Mobile's arena stays on budget after a $14.7 million fraud, but its contingency is nearly gone

Sam Matheny of Volkert Engineering, who runs the project for the city, told members of the council's finance committee that the original budget carried a $15 million owner's contingency. That reserve covered the stolen October payment, leaving roughly $285 million to finish the building, NBC 15 reported. Matheny put the odds of going past that number at “very low.” If it does happen, he said, the city would need to cut scope or raise more money.

The cushion inside the construction budget is spent too. Matheny said a separate $15 million construction contingency will probably be used up and could run slightly over. Some furniture, fixtures and equipment items, the scoreboard among them, have been shifted into the construction contract, which he said does not by itself mean savings. The city is up to date on payments to B.L. Harbert, and Matheny expects about seven more, retention and closeout included, over roughly five months of remaining work.

Drywall is about 85% finished, tile and restrooms between 60% and 65%, and crews have started the ice rink floor, Fox 10 News reported. Matheny said construction will finish by March 25, 2027, the date of the first event, a Red Clay Strays concert, with back-of-house work running through April.

Council members pressed officials on how the fraudster persuaded staff to change the contractor's email and bank details. The city says contact with the criminals began in May; one finance employee was fired and two were placed on administrative leave, according to NBC 15. A first attempt in August sent nearly $1 million, which the city got back five days later. City Attorney Robert Shreve said every vendor change now needs three levels of approval, including the executive director of finance. The $14.7 million has not been recovered, and the FBI is investigating.