Builders coalition hits roadblock
Hay River was to enter negotiations with town businesses
Paul Bickford
Northern News Services
Monday, December 14, 2015
HAY RIVER
The road to renovating the Don Stewart Recreation Centre is now facing another delay that could see the project go to a request for proposals instead of directly to a collection of local businesses calling itself the Hay River Builders Coalition.
The Department of Municipal and Community Affairs (MACA) wants to review the financial and procurement aspects of the project after it received out of date financial information from the town.
Mayor Brad Mapes called it a "stutter step" for the project. On Nov. 30, town council voted to table a motion that would have issued a memorandum of understanding to the Hay River Builders Coalition that the coalition, the architectural firm Stantec and the town's building committee should complete design and development to a stage that the coalition could provide a guaranteed maximum price for the project.
Under the motion, the town would have entered into negotiations with the coalition for a contract to design and build the project.
The coalition includes Hay River businesses such as Arcan Construction Ltd. and Rowe's Construction among others, whose representatives brought an unsolicited proposal to council on ways to keep the work in Hay River and lower the cost as much as possible.
"We are going to create opportunities for all the building suppliers," said Arcan Construction president Duncan Cooke at a Aug. 27 public information session on proposed renovations to the rec centre in Hay River. "We're going to create employment and training. We are going to keep this project 100 per cent local."
But the motion that was to begin negotiations with the coalition was tabled following a conference call between the town and the territorial department on Nov. 27.
"So basically with the recreation centre, we're having to kind of stutter step a little bit here because of the fact that MACA is reviewing it right now as they had some concerns about the procurement of the project but also with our financial data that we had given," said Mapes, explaining the financial information was based on 2013 numbers when it should have been 2014 numbers.
"We just need to update."
The mayor said the numbers that weren't up to date were provided to MACA before he became mayor and before some recent changes to senior administration.
MACA will decide on the use of about $4.1 million - a combined figure of population-based formula funding from the GNWT and federal funding from a building fund.
March 31 is the earliest that MACA will be able to say the town will get the capital funding from the government, said Mapes. "We're not going to be able to issue anybody an award until we know that money is coming."
The mayor said that extra time will give the town an opportunity to finish a design with Stantec.
"But it will also give the opportunity to get our financial numbers up to snuff," he said.
"It will also give the opportunity to seek other funding options."
The project is estimated at $24.5 million, of which up to $15 million would be borrowed.
That level of borrowing was approved in a plebiscite in October.
Mapes said that MACA also determines how much the town can borrow, and that the borrowing limit may be affected by a review of the 2014 financial information.
The mayor also said it looks very much like the project will now go to a request for proposal process, and will not be a negotiated arrangement between the town and the Hay River Builders Coalition.
The coalition formed earlier this year and brought an unsolicited proposal to council on ways to keep the work in Hay River and lower the cost as much as possible.
Council agreed to the idea and representatives of the coalition began working with the town to find ways to lower the cost of the project. Mapes said MACA has expressed concern about such a negotiated agreement, including the fact that there needs to be a more transparent and open requests for proposal process.
