Council refuses to approve roadwork
Inability to explain why work is $800,000 over budget raises alarm bells, administration says bike lanes not a factor
Cody Punter
Northern News Services
Published Wednesday, April 30, 2014
SOMBA K'E/YELLOWKNIFE
City council did an about-face Monday night after it voted to renegotiate the contract for its summer roadwork program, which came in at close to $800,000 over budget.
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2014 paving program
Reservoir Road
- Tender price: $22,249
- Budget: $60,000
- Difference: $37,751
Lanky Court
- Tender price: $222,426.20
- Budget: $400,000
- Difference: $177,573.80
Knutsen Court
- Tender price: $377,190.10
- Budget: $400,000
- Difference: $22,809.90
Bromley Drive
- Tender price: $774,086.50
- Budget: $900,000
- Difference: $125,913.50
Franklin Avenue and Taylor Road
- Tender price: $384,950.85
- Budget: $400,000
- Difference: $15,049.15
Pilot's Monument
- Tender price: $489,500.30
- Budget: $450,000
- Difference: -$39,500.30
52 Avenue
- Tender price: $2,706,233.10
- Budget: $2,000,000
- Difference: -$706,233.10
50 Street
- Tender price: $1,074,844.10
- Budget: $750,000
- Difference: -$324,844.10
Total
- Tender price: $6,151,480.15
- Budget: $5,360,000.00
- Difference: -$791,480.15
Source: City of Yellowknife
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Several councillors had previously suggested they were in favour of completing all the work this summer because NWT Construction Ltd. agreed to decrease the price tag of its contract by $450,000 if it was awarded in its entirety.
However, on Monday most agreed that it would be "irresponsible" to award the $6.1-million contract when the cost of paving two roads - 50 Street and 52 Avenue - came in more than a $1 million over budget, whereas most of the other road projects came in under budget.
"People are telling me that we need to get our roads done on a budget and that if we can't get that done then we shouldn't proceed," said Coun. Niels Konge, who introduced a motion to go ahead with paving for the five locations that were tendered under budget.
His motion was ultimately amended by Mayor Mark Heyck after noting council cannot change the terms of its contracts without first consulting the contractor - in this case, NWT Construction. The amended motion calls on administration to review its contract with NWT Construction and bring it back to council at a later date.
The motion, supported by all councillors present except for Coun. Bob Brooks, came after it was revealed that bike lanes would not increase paving costs, contrary to what administration had previously told council.
On Monday, senior administrative officer Dennis Kefalas said administration assumed bike lanes were contributing to higher costs on 52 Avenue roadwork because of the enormity of the overrun - $706,233.
However, at the time administration had not calculated the comparative cost of concrete and asphalt work for the road. After Coun. Dan Wong challenged administration to provide proof the bike lanes were adding to the cost overrun, it was determined that the cost of bike lanes - built on much cheaper asphalt - would actually save the city $21,000.
"We were just speculating," Kefalas told Yellowknifer after the meeting. "But based on the unit prices we received ... there is zero cost differential."
Although the cost of doing concrete work has inexplicably gone up by 25 per cent since last year, administration has been unable to determine why the 52 Avenue and 50 Street reconstruction projects came in 57 per cent over budget.
"We're still trying to determine why the costs are so high," said Kefalas.
Even if council had accepted the price reduction offered by NWT Construction, the city would still be $341,480.15 over budget. It would also still have to pay for landscaping and installing irrigation systems, which were not included in the budget.
"By reducing the scope of the project greatly and pushing some of it off to next year, that's not on budget, that's a different project," said Coun. Adrian Bell.
"That's like saying you were planning to buy a Cadillac and now you're buying a Pinto, but we can afford it so we're on budget."
It was revealed during Monday's meeting that NWT Construction is the only company to have bid on city roadwork contracts since 2005. One of the reasons for that is because the city has been tendering contracts for projects in their entirety, and not offering piecemeal contracts on separate components such as concrete work, paving and landscaping, said Kefalas.
As NWT Construction is the only company in the city with an asphalt plant, there are not many companies that have been able to bid on projects of this scope, he said.
The revelation led Coun. Rebecca Alty to say the city should review the way it issues tenders to ensure that the process is more competitive in the future.
