FAYETTEVILLE -- Cost estimates for a municipal parking deck are nearly $2 million over budget.

The construction manager for the project, Baldwin & Shell, last week pegged costs for the 245-space deck at about $8.8 million. City officials in 2012 thought the project, at Spring Street and School Avenue, would cost a little more than $6.8 million.

Mayor Lioneld Jordan, city staff and aldermen will have two options in the coming weeks: scale back the deck design to save money or come up with a new funding source for the project.

The parking deck is being paid for with $6.2 million in bonds issued in December 2012. The bonds are backed by money collected through the city's paid parking program.

Additional parking revenue will be used to pay for non-construction costs, such as moving Walton Arts Center administrators to temporary offices while new offices are built on the north end of the parking deck.

Jeremy Pate, who has been overseeing the project for the city for the past three months, told aldermen Tuesday estimates for the city's share of the administrative offices have gone up about $223,000 -- from $400,000 in late November to about $624,000 currently.

Pate said concrete and labor costs have increased by about $200,000 in the past 16 months.

And aldermen's decision to add another "liner building" at the southeast corner of the deck -- where city offices could go -- will add at least $150,000 to the expected price tag. Ron Petrie, senior project manager with Garver engineers, estimated eliminating a liner building along School Avenue would save the city about $340,000.

If the east liner building is replaced with row houses or retail space, as Alderman Matthew Petty has suggested, there's additional savings to be had.

Not as much concrete would be used, and a green screen and weathered steel panels used to wrap the deck wouldn't be needed on the east side of the structure, Pate said.

The row house idea is far from a sure thing, however.

Petty said Partners for Better Housing, the nonprofit group working on row house plans, has retained an architect for the project, but likely won't have a private developer on board, ready to build the row houses until early next year.

Pate estimated about $400,000 in savings could come from redesigning bank shoring and underpinning of the deck, reworking stormwater pipes, reducing the size of a rainwater catchment system and modifying the deck's electrical system.

And Petrie said construction bids could come in lower than budgeted.

Regardless of any cuts to project design, there will still be a funding gap that has to be filled.

"We don't believe that you'll be able to get enough cuts to get to our original number," Don Marr, the mayor's chief of staff, told aldermen Tuesday.

Jordan said he wasn't sure yet how the city will make up the gap. "We can work it out," he said.

City administrators plan to come up with a recommendation by May 13.

A current timeline shows construction on the deck beginning sometime this summer and ending in late summer or early fall 2015. An initial timeline for the project had construction beginning in spring 2013 and lasting for a little over a year.