials decided to relocate it and zone the area for residential buildings instead.
Subsequently, officials proposed building the City Theatre underground next to the cultural centre. This plan is an exception in that it was rejected. However, money was still spent on aspects such as an architectural competition.
Leppävaara Centre The area north of the Leppävaara station has been under planning for a long time. Officials created their own proposal, which left key issues and problems unresolved. Later, an architectural competition produced a feasible design. The current fire station would need to be demolished and rebuilt nearby. Hundreds of thousands of euros have been unnecessarily spent on planning, and demolishing a functional building is also financially unwise.
New Master Plan Last summer, a draft for a new master plan was presented. It was based on densifying single-family housing areas and a dense rail network. During council discussions, single-family housing areas were largely reverted to their current use, undermining plans for population density growth and rail projects. Tens of person-years of work were wasted.
What’s Next?
- Covering Kehä I near the Otaniemi water tower (Hagalundinkallio Tunnel) frequently resurfaces, even though it should be buried for good. To cover its costs with land use agreement revenues, for example, 50 eight-story tower blocks would be needed. Both Otaniemi and Tapiola are nationally protected cultural environments, so only a few buildings could be erected along Kehä I without disrupting the milieu—no more than without tunneling. A street would be built on top of the tunnel, so the barrier effect would remain.
- A football stadium might be built in Tapiola’s sports park. Originally, it was intended to be a private project, but officials convinced decision-makers to abandon this plan. The costs are meant to be covered by selling residential plots next to the stadium. The plots would need to fetch over €1,800 per square meter—a steep price. Such stadiums require ongoing support from their owners; how much exactly? Council members had to decide on the project plan without this information.
- Extravagant construction is planned under the Espoolaisten Talo (Citizens’ House) initiative. There’s already a record amount of vacant office space, and the council building is functional. Why build more offices and new meeting spaces for the council?
Hype is Harmful The Suurpelto area was zoned with hype as a region for Nokia and other high-tech companies, with an equivalent amount of housing. Not a single office building has materialized, and plots are gradually being repurposed for residential construction. At the same time, Suurpelto’s traffic network is becoming misaligned and economically inefficient.
More Firmness Needed Typical of the above-mentioned extra expenses is that council members have not been strict enough. Officials have pushed their own ideas, the financial aspects of which have not been clarified or communicated to decision-makers. And when the city builds, all the bells and whistles are included.
Jouni J Särkijärvi 