The sign at The ARCHES Project, the organization that will house the upcoming sobering center and an expanded day center. Construction started this week. (Anthony McGuire/Special to Salem Reporter)

The city of Salem is spending more money than initially planned to build a sobering center while continuing to look for funds to run it.

The city's Urban Renewal Agency agreed to grant $1.1 million to the Mid-Willamette Valley Community Action Agency to start building a space that will be used by the center and an expanded day center for homeless people.

Construction started Tuesday, according to Jimmy Jones, executive director for the organization. The space is slated for The ARCHES Project, at 615 Commercial St. N.E., which the organization oversees.

But the $1.1 million is well above the $300,000 the city expected to pay to help build the sobering center, which would take in drunk or intoxicated people that police would otherwise jail or take to the emergency room.

City officials gave two reasons for the increase: construction costs are rising, and the city is also returning a $330,000 grant to the Oregon Health Authority.

Urban Development Director Kristin Retherford said the state grant required that if the city built the sobering center it must also be prepared to operate it.

Recent cost estimates, however, show the operations budget is out of reach, costing roughly $950,000 per year. Salem, Marion County and Salem Health — so far the only entities committed to fund the center — have pledged $450,000 per year combined.

Read: Mayor calls on Marion County, Salem Health to help pay for proposed sobering center.

City Manager Steve Powers said the city wasn't "optimistic" the city would have been able to find the funds within the grant's expectations. Retherford said the city now gets more time.

"This is a choice to return the state funding to provide us with greater flexibility and time, because at this moment we do not have the financial resources in place to commit to the operation of the sobering center," she said in an email.

Delaying construction was not an option, she added, because it would have also delayed MWVCAA's day center expansion, which will add showers, bathrooms, laundry and more space for homeless service providers.

"We need the day room space here in the community to provide those services," she said.

The day center expansion, itself funded by a patchwork of local, state and federal grants, faces its own deadlines, Jones said. He said some grants needed to be used by July 1 or else be lost.

The other added costs to the city come from construction, Retherford said. Construction was slated to start late last year, according to Jones, but necessary funding from the U.S. Department of Housing and Urban Development was delayed by the federal government shutdown.

Retherford said building and running a sobering center remains a goal for the city. Jones said construction is expected to complete Aug. 1.

Have a tip? Contact reporter Troy Brynelson at 503-575-9930, troy@salemreporter.com or @TroyWB.

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